Finance & Enjoyment Blog

What You Should Know About Tax Planning -

For the most part, significant tax issues may be avoided by careful planning and attention to your financial situation. The goal of any tax payer should be to pay the least amount of tax, but this philosophy may lead to errors or even create more of a tax liability than what was originally saved. 

Tax returns filed by medical practices can be complicated, and leaving it up to Turbotax or H&R Block can have disastrous results. Usually the cost associated with hiring a CPA is made up several times over by the dollars saved on the tax return. 

Here are a few basic tips that will assist every practice / individual / business in maintaining clean records and saving time and money in preparing for tax return preparation:

  1. Keep expenses categorized. This can be as simple as office expense, salary, tax, etc. or it can be extremely detailed with breakdowns by doctor, location, or even the type of service performed and administrative costs.
  2. Health insurance premiums for owners should be kept separate. Depending on the business entity, these are treated in different ways.
  3. Any equipment bought may qualify to be fully expensed in the same year thanks to the section 179 deduction. The limit for this is $500,000 in 2011. Note that leasehold improvements are excluded.
  4. A cash balance plan will allow more pretax income to be contributed to the existing 401k plan. This is a protected company asset in case of any adverse legal rulings.

There are many others areas of business that by simply using legal, expert knowledge and advanced strategy you can put yourself, your practice or your business in a tax advantageous position for 2011. 

Begin planning ahead now by calling us at 303-815-1100 with any questions about how we can help you save money.

 


Posted in Successful Practice Management » Your Financial House » Rules and Regulations »



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