Written By: MB Group
At MB Group we are a team of certified public accountants who specialize in helping high net worth individuals minimize tax liability. We use a range of key strategies and tools to help our clients achieve today's as well as tomorrow's goals.
While we will do the heavy lifting, there are several proactive steps you can take to help make tax time as advantageous for yourself as possible. Let's take a closer look at a few of the top tax preparation tips for high net worth individuals.
It's simple — the more you earn, the more you should be willing to pay an experienced tax preparer. In fact, your tax preparer should specialize in working with high net worth individuals and be in the know on the latest tax laws affecting your income bracket.
Using a budget tax preparer commonly leads to minor oversights and misunderstandings that have gargantuan implications. In particular, this mishap could result in an improper tax position or a missed deduction - both of which will exponentially outweigh the cost of preparation.
Looking to save a dime by hiring an inexpensive tax preparer could end up costing you much more. It's best to work with an experienced certified public accountant who can give you an added peace of mind and even represent you in the unfortunate event of an audit.
Instead of thinking of tax as a one-time event or a season, it's best to consider taxes and implications all year long. And the high net worth individuals who effectively minimize their taxes each year tend to think about taxes all the time. You can proactively take steps throughout the year to increase your tax breaks and lower your taxable income through advanced tax planning.
In addition, you can stay organized throughout the year by keeping track of transactions and receipts that may affect your tax situation. Today, there are a range of different cloud-based solutions designed to make organization as simple as taking a picture with your smartphone and uploading. In either case, working to make taxes a year long event can help reduce your tax burden as well as reduce the amount of stress associated with — what can be — a very stressful event.
You May Also Like: 5 Tax Strategies for High Net Worth Individuals
While understating income is a great way to generate red flags and an audit from the IRS, it doesn't mean you shouldn't strategically look for ways to lower your taxable income. And one way to legally achieve this goal and shelter income is to make sure you contribute to the maximum amount allowed to a qualified defined contribution plan or workplace retirement account, like a 401k. Because these contributions are deducted from your paycheck prior to taxes, it will lower your taxable income. Examples of pre-tax opportunities include:
Planning and filing taxes for high net worth individuals can be very frustrating and challenging, but it doesn't have to be. When you partner with the CPA at MB Group, we'll work to simplify the tax planning and filing process. Contact MB Group today for high net worth tax planning.
Tags: high net worth individuals Tax Preparation
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