Saving With Thorough Tax Strategies & Tax Law Advice
Disinherit Uncle Sam!
At Dahl Law Group, we have the expertise, education, and experience to minimize your taxes for your business and real estate investments. We’ll work with you, taking a thorough look at your circumstances in the present and goals for the future. We will review your business structure, agreements, and transactions to ensure you are not exposing yourself to unnecessary taxes and there are no surprises years down the road for you or your loved ones, from Uncle Sam. Our goal is to make sure you’ve got the ammunition you need should your business be audited by the IRS or state tax authorities down the road.
Others often ask us “What’s the difference between your services and an accountant or CPA?” The difference is between tax preparation/filing and tax strategy. While both are essential components of managing one’s tax affairs, they serve different purposes and require distinct approaches.
Tax Preparation – A Look Backward
Tax preparation is the process of calculating and filing tax returns for a specific period, typically the previous year. It involves gathering relevant financial information, completing necessary tax forms, and ensuring compliance with applicable tax laws and regulations. Tax preparers, such as Certified Public Accountants (CPAs), Enrolled Agents (EAs), and California Tax Preparers (CTPs through the California Tax Education Council), play a crucial role in guiding individuals and businesses through this process.
At its core, tax preparation focuses on accurately determining one’s tax liability based on past financial activities. Tax preparers analyze income, deductions, credits, and other relevant factors to calculate the amount owed to federal, state, and local tax authorities. While tax preparation is essential for fulfilling one’s tax obligations and avoiding penalties, it is inherently backward-looking, providing insights into past financial transactions rather than future opportunities.
Tax Strategy – Looking Forward
In contrast to tax preparation, tax strategy is a forward-looking approach aimed at minimizing tax liability and optimizing financial outcomes for the upcoming tax year and beyond. It involves proactive planning, analysis, and implementation of various tax-saving strategies designed to leverage the complexities of the tax code to one’s advantage. Tax Strategists play a pivotal role in guiding individuals and businesses through this process.
Tax strategy encompasses a wide range of techniques and tactics tailored to the unique circumstances and objectives of each taxpayer. From maximizing deductions and credits to leveraging tax-advantaged investment vehicles and structuring business transactions strategically, Tax Strategists explore every avenue to legally and ethically reduce taxes. Unlike tax preparation, which focuses on compliance and reporting, tax strategy is proactive, dynamic, and responsive to changing tax laws, and financial circumstances and goals of the client.
Tax Law – Necessary for Tax Strategy
Tax Law encompasses the statutes, regulations, and case law that govern taxation by governmental entities like the IRS. It involves understanding and applying the complex tax laws established by federal, state, and local tax authorities to ensure compliance with tax obligations and evaluate the taxation of certain transactions and situations. Tax lawyers are experts in interpreting and navigating these complex laws, providing legal advice, and helping taxpayers structure their affairs in a tax-efficient manner while staying within the boundaries of the law.
Integration of Tax Preparation, Tax Strategy, and Tax Law
While tax preparation and tax strategy serve distinct purposes, they are not mutually exclusive. In fact, they are interrelated components. Tax preparers leverage their expertise to calculate taxes owed and filing tax returns for a specific period, integrating the tax strategies utilized in the prior year – this is still inherently backward looking. Tax Strategists must work with tax preparers to advise on the proper reporting of the tax strategies implemented by the Tax Strategist, which often can reduce audit risk. Conversely, Tax Strategists build upon this foundation by developing proactive strategies aimed at optimizing tax outcomes and achieving long-term financial goals. Tax Strategists must have extensive knowledge of tax law to properly advise clients. Furthermore, an attorney (hopefully a Tax Attorney) is required to implement most tax strategies. In essence, Tax Strategists are niche Tax Attorneys that create comprehensive tax strategies to save money in taxes and work with tax preparers to implement and report these tax reduction strategies correctly.
The following is a comprehensive list of tax law matters that the firm works on, which may be a part of a tax strategy, or include a one-time tax analysis:
Corporate Tax
- S-Corporation Election & Revocation
- Stock Redemptions & Partial Liquidations
- Non-Recognition Formation & Organization Strategies
- Non-Liquidating Distributions
Partnership Tax
- Non-Recognition Formation & Organization Strategies
- Partnership Allocations
- Operating Distributions
- Liquidating Distributions & Terminations
- Sales & Exchanges of Partnership Interests
Estate & Gift Tax
- Estate Tax Returns & Planning
- Gift Tax Returns & Planning
- Estate Tax Deductions & Credits
- Post-Mortem Tax Strategy
Contact Dahl Law Group and meet with a trusted adviser in California who can work with you on a plan to maximize your tax savings by leveraging a comprehensive, long-term tax strategy that is customized to meet your goals.
