I hope you have managed to stay safe and well! We focus on resolving tax issues in Prince William County and throughout the lower Northern Virginia area.

Now that the initial tax deadline (July 15, 2020) for filing your 1040 Individual, 1065 Partnership, and 1120S & 1120 Corporate Tax Returns has passed, you can finally breathe that sigh of relief.  That is of course, unless you were less than satisfied with the bottom line number from your tax returns, and what you had or will have to “fork” over to the IRS and U.S. Treasury.  Unfortunately for many, every year the tax deadline leaves a wave of disappointed, sad and frustrated individuals in its wake. But it doesn’t have to be this way. Probably, the number one question asked of us here at our firm, is how can I lower my tax bill (while still staying in compliance with the IRS, of course). Planning, Planning, and Planning are my answers to that question.  

Take this scenario (true story): you leave one position for a more lucrative position at another business.  You have all the hassles of changing jobs (including what to do with your deferred retirement contribution account – 401k, etc.), in addition to being a single parent.  Well you decide that it would be nice to have a little cash on hand for an eventual emergency, and thus you don’t rollover the entire amount from your account, and set aside $12K for your emergency fund. Now, fast forward to tax time.  You manage to “dodge” the 10% penalty for early withdrawals from a deferred contribution retirement account.  Yet, from lack of planning you owe $250 because your Adjusted gross income (AGI) was $2K too high to claim the American Opportunity Credit, that one of your dependent college students qualified for, which would have resulted in a refund to you of $2,300.  Which you then could’ve placed in your emergency fund to make up for the amount you would not have transferred, had you sought tax planning advice prior to your decision.

If you are one of the “disappointees” from this past tax season, or just feel as though you would at least like to discuss mitigating your tax bill and the IRS’s impact in your life. Feel free to contact us about potential tax planning and Savings. https://brtaxaccountant.com/