In the last week, I've written checks to the IRS for about $9K (for 2015) and $6.2K (2016 quarterly estimated) and to the California state government for $2.5K (for 2015) and $1.4K (quarterly estimated.) I was shocked when I went to my accountant and got the news. I knew it was going to be bad but I didn't think it would be this bad. As I put it to a friend, "My wife and I each had a good year and, as a result, the IRS had a great year."
There were two ways I could have reacted. One is to play ain't it awful. The other was to move on and enjoy my life.
In choosing the second, I was helped by an experience I had had in Rochester in the spring of 1978.
I was the only faculty member (University of Rochester) in an Israeli folk dance group that performed at various events; the other members were undergrads. We had been practicing for weeks for a big Saturday night performance at the U. of R., the biggest performance of the season. We had a pretty good program set up.
That Saturday morning, I sat down to do my taxes. They were pretty simple in those days. I didn't itemize and I was too naive to understand just how many deductions I could take from my Schedule C business income. Still, I thought I would get a small refund.
Wrong. I computed that I owed the IRS an extra $800. This couldn't be right. So I computed again. Still $800. Third time's a charm, right? Wrong. Still $800. Then I figured it out. I had not taken account of the $2,000 that Bill Meckling's business school had paid me to show a series of films and lead discussions with undergrads. There had been no withholding on that.
I had been looking forward to the evening performance and now I felt almost sick. I had the $800 but it would deplete my fund for a down payment on a house by about 8%.
Fortunately, I had been reading a book by Wayne Dyer called Your Erroneous Zones. It had been helping me with my attitude to a lot of things. I thought: how could I apply this learning to the situation at hand.
I figured it out and came up with a mantra that I started chanting out loud: "Ok, IRS, you can take my $800 but you're not going to ruin my evening." I chanted it over and over.