Tax Return Preparation and Tax Planning
The United States of America has one of the most complex taxation systems in the world. With an endless number of forms to fill out and documents to prepare, it is no wonder why so many individuals struggle to properly understand and make good on their taxes. Businesses find tax compliance increasingly costly to comply with the IRS code as they prepare their books and finances, transactions, and payroll information, in addition to all the supporting forms and documentation.
Companies filing tax returns have to be careful and thorough to ensure that they do not get penalized. Businesses need to file their tax returns accurately and immediately on or the filing deadline, or else they will have to pay an additional penalty cost of up to 5% per month. If businesses are unable to pay at all, they will be fined 0.5% of their monthly taxes due, on top of the interest being levied upon them for the missed payment.
The most ideal way for businesses to keep on top of their tax returns is to employ the services of an accountant with the enrolled agent designation that can represent client in U.S. Tax Court. Enrolled Agent accountants have the skills and certification necessary to capably file the returns on time, as well as accurately verify any tax information to ensure fair taxation.
Preparing for taxes is one thing, but actually planning ahead of the taxation in order to reduce tax liabilities is a whole different ballgame. Businesses, in particular, could use a bit of tax planning in order to maintain cost-efficiency. It takes knowledge and expertise in strategic restructuring of business operations in order to minimize a company’s tax liabilities. Although some may feel unsure about this method, tax planning is completely legitimate, since all that the corporations involved intend to do is to avoid excessive tax costs.
To understand how you can make changes within your business to reduce tax, you will need deep understanding of how taxation works, as well as the ins and outs of state and federal tax law. Such knowledge is necessary in understanding tax costs. If a business owner, for example, lacks profound insight, he or she can opt to hire an enrolled agent accountant licensed to represent in U.S. Tax Court, to act as their adviser.
For both tax preparation and planning, you will want a professional who is well-versed in all matters of tax and its mechanics to avoid any financial pitfalls. The Summerhays Group offers services to help you thoroughly understand taxes and advise you on how to maximize your finances. Contact us today to learn how we can help your business.