tax savings

Now that I’m back doing tax strategies again, I’m seeing a lot of tax plans people have tried or heard about from a friend, neighbor, and so on. The problem is that a truly effective tax strategy is, by its very nature, personalized to you. In this week’s online workshop I’m talking about the 5 biggest mistakes I’m seeing people make so far this year.

The latest tax cutting bill from Congress reminds me of 2001. The Economic Stimulus Act is designed to hopefully jump start the economy by giving tax cuts to business owners and put some spending cash in the hands of consumers, just like in 2001. In 2001, the country was reeling from the change from dot com to dot bomb. Now, in 2008, the country is reeling from the change of real estate boom to real estate bust. Or rather, the fall out from the mortgage meltdown.

Every so often someone asks me if “Tax Loopholes” are really legal, or rather, they’re more likely to ask if they can use them “wink wink” and really get away with them.

Granted … the name “TaxLoopholes” sounds like it might be something shady. But, in actuality, tax loopholes are anything BUT a scam.

The IRS says they are going after abusive tax shelters. So, how do you know if a strategy is legal or if it is an illegal scam? Read on for the five classic signs of an illegal scam.

Don’t Get Floored By an Unexpected Tax Bill!

We received this inquiry sent in by a gentleman who was approached by someone at his church. He had recently paid about $3,000 as a down payment on a program that promised a quick pay-off of his existing mortgage. His question to us - was this a good deal? He was starting to worry that something was wrong.

A business, hands down, is one of the best way to save on taxes. But, that doesn’t mean that you can simply declare “I have a business” and get thousands of newly found deductions.

First, you must prove that you have a business. You also need to prove that the deductions are ordinary and necessary to the production of income. And, finally, you need to be able to prove that you paid for the expense.

When Does Your Hobby Become a Business?

What’s in store for business and investments in 2008? My typical answer, of course, is It Depends.

We have an election year and so I don’t expect any drastic moves in 2008. Most likely, we’ll have another last minute AMT patch, just like 2007. Once we have the election behind us, I think we’ll start to see some dramatic changes. Here are my top 3 things to do to be best prepared for tax law changes:

Have you done your back of the envelope calculation for taxes you’ll owe for 2007? If not, this might be a good week to pull some of that information together. One of the most important questions to answer is whether you’ll be subject to Alternative Minimum Tax. Look for more strategies on how to get around AMT (and how to find out if you’re subject to it) through this Blog.

This month’s online workshops, offered as part of the First Class Lounge, are all about Last Minute Loopholes. These are the things you can do right now, to pay less tax right now.

The most successful business owners and investors I know use “outside the box” thinking. That’s what we do at Tax Loopholes and DKAffiliated™ (CPA services). We disclose tax saving strategies you can use right now to put more money in your pocket. The part that is “outside the box” is how we work with our clients to create amazing results in the quickest way possible. In fact, people that meet with me are saving an average of almost $30,000 per year — after just one meeting. It’s often not big changes, but lots of little ones, done in the right way so you have a legal and efficient strategy that makes all the difference.

How do you know if you, or your advisors, are using Outside the Box Tax Thinking? First, see how they measure up when it comes to these three strategies.

Does Your Tax Advisor Think Outside the Box?

Something I often see when reviewing client files are very complicated tax strategies that involve moving money from one entity to another. There can be some great tax advantages to these complicated strategies, and I’ve made plenty of similar recommendations.