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Tax Planning Should Be Your Year-Round Priority

by Matthew Person on January 11, 2016

Tax_Planning

Year-round tax planning can save both time and money by helping you take advantage of opportunities throughout the year to position yourself and your business to pay the lowest possible tax. Before you can begin your tax planning though, you have to get organized. If you are not using QuickBooks or other accounting software, now is the time to move to a computerized system. Haphazard record keeping is a primary reason why so many individuals and small businesses miss out on tax-saving opportunities. Good record-keeping is an essential first step for good tax planning. If you are not already using a computerized bookkeeping solution, we can help you choose the best system for you (for most small business owners, QuickBooks is the best solution…) then assist you in getting your information out of file drawers, boxes, closets, etc and into an electronic format.

There are many tax provisions that were made permanent last year that should be part of your tax planning considerations. Now that Congress has enacted the Protecting Americans from Tax Hikes (PATH) Act of 2016, small businesses can finally have some measure of certainty about tax rules for the foreseeable future. The new PATH Act law impacts taxes for 2015, as well as for 2016 and for more years to come and you should be planning to take advantage of the changes that impact your tax situation.

A rookie mistake in tax planning is to assume the only way to save taxes is to obtain a deduction. Tax deductions are great, but deferrals, recharacterizations and advantageous tax-year timing can also pay dividends. In fact, in some cases, it is smart to intentionally pay taxes up front. Just as diversifying an investment portfolio is advisable, so too is diversifying taxes. What is usually tax-deferred today will be taxed tomorrow and perhaps at higher rates. Timing really matters when it comes to tax planning but in order to take advantage of many of these strategies, you need to be thinking about your taxes year-round – not just during “tax season.”

We can help you make all the right moves to minimize taxes owed and increase profitability. Contact us today so we can help you get started with a long-range tax planning strategy that is right for you and your small business.

Contact Person Huff CPA Group

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