Tax planning is the process of looking at various tax options in order to determine when, whether, and how to conduct business and personal transactions to reduce or eliminate tax liability. Many small business owners ignore tax planning. They don't even think about their taxes until it's time to meet with their accountants, but tax planning is an ongoing process and good tax advice is a valuable commodity. It is to your benefit to review your income and expenses monthly and meet with your CPA or tax advisor quarterly to analyze how you can take full advantage of the provisions, credits and deductions that are legally available to you. Tax Planning Strategies Countless tax planning strategies are available to small business owners. Some are aimed at the owner's individual tax situation, and some at the business itself, but regardless of how simple or how complex a tax strategy is, it will be based on structuring the strategy to accomplish one or more of these often overlapping goals:
In order to plan effectively, you'll need to estimate your personal and business income for the next few years. This is necessary because many tax planning strategies will save tax dollars at one income level, but will create a larger tax bill at other income levels. You will want to avoid having the "right" tax plan made "wrong" by erroneous income projections. Once you know what your approximate income will be, you can take the next step: estimating your tax bracket. The effort to come up with crystal-ball estimates may be difficult and by its very nature will be inexact. On the other hand, you should already be projecting your sales revenues, income, and cash flow for general business planning purposes. The better your estimates, the better the odds that your tax planning efforts will succeed. Business Tax Compliance As your personal advisor, we will help you navigate the complexity of business tax law. We take a proactive approach to taxes and stay current on new tax laws and legislation so you don't have to! We believe it's critical you understand them and organize your activities so that you pay the lowest tax. Having a tax professional on your side , who understands the system, means less stress and anxiety for you. It also means the difference between money in your pocket and money needlessly given to tax authorities. Our clients know they can depend on us to keep them compliant with all tax regulations, including payroll taxes, sales tax, property tax, quarterly taxes, IRS examinations and more.
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