Taxes might be the biggest expense you don’t actually budget for, because you think you can’t influence taxes. Actually, there is something you can do to reduce the amount you pay in income taxes. It’s called tax planning. Tax planning helps you structure your income and expenses in a way that mitigates taxes legally.
The key to successful tax planning is to work with a financial advisor and choose your tax mitigation strategies in advance. If you don’t look at your tax obligations until after the year is over, it’s too late to be proactive about your taxes. Also, it’s important to work with a financial expert, because tax laws are complicated and change every year.
Taxes are an enormous expense for most Americans. You might pay 20% in income tax or significantly more, depending on your tax bracket. How much money would you have to invest for your financial future, save for retirement, or buy that vacation home if you could reduce your income tax burden? That’s where tax planning comes into play.
Our goal is to help you reduce your taxable income to keep more money for yourself. With tax planning, you can be strategic about your taxable income. Whether you decide to reduce your taxable income by contributing to a retirement account or donating to your favorite charities, you should be in control of where the money goes. Our tax planning advisors can help you create tax reductions strategies that reduce loss of income to the IRS.
Tax laws and regulations change regularly, which is why we recommend working closely with our financial advisors. You must use tax mitigation strategies correctly to provide the maximum benefit. Here are some examples of tax planning strategies:
You are not legally required to pay the most in taxes you can. On the contrary, the tax code encourages you to use it to your advantage. The IRS rewards certain financial behaviors with tax incentives, such as deductions or credits. Our financial advisors can help you take advantage of these incentives and minimize your tax burden. This allows you to focus on building wealth for your future.
Probably. If you don’t use tax planning strategies to mitigate your income tax burden, you might pay more than you need to. There are many legal ways to reduce your taxable income and receive tax deductions and credits. This includes saving for retirement in a tax-sheltered account, giving to your favorite charities, and using deductions for your business. If you want to know how to save money on taxes, call us to schedule an appointment.
The biggest mistake people make with their tax returns is not planning ahead. If you wait until April to calculate how much you have to pay, you can’t take advantage of tax mitigation strategies. Sometimes people also start investing without considering the tax implications. A large gain in your portfolio might not be such a large net gain if you have to pay capital gains tax. Our financial experts can help you reduce your tax burden by creating a tax reduction strategy for you.
There are many ways to reduce taxes legally. If you’re saving for retirement, you want to consider using a tax-sheltered retirement account to reduce your income tax burden this year. This helps you save for the future and increases your net income at the same time. Our financial advisors can help you create a tax planning strategy for your specific situation.
Don’t let the IRS take more than they legally require. The less money you pay in taxes, the more you have available to invest or give away. Call our financial advisors today to schedule a tax planning session.
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