OK, it is April and you still have a significant 2014 tax liability after doing everything you and your advisors are comfortable doing. What can you do today? First and foremost, you have to plan for 2015!
The substantive tax planning ideas for 2014 had to be consummated by December 31st. I wrote about several of these ideas in articles last year and many took advantage of these strategies, though certainly many more were not comfortable pulling the trigger.
I will continue to discuss these as they apply to preparing for 2015. Articles for the remainder of the year will focus on how you can reduce taxes in 2015. Please keep reading these articles!
2014 Tax Liability
Let’s get back to your 2014 liability. Certainly review all your tax deductions. Consult your tax advisor to be certain you have received the benefit for your prior year’s expenditures. Once you have done this, be sure they are recorded on the proper form. This might sound simple, but it could mean significant $’s to you.
Finally, the only thing you can do now is make sure you have fully funded an IRA, or depending upon your business structure, a SEP – IRA. These must be established and funded prior to the employer’s tax return due date, plus extensions for the 2014 tax year.
The contribution limit of a SEP – IRA is 25% of employee’s compensation, or $52,000, whichever is less. Obviously, this is better than nothing, but nowhere near what intangible drilling costs, captive insurance companies, or conservation easements might bear. Doing so requires that you, your CPA, tax advisor and any other financial professionals you tap, are aware of these strategies and how they work. I will be working throughout the year to speak, teach, write and consult for professionals to better serve clients.
Lots of interesting ideas coming in 2015…Keep reading!