By year's end, Americans usually have a good idea of what the tax rules will look like in the new year and can plan accordingly. That's not the case this time around. With a huge chunk of the tax code set to expire Jan. 1, the 2013 tax forecast is, well, foggy.

"The problem is, if you wait to see what Washington does before you give this any real thought, it might be too late to take any meaningful action," says Dan McNamara, president of USAA Investments.

Instead, you have to know the current tax landscape and what could be coming in 2013 — and you have to understand what each could mean to you. That way, when Congress ultimately takes action — or doesn't — you'll be ready to act.

What to Ask
For a better understanding of how these changes could affect your bottom line, speak with a USAA financial advisor or your tax counselor. Here are some questions to ask:

• How should I adjust my expenses to account for possible increases in taxes?


• If the changes go into effect, does it look like I'll get a refund, or will I have to write a check for taxes in April 2014?


• Have I recognized any taxable capital gains this year?

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Chris Russo of Innovative Accounting Solutions has been prestigiously recognized as a Five Star Professional Wealth Manager. This recognition is only given out after a rigorous research process that included a regulatory and consumer complaint review, and an evaluation of objective criteria associated with wealth managers who provide quality services to their clients. The Five Star Professional Award is the largest and most widely published wealth manager award program in North America

Innovative Accounting Solutions is very honored to receive this award. We work hard for our clients every day and believe this recognition is a testament to that fact. As a first-time award recipient in 2012 we'll work even harder to ensure that we continue to receive this same honor year after year by always putting our clients first and working tirelessly to meet and exceed their financial goals.

Please call us today if you're looking for an outstanding Denver Accountant, Tax Professional, or Wealth Manager to help you with your personal and business finances or taxes.

(303) 475-1807

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Many business owners and individuals assume their certified public accountant (CPA) and financial planner have interchangeable roles when, in fact, the two complement each other and can very rarely do the entire job of the other person. This is a matter of education, experience, and certification, but is a topic your Denver Accountant can discuss with a high degree of confidence.

What your accountant can do for you

When most people think of accountants, the first things that may come to mind are Denver Taxes and how to minimize them each year. That is perfectly understandable and to be expected, especially with complicated and regularly changing tax codes at the state and federal levels. From strategizing to budgeting to sheltering and tax preparation, taxes are their main focus.
But your denver teacher also can identify big picture opportunities and strategies that will help you get — and stay — ahead of the competition. Your CPA will help ensure you are depreciating all the right assets in the most productive way. Is your business structure good for you now and in the long run? What about the fine print in the most recent tax regulations, and how do they affect you and your business? Your accountant should have a deep understanding of these issues, and experience with similar situations.

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The year is halfway through, and if you haven’t got to grips with your Denver Taxes, what are you waiting for? A Denver Accountant can help you manage your finances, and year-end tax preparation, but nothing helps an individual or business succeed more than understanding common tax forms and how they should be filled out. Here is a brief rundown of these forms.

W-2

This is the most common of all forms. Anyone who draws a paycheck from a regular employer can expect to see one of these. The W-2 is an information return used by your employer to report wages or compensation paid to you during the year. The form reports your employer's basic information (name, address and tax identification number) as well as your own information (similarly, name, address and tax identification number). The form contains several boxes where different information is collected (wages, local, state, and federal income taxes withheld, amount of income subject to Social Security and Medicare, and so forth. Keep in mind that you'll receive multiple copies of your W-2. Copy B gets filed with your federal income tax returns, and Copy 2 with your state or local tax returns. You should always keep Copy C for your own records.

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A certified public accountant (CPA) plays a key role in helping individuals and businesses get a clear picture of their finances, often through services like different types of accounting, estate planning, financial services, and consulting. If you’ve decided it’s in your best interests to hire a Denver Accountant, there are a number of questions you should feel comfortable in asking.

Can I expect timely service? Financial information gets dated quickly. With the exception of annual information, you should expect to see accounting information that is no more than 10 – 30 days old. Your denver cpa should give you quick access to your information, and be timely in responding to all phone and email messages – at least by the following business day.

Do you believe I’m paying too much, too little, or just the right amount of Denver Taxes? A key task for any accountant should be in business and financial planning during the whole year. Whether a personal or business CPA, it’s reasonable to expect a quarterly review of your finances to make sure they’re in order. If not, then you may find yourself needing the services of a denver lawyer. A knowledgeable CPA will analyze your tax situation plan and minimize all taxes paid each year.

What services besides reporting and number crunching do you offer? Your Denver, CO Accountant does more than prepare tax forms. His or her duty as an advisor is to prepare you for your tax liabilities, but in order to do so, questions need to be asked. If your CPA isn’t asking questions for the sake of clarity, then perhaps it’s time to choose someone else.

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A Denver Accountant runs into problems all the time with owners of home-based businesses, who wonder if such-and-such an expense can be deducted, but not that one, and so forth. The problem is that many individuals and small business owners who work out of their homes erroneously assume – and hein and company haven’t figured out why – that any expense can be deducted on their income tax. The fact of the matter, and something that any denver cpa will tell you, is that the United States Internal Revenue Service has very specific laws at its disposal that regulate business expenses, and the penalties or legal action that can be taken against people who manipulate them.

When preparing to file your income tax return, you need to carefully consider all of your options for the following reasons:

• There is some anecdotal evidence that claiming Office in Home deductions makes you a target for an IRS audit, but opinions on this matter are divided even among someone as qualified as a Denver Colorado Accountant.


• There are specific requirements that you must meet in order to claim these deductions, as outlined by the IRS – so make sure you meet them to the letter.

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As of December 31, 2012, the Mortgage Debt Relief Act of 2007 expires and substantial tax consequences will apply if your main home is foreclosed or sold for less than what you owe.  Therefore, it is imperative to analyze your current mortgage situation and make some tough financial decisions before this tax break expires.

The Mortgage Debt Relief Act of 2007 was enacted on December 20, 2007.  The Act allows for the exclusion of income realized by the sale or foreclosure of your principal residence for less than the mortgage owed by the homeowner.

Normally debt that is forgiven or cancelled by a lender must be included as income on your tax return and is taxable income.  However, the Act allows you to exclude certain cancelled debt on your principal residence from income.  Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure qualifies for the relief.

The Act applies only to forgiven or cancelled debt used to buy, build or substantially improve your principal residence or to refinance debt incurred for those purposes.  In addition, the debt must be secured by the home.  This is known as qualified principal indebtedness.  The maximum amount you can treat as qualified principal residence indebtedness is $2 million or $1 million if married filing separately.

The Act does apply to debt used to refinance your home to the extent that the principal balance of the old mortgage, immediately before refinancing, would have qualified.

Therefore, if you are behind on your mortgage and considering a short-sale or foreclosure, you better act fast.  After December 31, 2012, any mortgage debt forgiven will be taxable as income on your return.  Consider this example:

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A Denver Accountant can help you achieve many of your financial objectives, but none of them can be fully realized without an action plan. Hein and company is available to not only provide standard accounting services, but educate the public on how to take control of their personal finances this year and in the future.

A denver cpa would be happy to discuss these with you as each is an important component in running your business, planning your estate, or simply figuring out the best way to prepare denver taxes each year.

Step #1, Set Financial Goals. If you don’t know why you’re doing what you’re doing —making sacrifices, working long hours — then it becomes easy to fail. The alternative espoused by a denver teacher is to set goals that can help guide your decisions and keep you focused even when it’s tough. But for your goals to be achievable, they need to be personal. They’ll be easy to dismiss if they don’t mean something.

Step #2, your Denver, CO Accountant can help you track every dime you spend. It’s easy to lose track of “small” expenditures like donuts and coffee a few times a week, but if you track the numbers in a notebook or your smartphone, you’ll have a clear and sometimes sobering understanding of how quickly your money can disappear. And once you’ve found a tracking method, stick with it.

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What makes the Roth IRA so attractive is that its earnings grow tax free.  Here is why this is such an attractive investment opportunity:

Say you have $50,000 in a traditional IRA and you transfer it to a Roth IRA.  You pay taxes on the transfer which is treated as an early distribution of retirement savings, which you also incur the 10% early withdrawal penalty.  However, once this money is transferred to the Roth IRA, its earnings grow tax free for life and you can withdraw the money at any time, any age without penalty or taxes.  So if you are due a tax refund, it makes sense to transfer money from your 401(k) or traditional IRA, pay the taxes and penalty now which will deplete the refund you are due, but in the future, you can earn tax free money and withdraw at any time.

As a CPA, I am recommending this to all my clients.  It’s a “no-brainer” because you take a big one-time tax hit to get assets into a tax-free account and can withdraw at your necessity anytime in the future.

If you currently do not have an IRA or 401(k) amount, then it is a great idea to start contributing to a Roth IRA.  Some eligible taxpayers can put up to $6,000 per individual or $12,000 per couple and the Roth IRA grows tax free throughout your lifetime and you can withdraw it anytime without absorbing the 10% early withdrawal penalty.

Withdrawals also don’t trigger higher Medicare premiums or taxes on Social Security payments, and there aren’t mandatory withdrawals at age 701/2.

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For many people, whether as an individual or a business owner, choosing a certified professional accountant (CPA) is similar to choosing a healthcare provider. A Denver Accountant assures you of working with someone who’s an expert in your business area, can provide sufficient coverage for all your business needs (and future needs), provides prompt service when needed, and provides services at a rate you can afford.
Here are key steps to following when choosing a denver accounting firm.

• Know what you want in your denver cpa, and put your objectives in writing. If possible, write out dialogue between yourself and a prospective CPA, and have someone play the role of the CPA. This will allow you to build confidence in yourself leading up to any meeting, and may also result in valuable feedback about a topic you missed.


• Verify the CPA is licensed in your state. You can check with your state's State Board of Accountancy, which is charged with regulating the certificate holders and can verify the CPA’s professional credentials. It’s important to note that your state board is not in the business of providing recommendations for a specific CPA or accounting firm.


• Prepare a list of CPAs who specialize in denver taxes. Ask others about their accountants. Whether your need is related to business or personal finances, look for guidance from those who you know and trust who have used a CPA for the same reasons. If you do not know anyone who has used a CPA, try a lawyer, broker, or banker – all of whom are normally familiar with one or more CPAs because of their business relationships.


• Interview at least three CPAs and ask questions like: How long have you been an accountant? What are your qualifications? What are the services you typically provide to a company like mine (or people like me)? What are your fees? What are the biggest and smallest companies you work with?

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