Tonight's my night off for writing, publishing, etc. That being said, I got
a few hundred words on the next story, it's called Heavy Shadows, and is
a near-term scifi story. No idea where it's headed yet.

I also did some behind the scenes work stuff, as it's that most wonderful
(ugh) time of year, tax time!

Something occurred to me while doing our taxes (following is not professional
tax advice, I am not a tax pro of any sort, I'm simply a fellow freelancer
who may have some experience to pass on. Talk to your own accountants,
people.)

So the U.S. congress, in their infinite wisdom, has changed the tax laws. As
yet, there's been little effect due to timing. And just when my wife and I
had gotten used to a significant fraction of our income being freelance work
(her all, me some, it's been like that for a few years now). Meaning, we'd
become used to the quarterly tax payments, the business structure and how
it's reflected on the tax forms, etc.

The changes in the tax law ongoing are a bit odd for us, from what I've been
able to tease out. The rate changes aren't a big deal, at our level they
basically don't make enough different to matter (no, we're nowhere near
putting aside forty percent of our gross, we should be so lucky). But what
will matter is how the 199A deduction is built into the tax form structure.

As with any big change, the IRS hasn't published their guidelines yet for
where the 199A deduction will line up compared to existing deduction
categories. What this means as a practical matter is that this year's
withholding allowances are going to be pretty much guesswork. The rates are
known, but what we don't know yet is the degree to which the deduction
applies. and the examples the law provides don't quite answer the question
with respect to withholding.

In other words, what we don't yet know is whether the deduction is going to
be part of the schedule A type deductions, the class of above the line
deductions such as the social security deduction, or whether the IRS is going
to have to make something up. Some of the tax pros are calling the 199A a
"between the lines" deduction, a new beast entirely.

The bottom line here is that I think we're going to be very (in the financial
sense) conservative about how we approach the 199A for next year through
the withholding allowance. The irritating part about this is that I much
prefer to have as little of a refund as I can manage.

Why? Because ultimately too large a refund can lead to questions from the
IRS, just as much as too large a deficit in the other direction. For the
simple reason that we're supposed to have knowledge enough of our business
structure so as not to be completely out of whack with our tax obligations.
Habitually blowing through and asking for a big check from the gov't, or
sending a big check to the gov't, is going to have them knocking on the
door wondering why we can't get our stuff straight.

And until there's been a couple of years of forms and guidance on the 199A
to go by, there's no avoiding it. We're just going to have to anticipate that
we're sending more in withholding than we would if we knew precisely how
the deduction was going to apply, and then adjust down the line. The good
thing is that we won't be the only ones, so we'll all be in the same boat.
Next year will be when the auditing department expects the knowledge and
guidelines to have become well established enough to be common business
knowledge.

Here's a little p.s., though. In spite of themselves, for the first time in
my working lifetime, the congress has done something with the tax laws that
will significantly benefit people who work for a living. And I think they
did it completely unknowingly. The 199A deduction (so called pass-thru
deduction) is understood (in the same way that "everybody knows such and
such", which should make you nervous, it does me) to apply to high-end
incomes, doctors, lawyers, real-estate moguls, etc.

However. People like us, nobodies who happen to have a schedule c income,
plumbers, electricians, hell handymen and landscapers, mechanics, fishermen,
farmers, artists, writers, all the lads and ladies who go to conventions and
quilting shows, anybody with their own shop or truck or sewing machine?

That twenty-three percent 199A deduction, once the dust settles and we know
how it works? Is going to be the most significant impact of the whole thing.
And if there's one thing I understand about congress/dizzy city, it's that
this particular group of people, the people who were/are the gig economy,
have been and will always be invisible to them.

And they went ahead and helped us anyway, entirely by accident. Shh, don't
tell them. And, figure out how to make the 199A permanent, 'cause it'll
expire in ten years. If this thing works out the way it looks like it will,
for people in the gig world, or carpenters working weekends on their own,
gardeners selling an extra basket at the farmer's market, the hit on the
back end when it expires is going to be a much bigger kick in the pants than
the benefit over the current known legal lifetime. Once we get used to the
deduction, having it yanked from us is gonna hurt.

Enough of that. I'd love to have written a story that made taxes make sense,
but it'd take a much greater ability than my poor skills to make that work.

For the week, where am I? Stories wise, daily words. First, last, always.
Publishing wise, links page for San Angelo and Badlands, and then start work
on the next book to go up.