Tax planning is defined as the process of looking into various tax options for determining whether, when, and how to conduct personal transactions or business to reduce tax liability or eliminate it completely. Many small businesses ignore tax planning but this is an ongoing process and getting a good tax advice is very important. There are actually tax provisions, deductions, and credits existing and governed by the law which is legally acceptable, so you can take advantage of these by discussing these with your CPA or tax advisor whether you are engaged in a small, medium, or large business.
Keep in mind that although there are ways to reduce or eliminate your taxes, performing tax actions with deceit, concealment, or subterfuge is illegal, but tax avoidance planning is completely legal. What makes tax evasion different from tax avoidance is that the action is fraudulent. The IRS examiner checks four different areas for any possible fraud such as accounting irregularities, failing to report substantial amounts of income, claims for improper or fictitious deductions on a return, and improper allocation of income. Failing to report a portion of your daily business receipts or shareholder’s dividends is fraudulent and may lead to a tax evasion case. Travel expenses that are overpriced or stated and a large reduction in the taxpayer’s claim for charitable contributions are also fraudulent activities that may lead to tax evasion case. It is important to keep sufficient financial records and financial statements, and don’t hide or conceal anything to IRS, otherwise, it may be considered a fraudulent tax avoidance warranting tax evasion. Allocating income to a related taxpayer in a lower income bracket where a company makes distributions to the controlling children of the shareholder is also fraudulent.
A tax planning professional can help you by finding the right tax planning strategies. When it comes to tax planning a professional can help you in avoiding the most common mistakes of tax planning, reducing the taxable income amount, lowering tax rate, controlling time for tax payments, claiming tax credits, and controlling the Alternative minimum Tax effects. If you are looking for a trusted, reputable, and reliable tax planning professional in Foxborough, we can help you by visiting our website or homepage now. We are a tax planning and tax returns professional who can help you with your business. A good tax planning professional or agency provides excellent services, with a good reputation, foolproof credentials, good communication skills, and reasonably priced services. It is our dedication, commitment, and passion to provide excellent tax planning services to our clients in Foxborough and its surrounding areas with full confidence and expertise.