Taxes are burdens by definition. Your individual obligations to the rates assessed for your investments, your business and/or the income paid to other parties who work for and with you are not always crystal clear to the average person. Still, the laws are set, and so your best bet is to learn to lean on a tax lawyer who knows the ins and outs of such situations and a host of others.
Deferring Income Tax
One aspect of planning for the inevitable is to defer your income tax as much as you can. But how does this work? A former IRS tax attorney will tell you that the byword regarding this crucial concept is to fast track deductions in the current year while deferring income in the year to come.
For instance, if you have expenses that can help to lessen your taxes, you may be better off than if you wait to spend these profits. This is especially true if you’re self-employed. Those who work for themselves have a host of ways to move money around to their advantage. The tax lawyer of your choosing will help you pull this off in a safe, effective and legal way.
The same is true on taking the route of deducting certain taxes by accelerating them. In this arena are such aspects of your working life such as income from consulting, income from annual or bi-annual bonuses and income from self-employment.
One way to get right with the money you spend on your taxes is to get organized. Your tax attorney can assist in making sure you do this to the tune of the IRS tax laws. For instance, if you know medical costs will be coming your way, take care of them all at once in the same year if possible and you’ll be rewarded with lowered taxes.
In the same vein, your tax lawyer can also tell you that if you put his or her fees – as well as any other experts who aren’t reimbursed from the company for which you work – into play on your records all in the same year, you will save money.
Another must as far as deductions are concerned is the ever-effective IRA (Individual Retirement Account). Not only is investing money this way for use later on a wise move for paying a lower tax rate, but this tact also insures a better financial future in the long run.
And finally, your ever effective tax lawyer will also steer you in the right direction when it comes to giving to the charities of your choice. You will be informed when and to whom this is a good idea, and that goes beyond just giving because you are a giving person.
This advice is especially effective when or if you have property that has appreciated. Indeed, if you have healthy shares of stock, that may mean you are staring at the possibility of paying capital gains. To avoid this, ask your IRS tax attorney if charitable contributions (and which ones) will help alleviate that concern.
In summary, all of these pieces of advice and many, many more are at your fingertips when you hire the right professionals to help you figure out what to do when it comes to making tax breaks count.