Proactive Tax Planning: When You Should Call a CPA
Too often, we see clients make financial decisions before consulting their CPA. By the time we find out, the transaction has already happened, and there’s little we can do to optimize taxes or reduce liabilities.
Tax planning is most effective before major financial moves—not after. Keeping your CPA informed about key decisions ensures you take full advantage of available tax-saving strategies.
Why Tax Planning Must Start Early
The best way to minimize taxes is to plan ahead. Tax laws are complex, and timing plays a crucial role in determining liabilities. If you wait until tax season, you may miss valuable deductions and strategies that could have lowered your tax bill.
By involving your CPA early, you can:
- Reduce taxable income through strategic planning
- Avoid penalties and unexpected tax liabilities
- Structure financial decisions in the most tax-efficient way
When to Consult Your CPA About Taxes
If a financial decision changes your tax situation, your CPA should be involved. The following scenarios require tax planning:
Major Financial Transactions That Require Tax Planning
- Selling rental or investment property
- Withdrawing money from retirement accounts
- Gifting stock or business equity to family members
- Purchasing or selling a business
- Making large stock sales or receiving restricted stock grants
- Loaning significant amounts of money
Business and Investment Changes That Impact Taxes
- Starting a new business or changing business structure
- Deeding property to family members
- Opening a foreign bank account
- Implementing estate planning changes
- Expanding to multiple office location
Life Events That Affect Your Tax Liability
- Marriage or divorce
- Receiving an inheritance
- Adopting a child or having a baby
- Significant medical expenses or disability-related costs
This list isn’t exhaustive, but it provides an idea of the types of financial moves that require professional tax advice. If a decision impacts your financial standing, your CPA should be aware before the transaction takes place.
How Proactive Tax Planning Saves Money
Working closely with a CPA ensures that you:
- Optimize tax deductions before making financial moves
- Avoid costly mistakes that could increase liabilities
- Ensure compliance with IRS regulations
- Improve cash flow management by planning for tax payments
Get Expert Tax Guidance for Your Law Firm
Tax planning isn’t just about filing returns—it’s about maximizing savings and protecting your financial future.
Aligned CPA helps solo and small law firms with proactive tax strategies. If you want to reduce liabilities and take control of your tax planning, schedule a consultation today.