Five Benefits of Tax Planning covers five reasons why a proper tax plan saves you time, money, and stress. Now that April’s rush to file taxes on time has settled down, let’s talk 2022 taxes returns! I can hear you groaning from my office. You probably don’t want me to tell you this, but some people need reminding. I’ll spare you the lecture and give you five benefits of tax planning.
Next year’s tax return probably doesn’t rank very high on your list of priorities right now, does it? But when you take the time to make incremental adjustments during the year, your April will feel much less painful.
Whether you file personal or business returns or both, quarterly reviews help you get more organized for April. Businesses need to file quarterly estimates and quarterly reviews help to decrease the pain of those sessions, too.
The Payoff of Planning
1. Less Stress
I don’t know anyone, including adrenaline junkies, who enjoys scrambling around looking for lost receipts at the last minute. When you plan out a bit of work each quarter, that work creates much less stress ahead of filing.
2. Fewer Errors
Less stress and more time to check your work will also result in fewer errors. Tax return errors, especially when you file yourself, can get incredibly expensive if you mess something up. You also have time to run questions by a tax planning professional to further reduce your chance of error.
3. Avoid Penalties
When you wait to file taxes until the last minute, you may miss something that you should’ve submitted. By the time the IRS is kind enough to tell you, they’ve usually already tacked on penalties for filing late. Penalties continue to accrue interest until you pay off the principal, too. Ultimately, this makes the bill much more expensive than the original amount.
4. Minimize Tax Liability
With proper time to plan, you can also make more strategic decisions on how to minimize how much you owe. Maybe you decide to make a larger purchase this year or increase your retirement savings contributions. If you wait until the last minute, you won’t have time to adjust your course.
5. Research New Tax Laws
As you adjust your course, you can also see how new tax laws impact your current plan. The IRS loves to come up with new laws every year. If you don’t keep up with them, you can leave money on the table or end up owing more.
Need help getting it together for next tax season? Our experienced tax law professionals can help you minimize any taxes you owe and ensure you comply with all applicable laws. We can do a much better job together if we talk regularly throughout the year. And you’ll learn way more than just these five benefits of tax planning. Complete our online form or call us today at 724-216-5180 to learn more.