Year End Tax Planning

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Imagine this.  It is January of 2017, and you are meeting with your tax professional.  After a quick review of year 2016 income and deductions, he proceeds to inform you that you owe $50,000 in additional taxes because your company “made so much money” last year.  And in addition to that, you owe him $2,000 for the pleasure of informing you of that fact.  Like most people, you don’t have the extra $50,000 sitting around so now you have to sell some assets or go on an IRS tax payment plan, which costs more money in interest and penalties, plus the payment plan fees.

 

THIS IS WHAT YOU GET WITH MOST ACCOUNTING FIRMS—POOR SERVICE AND LACK OF FORESIGHT.

 

Now imagine you were a client of Culpepper and Associates.  During our pre-tax season meeting (in Nov/Dec) we noticed that based on your first three quarters of profits plus an estimate of your 4th quarter profit, you might have an extra tax liability of $50,000.

 

To prevent or reduce this additional tax, we implement any or all of the following:

  • Setup a defined benefit plan
  • Setup a 401K plan with company matching
  • Recommend you delay signing of any pending sales contracts
  • Recommend you buy materials in December instead of January, so as to increase your expenses
  • Have you purchase some additional capital assets (such as cars, trucks, office equipment or machinery) so you can take advantage of Sec 179 accelerated depreciation.

 

Now we have essentially eliminated your additional tax ahead of time.  And our bill for these services was probably less than most other CPA firms.

 

FORWARD-THINKING

THIS IS WHAT WE DO AT CULPEPPER AND ASSOCIATES

 

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