The Time To See A Tax Pro Is Now

Wednesday, March 1, 2017

\Tax Topies The Time To See A Tax Pro Is Now (NAPSA)—Manytaxpayers may be surprised to discoverthat a good time to get tax adviceis after their taxes are done andfiled. ‘That’s because by taking a look at yourtax situation now, you can take advantage of every legal means to reduce the amountyou'll pay in taxes next year. For example, if you know in advance of looming life changes, events such as marriage, divorce or remarriage, you need to consider the effect of these changes to your tax status. The exemptions claimed on your W-4 may need to be adjusted to prevent an unexpected tax bill. If youre going through a divorce, discussing the tax ramifications of dependents, alimony, child care or division Even after you pay yourtaxes,it’s wise to keep yourtax professional informed of any changesin yourlife because they maychangeyourtax situation. of property before signing anything is extremely helpful. Divorce decrees often contain wording that has a different tax result than what was intended. You can call on yourtax professionalfor a review. A change in family size with the birth or adoption of a child can also affect your tax return. Plus, as children get older, you maylose certain credits. A career changeis another thing that might affect your tax situation. If you have pension opportunities you're not sure about or excludable benefits such as cafeteria plans and dependent care benefits, a tax professional can help you evaluate your options. A career change mightalso increase income, shifting you into a higher tax bracketor changing the event definitely changes your life and yourtax situation. It’s better to discuss the options before you act rather than face a large tax bill because you didn't. Knowthe tax implications of your decision: Check with your tax professional to make sure you're not triggering an early-withdrawal penalty or causing Social Security to be taxable. Certainly, if you get a letter from the IRS, call your tax preparer or you may risk larger andlarger penalties. ing a change in withholding a possibility. If you find yourself in financial trouble, bankruptcy may be the option you with the IRS, to have passed testing work-related deductions available, mak- choose. If so, there are tax implications you should be aware of and options that may be available, so contact your tax professional soon. Timeis ofthe essence if you are in a bankruptcysituation. Did your company present you with an early retirement proposalor are you considering an early retirement? ‘This What To Look For In A Tax Preparer It’s important that you know youre speaking with someone knowledgeable whocan betrusted. You'll wantthe person doing your taxes to be registered on taxation, and to keep up with the ever-changing tax code through continuing education. Enrolled agents do all that, are licensed by the U.S. Depart- mentof the Treasury and are bound by a code ofethics. Find An Enrolled Agent To find one nearby, use the “Find a Tax Expert” directory at www.eatax.org.

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