...you make decisions that might effect your taxes.
I am sure, that somewhere in all the blog posts I have written, that I have covered this before but the subject is worth repeating.
If there is one thing I stress to my clients is to come see me when they decide to retire, pull from an IRA or 401(k), make a major charitable contribution, in short anything that will effect (or they think will effect) their income taxes. Too often, I have had to give clients bad new about a loss of a credit or big balance due at tax time because they didn't talk to me and get all their options before they acted. Sometimes the knowledge wouldn't effect their actions but it would give them an idea what to expect. Other times, however, it gives them a chance to alter their plans and save some tax money.
Too much of the info a taxpayer can find on their own is very generic. When they are making tax decisions, the taxpayer need more specific info that takes into consideration their actual income and situation. For example, the Social Security Administration can give lots of info about drawing SS and how much you can make while working but seldom to they mention that SS can be taxable. I can give you an idea how that will effect your return and help you set up estimates or withholding to cover any tax increase. The Real Estate Agent can tell you about deducting mortgage interest and taxes but I'll tell you if they will really save you tax money. An exception mentioned in the information an IRA or pension gives you when you request a withdrawal may not really apply to you. Or, I can tell you about an exception that will apply. Finally, I can make sure you know to get the proper documentation for a major charitable contribution when you make it.
In short, please see me (or your tax professional) before you do something that will effect your taxes. If you're not sure if there will be an effect, please call and ask.
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Your post is very insightful. It does present a means of securing your clients and making sure that all of your client's actions are accounted for.
Posted by: Michelle Strauss | November 12, 2010 at 04:59 AM
I stress the same thing to my clients. Unfortunately some don't listen and I have to be the bearer of bad news, that possibly could have been avoided. I just hate it when that happens :-(
Posted by: Cindy Galford | November 14, 2010 at 06:00 PM