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The speed of modern life can make your days feel hectic. Between school drop offs, deadlines, and getting dinner on the table, taxes are the furthest thing from your mind. Until the deadline that is. 

We get it, you have a lot on your plate. It’s tempting to wait until the last minute when it comes to taxes. But doing some year-round planning can actually relieve pressure. And when you work with a trusted Roanoke CPA firm, planning doesn’t have to be stressful at all. In this article, we cover how to plan and the ways year-round tax planning can boost your financial well-being and make tax-time easier. 

How to Plan for Taxes Year-Round

Planning for your taxes year-round may seem intimidating, but it doesn’t have to be. Setting up good habits will make tax planning a breeze. And, having professional tax services on your side means you’ll always have someone to go to for advice if you get stuck. Here are some top tips from our Roanoke CPAs for year-round tax planning.

• Maintain Detailed Records: Don’t keep your receipts and paystubs in a shoebox. It’s important to know how much money you’ve earned and how much you’ve spent on items that are eligible for deductions. Take advantage of technology: there is software that track and organize your finances automatically and apps that help you track deductible expenses. 
• Adjust Your Withholding and Estimated Payments: If you’re employed, be sure to review your tax withholding to ensure that the amount being withheld aligns with your projected amount owed. If you’re self-employed, it’s a good idea to pay estimated quarterly taxes to avoid huge and surprising bills at tax time. 
• Maximize Tax-Advantaged Accounts: When it comes to taxes, tax advantaged accounts like IRAs, 401(k)s and Health Savings Accounts (HSAs) are your friend. If you can, it’s excellent practice to max out your contributions to these accounts as it helps you save for the future and lowers your taxable income.
• Keep Records of Deductions & Credits: Keep track of your donations to qualified charities, money you spend on your business and any education expenses. These can all qualify for deductions and it’s important to know how much you could claim. 
• Prepare for Filing Early: This tip will make tax time so much less stressful: Know what tax documents you’ll receive and begin gathering and organizing them as soon as you receive them. Once you’ve received all your documents, you can file taxes. The sooner the better because then it’s off your plate. 
• Schedule Quarterly Reviews: We all need a little help sometimes. It’s a good idea to sit down with your tax advisor on a quarterly basis so you can review your financials and stay on track. 

Advantages of Year-Round Tax Planning

Year-round tax planning offers a host of advantages. With a little bit of planning, you can ease tax-time and financial stress. It helps you banish uncertainty around what deductions you’re eligible for and how much you might owe. Here’s some of our favorite benefits of year-round tax planning: 

• Strategic financial planning: You’ll have a great picture of your financial health now and strong projections about your future financial state. 
• Maximizing deductions: Stop guessing about whether you took the maximum deduction. When you plan, you’ll know!
• Avoiding last-Minute stress: Tax time stress will be a thing of the past. You can file quickly and efficiently because your ducks are in a row.
• Investment and retirement planning: Tax planning can double as financial planning. If you’re maximizing your tax-advantaged retirement accounts, your golden years might look bright!
• Proactive risk management to avoid tax-related risks like audits: When you keep good records, your chance of being audited is low. And in the event that you are audited, you’ll be prepared with excellent records!
• Financial education to make informed decisions: Year-round tax planning keeps you on top of your financial situation. So, when you have a big decision to make you can make it with firm data!

Contact Neely’s for Year-Round Tax Support

Our friendly, Roanoke CPAs have helped Roanoke tax payers since 2007. With Neely’s you’ll get customized solutions for your unique financial circumstances including help with year-round tax planning! If you’re ready to take the stress out of tax-time but need some help, contact us!

Being on the receiving end of a tax audit can be a daunting and scary prospect. If you find yourself in this situation, it’s important to keep in mind that it doesn’t necessarily mean that you’ve done something wrong. In this article, we’ll cover the basics of IRS tax audits how to prepare and how professional tax services can help.

What is a Tax Audit?

When the IRS conducts a tax audit, they are looking closely at your tax return because they suspect it might contain errors that need to be corrected. There are three types of audits: 

• Correspondence audit: this type of audit happens through the mail. It’s the most common type of audit and is designed to address simple errors that can be resolved through additional documents or clarification regarding specific items on your return. 
• Office audit: This type of audit happens in a local IRS office. You will be asked to bring documentation with you for review.
• Field audit: In this type of audit, the IRS agent travels to you and conducts an audit in your home, business, or tax professional’s office. This is the most thorough type of audit. 

The IRS will notify you of an audit via mail. They have three years after you file a return to conduct an audit. It’s important to remember the results of the audit are not final and you have the right to appeal decisions.

How to Prepare for A Tax Audit

The key to facing any audit is preparation. Taking time to understand the process and the scope of the audit will help you stay calm and enable the audit to proceed smoothly. Here are some of our top tips on how to prepare:

• Understand the extent of the audit: Mail audits don’t typically address the entire return while field audits are much more comprehensive. It’s important to start out by understanding exactly what information the IRS is looking for. 
• Review your tax returns: It’s a good idea to thoroughly review your tax returns, making note of discrepancies or anything unusual that the IRS might have questions about. This will help you answer the IRS’s questions quickly and efficiently.
• Gather your records: The IRS will notify you about what records or documents they would like you to provide. It’s a good idea to gather these and any other related documents as soon as possible and keep them together. 
• Get organized: One of the best ways to keep an audit process operating smoothly is to be as organized as you can. Once you’ve gathered your documents, be sure to record and organize them carefully so you know where they are and how they relate to the IRS requests.
• Be timely: Prepare your responses, advocate for yourself and respond to all IRS requests by the deadline. The IRS will either close your case or propose adjustments. If you disagree with their findings, you have 30 days to appeal.

How a Tax Professional Can Help

The top way to prepare for an audit and ensure a smooth resolution is to engage a tax professional. Tax audits can be stressful, particularly if you haven’t experienced one before. Tax professionals render professional tax services day-in and day-out and have a deep understanding of the intricate US tax system. Here are ways they can help you in an audit.

A tax professional can be incredibly valuable during a tax audit. Here are several ways they can assist you:

• Expert Guidance and Representation: Tax professionals, like our expert Roanoke CPAs, have in-depth knowledge of tax laws and regulations. They can walk you through the specifics of your case and help you comply with all relevant laws. When you work with a tax professional you won’t have to face the tax authorities on your own. Instead, they can represent you in everything from handling communications, to taking meetings on your behalf. This reduces your stress and give you peace of mind that the audit is handled professionally.
• Document Preparation and Organization: Gathering your documents can be overwhelming but a tax professional can provide practical support and assurance that the job is done right. They’ll help you collect and organize all necessary documents. Then they’ll review your records for accuracy and completeness, identifying any potential issues before presenting them to the auditor.
• Audit Strategy and Planning: Tax experts like CPAs can help you craft a strategy for the audit, help you best present your information and address any potential issues. Thanks to their wealth of experience, they can anticipate the questions an auditor might ask so you can answer them confidently.

Prevent Tax Issues with Neely’s Accounting Services 

Working with a tax professional is always a great idea. From reducing stress, streamlining tax returns, or supporting you through an audit, Neely’s Accounting Services is here to help. 

Our expert Roanoke CPAS can provide tax planning advice to help you avoid issues and provide ongoing support for the tax season and beyond. Contact us for tax support today.

As Roanoke CPA professionals, we get quite a few tax questions about remote work. Remote work has become more common for many employees in America. In Virginia alone, the number of people working from home has risen significantly. According to a story by Cardinal News, only 5.8% of the workforce worked remotely prior to the pandemic. Today, that number has risen to 18.2%. 

Today, approximately one-third of the U.S. workforce works remotely in some capacity. Remote workers cite benefits like increased flexibility, higher productivity, low commute times, and less stress. It’s easy to see why remote work is attractive to many.

If you or your employees work from home, there are important tax implications that you should be aware of. Keep reading to see if they apply to you.

What Type of Remote Worker are You?

Remote work is a blanket term that applies to any form of working that’s away from an employer’s home base. Telecommuting is a popular way to work remotely: you work from home or another location instead of going into the office. In other cases, you may need to work away from the office temporarily to attend to a project or complete tasks. 

Whether you’re an employer hiring remote workers, or an employee who telecommutes, it’s important to know that employer and employee location have implications come tax time.

Remote Work and Taxes: What You Need to Know

U.S. workers pay both federal and state taxes. Employees pay income tax based on where they physically live, not where their employers operate. Your federal tax obligation remains the same as if you were both working in the same place. State taxes are a bit more complex and vary from location to location. Here is some important information to keep in mind about remote work:

• Don’t Get Taxed Twice: If you live and work in a different state than your employer, it’s important to know if your employer has withheld taxes based on their state’s requirements. If so, you are eligible for a tax credit, ensuring that your income isn’t taxed twice. 

• Are you Eligible for a Return? Some states don’t collect income taxes including:
  • Alaska
  • Florida
  • Nevada
  • New Hampshire
  • South Dakota
  • Tennessee
  • Texas
  • Washington
  • Wyoming 

If your employer operates in a state that does withhold income taxes but you live in a state that doesn’t, you could be eligible for a refund but you’ll have to file a return in your employer’s state. 

• Convenience of the Employer Rule If you work remotely for a company based in Connecticut, New York, Nebraska, Pennsylvania, Delaware, Arkansas, or Massachusetts you’ll need to comply with the “convenience of the employer” rule to determine how your income will be taxed. Your income will be taxed according to your location only if you can show that your location is at the convenience of the employer, not the employee. Be sure to check the applicable state’s Department of Revenue to find out the relevant specifics.

Get Professional Tax Services for Remote Worker at Neely’s

At Neely’s our knowledgeable Roanoke CPAs are ready to help you with all your tax questions. Whether you telecommute or go into an office, we’ll work to make sure you get the maximum return you deserve. Work with a qualified accounting firm to save time and stress. Call Neely’s Accounting Services and get help with your taxes today.