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Tax accounting and risk advisory services are focused on analyzing financial and tax problems. These services serve an important role in minimizing litigation and reducing tax liabilities. They are also committed to formulating the right solutions and recommendations that are designed to provide solutions to taxation. 

Engaging the services of certified tax accounting and risk advisors to come in handy in translating personal and business goals into targetable actions and steps that are designed to maximize the entity’s tax position. With the right tax planning and preparation, clients get to understand the tax effects of their financial decisions and work towards maximizing them.

All you should know about Tax accounting and Risk Advisory Services

What is tax accounting?

Tax accounting is a sub-sector of accounting that deals with the preparation of tax returns and tax payments. It assists accounting firms in tracking funds associated with individual entities and focuses more on taxes rather than public financial statements.

What are risk advisory services?

Risk advisory services assist business organizations in understanding the risks they may face and how to minimize them. Risk advisory services cover a wide range of accounting procedures, including management consultancy, taxation risk assessment, and auditing. 

What is the role of Experts in Tax accounting and risk advisory services?

The bulk of tax accounting and risk advisory services focus on tax planning and tax preparation. Experts in Tax accounting and risk advisory services are trained to offer the best financial advice to clients concerning their tax implications and more. They also play a critical role in assessing the risk factors threatening your business financials and will stop at nothing until they proffer the right solution. Some other roles of tax accounting and risk advisory experts include but are not limited to the following;

  • Assessment of property tax
  • Calculation of federal and state income tax returns.
  • Ensuring compliance with trade laws Trade and customs services – ensures compliance with trade laws and regulations while trying to avoid, reduce, or defer overall customs duties.
  • Estate tax planning.
  • Identifying the tax consequences of acquiring existing businesses and business assets.
  • Individual and corporate tax planning.
  • Planning investment based on tax returns and implications.
  • Planning retirement programs.
  • Reorganization of corporation and partnerships.
  • Succession planning.
  • Transfer pricing studies and evaluation, documentation, and modification of existing policies.
  • Valuation services.
  • Value Added Tax (VAT) Services.
  • Value Added TaxAddressing tax accounting issues, policies, processes, procedures, and controls. (VAT) Services.

Tax Planning Vs. Tax Preparation

While it is common for people to identify tax planning and tax preparation as the same, it is pertinent to know that these are different entities. Gaining a clear understanding of tax planning and tax preparation is paramount to identifying several tax-saving opportunities that may possibly exist in a company. 

While tax preparation is a service aimed at assisting firms in filing for tax returns, tax planning focuses on optimizing tax situations before reporting. The purposes of utilizing tax planning and tax preparation differ from one firm to the other. While the former is aimed at using legitimate means to optimize your potential tax consequence based on your goals and future plans, the latter tends to focus on making sure your tax reporting complies with both federal and state tax laws. 

In other words, tax planning can be described as an effective way to manage taxpayer’s financial situation to maximize tax burden at the federal and state-level for both near and long-term purposes. Tax planning processes don’t have to be complex. It could be as simple as making sure taxpayer has enough withholdings to avoid tax underpayment penalties to incredibly complex scenarios. 

Tax planning and tax preparation differ in their timeline and ability to handle client needs. During tax planning, experts will have to focus on the future in order to create the most suitable strategies that will help you create a good plan and benefit from the existing tax rules. This is what makes the process very time-consuming and requires a high level of expertise and engagement. Tax preparation is more focused on the company’s compliance with tax laws. It keeps the company abreast of any important factors while preparing taxes. 

Tax planning is usually an ongoing process where experts and clients sit to analyze previous tax returns and the current financial standings of the company to ensure future returns are more tax-efficient and beneficial to the client’s growth and profits. 

Tax planning is unique tends to employ a unique approach to solving clients’ needs. There is no one-size-fits-all approach to tax planning since organizations may have their peculiarities. With the right professional, you can gain a correct understanding of what will work for your business and how to maximize it.

How can I choose the best tax planning and tax preparation experts?

Note that any taxpayer can benefit from tax planning with the most opportunities arising for people and businesses that are interested in planning tax returns that are in compliance with tax laws. 

Hiring the right tax planning and tax preparation experts is paramount to achieving your tax accounting goals. To gain the most value for these services, it may be in your best interest to engage the services of a professional and certified tax planner. Although CPA is the most commonly known designation, there are also Enrolled Agents, as well as CPA’s who are Certified Financial Planners (CFP’s) or Personal Financial Specialists. Also, When reviewing professionals you will want to see if they engage in Tax Preparation and Tax Planning or just Tax Preparation.

Final words

Please note that since tax planning and tax preparation aim to settle client needs by focusing on different timelines and data, it is recommended that clients consult with experts on what they may need at the moment.

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