Tax planning
Steuerberatung Hattingen planning involves a series of strategies that minimize the percentage of your income that must be paid to the IRS. It can include claiming tax deductions, calculating investment losses, and deferring tax payments. It is also important to make sure that your tax withholding is accurate. This will help you avoid surprises come tax season.
One of the most common pitfalls associated with tax planning is taking on too much debt. Many people buy homes and cars because they have a tax deduction for them, but this can end up making your budget lopsided. You should only take on debt if you really need it and can afford to pay it off in a reasonable amount of time.
In addition to claiming deductions and credits, tax planning also includes deciding whether you should itemize or take the standard deduction, postponing income, and maximizing retirement plans. A tax planner can help you determine these strategies and avoid mistakes that can cost you money in the long run.
Tax audits
The words “tax audit” foster trepidation in many Americans, but the reality is that the IRS isn’t going after everyone. The service selects only a small percentage of returns for review, and the likelihood of being selected is much lower if you follow some simple rules.
Generally, math errors are the biggest trigger for an audit, but even innocent mistakes can raise suspicions. If you work with a tax professional, your chances of error decrease significantly. Also, be sure to answer every question on a form; leaving blanks or using incorrect numbers is an easy way to raise an eyebrow at the IRS.
Certain businesses, such as restaurants, car washes, and barber shops are more likely to be audited by the IRS because they tend to have complex recordkeeping requirements. The IRS will scrutinize these business’ cash-heavy records, so be careful about making guesses as to income categories. Also, don’t change the amounts reported on a return unless you have good reason to do so.
Tax advice for private individuals
Taxpayers who need help avoiding tax pitfalls should seek the advice of a reputable tax consultant. These professionals specialize in income taxes and offer a wide range of financial-related counseling services. They also keep up to date on changing tax laws and requirements at the federal and state levels. They can also advise businesses on how to minimize their tax liability and take advantage of available tax benefits.
Private individuals face a complex set of issues when it comes to personal tax matters. These include saving for children’s college tuition, financing a new home, supporting charitable causes and passing wealth to future generations. They need a financial advisor who can help them navigate these shifting tax regulations and make smart choices about their estate and investment plans.
To avoid scams, choose a preparer who has professional credentials from an IRS-recognized organization. This includes certified public accountants (CPAs), enrolled agents (EAs) and members of the National Association of Enrolled Agents. You can search for a qualified preparer by using the IRS’s online directory.