This is the first time ever I’ve been so stressed about taxes. Usually it’s simple. DH has a W2, 2 dependents, EZ file, get a refund, and done. No big deal. 2020 is a whole new level of messy tax filing for us.
DH had his side hustle on Amazon, I had mine on Etsy. His 1099 is about $30,000. I came in at just under $20,000 on Etsy, and did not receive a 1099. I’m working on itemizing expenses for both of those. I won’t lie, DH’s 1099 was a shock. No way did we see $30,000 in deposits lol. Amazon takes a HUGE chunk in fees, PLUS advertising. I’m quite sure there is little profit after all is said and done.
I also expect a low profit year for Etsy, which I expected. I dumped a good bit of my monthly profit into materials over 2020. I shouldn’t have to reinvest nearly as much in 2021. I built up a decent bit of inventory to continue for at least the first quarter without purchasing additional supplies.
The biggest tax hurdle is real estate. I sold my old house. Then we sold our primary home. We’ll have capital gains on the profit of the old house. “Profit”. We’re not sure what bracket we fall into, the tax code in this country is so confusing. I think somewhere between $10,000 and $30,000 will be what we have to pay the IRS. I hope I’m aiming high! We have the cash in the bank to cover it, and will pay it in full. I just hope our CPA is really good at finding deductions or loopholes like the rich get LOL!
We certainly weren’t expecting to sell two houses last year. I’m glad we did, albeit not fond of the tax consequences. I’m wondering what I can deduct on the house. Original investment and equity loan? Upgrades? I’m not sure. I need to do my research and speak with our CPA soon. Once all our forms are in and I’m done itemizing, I plan to file asap. Can’t wait to get this last little bit of 2020 burden off our shoulders.