What is Tax Planning?
The purpose of Tax planning is Tax efficiency. Effective Tax Planning strategies include implementing strategies to reduce your current tax liabilities while being compliant with the current IRS Tax Code.
Tax Preparation Services
There are no two clients alike!
Each Taxpayer has a different scenario. One may have one source of income, the other may have multiple sources of income. One may receive one or two W-2s at the end of the year, and another may receive a combination of W-2s and 1099-Misc. Effective Tax preparation requires you to have good record keeping of all your income sources and expenses.
Taxpayers should not automatically assume that because they had their taxes withheld by their employer, they should owe nothing and should be entitled to a refund. Instead, Taxpayers should regularly evaluate changes in their filing status and correct their W-4 information so the right amount of Tax is withheld. Similarly, Taxpayers should ensure that not too of tax is being withheld for two reasons, 1) To receive a refund when the annual tax return is filed - IRS will not pay you interest on the overpayment of taxes, and thus it is a wrong way of saving your hard earned money, and 2) fear of probably owing more at the end of the year.
For Taxpayers who own their own businesses, must ensure: 1) maintain your books, 2) pay estimated taxes every quarter, 3) know the difference between an employee and a contractor. Failure to correctly follow these suggestions can earn you various forms of penalties. Why waste your hard earned money on penalties?