#24 | Tax Planning and Preparation feat. Roger Knechtt

Practical Tax with Steve Moskowitz

On today's episode; Steve sits down with Roger Knecht, President of Universal Accounting Center to discuss the ways in which both firms' distinction between tax planning and tax preparation helps their clients stay ahead of the game with proven strategies for your business! Episode Transcript Intro: You're listening to the Practical Tax podcast with tax attorney Steve Moskowitz. The Practical Tax podcast is brought to you by Moskowitz LLP, a tax law firm. Steve Moskowitz: Welcome to everyone. And we're looking forward to another podcast, and we're looking forward to tell you all the benefits you can have for your tax return. And it's a shame, 'cause most people, they think about their tax return, and they think about, well, that's some guy movin' the numbers from one place to another. And you know what? We're already laughin', there's so much more to it. And in addition to savin' you taxes, this also helps you to run your business. So, what I'd like to do is go ahead ask our guest to introduce himself and tell us all about you. Roger Knecht: Happy to. First of all, Steve, thank you for having me on the webinar or podcast here. The idea is, I'm Roger Knecht, President of Universal Accounting Center, and I've worked with accounting professionals for more than 20 years now, helping them run and operate their businesses. And the advice, the suggestions that I hope to offer today are meant to help you build a better relationship with the accounting and tax professionals that you're interacting with, as you run your businesses and live your lives. Steve Moskowitz: Excellent. And what we're gonna do is go ahead and say, so somebody knocks on your door and says, "Hi, how can you save me money? "What's the secret, what do the big boys do?" What would you tell 'em? Roger Knecht: Well, the big boys have a variety of strategies that some of us lessers don't necessarily have access to, but I can give you the distinction that I think we should start with, in that there's a difference between tax planning and tax preparation. I think one of the first errors that we need to recognize is, whether we're individually or as a business, looking at the taxes, we need to realize that December 31st for most things is kind of a drop dead date, and too often what happens, whether either individually or with our companies, we fail to realize that tax season isn't April 15th or maybe some other tax deadline. It literally is the end of the calendar or fiscal year, and so anything we can do with the tax preparer before those deadlines to mitigate our tax liabilities is very prudent. It's smart, it's important. Sit down with someone and actually kind of come up with a strategy, a plan of how you're going to mitigate your tax liabilities. Steve Moskowitz: And that's so true, and that's so important. And that 12/31 deadline, I call it 12/31 Year One, is so important, and so many things do have to be done by 12/31 Year One, however, there's some exceptions. A lot of the pension plans allow you to go ahead and create them and fund them up to the time of filing the return plus extension, so that's something you can do in Year Two that will save you taxes in Year One. And another thing is amended tax returns. A lot of times clients will come into our office, and I'm sure the same with yours, and you say, "Well, you can do this and this and this." And they invariably say, "Oh, is that new this year?" And I say, "No, it's been around for years." And they say, "Well, how come my last person didn't do that?" And we say, "Well, that's why you're here." And then, we can go back and amend the federal return for the last three years. So sometimes, it's not only about saving money for the current year, but going back three years on the federal return. And if you're in a state that has a state income tax, amending that one as well, and there's different statute of limitations for those states. So Roger, tell me some other things,