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3 Things You Need to Know about . . . Taxes and Your Business

We’ve all heard them -- life lessons communicated through old, common-sense tales – yes, their wisdom even translates to taxes.

1.    Change is Inevitable

In business as in life, change is inevitable. Yet inevitably, change can still be managed. Many tax issues surface as an after-thought. Taxes are just another area in your business to manage and apply resources, primarily your time and thought:

  • Think about the objective
  • Analyze the unforeseen tax consequences
  • Xtend the implementation; deferral is a solid tax strategy
  • Explain all matters to your advisor
  • Solve the burden in a tax-neutral manner

2.    Proper Planning Prevents Poor Performance

In business school [Management 101] we all learned the life lesson of advance planning.

With the combined, all-in federal, state and local tax cost we have these days, your “governmental partners” in your business earn a hefty commission. Even taking the most elementary steps in planning will assist you in focusing your efforts, and in the end yield more profit.

Many traditional businesses have tax planning on their “to do list;” it is the priority that is askew -- move tax planning to the top three areas to attend to – would you not apply “time, talent and treasure” to any other high cost area of your business? Yet time and again, businesses fail to consider the tax implications of the simplest of matters. Make taxes a priority, and you will be able to count the yield in dollars earned.

3.    Paying Taxes (Like Death) Is Inevitable

NO ONE enjoys paying taxes – yet we all pay. It is a business reality. Accept the premise that there is a tax cost to virtually everything. Common business sense teaches us that it is not cost-efficient to strive to eliminate your tax burden – minimization should be the goal. Take an “inventory” of your all-in tax burden and start from there. Reducing your tax cost by 15% from current levels is a tremendous success -- who wouldn’t like a 15% return on an investment?

Tax in Life is a “hand in glove” concept – resolving these lessons in your business will undoubtedly yield results and successes.

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