I've entered in all of my major numbers from 2006 into Turbo Tax. My tax bill for 2006, including federal and state, will be roughly $200 K. This is a huge number, but I am absolutely thrilled.
I was mentally expecting a $600 - 700 K tax bill, due to the gross proceeds totals on my 1099's. I was saved by the AMT cost basis on my sales of company ISOs. Because of the AMT cost basis, my effective tax rate this year will be relatively tiny - I already paid a lot of the taxes due on these shares several years ago in the form of AMT.
I do not owe any penalties, because I met the safe harbor requirements for 2006. As I mentioned in an earlier post, it's better to owe without penalty than to get a refund. 2006 was a great year for investment returns of all types, so it's a good year to owe the IRS.
My sister's family owes over $30K this year, due to withdrawal from a deferred compensation plan. Apparently this was an unexpected bill. I'm thinking of offering to help review their budgeting, but it's a sensitive topic...