Your Road Map to Lower Taxes: Prepare Early

The holiday season is a distant memory. It's time to file your 1995 tax return. If you are among the owner-operators who have not done books during the year, now is the time to prepare them or go to a bookkeeper or an accountant to get it done.

If you have been keeping good records all year, it should be a breeze. If you owe tax, you should know as soon as possible in order to make arrangements for payment. If you owe less than $10,000 but don't have the cash to pay in full, the IRS will allow you to pay the balance over 36 months. However, you must file IRS Form 9465 "Installment Agreement Request" with your tax return. If you owe more than $10,000 getting an installment agreement is much more complicated. You should ask your tax preparer to help you through the process. If you have a refund coming this year, you can have it electronically sent to your bank account by filing Form 8888 with your tax return. However, you will be required to give the IRS your bank name and account number and that could cause problems if you owe them in later years.

Remember, the best of all possible tax shelters is the Retirement Plan. Self-employed plans, also known as Keoghs, Simplified Employee Pensions known as SEPS, and IRA's all give you tax deductions by simply transferring personal or business money into savings accounts inside those plans.

The Bottom Line Is - Do your taxes early. Find out where you stand with Uncle Sam so that you can plan your 1996 cash requirements as soon as possible.

This article has been provided by PBS Tax &Bookkeeping Service. If you would like further information please contact Barry or Howard at 1-800-697-5153.