Whether personal or corporate, managing the tax landscape comes with tremendous challenges. However, with the right tax knowledge, there is a world of opportunities for individuals and organizations to enhance their wealth management and revenue growth.
Jim Wilhelm, CPA, Director, SC&H Group, recently provided Expertise Beyond the Numbers with the following top 5 tax secrets to consider for year-end tax planning.
1. Tax Planning All Year Long
Work with your accountant all year long, not just in December and April. Tax planning should happen continually – through life changes, new jobs, financial windfalls, when tax laws are modified, and so much more.
2. Collect Tax Data All Year
Collect tax data all year long. Proactive clients maintain a current Tax Folder where they continually store tax documentation such as charitable contribution receipts, business expense documentation, automobile logs, settlement sheets, etc.
3. Consider Current and Subsequent Years Simultaneously
Tax planning done properly needs to consider the current year and the subsequent year simultaneously. The best planning requires a multi-year analysis such as when your tax rate is in flux, when you are subject to the alternative minimum tax, and when your tax situation is subject to change in the following year.
4. Ask for Referrals When Seeking a New Accountant
When seeking a new accountant, ask for referrals from advisors you know and trust. Your attorney, controller, and business partner can all likely provide you with choices of respected professionals who understand tax law, as well as responsive client service.
5. Think Globally All the Time
Think globally. When investing in the stock market, think about taxes. While they don’t drive decisions, taxes certainly influence investing strategies. When purchasing a business or real estate, get your CPA on the phone long before you talk specifics, so that tax benefits can be negotiated early and often. When reviewing your financial plan (education, retirement, estate, insurance), utilize the tax code to lower the net costs of these plans. Coordinating tax and financial planning advice is essential to landing the right plan for you and your family.
We would also like to remind our readers about SC&H Group’s two-part webinar series, which will provide the insights that both companies and individuals need for year-end accounting and tax planning.