More On Tax Planningfrom The Advisor's Professional Library
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- 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.
Bernard “Bernie” Kiely of Kiely Capital Management in Morristown, N.J., delivered a presentation to a standing-room-only crowd at the National Association of Personal Financial Advisors (NAPFA) annual conference in Salt Lake City on May 18.
The outspoken Kiely was blunt in his discussion with attendees about what advisors should—and should not—do when dealing with the tax issues of their Schedule C business clients. But just as important, Kiely discussed a range of tax ideas advisors must consider in their own practices (for those who are sole proprietors).
“I am as organized as I can possibly be with tax receipts, documentation and other related items,” Kiely said. “In this way (and I’ve had this happen to a client), if something is missing during an audit, the auditors will recognize my attention to detail and will likely let it go.”
Fresh flowers delivered once a week to make the office look nice? Write it off, Kiely said.
“But avoid checks payable to cash and avoid paying non-business expenses from business accounts,” he stressed. “And always identify sources of deposits! Deposits that are unaccounted for may be considered self-employment income by the IRS.”
These are just a few of the tips Kiely provided to the audience of advisors, who stayed long after the allotted time to ask questions and hear more. For that reason, we asked Kiely for the presentation to repost at AdvisorOne, which he graciously allowed.
In an increasingly complicated tax environment, you’d do well to spend a few minutes with the slides (there are 20, which you can click on to enlarge). Your clients, employees—and E&O carrier –will thank you.