Time for Year End Tax Planning

October 27, 2011


Although the warm summer weather doesn't seem that far behind us, it will be the end of the year soon. Among other things, that means it is time for business owners to review their tax liabilities and put a plan in place for any year end tax management tactics. 

Many business owners work with their CPA every fall to assess expected that liabilities and to understand what can be done to optimize those liabilities, often by deferring taxable income and sometimes even by accelerating it. In many cases the personal tax situations of the principal owners need to be considered along with the business. 

If you have not already done so, specific issues to address with your CPA include: 

1. Expected taxable income for your business
2. Combined business and personal tax picture
3. Estimated tax payments that should be made
4. Any expected major changes in profits in 2012 compared to 2011
5. Timing of year-end transactions which could be completed in 2011 or pushed into early 2012
6. Any special opportunities such as tax credits that might be available to your business 

SmartBooks can help. Our clients receive accurate, timely financial reports which can be used for effective tax planning. We work with our clients' CPAs to provide whatever additional information would be helpful to the tax planning process. 

Cash-Basis Projections are Often Required

Some businesses file cash-basis tax returns while using the accrual basis for regular financial reporting. In this case, accurate tax planning requires that taxable income be estimated using the cash basis. SmartBooks provides this cash-basis conversion for some clients as part of their service package. For any client we can provide this cash-basis estimate upon request for a fixed fee-- if interested contact your Accounting Associate. 

If your business is having trouble staying on top of its bookkeeping or getting regular financial reports, please contact founder Calvin Wilder at cwilder@smartbookscorp.com or 978.202.3064 x700 to learn how SmartBooks can help.