As the year comes to a close, the thing on most people’s minds are the upcoming holiday festivities and all the family, food, and fun that come with them.
However, did you know that this is also a good time to employ some basic tax strategies to minimize tax expenditures and maximize your benefits?
At Gonzalez & Arrambide, we like to help the joy roll into the new year and on! Our team of talented Weslaco CPAs and vCFOs can show both individuals and businesses the best tips to improve your financial circumstances come tax time.
Tax Advice for Individuals
- Make a Charitable Donation – Contributions to charity allow for beneficial tax write-offs. Remember, cash contributions must be documented and additional forms may be required if property or vehicles are donated.
- Contribute to Your Retirement Account – Leverage retirement account savings as making payments to it now offers reductions in taxable income.
- Additional Tips – If you accelerate deductions and defer income, it will pay off come tax time. Also, consider withholding from your salary if in danger of penalties.
Tax Advice for Businesses
- Add Family to Payroll – As long as you work within the specified rules and regulations, this strategy can work out for your family and business.
- Make a ROTH Conversion – This move allows you to pay taxes at a lower rate now without paying future taxes on withdrawals.
- More Strategies – We recommend that you push income to the following year while you expedite expenses for the current year. Also, file any necessary articles, and implement a 401(k) plan before the end of the year.
Let Weslaco CPAs Gonzalez & Arrambide Provide the Tips You Need
Regardless of the time of year, the skilled certified public accountants and vCFOs at Gonzalez & Arrambide in the Rio Grande Valley can offer expert tax advice!
There’s no time of year that’s more stressful financially than tax time, so be sure to prepare now with the expert Weslaco CPAs and vCFOs at Gonzalez & Arrambide in the Rio Grande Valley!
More
Tax Day is nearly here, so it’s absolutely important to understand your current financial situation. But perhaps even more important is knowing when the help of a certified public accountant can relieve financial burdens and possibly save you money in the long run.
The Rio Grande Valley accountants at Gonzalez & Arrambide want to help you understand why you should seek the help of a tax professional with this helpful guide!
More Complex Situations Call For a More In-Depth Review
Though not always the case, a general rule of thumb is that the more complicated your financial situation, the more likely a tax professional’s guidance will benefit you.
There are quite a few situations in which you’d be better off seeking the support of a Weslaco CPA:
- Self-Employment – If you own a business or work freelance, then there’s no employer to withhold taxes from your “paycheck.” It’s easy to get confused by tax details when you’ve got a business to run or contracts to complete, so working with a professional is best. Owning rental properties often falls under this umbrella as well.
- International Income, Investments, or Bank Accounts – With increased requirements and much stiffer penalties, foreign financial assets and investments can be a nightmare come tax season. Let a professional take over in these situations.
- Major Life Change – Big events in our lives affect every aspect of them, including our financials. Marriage, divorce, having a child, and buying or selling a home are just some major life events that could alter your filing status.
Mistakes Happen, As Do Audits
Mistakes can happen at any time, including when doing your taxes. If you aren’t a professional or well-informed, trying to do your own taxes can be overwhelming.
Sometimes an innocent filing mistake can lead to serious consequences, like an audit, which is when you will definitely need the support of a certified public accountant.
Regardless if you recognized your own error after filing, or the IRS did, it can’t hurt to have an expert on your side when things seem their most difficult. A tax professional may even be able to catch a mistake made by the IRS, saving you time and money.
Keep More Money in Your Pocket
You might ask yourself, “How will spending additional money on a tax professional save money?” While it may seem contradictory, the advice of a tax pro can be an incredible financial boone to your situation.
Certified public accountants, such as those at Gonzalez & Arrambide, act as a microscope for your financial circumstances and analyze every aspect. This way, they can optimize the way you run your business, make investments, or perform other complex financial activities.
At the end of the year, you may be surprised to see that you’ve been over-paying and are now saving money thanks to the help of a professional!
Reach Out to the Top Rio Grande Valley Accountants Today
As you can see, there are a number of factors that can complicate your financial circumstances. That’s why the Weslaco CPAs at Gonzalez & Arrambide are here to lessen your financial burden, save you money, and strategize in time for tax season this year!
More
By admin
15 Mar, 2022
taxes
Best Tax Advice, Business Taxes in Texas, Common Mistakes, CPA, Gonzalez & Arrambide, IRA Contributions, Rio Grande Valley, Strategic Planning, vCFO, Weslaco Accountants
As we get closer to Tax Day, the more important it is to make sure you’re prepared to file everything correctly. It’s common to have questions around this time of year, so we’ve organized some additional notes on being ready for tax time.
Your Rio Grande Valley CPAs at Gonzalez and Arrambide want to ensure you feel ready when Tax Day finally comes.
Make a Decision on Filing Yourself or With a Tax Preparer
Depending on your financial situation, you will want to decide between filing your taxes on your own or with a professional. There are a few factors at play when you determine the best course of action:
- Do-It-Yourself Tax Filing – If you work a job that provides you with a W-2, don’t have any dependents, aren’t a homeowner, or your situation is overall uncomplicated, it is probably simpler and less expensive to file using a tax software.
- Get the Help of a Professional – Say you own a business and need to file personal and business tax returns or you’re married, working two to three jobs, with several dependents. It may be less of a headache to seek out a CPA for their skilled help.
Whatever your tax situation, the accountants in Weslaco at Gonzalez & Arrambide offer a FREE consultation. They can help you decide what’s best for you!
Check and Adjust Your W-4 Withholding
For people who work a straightforward W-2 career, every January your employer will request a completed W-4 form. This document will determine how much is withheld from your paycheck, based on:
- Overall Tax Situation
- Household Status
- Number of Dependents Claimed
- Other Adjustments Like Additional Deductions or Income
You can see yourself if you’re withholding too much or too little by comparing two fiscal years’ returns. If the financial situation was overall the same, a large refund could mean withholding too much. However, if you owe the IRS money, not enough money may have been withheld.
Decide if Filing an Extension Is Right for You
“What happens if unexpected problems arise this month?”
If you want to err on the side of caution, think about filing an extension, which, if approved, would give you until October 2022 to complete the tax filing process. Keep in mind that while filing the extension costs nothing, you could incur additional interest on what you owe.
Even if you’re fairly certain everything will go smoothly, an extension can never hurt as it allows for extra time to make sure everything is correct. To actually file the extension, you or your tax preparer will need to fill out IRS Form 4868.
Get the Best Tax Advice from the Rio Grande Valley CPAs at Gonzalez & Arrambide
Regardless of your financial situation, it can be helpful and reassuring to seek the support of tax professionals. That’s why the Weslaco certified public accountants at Gonzalez & Arrambide offer a FREE consultation. We want to make sure you’re both knowledgeable about and ready for tax season!
Don’t stress over questions anymore! Contact the accountants in Weslaco at Gonzalez & Arrambide for a FREE consultation now!
More
Though the deadline to file your taxes is April 18, 2022, it’s never a bad idea to prepare yourself early. The Weslaco accountants at Gonzalez & Arrambide are here to help! It’s our goal to guide you along the way and answer any tax questions you may have.
That’s why we’ve created a set of tips that will help you have a smooth and straightforward tax season.
Be Aware of Your Filing Status
When you go to file your taxes this year, it’s important to provide the IRS with the correct filing status, of which there are five:
- Single
- Head of Household
- Married Filing Separately
- Married Filing Jointly
- Qualifying Widow/Widower With Child as Dependent
Each filing status has different requirements, and you may be eligible for certain deductions and/or credits. For example, someone who is filing as “Single” and “Without Dependents” will not be offered the same opportunities as someone with dependents.
The IRS’s website as well as certified public accountants like our Weslaco CPAs can help citizens determine their status if they are unsure how to file.
Get Your Tax Documents Together
Upon knowing your proper filing status, the next step is to organize all the necessary papers to file your return, some of the usual ones being:
- W-2 Forms – This document shows the income you received from your employer, and they will generally have this ready for you by the end of January.
- 1099 Forms – Those who are self-employed are given individual 1099 forms from clients detailing how much they paid you.
- 1099-DIV – This form reports any income related to investments such as stocks, bonds, etc.
- Copy of the Previous Year’s Tax Return – This should remind you of any information necessary to file your 2021 tax return.
- Form 1098 – This document pertains to homeowners and relates to any mortgage interest paid.
- Form 1098-E – If you are or were a student, this form details the amount of student loan interest paid during the year.
While this is far from a full list, the Weslaco certified public accountants at Gonzalez & Arrambide are here to help you understand exactly which forms are important to you!
Ensure You Update Your Name and Address
If you’re in a different living situation or you’ve changed your name for whatever reason, it’s important to make sure this information is updated with the IRS and Social Security Administration.
- Legal Name-Change – Reach out to your local Social Security office and provide proof of identity such as a government-issued identification.
- Change of Address – Either mail a change-of-address form to the IRS, call them and update the information, or provide the new address on your latest return.
Though this may seem like obvious advice, something so simple can cause complex problems if not properly addressed beforehand.
Maximize Your IRA Contributions
An IRA, or individual retirement account, is a wise investment for adults of all ages and even wiser to contribute as much as possible before the deadline. If you are younger than 50, you may contribute a total of $6000 while those 50 and older may contribute a total of $7000 in the 2021 tax year.
Keep in mind that the deadline to make more payments into your IRA is April 15, 2022.
Best Tax Advice in the Rio Grande Valley
While filing taxes can be intimidating and sometimes confusing, the Weslaco accountants at Gonzalez & Arrambide are here to lessen those burdens. If you have any more questions, we are more than happy to talk you through the answers until you understand taxes as well as we do!
Reach out to the knowledgeable certified public accountants at Gonzalez & Arrambide with your questions today!
More
It’s hard to imagine that a small business does not qualify for some or all of the employee retention credit (ERC).
And remember, this is a tax credit—one of the very best things that tax law has to offer. True, it’s not as valuable as some other tax credits because you have to reduce your payroll income tax deductions for the credits, but the ERC certainly puts you ahead.
And you can be looking at big bucks. The possible ERC is $5,000 per employee for 2020 and $28,000 per employee for 2021. That’s $33,000 per employee!
For 2020, You Have Two Ways to Qualify:
- You had a gross receipts drop during a 2020 calendar quarter of more than 50 percent when compared to the same calendar quarter of 2019. The more than 50 percent test is the trigger for the ERC, and you automatically qualify for that quarter and the following 2020 quarter.
- You suffered from a federal, state, or local government order that fully or partially suspended your operations (under this rule, you qualify for the ERC on the days you suffered the full or partial suspension, even if you did not lose any money).
For 2021, You Have Three Ways to Qualify:
- You suffered a federal, state, or local government order that fully or partially suspended your operations (under this rule, you qualify for the ERC on the days you suffered the full or partial suspension, even if you did not lose any money).
- Your gross receipts for a 2021 calendar quarter are less than 80 percent of gross receipts from the same quarter in the calendar year 2019.
- As an alternative to number 2 above, using the preceding quarter to your 2021 calendar quarter, your gross receipts are less than the comparable quarter in 2019.
One final note. You may not double-dip. Wages you use for the ERC may not be used for the Paycheck Protection Program (PPP), family leave credit, or similar COVID-19 programs.
More
