TAXES – IT’S THAT TIME AGAIN!
It is that time of year again. Taxpayers are thinking about getting all of their documents together to submit to their tax preparation professional or to input into their store bought tax software. People are thinking about how bad the tax burden is going to be. Am I going to get the refund I hope for? How much am I going to owe? Lord knows I hate taxes! Do these feelings seem familiar to you.
Tax compliance and obligations are a big stress factor to millions of people across this Country. As a tax professional for more than 30 years, the thing that amazes me more than anything I have experienced in my profession over all those years is how little taxpayers do to plan to minimize the tax burden. They will work hard to build up their retirement accounts, kids’ college funds or save for the vacation home or RV. People will utilize the services of a financial planner to accomplish these goals, they will seek out an attorney and do estate planning and form a family trust, and these are smart things to do. But, so few do real tax planning. Thousands of dollars are being handed over to the federal and respective state governments each year by millions of taxpayers that don’t have to be paid out. They are not taking full advantage of the tax laws to minimize their tax obligations. THEY ARE PAYING TOO MUCH IN TAXES!
Many people I speak with will tell me that they use a CPA or enrolled agent to prepare their tax returns and that if there is anything they can do to bring down the tax burden, their professional will let them know. This is not tax planning!! Many tax professionals are over burdened during this time of year providing tax compliance services and they do an excellent job. But, they don’t have time to analyze the taxpayer’s situation and develop a real plan. They are just preparing the return with the information provided and making some minimal suggestions. Many of my “peers” are not experienced or have the knowledge base to perform true formal tax planning. At Joseph F. Fragnoli, CPA, PC, we spend hours and days each month studying tax planning materials, we subscribe to some of the best tax planning software on the planet and we have an affiliation with one of the Nation’s most progressive tax planning firms, Financial Gravity. We have a strong emphasis in our practice toward tax planning services.
Let me give you an example of a tax planning strategy that, in all my years of practice, I have never seen applied by another tax compliance professional, that we utilize all of the time. If you own your own business and you utilize your home for company events or entertainment of clients, are you aware that you can charge your company rent for up to fourteen days per year and the company can take a tax deduction for the rent paid, but you don’t have to pick up the income at the personal level. This is referred to as the Augusta rule (yes, named after the Masters golf tournament). When applied on a conservative basis, it can mean hundreds, if not thousands, of dollars is tax savings. This strategy is my gift to you for reading my blog. But, this is just the tip of the ice berg in legitimate and documented tax strategies that we utilize in our formal tax planning services. Yes, these services are not cheap. But, the return on the investment is huge. Check out my brief video on the value of these services
If you are stressed about taxes, both preparation and paying them, seek out a professional; and, if you want true formal tax planning services included with preparation, seek out Joseph F. Fragnoli, CPA, PC. Call us at (615) 678-4751.