First of all, tax planning or analysis is not tax preparation.
- Tax preparation gets the filing done. The main goal is to make sure your tax reporting complies with both Federal and State tax laws. It deals with historical information.
- Tax planning provides proactive tax advice. It helps arrive at ways to minimize the amount of tax you must pay.
- A tax analysis takes planning to the next step. Clients engage us for analysis to give them peace of mind. An analysis, with proper assumptions and due diligence, should eliminate a nasty April 15th surprise. It involves calculations of future taxes and is usually performed to provide a client with a schedule of tax payments to eliminate a tax-due situation and/or to avoid penalties and interest.
- Scenario analysis takes tax analysis even further. It is an iterative and laborious process of calculating and predicting the value of a set of situations, under a variety of different circumstances or scenarios.
There is no such thing as a “typical” tax plan or analysis. The list below provides examples why some clients contact us for tax planning:
- Sale of Rental Property or Residence
- Starting New Business
- Entity Change consideration (i.e., Sole Proprietorship vs. S Corporation)
- Ownership in Foreign Business
- Converting Traditional IRA to Roth
- Changing Jobs
- Change in Marital Status
- Estate Planning
How Much Does it Cost for you to Prepare a Tax Plan or Analysis?
The cost depends upon the level of effort and output you want. The list is in order from least expensive to most expensive:
- General information that can be delivered to you in a quick 5-minute phone call
- General information, but you want it outlined in writing via email
- Using supplied information from you, detailed calculations that answer your question(s) and provided to you in a quick 5-minute phone call
- Using supplied information from you, detailed calculations that answer your question(s) and provided to you in report format and emailed to you and/or a consultation
- Scenario analysis with a written report of findings and or a consultation
Because each situation is unique, currently we bill for tax planning and analysis on an hourly basis. Our standard rate is $255 per hour.
For more information, contact us so we can get address your planning needs and peace of mind.