Unlocking the Power of Proactive Tax Planning

Taxes!! I know I know I see your eyes rolling!! I get it. Most people hate talking about taxes but it’s something we can’t get away from. I love this quote from Morgan Stanley… You must pay taxes. But there's no law that says you gotta leave a tip."

How many of us are leaving the IRS a HUGE tip?

Here’s the thing: millions of people are leaving the IRS a fat tip and don’t even know it! Small businesses get blindsided ending up with massive tax bills and don't even understand why. One of the reasons I see is that people are treating taxes like it is a seasonal thing and it’s not.

I’ve seen firsthand how often business owners are unknowingly overpaying the IRS. Especially those who are SELF-EMPLOYED! If you aren’t getting assistance all year long, then you’re more than likely leaving the IRS a HUGE TIP each year. And not realizing that taxes are something that should be worked on all year long.

So, my clients ask, “How do I stop leaving the IRS a tip every year and what’s the best way to reduce my taxes?”

For me to help them, the first questions I ask them are:

• Are your financials up to date?

• Can I look at your P and L or income statement to see where your business stands today?

Most tell me no, not really and my response is, “Well that is the first step.”

How do we help if we have no idea where you stand financially? We can’t!

Here is the thing, up-to-date Financials Make Tax Planning and Tax Preparation Easier and set you up for:

• Less Stress: Keeping your financial records in order makes tax season easier to handle. When everything is organized and up-to-date, you can do your taxes with confidence, and it won't be as overwhelming.

• Better Money Plans: Having current financial information helps you make smarter long-term money plans. This includes things like planning for retirement, deciding how to invest your money, and managing any debts you have. These plans can also impact how much you owe in taxes over time.

• Smarter Tax Moves: Up-to-date financial records don't just help you pay less in taxes; they also help you make better tax decisions. You can explore advanced ways to save on taxes, like making tax-efficient investments, giving to charity, or planning your estate. These strategies reduce your tax bill while you work toward your financial goals.

Now that you see the benefits of having up-to-date financials, the world can open up to you when it comes to tax planning because you are ready.

Tax planning, tax advisory, and tax strategies are a year-round process; not just a January to April season, where strategies and plans are created and used to help you reduce the amount of taxes you pay by legally taking full benefit of all available deductions and credits so that you are not overpaying in taxes.

Tax planning isn’t a transaction, it is an ongoing relationship with your taxes and your tax professional.

I am a firm believer that proactive tax planning is the key to keeping more of your hard-earned money in your pocket.

This is how the wealthy who have businesses stay wealthy. They implement strategies all year long so they can pay the least amount of taxes LEGALLY possible. Written into the tax code are lots of options for people with businesses and real estate to help lower their taxes. Believe it or not, the government’s incentive is for you to flourish as you add value to the economy. Amazon and Netflix are two great examples of companies that know how to take advantage of all the legitimate deductions, credits, and strategies the tax code offers.

You might think they are cheating the system, but they are actually using the system in every possible way they can.

All those deductions, credits, and strategies are also available to you and your business.

Working with the right tax professional they can and will show you things written in the code that could save you thousands of dollars.

Here are just a few of the strategies that are out there:

• Hiring your children where you can pay up to $13,850 this year.

• Starting your own company retirement plan.

• Putting yourself on payroll so you can eliminate some of those self-employment taxes.

• Using the mileage deduction in a way that gets you the higher write-off.

• Your health insurance premiums.

• Changing the way your business is taxed.

Again, these are just a few strategies that can help you save on taxes. There are so many possibilities! It’s not too late to save. Do you really want to miss out? Remember, your loss is the IRS's gain!

The most expensive mistake a business owner can make is failing to plan. I'm sure you hear this a lot in other areas of your business. Guess what? It also applies to your taxes.

When it comes to taxes it isn't about how much you make; it's about HOW you make it that helps determine how you are taxed, which is why tax planning is so important.

Now that you know what’s possible you can’t unknow it. So, get started on finding the help you need so you can win, stick to paying your fair share in taxes, and maximize all the tax savings entitled to you and your business.

Remember, business success is not a matter of luck or chance, but rather a result of taking action.

Here’s to taking the anxiety out of taxes!