It's more annoying than anything else, because we knew we were going to make a lot less money in 2007 than 2006, and have been paying estimated taxes every quarter. We had calculated a 90% target, but AMT added a few thousand dollars to our total taxes. Ironically, we suspect that the trigger in this case was the large deduction we took because of our state taxes paid for 2006.
Other IRS-related lessons we learned recently:
- Know how to fill out your Schedule D correctly.
- H&R Block's TaxCut software is more user-friendly than TaxAct.
- If we ever get rich, we are definitely hiring an accountant.