#getuntaxed

Unlock Financial Magic: Elevate Your Business with Tax Planning!

As we say goodbye to the charm of summer, an equally magical time is on the horizon – the opportunity to experience the transformative potential of proactive tax planning. With just a few months left in the year, there's no better time to discover how this strategy can reshape your business landscape.

Leveraging advanced tax reduction techniques and strategies can be like wielding a magic wand that boosts your business's prosperity. Imagine reducing your tax burden, enhancing cash flow, and setting your business on a path to financial triumph….after all, the difference between try and triumph is a little umph.

Tax planning begins by collecting financial information about what has occurred year-to-date in your business and, if your entity is a pass-through for tax purposes, what has occurred year-to-date for you personally.?Since the majority of owner-operated businesses are pass-throughs, we’re going to be primarily using this scenario in our discussion.

So, for the business(es) you operate, you’ll want to make sure the books are updated (and that means bank accounts reconciled and the whole month-end close process completed….if that’s not happening monthly then, well, we have a whole other problem to address and you’ll just have to call me so I can explain why routine accounting records are the key to your business’ success).?Also, you’ll need to project sales, cash collections, additional expenses or equipment purchases that will occur for the remaining months of the year.??Depending upon the basis upon which your business files taxes (cash or accrual), the net income will need to be converted to the appropriate basis.?Do this for each business.

Next, you will need to gather your personal financial information – paystubs (wages, FIT withheld), estimated interest income, estimated capital gains, expected K-1 income, estimated itemized deductions, estimated tax payments.?It might be easiest to take a look at your Form 1040 from last year and make sure that you have a number for every line item for the current year.?It’s ok if it’s an estimate.?Then, be sure to identify any new financial information that is relevant to the current year, like new rental properties, new K-1 investments, etc.

Once you’ve got all this information gathered, then you’ll want to work with your tax advisor to draft up a current year tax return.?Boom – you have projected your tax liability for the current year!?

What happens when your projected tax bill isn't a delightful surprise? Fear not – this is where advanced tax reduction strategies shine.?Here are several strategy ideas that should be considered and analyzed for current year and future years:

• Optimize Entity Structuring
• Harness Deductions and Expense Acceleration
• Master Income Timing as a Cash Basis Taxpayer
• Leverage Tax Incentives and Credits
• Maximize the Qualified Business Income Deduction (while it is still around)
• Consider Making a Change in the Applied Accounting Principle(s)
• Evaluate Creative Solutions like Family Employment
• Safeguard Your Future with Insurance
• Harvest Capital Losses Strategically
• Elevate Charitable Giving
• Unleash Retirement Planning's Potential
• Unbox Unused Losses
• Explore Health Savings Account Eligibility
• Play the Timing Game with Real Estate Taxes
• Consider Net Operating Loss Carrybacks

This isn't an exhaustive list, but it's a journey toward a tax-smart future. If your tax advisor isn't steering you toward these strategies, it's time to rethink your partnership. The future isn't determined by the past – it's shaped by today's decisions.

While you're navigating these strategies, remember that your business's prosperity isn't confined to taxes. It extends to your financial security and these important areas of your business and should be integrated into a full financial plan and vision:

• Craft a Robust Estate Plan
• Navigate State Tax Compliance
• Master Budgeting and Forecasting
• Strengthen Buy/Sell Agreements
• Reevaluate Life Insurance Policies
• Strategize with Marketing Plans
• Update Employee Handbooks (and other HR Practices)
• Establish Business Continuity Plans
• Optimize Business & Personal Insurance Coverage
• Enhance Employee Retention Strategies
• Embrace Strategic Planning
• Transform with Metrics-based Management

The work is substantial to achieve the outcomes; however, it’s often very useful to leverage savings from taxes to invest in these other critical areas.?But not alone.?With a team of exceptional advisors by your side, it’s completely within your grasp to create a financial masterpiece – an organization and life primed for excellence and prosperity.

For more insights on tax planning and other business advisory services, reach out to me at [email protected] or call +1 (209) UNBOXED. It's never too early to craft a strategic vision for your business's financial future. Unbox your potential today and embrace the art of proactive tax planning.

Unboxed Advisors

Catherine Meyer, CEPA?