6 Tips for Finding the Tax Advisor Who Can Help You Achieve Your Financial Dreams
How choosing the right partner can save business owners millions
Smart tax decisions can often save business owners millions of dollars over a lifetime. And that makes partnering with an exceptional tax advisor one of the most important steps you can take to protect and grow your wealth.
Great tax advisors don’t simply do the taxes for your business once a year. They advise you on its structure and meet with you regularly to strategize the right approach that helps you achieve your financial dreams. They don’t just record the history that you give them every tax season; they help you chart a path toward a better future that significantly minimizes your tax burden to Uncle Sam.
More than 74,000 pages comprise the complex and ever-changing U.S. Tax Code, and the Washington Examiner projects that it will exceed 100,000 pages by 2050 if it continues to grow at its current pace. Buried in all that text are tax breaks and legal strategies the average American is likely to miss without a skilled tax advisor. It’s also easy to make filing mistakes that can land you in hot water without guidance from someone who is up on the latest ins and outs of the law.
Great tax advisors can steer business owners toward money moves with the most tax advantages in vital areas like retirement, estate planning, small business planning, and investment management. And they can make sure you don’t leave money on the table during major life events like a marriage or the purchase of a home.
Here are six tips for choosing an exceptional tax advisor who will help you maximize your wealth by minimizing your taxes:
- Don’t become
another number to a mass-production company. The best tax advisors are certified public accountants. Not only must they
pass tough licensing exams, but their certification must be renewed
periodically, ensuring that their expertise and training is up-to-date. CPAs
are the most knowledgeable about reducing taxes, and more passionately
dedicated to saving you money in the long-term than a mass-production tax
company that thrives on volume during tax season.
Good CPAs don’t merely read your company’s numbers; they take the time to explain them and make recommendations about the health of your business. They also are the only tax professionals certified to perform the most complicated tax-related tasks, like audits.
- Make experience a priority. While newly-minted tax advisors may be smart, experience can make a big difference in long-term tax savings. There’s no denying the benefit of hiring an advisor who has successfully gone toe-to-toe with the IRS, or who has worked with enough clients to be familiar with your circumstances and the unique issues they may bring. If you are offering stock options, for instance, it’s wise to choose a tax advisor who has already helped other companies through the process. While there’s no magic number when it comes to years of experience, you need to assess whether the advisor you choose has the background to handle the complexities of your needs.
- Learn to think outside of the box. The best tax advisors don’t simply rely on the most straightforward tax savings. In fact, warning bells should go off if you are the one asking all the questions during your initial interview. An exceptional tax partner invests time into initially understanding your goals. Then they will meet with you regularly to help you develop a lifelong tax strategy based on creative and legal ways to achieve permanent savings.
- Do your homework. It’s essential to vet potential advisors properly. Shady, fly-by-night tax preparers pop up during tax season and then disapper – leaving you on your own to handle problems. Be sure to ask for professional credentials and references from any tax advisor you consider. Any of those who can’t deliver should be cut off your list.
- Trust your gut. Recommendations from friends and colleagues can be a great start to finding an exceptional tax advisor. But at the end of the day, no one’s tax needs are exactly the same and it’s most important that you can establish trust and build a good working relationship with the advisor you hire. If you feel concerned, alarmed, or inferior after the first meeting, or you are worried that the firm is too busy to assist you, you should keep looking for other candidates. It’s never wise to hire someone hoping communication will improve after you begin working together, no matter how highly recommended they are.
- Mirror your tax philosophy. If you want to deduct everything you can but your tax advisor is conservative and worries about IRS audits, you probably don’t share the same tax philosophy. Or perhaps you fear the IRS but your advisor is pushing aggressive deductions. There might be room for compromise if you are willing to entertain each other’s ideas. But the bottom line is that you are paying for a service – and you have to be comfortable with the tax philosophy and tax advisor you choose.
Maybe your business isn’t set up in the most tax-efficient manner. Maybe you’re holding your asset classes in the wrong accounts. Or maybe you fear that you’re paying money to the government that rightfully belongs in your pocket.
Hiring an exceptional tax advisor is one of the most important decisions you’ll make as a business owner. A true tax partner will take time to educate you about the rules while helping you uncover all the credits and deductions you deserve. By doing your research, you will find the advisor who understands your long-range goals and uses the nuances of the law to potentially save you millions over a lifetime.
Provident CPA & Business Advisors serves successful professionals, entrepreneurs, and investors who want to get more out of their business and work less, so they can make a positive impact in their lives and communities. Typically, our clients reduce their taxes by 20 percent or more and create tax-free wealth for life. Contact us for expert advice on tax planning, and to find out how we can help your business exceed your expectations.
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