Preventing Big Tax Payments Next Year
Did you have a large tax bill this year? It’s too late to solve last years tax nightmare but there is still time to prevent an issue from occurring come tax time this year. Completing a tax projection will help prevent unwanted surprises on Tax Day.
What is a tax projection?
A tax projection is a mini-tax return completed by your accountant in the middle of the year to estimate your year end tax results. The goal of a tax projection is to determine if you need to make any changes to your current withholdings or estimated payments to ensure you are prepared when taxes are due.
How do I complete a tax projection?
The simple answer: Hire a professional accountant. Your accountant is skilled at understanding how to take your current revenue/income and use that to project your year-end taxes. They are also aware of any new tax code changes.
When should I do a tax projection?
Your accountant will be able to provide an answer specific to your situation. We recommend starting your tax projection by meeting with your accountant at the end of Q2. At this point you will have half a year of revenue/income, providing a clearer picture for your projection.
My accountant doesn’t offer tax projections:
Not every accountant provides the same services. If you are interested in a tax projection and don’t have a trusted resource to assist you, we would be happy to help. The Stampone & Associate team is skilled at preparing projections to eliminate Tax Day surprises and allow you time to re-correct. To find out more about Stampone & Associates Tax Projection service, contact us today.