- December 17th, 2012
- John Dillard
- Income Tax Preparation of Corporate & Personal Income Taxes, Virtual CFO, Business/Tax/Financial Consulting, Business Loans/Money Management
- 0 Comments
Duluth/Gwinnett CPA: 10 Tax Tips That Will be Helpful for 2012 Tax Fillers
Economically Surviving Your 2012 Taxes and the Economy
Looking not to our own devices but to serve the needs of others is always on the forefront of our advice as be both start a New Year and Prepare for Tax Season. These time tested techniques will do much to help ensure that you Keep Your Tax Bill as Low as Legally Possible, Avoid Unnecessary Fines and Penalties and Prepare Your 2012 Taxes
1. Live Below Your Means. There is perhaps no bigger suggestion that to live below your means. I believe I can say with certainty that in the course of Human History that all generations have experienced substantial changes in their lifestyles due to uncertainties in both economic and political times. Those who fail to consider this in both their spending and saving habits will be dramatically more likely to have their financial plans derailed.
2. Have Contingency and Reserve Funds. Having excess monies available for both your business and personal needs is essential to both surviving lean times as well as to have the capacity for growth, for in times of rapid expansion, cash flow will be strained to the maximum. Being sure you file your taxes early is a good first option while keeping in mind that an extension to file is not an extension to pay.
3. Have a Back-Up Plan. Just as we should back up our computer by having off site data storage, so should we have a backup plan for our finances. If you are a homeowner it is widely recommended that you set up an equity line on your home, which you can use in times of financial distress. Also having a backup plan will allow your business to survive and even thrive in otherwise economic down periods.
4. Check your Entity. Selecting the right entity for your business is perhaps the most critical issue in determining if you are operating your business in a tax and liability model that is most applicable and efficient for your business. Also staying abreast of news in Washington, D.C. will help you plan for new tax laws and pending legislation.
5. Utilizing a Payroll Service. Payroll is perhaps the biggest bane of many who strive to go it alone. Also a payroll service is going to be able to offer the processing of your payroll checks and 1099’s at a price that is the most competitive in the marketplace. Going directly to the source, the provider is your best option for competitive pricing.
6. Plan for the Future. Business Owners that fail to plan are preparing to fail. Know that everything will change; we just do not know whether it will be for the better or not. Know that every great deal, every profitable venture and every good business run will eventually run its course. Being prepared for this eventually will help ensure your business survives the tough times.
7. Keep a mileage log. The IRS has increased their sensitivity towards business owners keeping a by day log to support their business miles. Frequently the best place to do this on your business day timer or calendar, where you could also record the business miles driven.
8. Retirement Planning. Although this is a variable that requires you to thing long term, which is not in our basic nature. Planning for Retirement is an essential part of a business owner’s responsibility to both his family and his employees. Like Joseph in the Old Testament, we are to look to the future and to plan accordingly both in fat times and in lean.
9. Using a Checklist. Being sure you review your prior taxes and have a well thought out checklist is essential to having the building blocks to ensuring your prepare your return properly. You can find one on our web site at http://www.hiscpa.com/newclient.html
10. Keep Your Balance. Just as our lives are to be balanced so should our finances. Too much planning for the future while not taking care of the present and vice versa are deal killers that will ensure and rob you and your business of financial peace and security. Keeping a broad perspective and understanding will do much to ensure your business future viability.
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