As a Certified Tax Coach my team and I understand that creating and executing tax planning strategies is not the same as preparing and filing tax returns. It is not the same as forecasting your tax liability and helping you prepare for the necessary quarterly payments and potential balance due although we do include this service as well.
At A Parness Company CPA, we define tax planning as the path we take to move taxable income into lower tax brackets, where possible, convert post-tax dollars to pre-tax dollars, and work with your other financial partners to ensure that you earn as much tax-exempt income as possible. We believe that the process should be a team effort as we work to help you achieve your financial goals.
Tax planning under the Tax Cuts & Jobs Act, has given us a new opportunity to step back and really look at your situation. We start our discovery session listening to you; what about tax planning and minimization is most important to you. We understand that maximizing your after-tax income is important in assisting your efforts to grow and preserve your assets to enable you to reach your goals.
As accountants located in New York City we are sensitive to the issues related to NYC business and personal taxes and look to form plans that take your main location into account. We work with individuals and businesses located in all boroughs of New York City as well as Long Island, New Jersey, Connecticut, Westchester, the tristate metropolitan region as well as other parts of the country.
We love to create tax minimization plans for our clients and help them stick to their plan starting with a discovery session, creating a plan and then ensuring implementation through the accountability appointments built into our maintenance plans.
Copies of your prior year’s tax return serve as our road map, enabling us to determine if you need to make a change now. Plans that worked in 2017 and prior may not be best in 2018 and beyond! Our review may find that you may benefit from amending prior tax returns in order to take advantage of previously missed deductions. A review of prior tax returns will also enable us to plan for claiming a refund of prior Alternative Minimum Tax (AMT) payments.
Typically year-round tax planning is preferred as you would be constantly reviewing your record keeping and transactions. This usually means more deliberate and accurate documentation as well as the opportunity for a series of accountability meetings. Tax saving strategies may include year-end tax and entity review planning for the current year and/or the following year.
Part of our evaluation of your entity type may include your short and long term business goals. We expect any discussion of goals to include retirement planning, education funding/planning, tax advantaged charitable giving, and structured succession planning. Options may also include Income shifting, pretax medical expense plans, income deferral, accountable plans and the like.
We will usually suggest that we have at least one joint meeting with your current investment advisor. This will enable us to move forward with a plan for tax advantaged capital gains, stock option compensation planning, real estate and other investment and divestiture and the like.
Like many things in life “timing is everything”. That being said, working with a plan towards pre-set goals will enable us to help you time your personally held investments or retirement fund entry and sale or withdrawal and method of divesture.
We also recognize that the timing of tax payments can have a crucial impact on cash flow. We work closely with our clients so that tax payments, to the extent possible, can be budgeted in advance. The best tax strategy can be muted if the tax payment comes as a surprise.
Just as your medical specialization enables you to expertly advise your patients, we, as New York Metropolitan area accountants who work with many medical practitioners and physicians are aware of the special details of medical practices and as such are able to provide expert advice on business process and tax issues.
Any good plan takes all types of taxes into account. The Tax Cuts and Jobs Act like prior tax reform requires an analysis of tax treatment at the federal level and the state level as most states have de-coupled from the federal laws. A prime example is asset purchase and expensing (depreciation options, cost segregation). These must be evaluated for both federal and state treatment as well as your current and expected tax rates.
In addition, we see tax types much like different buckets of money or different pockets that the funds come from. Taxes are not always equal and your tax rates may change from year to year based upon your circumstances.
The Tax Cuts and Jobs Act has opened a wider gap between Federal and State taxable estates. Again a new opportunity for proactive planning. We work closely with several attorneys and investment advisors and liaise with you during and after those planning meetings to make sure that your overall goals are always top of mind. This insures that you have a full understanding of your plans, the attorney has a full understanding of your goals, and the investment advisor has a full understanding of how the investments need to be titled.
Many people worry that tax planning or aggressive tax strategies will subject them to a higher chance of getting audited. Our proactive Tax Strategy Plans include ideas that are fully researched and documented. After a review of your current business and personal tax issues we can see where the weaknesses lie and educate you about proper processes and documentation. As part of our proposal we provide a set of action items, which, when followed will assure that your records are complete and properly documented.