Inherent Characteristics of A SIMPLE IRA Plan

Tax planning is a long drawn process. However, this does not mean that it has to run throughout the year. In fact, in order to avail most tax benefits, a business needs to ensure that it has everything pertinent in place well in advance. This is exactly what we, as your chosen Rochester CPA, look to do for your business. There are various instruments that we try to use to get you the maximum Rochester taxes benefits. However, which ones fit your business depends entirely on the key nature of your business.



One of the instruments that we recommend for businesses looking for tax planning is the SIMPLE IRA plan. Here are some key characteristics of the SIMPLE IRA plan that should be of use to you.

1. Size of the business matters:

The first thing you need to know about the SIMPLE IRA plan if you are in the midst of tax planning is what any Rochester CPA would tell you. This is that the SIMPLE IRA is only limited to those companies whose employee strength does not exceed 100. This means that you can only avail the SIMPLE IRA plan if your business employs 100 or less than 100 employees.

2. Adopting the SIMPLE IRA plan:

If you know that your business meets the prerequisites then all you need to do is contact a Rochester CPA like us and ask them to set everything up for you.

We would ensure that you get the Rochester taxes benefits by choosing whether a Form 5304-SIMPLE, 5305-SIMPLE or a SIMPLE IRA prototype suits your organization the best. Subsequently, we would help you establish it.

3. Two forms of contributions:

There are two ways through which you can contribute in a SIMPLE IRA plan. You should note, however, that your benefits in terms of Rochester taxes would remain the same, regardless of your choice. Your choices would be between a matching contribution of up to 3 percent of the employee’s salary and a 2 percent contribution for each employee which would be non elective.

4. Mandatory exclusivity:

Establishing a SIMPLE IRA plan means, however, that you cannot partake in any other retirement plan. Effectively, this is something that needs to be assessed. This is also a stage of tax planning where you need our help as your Rochester CPA.

Basically, in our capacity as your Rochester CPA, we would assess whether the Rochester taxes benefits you would get from a SIMPLE IRA plan would be enough for your organization by themselves or not.
If we find during the tax planning procedure that you need more Rochester taxes deductions and exemptions then we would not recommend the SIMPLE IRA for you. In either case, expert guidance from an experienced Rochester CPA is something you should look for.




 

Dealing with Taxes Alongside the Best Rochester Accountant

Taxes are the bane of individuals especially during times of economic crisis. These payables to the government specifically the Internal Revenue Service can be considered as business expenses and, thus, lessen the net profits. Fortunately, the best Rochester accountant can provide expert assistance on all matters related to taxes, be it the corporate income tax or the monthly sales tax.

But to deal with taxes in a successful manner, you must work well with the accountant, too. Keep in mind that an accountant’s job is limited to certain tasks in the taxation process including identification of the taxable and non-taxable items, computation of the tax liability, and tax planning. Your job is to prepare the documents, assist the accountant when necessary, and pay the tax liabilities as well as become involved as an active participant during the tax planning process.

As we have always emphasized, the best Rochester accountant will only be the best when he has the full cooperation of his client – you, for example. Without your full cooperation, no amount of work on the tax-related documents including receipts, invoices and ledgers will be successful. You, after all, are in charge of these documents!

Thus, the first rule of successfully dealing with taxes is to gather all the pertinent documents before your appointment with the accountant. You will most likely be provided with a tax organizer, which is a checklist of all the necessary documents, the deadlines for submission and other remarks. Just follow the instructions on the tax organizer and you should be fine.

You may also present other documents containing information excluded from the tax organizer. These documents can be used to support non-taxable donations, for example, which the Rochester accountant can consider as such. Examples include payments on estimated taxes and cancelled checks.

Then, you must be ready with a set of questions to be asked of the accountant. Don’t worry about being seen as a pesky client – it is well within your rights and responsibilities to ask questions, to clarify issues, and to learn a few more important things. In fact, if you are walking out of the accountant’s office with little to no improvement in your knowledge about tax-related matters, then you are not getting your money’s worth.

You may think that there’s no need to learn about tax-related matters that accountants are already knowledgeable at. You can, after all, just pick up the phone and set up an appointment with the accountant to ask your questions for the nth time. But since you are paying for the expertise of the Rochester accountant, you may as well as learn a few things. In the end, it is your business, your money and your reputation at stake when you file the tax returns – not that of the accountant.

Most important, be forthright about your business. With honesty come trust, confidence and respect, all of which are the pillars of a successful working relationship with the best Rochester accountant. And don’t even think about asking your accountant to engage in dubious business – you will be rebuffed because of legal and ethical concerns.