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Tax Planning

Tax-Planning Tips to Put Money in Clients' Hands


The evolving tax landscape has led to changes to certain deductions for clients. In this article, tax guru Craig Smalley offers some tax tips to put tax-free money in your clients' pockets, as well as some best practices from his years as a tax planner.

Dec 3rd 2021
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I have provided tax planning to clients for the past 15 years. There are many ways to do tax planning; however, finding ways to put tax-free money into my clients’ hands has been the best approach. Here are some tips to help you do the same for your clients.

Should I Use Tax Planning Software?

When I first started doing tax planning, software programs that did this ancillary service did not exist. Today, there are several programs that will do tax planning. However, not all of these programs are up to par with my needs. Most provide only mathematical feedback, without any accompanying advice, similar to tax software. This is why I don’t use any software to do tax planning.


When Should Tax Planning Be Done?

First, tax planning should be done once a quarter. If your specialty is taxation, you should be providing advice to your client. For example, if you are merely doing accounting work for a client and sending them financial statements, the client likely doesn’t understand what you are sending them. Fewer than one percent of clients will even look at what you are sending them because they don’t know what it means. 

Some people wait until the end of the year to do tax planning. However, the reality is that every business has cash flow issues. November and December especially are horrible for most businesses, unless they are retail. Therefore, your client may not have the cash to implement what you tell them to do.

A Misconception in Tax Planning

There is one theory among tax planning that is incorrect. Most people know that you can use the Section 179 deduction for any equipment that was bought in any year, provided it doesn’t exceed taxable profit. Further, you can use bonus depreciation, provided the equipment commences with the taxpayer.

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