With millions preparing tax returns in the U.S., CPA, CEO and Tax-Free Wealth Author Tom Wheelwright reveals five last minute tax tips for 2017 Returns due April 17, 2018. Taxes are one of the biggest expenses for anyone, and procrastination can be very costly.
Finding a Great Tax Advisor is one of the most important decisions in anyone’s life. In the ideal scenario, schedule a meeting with a potential Tax Advisor in person to discuss overall goals first. With the last-minute crunch, the in-person meeting may need to wait. Wheelwright adds, “When you meet, make sure they are asking you more about your goals versus you asking them questions. A great Tax Advisor is passionate about both the tax law and your future.”
For next year, Wheelwright emphasizes that small business owners and investors should have regular meetings to discuss a tax strategy in 2018. There are many legal ways to reduce taxes, and it’s important to have a plan to take advantage of these cost savings. And with the new Trump Tax Plan, it will be even more important to find a great Tax Advisor who understands the new law.
For those who waited until now to work on 2017 Tax Returns, here are Wheelwright’s filing tips:
5 Last Minute Tax Tips for 2017 Returns
1. Reduce Stress over Taxes to Minimize Mistakes
While many panic about doing taxes at the last minute, the most important thing is to reduce stress to minimize costly mistakes. Create an action plan, get your paperwork organized and find the right team. And then take time outs.
2. Find A Great Tax Advisor at the Last Minute
The fastest way to find a great Tax Advisor is to get a personal referral, and then research what their clients have said. It’s also important to understand that there are 3 types of tax professionals. The best tax professionals are CPAs, Certified Public Accountants. The second option is an Enrolled Agent, and finally, there are the mass production companies like H&R Block and Jackson Hewitt. Some very small businesses should use an Enrolled Agent, and business owners should NEVER use a mass production company or do their own taxes.
3. Don’t Miss Deductions
When organizing tax files, don’t miss the most commonly overlooked deductions. Anyone who owns a business should consider taking deductions for a home office, automobile deductions, meals with spouses if business is discussed, continuing education and travel.
4. File for an Extension if Needed
Taxpayers still need to pay taxes due by April 17, 2018, but can file for an extension to submit the paperwork later. In this case, ask your Tax Advisor to file an extension. Another option is to go online to IRS.gov, and file for an extension electronically using an automatic tax-filing extension on Form 4868 before Tax Day. By completing this extension form, taxpayers have until October 15 to file a return.
5. Minimize Penalties
If you don't pay your income taxes by April 17, 2018 (or business taxes by March 15), the IRS will most likely assess a late payment penalty and interest charges which accumulate each month that taxes go unpaid. For anyone in this situation, talk to your Tax Advisor or a Tax Attorney on the best ways to minimize penalties. To avoid serious penalties, get professional advice. There are different penalty waivers that may apply. For example, a Reasonable Cause or Statutory Waiver may save someone a lot of money.