Tax planning is all about devising strategies that businesses and people can use to reduce their tax liability for a particular tax period. This is very important for the small business because it means saving money that can go towards meeting other expenses, investing and growing the business. A top rate Sherwood financial advisor does tax planning for businesses as well as individuals.
There are two basic rules of tax deduction most small business owners are not aware of that the advisor educates them on. One is that additional expenses should never incurred in order to qualify for tax deductions. Another is that small businesses should always aim to defer taxes whenever possible. The deferred amount can be used interest free in running the business and it can even be put into interest-earning investments.
There are also several areas of tax planning that the advisor breaks down for business owners. They are timing when business equipment is bought, going for accounting and inventory valuation methods that minimize liability and sharing income among family members. The other is going for investment and benefit plans that offer the highest tax returns.
In addition to this, there is tax planning that is specific to some types of business structures such as sole proprietorships, partnerships and limited and unlimited companies. The amounts of tax paid are very different depending on which structure one chooses. Chances of being audited by the IRS are also dependent on the kind of business form one chooses.
It is the recommendation of the consultant that planning sessions are towards the middle of the tax year. This way, there is time to make use of the strategies in the tax current period and to get started early for the next tax period.
It is not enough for a business to have a bookkeeper or accountant and leave tax matters to them. Engaging the Sherwood financial advisor who has the facts and experience in tax planning is essential. It has a big effect on the bottom line for a business and for being able to grow it.
There are two basic rules of tax deduction most small business owners are not aware of that the advisor educates them on. One is that additional expenses should never incurred in order to qualify for tax deductions. Another is that small businesses should always aim to defer taxes whenever possible. The deferred amount can be used interest free in running the business and it can even be put into interest-earning investments.
There are also several areas of tax planning that the advisor breaks down for business owners. They are timing when business equipment is bought, going for accounting and inventory valuation methods that minimize liability and sharing income among family members. The other is going for investment and benefit plans that offer the highest tax returns.
In addition to this, there is tax planning that is specific to some types of business structures such as sole proprietorships, partnerships and limited and unlimited companies. The amounts of tax paid are very different depending on which structure one chooses. Chances of being audited by the IRS are also dependent on the kind of business form one chooses.
It is the recommendation of the consultant that planning sessions are towards the middle of the tax year. This way, there is time to make use of the strategies in the tax current period and to get started early for the next tax period.
It is not enough for a business to have a bookkeeper or accountant and leave tax matters to them. Engaging the Sherwood financial advisor who has the facts and experience in tax planning is essential. It has a big effect on the bottom line for a business and for being able to grow it.
About the Author:
Get details about the reasons why you should consult a Sherwood financial advisor and more information about an experienced financial planner at http://www.robertlettin.com now.
No comments:
Post a Comment