Now is the time to start planning for next year
The end of tax season may mean your 2012 tax obligations are behind you, but it's also an excellent time to remember that tax planning is a year-round opportunity.
Think of it like home maintenance. When you stay on top of small repairs, you can minimize and even prevent possible serious damage later on.
Let this be the year you commit to examine your taxes regularly, both on a business and a personal level. By doing so, you can track throughout the whole year -- January through December:
* If you're self-employed, now, and again in September, are excellent times to focus on your quarterly tax payments to review assets and income and their impact on net profit.
* Be aware that income and expenses from rental real estate also present tax consequences depending upon your total income and occupation.
* If you're planning to sell real estate in 2013, whether your home or a rental property, now is a great time to understand the tax impacts of gains/losses, former depreciation, or passive loss carryovers.
* For those corporations and LLCs, compelling reasons may exist to make an election for pass-through taxation for 2013.
* Know when distributions from your IRAs and Social Security income will be taxable and at what rates.
* Will you be impacted by Alternative Minimum Tax or the new Medicare surtax on net investment income?
Ultimately, by focusing on year-round tax planning and your family as a whole, you will clearly understand how well you are achieving your end-goals while reducing your tax liability to pay only what you really owe.
The end of tax season may mean your 2012 tax obligations are behind you, but it's also an excellent time to remember that tax planning is a year-round opportunity.
Think of it like home maintenance. When you stay on top of small repairs, you can minimize and even prevent possible serious damage later on.
Let this be the year you commit to examine your taxes regularly, both on a business and a personal level. By doing so, you can track throughout the whole year -- January through December:
- How much income you're earning, and, better yet, what you project by year-end
- How much cash you have available and what your cashflow forecast looks like
- How well you're doing with your plans to save for retirement and other goals
- What expenses you've paid and how much you plan to spend
- What gifts you would like to pass along to your children, grandchildren, or nonprofit organizations
* If you're self-employed, now, and again in September, are excellent times to focus on your quarterly tax payments to review assets and income and their impact on net profit.
* Be aware that income and expenses from rental real estate also present tax consequences depending upon your total income and occupation.
* If you're planning to sell real estate in 2013, whether your home or a rental property, now is a great time to understand the tax impacts of gains/losses, former depreciation, or passive loss carryovers.
* For those corporations and LLCs, compelling reasons may exist to make an election for pass-through taxation for 2013.
* Know when distributions from your IRAs and Social Security income will be taxable and at what rates.
* Will you be impacted by Alternative Minimum Tax or the new Medicare surtax on net investment income?
Ultimately, by focusing on year-round tax planning and your family as a whole, you will clearly understand how well you are achieving your end-goals while reducing your tax liability to pay only what you really owe.
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