Tax Planning Advice: Look at Last Year’s Return—Bernard Kiely

A minimum of a two-year trend analysis on a client’s tax returns can pinpoint mistakes and opportunities.

More On Tax Planning

from The Advisor's Professional Library
  • Annuities: Variable Annuities Annuities are hot. The tax rules vary with the circumstances. Advisors must be aware of these intricacies when discussing annuities with clients.
  • Health Insurance: Health and Medical Savings Accounts A Health Savings Account is a trust created exclusively for the purpose of paying qualified medical expenses of an account beneficiary. Although they are popular, they are not without their pitfalls and the regulations can be complicated. Learn more about how to avoid federal taxation on the accumulation and distributions of HSA.


This is the 22d and penultimate in a series of 23 tax tips that AdvisorOne is publishing on each business day in March as part of our Tax Planning Special Report (see our Special Report calendar for a more complete list of topics to be covered and experts who will deliver their insights).

Today’s tip comes from Bernard Kiely of Kiely Capital Management in Morristown, N.J. Mr. Kiely is a CFP and CPA and has been a fee-only financial planner and provider of income tax services for individuals for more than 25 years. He holds a BA in Accounting from Upsala College and an MBA from Rutgers University.

The Tip: Use the Section 179 Deduction

Yes, The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, whose provisions became effective Jan. 1 after a compromise was reached between President Obama and Congress, changed many provisions of the tax code, especially when it comes to estate planning and other tax planning issues of interest to advisors and their clients.

However, Bernie Kiely (left) still recommends that when doing any kind of income tax planning that you start at the beginning, that is, with last year’s return. In his presentation for NAPFA University, where he serves as the dean of the fee-only planning group’s School of Taxation, this is the first step that Kiely suggests to other planners as a way to forecast the coming year and find any mistakes that might have been made the year before.

A two-year trend analysis, he argues, will pinpoint differences in income, gains and losses, taxes and the phaseout of deductions that may need to be replaced in the coming year, as well as highlighting anything that might have been missed.

See our Tax Planning Special Report calendar for a list of all the topics covered in our month-long special report.

Reprints Discuss this story
This is where the comments go.