late-taxIt’s critical to understand your 2013 tax liability now, while there’s still time to make changes.

2013 tax season is over, although we’re still working on a few late returns for clients with unusual financial situations. This year, the CPAs at Bach, James, Mansour & Company processed more returns after the initial April 15 deadline than ever before. As I discussed in Part 1 of this article, sometimes clients really don’t have a choice but to file between April 15 and the final October 15 deadline. Especially with the new tax regulations going into effect in 2014, now is the time to start planning for your next tax returns, regardless of when you plan to file.

Time to touch base with your CPA

The fourth quarter is a great time to meet with one of the CPAs at Bach, James, Mansour and Company, since there is still time to make changes to your 2013 tax situation before year-end. It will be too late for many adjustments after the new year. The American Taxpayer Relief Act of 2012 will impact the taxes of many middle- and upper-income individuals and families. From what we’ve seen, many clients are underestimating their tax liability. That means writing a larger check in April, and potentially paying penalties for underpayment of taxes.

A little effort now can have a big impact on your 2013 tax returns

The rules changed this year, and there’s a good chance your tax liability has changed, even if your salary remained the same. A CPA is best qualified to help you project and understand your new tax liability. Knowing that, there may be things you can do to minimize your 2013 Federal and State tax liability, including:

  • Funding retirement plans and SEPs.
  • Accelerating deductions, taking them in 2013 rather than waiting.
  • Businesses – buying equipment now or paying rent early.

Contact one of the CPAs at Bach, James, Mansour and company to start your 2013/2014 tax planning, and understand how the new tax laws will impact your tax filing. This may not be on the top of your holiday shopping list, but it can save you hassle, frustration, and money in 2014.

Speaking of frustration, Part 3 of this series will provide some ideas for making your 2014 tax filing process a little easier to manage.

Neal Bach