Delaying the preparation of business taxes can cause problems that go beyond your budget, and yet still so many people procrastinate when tax season rolls around.
Pressure to file your business taxes due to impending deadlines, can lead to mistakes and shortcuts that may well cost you dearly. But by adopting a proactive approach to tax planning with help from professional tax services in Coral Gables, you can avoid the many perils associated with procrastination, such as penalties, interest charges and missed deductions and credits.
What does proactive tax planning look like?
Basically, tax planning that’s proactive involves the making of strategic tax decisions throughout the year, instead of just during tax season. This might mean for example, that you structure your business entity in a certain way that’s optimal, that you buy equipment in December instead of waiting until January, or that you strategically time income recognition.
How tax services can help
When you work with professional tax services, they’ll talk to you in detail about your business situation to understand it fully from a tax perspective. They’ll scrutinize your previous tax returns, identify any opportunities to save money that might have been missed, and tailor a roadmap tax strategy for you.
They’ll then arrange to check in with you at a frequency of your choice, making sure your financial records are up-to-date and organized throughout the year.
Basically, tax services help you proactively plan your taxes so that there are no unpleasant surprises once you’ve filed, but perhaps some pleasant surprises in the form of credits or deductions.
Basic steps you can take to avoid the perils of tax procrastination
Beginning well in advance of tax season, there is plenty of groundwork you can do to reduce your stress levels and make sure that no opportunities are missed, including the following:
- Organize your financial documents
Categorize your physical and digital financial documents by putting them in groups with clear headers such as deductions, income and investments.
- Review income and expenses
Allocate some time to reviewing your year-to-date expenses and income, looking for areas in which timing adjustments could be beneficial. For instance, prepaying any expenses that are deductible in December, might afford you more benefits in taxes in the current year.
- Address opportunities for retirement contributions
While employer retirement plans typically require action before the end of December, what many employers don’t know is that IRA contributions can be made right up until the deadline for filing.
Making tax planning part of your routine
Tax planning is always most effective when it’s worked into your regular financial routine, instead of being a wholly separate task. This is perhaps best achieved by setting a reminder for yourself to make a tax check-in on a quarterly basis with your chosen tax preparation service in Miami.
Throughout the year, including tax considerations for every significant financial decision you make, such as when you make a change to an investment strategy, buy new equipment, or alter the structure of your business.
Ultimately, seeing and using your tax advisor as someone who can help you throughout the year instead of solely during tax season, is the best way to avoid procrastination and the many costly perils that go along with it.
