I can’t do that. If I do, I’m going to get audited. That is Audit Paranoia! Very few people get audited, and if you’re deducting something, you’re doing it correctly, and you’re documenting it, do not worry? Most audits are conducted via the mail. If you take a legal deduction and have the documentation to back it up, sleep easy.
As long as you have everything documented, if you get a notice, have you have your CPA respond back with the documentation. Here’s what we did, here’s the correct documentation on how we did it. So, if the government allows you to do it, document it and deduct it
Wrong Retirement Plan
Another issue we see is, having the wrong retirement plan, or no retirement plan at all. People are not thinking about that. Oh, I’m just going to do an IRA, and maybe I could deduct $6,000, but maybe you might have had another plan that you could have deducted, $18,500, and you had the cash to do it.
Hiring Your Family
Hiring your family, whether it’s your kids or your spouse can lower your tax liability. Depending on the type of entity you have you can actually pay your kids and not actually pay any FICA tax. We have a lot of clients where they do that, and the kids take the money and they put it into a Roth IRA . Next thing you know, by the time they’re 18 years old they have a ton of money saved up.
YOU SHOULD REVIEW THE THE NEW TAX LAW CHANGES WITH YOUR CPA BEFORE IMPLEMENTING ANY TAX PLANNING STRATEGIES.
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