The last deadline to file amended tax returns is now over, and your CPA should be coming up for air in the next week or two. Now is the time to be proactive and request a 4th quarter review with your tax advisor to help plan for cash requirements for the end of the year; and for the April 15th tax deadline.
Yes… I am suggesting that you plan for any taxes that you might owe next year… start planning NOW!
Dirty Little Secrets About Cash Flow
One of the many secrets I share is that you can be profitable and still have a cash flow problem. How can that be? If you are filing your taxes as a Sub S Corp, all the profit that you are making will be passed over to your personal returns and taxed to you as additional income. If you are not working proactively and strategically with your CPA, you will be surprised with a tax bill in April!
I like to recommend that you have a meeting with your CPA and other trusted financial advisors at the end of October / beginning of November.
Here is what you want your CPA to tell you:
- What are your projected tax liabilities going to be for 2017?
- If you are paying Quarterly Estimates; are you on track for the right amount?Are you overpaying or underpaying?
- Did you take too many Dividends against W2 Wages? If so, should you do a bonus payroll in December to reclassify some of the dividends and pay both your portion of the taxes and the payroll employer taxes before you close your books?
- Is there anything you can do in the 4th quarter to get more money into your pockets instead of paying it to the government in taxes?
There is no reason business owners should be surprised with how much they will need to pay in taxes in 2018 for 2017. This can all be estimated by the time you close your books in December.
From a cash flow position, once you know this information, you can plan for how much cash reserves you need to set aside to take care of your tax liabilities without being surprised or experiencing a cash flow storm!
My cash flow modeling and forecasting system is a great tool to help you get eyes on cash requirements 8 months into the future! Call now for a free consultation on how you can become more empowered and learn to sleep better at night without worrying about cash requirements.