Up to your eyeballs in debt? Feel like you’ll never get a good handle on your money? Is tax preparation something you feel like you have to do? It’s possible that you’re missing out on a number of strategies that actually help you use the income tax preparation as a way that supports you in building wealth for retirement rather than it always feeling like an exercise in compliance.
With a good tax preparation, your tax debt can actually be minimized.
A tax credit is a dollar-for-dollar reduction of the income tax you owe. For example, if you owe $1,500 in federal taxes, but you are eligible for $1,500 in tax credits, your net liability is reduced to zero. This is a significant way to keep more of your hard-earned money, but by not taking full advantage of their available tax credits, many American taxpayers are simply handing money over to the U.S. government that they aren’t required to. (And once you hand it over, you’d be hard pressed to get it back!)
Some of these tax credits include, by are in no way limited to: the earned income tax credit (can be worth up to $6,242 for qualified individuals), child and dependent care credit for children under 13 years old, the American Opportunity tax credit for qualified education expenses for students pursuing higher education, lifetime learning credit for qualified education expenses and job training, advanced premium tax credit – a break on paid health insurance premiums for those below certain income limits, savers credit for those making contributions to an eligible retirement plan and making low to moderate income levels, child tax credit which may qualify you for up to $1,000 per child, credit for adoption related expenses, credit for elderly or disabled (up to $7,500), and even though they’ve been scaled back over the years, there are still some energy credits available.
Part of an IRS agent’s job is to look for errors on tax returns and perform audits to make sure the government is collecting each and every dollar due to it under the U.S. Tax Code and Regulations. But there are some really simple errors in presentation that tax preparation software won’t catch, and will cause red flags to go up for an IRS agent. The best prevention for audit (and in turn, the amount you owe) is good tax return preparation, which includes presentation.
We pay attention to both your big picture financial goals and all the little details that a tax preparation software program simply will not catch. For example, there are a number of forms that flow together to make up your return that must tie to certain income forms you’ve received from financial institutions. If even one of these doesn’t match up exactly, an agent’s professional skepticism is triggered. Another example is claiming deductions without proper substantiation.
Sometimes the simplest mistakes can cause the biggest headaches. Have you signed all the right pages? Are all the names on the return been spelled correctly? Are there any unexplained differences between last year’s and this year’s returns? At Clem Collaborative, we make sure your tax preparation services are strategic, yet also 100% accurate, within the confines of the law and easily substantiated with the proper documentation and calculations necessary to back up each number on the forms.
Look no further.
Clem Collaborative is based in the Charleston area, and available for in-person interviews to discuss your financial and tax situation. However, you don’t have to be in the Charleston area to take advantage of the best that Clem Collaborative has to offer. We’d be happy to speak with you over the phone or video conference. Regardless of where you live and work, our online client portal will support a seamless flow of information between us.
Call us or schedule an appointment online to start a conversation and see if we’re a good fit for you and your business.
You never hear of someone looking for a discount brain surgeon or a cut-rate cardiologist. Unfortunately, when it comes to their financial health, far too many people mistakenly believe that tax preparers are interchangeable, and that cheaper is automatically better. As Enrolled Agents (the highest level of tax certification available) our Charleston, South Carolina based tax preparers engage in dozens of hours of training and education every year – all to ensure that when it comes to YOUR tax return, we have the tools to maximize your refund or minimize your balance due, each and every time.