When preparing your tax return we create files that show the detail behind your income figures and most large expenditures. This is and important step in income tax preparation as it helps us in subsequent years in directing you to be able to obtain the same information and it also helps us in case of IRS inquiries or IRS audits. Proper detailing of your information will cut down time and fees when it comes to corresponding with the IRS, State of California and other sources. Each year you will receive a booklet known as an income tax organizer. It reflects figures used on your prior year’s return to assist you in including the appropriate information for the current year. Face to face meetings are also important to assist us in obtaining all relative information to prepare a complete and accurate tax return that lowers you tax liability.
We all know that when we work, we pay taxes. That’s just how it goes right? When tax season comes around, all we do is sign what they send us and send it back.
What is it they send us again? Everyone needs to understand the basics about how paying taxes work, and we all need to understand that this is something that needs planning. It isn’t something that’s set in stone for us.
Tax planning is a systematic evaluation of finances and investments to reduce the tax burden in a legitimate way. We need to understand different financial processes that affect us individually and our businesses. There various implications that can change how we do our taxes from year to year. These include cash inflows and outflows such as property income, salary composition, investment, home loan, gifts and interest-bearing deposits, sale or purchase of assets etc. to create an appropriate investment plan that helps draw out financial goals while reducing tax liability.