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CPA and Tax Planning

Aug 18, 2007
Since 1981, tax laws have been undergoing constant change. Keeping this in view, individuals and business owners should have a financial advisor for guiding them through the various changes that influence their circumstances. CPAs can help you prepare for a lifetime of efficient tax planning as they are equipped to address a wide range of financial needs with insight and integrity. Basically, a CPA prepares all the required tax returns for ensuring that the taxpayer is paying only the necessary taxes. All through the year, the CPA monitors tax law changes that could affect the taxpayer, proposes tax saving policies. Moreover they serve as an advocate in matters of tax planning and payment of taxes.

Job of a CPA in tax planning

The CPA plans certain transactions, so as to postpone the income taxes. There are times when they structure a transaction to completely avoid income taxes. However, there are many transactions that come with income tax penalties and taxpayers are unaware about the variations. This is when the role of the CPA comes into play. They meet the concerned client and acquire ample information about the proposed transactions. Thereafter they research the workable alternatives with tax consequences. This way, both the office and the client are aware of the tax end results and are not shocked at a later date.

CPA Tax planning for business owners

In case of business owners, the CPA carries out tax planning by choosing the business entity within which they have to function. The business could be a corporation, a sole proprietorship, a partnership a limited liability company, or a small business corporation. Since all entities have their share of advantages and disadvantages, it is essential that the CPA select the right entity.

CPA Tax planning for retired individuals or businesses

Retirement plans prove to be excellent tax planning tools. CPAs suggest which retirement plan is suitable for an individual or the business as a whole. Moreover they propose retirement plan based on the required qualify and help with the queries tax holders have.

CPAs help individuals and business owners in filing taxes every year. They also prepare state and federal income tax returns on a routine basis for individuals, mall business corporations, corporations, and partnerships. Clients who have recently moved in from another state can still avail of getting a tax return.

Besides planning the taxes, CPAs also provide a tax organizer to the help in collating information for preparing an exact tax return. Clients fill the required information and mail back the organizer to the CPA. In such situations the client and the CPA may not even meet face to face, but they do have occasional conversations over the phone.

Among the other returns CPAs also prepare various workers compensation reports, intangible and tangible personal property tax returns and payroll tax returns.

People often say that they dont plan to fail, but fail to plan. It sure is true, if timely advice was obtained from a CPA, it would have saved people from the shock of unexpected tax obligations and avoided the unpleasant phone calls after tax returns have been completed.
About the Author
Sacramento CPA Firm Murray and Young provides California Tax Help. Check out our new website that includes useful articles on Estate Tax Planning. Visit us at http://www.april15.com.
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