Why Complete a Mid-Year Tax Review?
If I asked most people I encounter throughout the day, when do you think about your taxes? I believe around 90% would say sometime between January through April each year.
In fact, I think most people want nothing more than to hurry up and file so they can forget about taxes for another 12 months. However, it is effective to conduct a mid-year tax review. Taking initiative mid-year can make the weeks leading up to next year’s tax season much more bearable.
At SCOPE, we recommend a mid-year review for your business and personal taxes. Why? Simply, things change. In your personal tax situation, which could be anything from a job change to the birth of a child to the sale of a home. In your business, you can purchase a vehicle, or invest in equipment, along with the added complexity that you might be paying property tax, sales tax, and payroll tax too. It is easy for us to forget to think about how these transactions will affect our tax liability until we file our annual returns.
We find that completing a mid-year review avoids the bulk of the year-end panic that sets in when you are wondering if you will owe the government a big chunk of change.
What does a mid-year review do?
Working with SCOPE on a mid-year review can help you identify potential problems and address them before they become an unpleasant surprise or financial burden as the looming April deadline comes towards you.
When it comes to personal and individual taxes SCOPE takes a 5-step analysis approach. Our job is to take time with you on each of these steps to proactively plan to lower your year-end tax liability based on your mid-year review.
Assess your current portfolio and how it is performing.
Understand and analyze your current tax situation
Reassess your financial plan and make updates as necessary
Evaluate your financial goals
Analyze and review your budget
From the business perspective SCOPE uses a 7-step check-up approach to complete a full 360 business and tax review.
Check your payroll taxes
Review your estimated quarterly tax payments
Assess your entity structure
Check in on your bookkeeping and its processes
Analyze your budget to actuals reports and update your income and expense records and Pro-forma projections
Plan for the remainder of the year.
Review your assets and business purchases
An easy mistake to make is to assume that because not much has changed that the same outcome will occur at year-end when you file your taxes. It is hard to believe that the year is officially halfway over. Complete a review with SCOPE and we will break it down into bitesize chunks and make sure we can make any adjustments for you now to better position you during tax season.
Do not wait and wonder where your money goes, be proactive and put your money where you want it. I know I want my money in my back pocket, if you feel the same, book a mid-year tax review with us and we will make sure you are on the right track!