Many key events in life can trigger the need for
a reliable and professional Accountant. With our combined experience
in business and personal accounting, we can help you meet your needs
in events such as these...
Job
Promotions - Does the salary associated with your new
job push you into a new tax bracket? Did you cash in stock options
or receive a large bonus? Your withholding amount may need to
be adjusted to avoid penalties or an unexpected tax bill at the
end of the year.
Business
Development or Expansion - In light of issues such as
legal liability and double taxation, is another legal form of
business appropriate (e.g., C or S Corporation, Limited Liability
Company)? [Single-member LLCs, where permitted by state law,
generally are preferable to sole proprietorships because of their
liability limitation advantage.]
Sole
proprietors - have you considered the tax benefits of
employing family members in the business such as shifting income
to lower tax rate family members, reducing self-employment income
by employing a child under age 18, and obtaining a 100% (rather
than 60% in 2000) deduction for health insurance by employing
the owner’s spouse and setting up an appropriate health
insurance plan? Are you eligible to deduct your home office expenses?
Marriage -
Although the world doesn’t revolve around taxes, when there’s
a marriage in the works, you should at least be made aware of the
tax results of holding the wedding this year or next. For example,
if both spouses work, do you understand the tax impact of stacking
one spouse’s income on top of the other’s? Does one spouse
have a high risk of exposure to creditor’s claims (because
they own a business for example) that may be reduced through asset
protection strategies?
Birth
of a Child - Are you aware of the types of expenses
that may qualify for the child care credit, including payments
to maids, relatives, and day camps? Alternatively, if your employer
offers a flexible spending account for child care expenses, have
you considered taking advantage of it to pay for child care expenses
with pretax dollars? If your children have earned income, should
they set up individual retirement accounts (IRAs) not only to
reduce taxes but also to get an early start on accumulating funds
for their eventual retirement? Has any college planning taken
into account the transfer (gift) tax implications, especially
for grandparents who have no legal obligation to support their
grandchildren?
College -
Significant tax planning strategies are available for college expenses,
including taking advantage of the Hope Scholarship Credit, Lifetime
Learning Credit, and the deduction for interest on education loans.
Proper planning will help taxpayers maximize their tax benefit
from these credits by carefully timing when qualified education
expenses are paid, determining who should claim the credit, and
the type of credit claimed.
Retirement -
If you are considering contributing to an IRA, was a determination
made as to whether a traditional IRA or Roth IRA is the better
choice? (The amount of AGI and coverage by an employer plan may
affect the available choices.) As a self-employed individual, have
you considered taking advantage of the deductions allowed through
(and the income compounding benefits of) Keogh, SIMPLE, or SEP
retirement plans? If you want to take distributions from a retirement
plan or IRA prior to age 59, have the available exceptions to the
10% early withdrawal penalty been considered?
Sale
or Purchase of a Home – If purchasing a new home,
have you taken advantage of all available itemized deductions?
If you are subject to alternative minimum tax (AMT), are you
aware that real estate taxes claimed as an itemized deduction
aren’t deductible for AMT purposes? If selling your home,
have you taken advantage of the exclusion for the sale of a principal
residence?
Estate
Planning - For sole proprietors who want to transfer
a business to their children at their death, do you understand
the estate tax benefits of the qualified family owned business
deduction (and will it be necessary to restructure the estate
to meet the deduction’s requirements)? Do you know that
retirement plan distributions are subject to both income and
estate tax? Has consideration been given to ways to keep the
value of employer-provided life insurance coverage out of your
estate? If you intend to transfer a business or farm to family
members at death, would you benefit from restructuring your estate
to meet the special-use valuation rules? After considering your
estate plan and overall family financial plan, has consideration
been given to converting at least a portion of your traditional
IRAs to a Roth IRA?
Rental
Real Estate and Passive Activities - Are you taking
advantage of all qualified rental expenses and deductions? If
unused passive activity losses exist, have your passive investments
been reviewed to determine if any should be sold to free up some
losses? If your use of the special $25,000 rental loss allowance
is restricted because of excessive adjusted gross income (AGI),
has consideration been given to ways to reduce AGI?
Capital
Gains or Losses - Do you incorporate tax planning into
your investment strategy effectively? Are you aware of the tax
benefits of gifting or donating appreciated stock or mutual fund
shares? If a capital loss carryover exists, do you have unrealized
capital gains that can be recognized to utilize the carryovers?
. If unrecognized installment sale income exists, do you have
unrecognized capital losses that could be recognized to offset
the installment gain?
And so much more!
