Year End Tax Planning

Business owners and individual tax payers will do well to consider their taxes before the end of the year. Don’t wait until April to start thinking about it.

Most of us know to keep track of our receipts, watch for our w-2s and 1099s in the mail, but that’s just record keeping. Real year end tax planning takes into consideration how to actually minimize your tax burden. To some degree, you can push out your tax burden to the next year, or sometimes it’s actually beneficial to accelerate your tax burden into the current year so that the following year will have less tax.

The U.S. tax code is more than 27 THOUSAND pages long. Business owner aren’t expected to know it in and out. That’s where a trained, experienced, CPA comes in.

Probably the most important part of your year end tax planning strategy is the selection of a trusted CPA.

Year End Tax Planning

Hire a business coach

Once you have decided that you want / need a business coach, you need to choose the right one. I mentioned before that you need a coach with the heart of a teacher, one that puts your success in first priority.

You also need to ensure that the coach has the experience and understanding to interpret financial statements and to explain them in terms you will understand.

Your coach must be patient. We don’t always understand something the first time we’re exposed to it. Your coach must be willing to repeat their lessons and approach them from a slightly different angle until the knowledge finally integrates for you.

Whomever you hire, make sure it is someone you trust. If you don’t have full confidence in them, you will have a hard time making yourself follow through with their advice. If you’re going to go through the motions of hiring a coach and getting advice, make sure you are willing to make any suggested changes.

Hire a business coach

Questions to ask an accountant

When you are looking for someone to prepare your taxes, you should ask a few questions so you know what to expect from your accountant. Answers to these questions will help you choose an accountant and ensure you are comfortable working with them.

This is a short list with additional ideas found at Accountability Team

Are you a CPA?
If not a CPA, are your an Enrolled Agent or an unlicensed accountant?
What are your fees?
Do you have hourly fees for non-tax services?
When do you need my documents?
If I need an extension, when do you need my documents?
Can you help if I get audited? What is your procedure?

Expect your accountant to also ask you some questions and to request various documents. Be available to them by phone or email in case they need more information from you as they work on your tax return.

Questions to ask an accountant

Benefits of Business Coaching

Connecting with a business coach can have a huge impact on your business. Let’s review some of the benefits of this type of connection.

One of the most important is higher profitability. No matter what you want to do as a business, you need more money to do it. Reducing costs and increasing revenue takes experience and skill. A  business coach can provide that experience for you.

Another big one is accountability. As a business owner, you sometimes feel that you answer to no-one but yourself. This can be good at times as it gives you the freedom to try new things and not be second guessed. The down side is that there’s no-one to keep you on track to do those things that must be done even when you find them less satisfying to do. A business coach can set up systems that help you stay accountable to yourself as well as to the coach.

For an more in-depth treatment of this subject, check out: Benefits of Business Coaching

Benefits of Business Coaching

Do I need a CPA?

Can’t I just do my own book keeping and file my own taxes?

Sure you can but do you really think that’s wise?
If you run a successful business, chances are that somewhere along the way your taxes are  going to get more complicated than you expected. You probably have your hands full running your business and don’t have time to study changes to tax law every year. Leave that to the professionals.

Can’t I just hire an accountant?

Again, maybe, but consider this:

In some states, there are no restrictions on who can call themselves an accountant. A high-school graduate could hang their proverbial shingle out and start taking on accounting clients. That is not meant to disparage all “accountants”, but to point out that the title alone is self appointed.

The title of CPA or Certified Public Accountant requires rigorous training and a state test with ongoing tests to continue certification. By choosing a certified professional, you have the assurance that they have taken and passed the state run test.

If the IRS decides to audit you, there is very little an accountant can do for you, but the CPA can deal with the IRS on your behalf.

This article is just a quick primer, check out Does my small business need a CPA?

Do I need a CPA?

The Heart of a Business Coach

Obviously, the mind and skill-set of a business coach is extremely important. A business coach must know how to run a business, how to find and fix problems, and how to set up processes that ensure continued success, not just a one-time fix.

All that being said, the heart of the coach is also important. You need a coach that CARES about YOU. Cynthia works for her clients with the same passion she shows when mentoring school children.

She believes every student should know they count and that regardless of their track (college, technical or uncertain), they have value and a purpose in the world. Though she has had the privilege of working with all grade levels, Cynthia’s passion is to help those high school students that need some encouragement to finish strong.
The Heart of a Business Coach