Plan Now To Save Later!

    They come about at the same time each and every year, but too often, taxes take even the best intentioned people by surprise.  This doesn't have to be the case, however.  A little forethought and some knowledgeable advice can ease the annual stress and prevent unwelcome surprises.

     Right about now is the ideal time to meet with your tax professional to do some tax planning-enough of the year has passed that estimates for income and expenses for the rest of the year can be reasonably made.  Plus, there is still ample time left for making adjustments that could help your tax situation.

          In preparation for tax planning, an appointment should be made with a knowledgeable tax advisor and some basic documentation accumulated.  A summary of your income for the year to date should be prepared.  This would include:

1)  your most recent paycheck stub if you are a wage earner, 2)  your most recent financial statements if you are a business owner and 3)  records of any other 'out of the ordinary' income you may have received or be expecting.  Income items that are expected to be about the same as the prior year can be estimated from amounts recorded on the last tax return.

          A list of your year-to-date or total expected deductions should be prepared as well.  These would include medical expenses; cash and property donations; job expenses for which you did not receive reimbursement; home, property, or investment purchases/sales; education and student loan expenses; child care expense; and some legal fees.  If you are expecting these to be about the same as the prior year, these can be estimated from last year's tax return as well.

          Prior to your appointment, you should also sit down and try to think of any changes that have occurred this year or that you expect to occur prior to year-end.  Did you move?  Did any of your dependants change status?  If children are over 18 and not students, they may not qualify as dependants anymore.  Did you begin or wind up a business?  Did any business activity in which you are involved have greater than or lesser than expected income?  Did either you or your spouse retire or take out any retirement income?  Are you involved in any litigation that might result in an award?

          All of these items, plus many more can have an impact on your tax returns.  It is important to think of as many of these things as possible so that the professional can help you to accurately predict what your situation may be.  Once the information is gathered your tax professional will run some calculations on the information provided and then guide you in determining the next steps .  Call Stevens Pierce & Associates, CPAs to schedule your tax planning appointment today, 734-8662.