SB2K14 for the Stover/Boedeker Family has been cancelled :(

Expiration of the Bush tax cuts on the 'wealthy' is to blame!

Every few years, Dennis and I make plans to take our family on a Spring Break cruise.  We've done about 6 of these where were treat 12-25 family members to a week's vacation in the Caribbean. Well, 2014 was going to be the year we treated them all again!  Until.....

Here's the explanation:

Our small business, Boedeker Construction will see gross revenues around $1.5 million for 2012.
Also, total expenses will be around $1.3 million for 2012.  Sounds great, huh! 
Don't have to be a math scholar to figure out the profit is $200K!  Terrific huh?  NOT!

Of the $1.5 million in gross revenue, $225K hasn't actually made into Boedeker Construction cash register.  You see, the $1.5 million is defined by the IRS as what has an invoice date in 2012.  The IRS doesn't care if you ever collect it, just as long as you include it in your gross revenue column. Actually, Boedeker Construction has only seen $1.275 million in payments from clients.  The rest is still open invoices that will be paid eventually.  Some are paid in 30 days, some in 60 days and well some take 180+ to get paid.  So when I do the math in my head, the $1.275 million I actually got paid minus the $1.3 million in bills I always pay ontime  = <$25,000.00> loss for Boedeker Construction :(

But, because the IRS says I have to show the 'on paper' the $200K profit from my business on my personal income tax return.  When I add my salary to that I get to have an income over $250K for 2012 and BAMM, I'm wealthy and need to pay an even higher tax rate since Bush's tax cuts were allowed to expire.

And Boedeker Construction, hasn't seen that $225K of outstanding invoice payments either!

So, I'll scramble to figure out how to make payroll and keep my suppliers account current in 2013 even though I don't have the $225K in the bank that's owed me.  Oh and I'll have to borrow money from the bank to pay the increased personal taxes I owe on the 'on paper' income of $250K.  If I'd only actually received the $200K profit, I could pay my taxes without having to go in debt. 

I'm using the SB2K14 savings of $24K that we'd been setting aside, to pay off some of the additional taxes I'll owe on money I never received.

Bon Voyage :(