One of the most common mistakes made by many accountants or financial advisors is their failure to adequately prepare a client for federal and state income tax balances due. This type of surprise is avoidable but proper planning must be done before year end in order to create some tax savings.
In that regard this is the time of the year that our firm is busy preparing tax projections for clients. The exercise essentially allows us to project the amount of money they will owe, or the refunds that they may be entitled to, come April 15, 2010. This information is especially important in a year where there may have been significant changes in client facts including substantial stock sales, changes in business results from one year to the next, sale of investment real estate or something as straight forward as marriage or the birth of a new child. All of these impact the bottom line results come the due date of the individual income tax return.
Most importantly, the projection process is cost effective. More often than not, the tax savings that are produced from the added planning are greater than the money invested in professional fees
This truly is the season to anticipate where you will be April of next year. Of course the choice is always yours but remember; nobody likes surprises except children at Christmas time.
This article was written by the expert tax professionals at Numerico, PC. Click here to view their website.
