With ever-changing tax laws, forecasting your tax obligation is now extremely difficult to do. This uncertainty can create the need to write a large payment to the IRS. Here are some suggestions to help prevent overpaying your taxes.
- Make estimated tax payments
The objectives of an accurate tax forecast are to avoid IRS penalties and eliminate surprises. To avoid IRS underpayment penalties, your estimated tax payments must be large enough to satisfy these thresholds:
90% of your current year tax liability, or
100% of your prior year tax liability (110% if your adjusted gross income is more than $150,000).
- Maintain your books and records
Don’t wait until December to balance your books. This holds true for both individuals and small businesses. Create periodic income statements and project what the full year will look like.
- Contribute to your retirement accounts
- Invest back in your business by purchasing equipment
Call us today at 877-6-SOLVER -we can run a tax forecast to help you maximize your tax savings.
