11 October 2017

Tax Tips: Pasadena Tax Attorney & Cpa ? Tax Preparation Advice

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Tax Tips: Pasadena Tax Attorney & Cpa ? Tax Preparation Advice

Here is some practical advice when preparing your tax returns or getting the documentation ready for your tax attorney or CPA to do the preparation. You will save yourself a lot of grief by being prepared and keeping good records throughout the year. A tax accountant or tax attorney can do wonders but they will need complete and accurate data.

?If you are self employed, you have many deductions that are available to you but you need to have the details available. Wage and salary earners have fewer opportunities for eligible deductions.

?Rule number 1 is to keep accurate and complete records. These are needed for the tax preparer as well as documentation in the event of an IRS or Franchise Tax Board audit. There is no better ?protection? that having excellent documentation of your income and especially your expenses.

'separate out your personal expenses from your business expenses. This is quite simple to do if you open a bank account for your business and only use it for business income and expenses. Don?t use your business bank account, debit card or credit card as your personal piggy bank.

?Pay yourself just like other employees. Even if you are not a corporation you should pay yourself by writing a check for your 'salary?. Then the salary is deposited to your personal bank account where you spend it on personal expenses.

?Get advice from your tax attorney or CPA regarding deductions that require special treatment. These include an office in your home, car expenses, meals, entertainment, and charitable donations. Once you get the advice then stick to the program. E.g. if your tax advisor suggests leasing a car, then lease a car and keep track of the business miles vs the personal miles.

?When you make a business purchase, get a receipt and file it away.

'don?t pay by cash ? use your business bank account, business debit card or business credit card.

?On the income side prepare an invoice or sales receipt for each sale.

'deposit all income into your bank account ? never disburse funds from income before it is deposited.

?Get printed bank statements with originals or copies of checks.

?Utilize accounting software such as Quick Books which is user friendly and every tax accountant knows how to use it to prepare your tax return. Ideally your accounting is done weekly. By keeping your ?books? up to date, you can also use the information to manage your business.

Get into a routine with your bookkeeping so that it is kept up to date. That way your tax attorney or CPA can quickly and efficiently prepare your annual tax return. It will save you money and make your records defensible against an IRS audit.

John Spurgeon is a tax attorney in Pasadena, California servicing clients in the greater Los Angeles area. John Spurgeon & Associates, who are both tax attorneys and CPAs, offer a complimentary initial consultation. Please call 626-440-9518.

About John Spurgeon & Associates

John Spurgeon & Associates is a professional services firm located in Pasadena, California with a focus on tax law and related accounting services. They have extensive experience with federal and state income taxes, payroll taxes and sales taxes. They represent business, non-profits and individuals against the IRS and the Franchise Tax Board (California State Taxes). As both tax attorneys and Certified Public Accountants they offer a broad range of tax related services.
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