Tax Planning Goals
July 2, 2011
Tax planning strategies can range from minimizing the amount the government takes from your paycheck to blending with investment and estate strategies, helping to mimimize the overall amount Uncle Sam thinks you should pay.
Tax Planning Quadrant Goals
1. File your taxes on time.
2. Maintain good records.
3. Go over your return each year to understand the “big picture” and review for accuracy.
4. Research ways to minimize your taxes. Check with your CPA.
5. Properly budget for taxes due:
Meet with tax advisor before year-end to calculate estimated tax.
Consider the impact of deferring income or expenses to next year.
Find a qualified tax professional. (CPA)
Meet with your CPA every 6 months.
Maintain a good understanding of tax laws.
Complete a 5 year tax projection.
photo credit: MoneyBlogNewz
How Do “High Income” Individuals Pay No Tax?
June 6, 2011
The Internal Revenue Service recently released tax data from 2007.
In 2007 over 2.5 million Americans reported “adjusted gross incomes” of $200,000 or more. Over 10,000 of them paid zero federal income taxes. Many more high income taxpayers paid only minimal income taxes .
How did they do it? According to the IRS the items that produced the largest tax effects on high-income taxpayers were:
1. Interest paid (including mortgage interest and investment interest)
2. Taxes paid (Real Estate and State Income Taxes)
3. Charitible contributions
4. Casualty and theft losses
5. Partnership and “S corporation” losses
6. Tax-exempt interest
What sets these people apart frequently is “TAX PLANNING.” Higher income individuals utilize professionals to help them in tax planning. Middle income taxpayers may not have all the same opportunities, but can frequently save considerable taxes with some planning.
We cannot promise that tax planning will eliminate your tax entirely, but it will give you your best shot to save some money.
photo credit: kenteegardin
Automatic IRS Installment Agreements
May 28, 2011
Dear CPAS
I’m not able to pay the full amount due on my 2010 tax return, and would like to file an installment agreement. Does the IRS approve everyone for an installment agreement?
Brad B., Minneapolis, MN.
Dear Brad:
The IRS has created automatic and streamlined installment agreements. Taxpayers can have an installment agreement automatically, as long as the liability is paid within five years and they:
1. Owe less than $25,000
2. Have filed all their tax returns.
3. Have not had another installment agreement within the last five years.
4. Complete and sign the installment agreement form.
Hope this helps,
Joe
photo credit: Valerie Everett
Fraud in the Workplace
May 18, 2011
“The Typical Organization loses 5% of it’s annual revenues to occupational fraud.”
This news from the Association of Certified Fraud Examiners (ACFE) 2010 Report to the Nations on Occupational Fraud & Abuse. You can request a free copy on the ACFE website. In case you don’t have time to read all 84 pages, I’ll share some highlights:
- Small businesses are hit hardest. They usually have less controls in place.
- Hotlines and setting an ethical tone for employees are affordable and effective.
- Fraudulent employees show warning signs. They often live beyond their means or are experiencing financial difficulties. Many exhibit control issues.
- Don’t rely on external audits. They rank poorly in preventing loss and limiting losses. Consider surprise audits. They are effective and underutilized.
Asset misappropriation is the biggest category of fraud, but financial statement fraud is the most expensive with a median loss of more than $4 million:
Where Is My Refund?
March 4, 2011
photo credit: saturnism
Where is my refund?
For those who have planned well for 2010 – the above link will give you your refund status.
Tax Refund to Fund Fun?
February 23, 2011
As snow melts and the calendar slides into April it means a new season is on the way. No, not spring. Tax season. For many, tax season means a refund check. Then the question becomes: What do I do with that refund?
The answer to that question for many people, at least according to recent surveys, is pay bills. And that is a strong plan—paying down credit card bills or other high-interest loans pays off in the end.
But what about more creative uses for your refund? After all, you can’t spell refund without fun. Consider spending your refund on a trip you have been planning. Or consider other health benefiting activities such as a massage or signing up for a health club membership. Investing money on your health—mental or physical—will continue to pay dividends in the future.
No matter what you choose, make sure you stay within your means and never lose sight of your long-term financial plans.
And if you’re not gettting a refund? Perhaps you should be visiting somebody as myself for tax planning. We can help ensure that your financial picture will be bright in the spring of 2012.
photo credit: Just Add Light
Voted “Best CPA Firm & Accountant” in Edina !
January 29, 2011
January 28, 2011
Sun Newspaper’s 2011 Readers Choice Winners came out today. Rapacki + Co. CPAs were voted the Number ONE Accounting Firm in Edina !
Thank you everyone for making this possible.
Sincerely,
Joe Rapacki
Here’s a link to the Sun Current front page.
College Financial Aid For Massachusetts Residents
January 21, 2011
photo credit: guillenperez
The workforce has become very aggressive and competitive over the past couple years. This is because of the decline in the economy. This has created the need for people to improve their education in order to remain marketable. However, it is very challenging for people to pay their way through college especially with family expenses and other financial obligations. Many people across the United States of America are seeking financial aids to fund their education in order to achieve their goals. Each state has its own guidelines and availability of funding, but there is a lot of college financial aid for Massachusetts resident.
Financial aid is Government funding that is offered to United States residents to fund their education. In order for students to be eligible to receive this kind of financial assistance, they must be an American citizen or resident. In the state of Massachusetts, there are various institutions that offer financial aid to college students. The list below will give people choices in getting the necessary funding they need.
1. Massachusetts Educational Financial Aid Authority (MEFA).
2. Massachusetts Office of Student Financial Assistance.
3. Massachusetts Grant and College Financial Aid Program.
4. Massachusetts College of Arts and Design Financial Aid.
5. Tuition advantage Massachusetts community College.
These are only few options of financial aids offered by various organizations in the state. These financial programs offer great help to students as well as improving the level of education in the state. Therefore, there is dual benefit .In addition to these financial aid programs, there are government grants available as well as numerous scholarship programs. The state shows a great interest in education with its vast inventory of financial assistance.
There is a very vibrant education program in the state and residents are encouraged to take advantage of these opportunities. There is no excuse to be left behind as the state aim for professional growth and academic excellence. Financial aids take the burden off your pocket and allow you to study freely. Financial aid is a privilege and eliminates the huge expenses that are incurred on student loans.
This government funding program has decrease the amount of out of pocket expenses that students normally pay for and offer a solution to the drop out rated in college because of lack of financial assistance. This has greatly impacted the level of productivity in the state. This funding covers tuition, books, room and board.
Therefore, if you are in the state of Massachusetts and need to advance your education, financial aid is available to you. Lack of funding for school should never be an issue or impediment to thriving for success. The government has implemented ways in which to stimulate the economy through its ability to educated people.
With this opportunity, people are free to go back to school and either chose new career path or improve on their existing knowledge based knowing that the funds are being covered by the government. Therefore, there is a lot of college financial aid for Massachusetts resident.
New Tax Law – 2010 Tax Relief Act – Video
December 24, 2010
We’ve placed a great little video online about the new tax act
New Tax Law – Tax Relief Act of 2010 – Video Presentation
Personal Liability Protection
November 20, 2010
Hello Mr. Rapacki,
I’m considering forming a new business and wonder if forming a corporation or limited liability company is necessary for liability protection?
Matt B.
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