There was bad news and there was good news. The bad outweighed the good by about $2500. but at least we are no longer in arrears on income tax.
We had taxes for 2005 and 2006 done, this week, and will owe $4500. for 2004, not counting a 25% penalty and interest, but will get back $3100. for 2006, so it isn't as bad as we expected. We sold a house in 2005, and sent in ten grand for capital gains, as we were told that should cover it. We also filed an extension, but didn't get it in on time. The tax accountant, who told us it would be about ten thousand, in the beginning, later said we would owe about eight thousand more! Yikes! That was scary, so the $4,500. didn't seem as bad. With the refund for 2006, we won't have to come up with as much as we thought, so it is kind of a relief.
Pay your taxes on time, seems to be the moral of the story!
We will be billed for the penalty and interest in about ten weeks, so I'd better start saving now!