Inside,Secrets,Failed,Tax,Stra finance, share, loan Inside Secrets of Failed Tax Strategies


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I have seen the inner workings of hundreds of tax strategies. I recently did a study of tax strategies to reveal the inside secrets of failed tax strategies. I was searching for common causes of the failures. The most common causes all centered around cost, but not in a way you may expect.- The real cost -When determining if the cost of the strategy was outweighed by the benefits, many people miscalculated a very important cost - the guide, that is, your CPA. The cost of a CPA can vary greatly. Take for example, the cost of a tax return. One CPA may charge $750, another may charge $2,500. Now, on the surface, it's easy to say the $750 return is the lower cost. But what is the real cost of that $750 return? What if that $750 tax return doesn't include any analysis to reduce the amount of taxes paid and the taxes paid with the $750 return are $5,000 more than the taxes paid with the $2,500 return?- Never getting started -Many tax strategies failed because they simply never got started. The time that most people think about a tax strategy is usually the same time they are starting a new business or investment strategy. A time when cash is usually tight. The tax strategy then becomes an additional item to add to the already growing pile of cash commitments. The tax strategy gets put on hold temporarily but the temporary status soon becomes permanent.- DIY -I often refer to this as the 3 most expensive words in the English language - Do It Yourself. The people who took this route were really forced into it. The options available to them didn't have benefits that outweighed the cost so they were forced to reduce the cost. The number one way people reduced their cost was to do as much as possible themselves. The problem with this concept is that these people were not leveraging their intellectual capital. They were relying on their own knowledge and not that of proven professionals. Because they had nowhere to turn for professional help that was cost effective for them, they were relying on what little they could learn from the IRS website and tax guides in the bookstore. There was no low-cost, effective alternative to learning the tax-savings concepts that are critical to paying fewer taxes.- No check up -Do you see a doctor annually, even if you are not sick? Most of us do, its part of our strategy for a long and healthy life. The same needs to happen with tax strategies. Many people set up their tax strategy, work diligently with their CPA for the first year or two, then let things slide a little bit. While its true that some tax strategies can run themselves to some extent over time, its never a substitute for checking in with your CPA to determine if there is anything that has changed or can be done differently. After all, even if nothing has changed in your world, the tax world changes on a regular basis.- What should you learn from these failures? -* Start your tax strategy well in advance of your new venture.* Don't let DIY be your most expensive decision!* Minimizing costs is admirable, but don't give up the right guide to do so.* Understand your real costs, which includes overpaying your taxes with the wrong guide.* Get your routine check up. Even if you have no new activity, check in at least 3 times a year - once with your tax return, once at the end of the year and once during the middle of year. Article Tags: Inside Secrets, $750 Return, Taxes Paid

Inside,Secrets,Failed,Tax,Stra

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