The average income tax payment for Americans who filed in 2018 is $15,322. For some Americans, this is a lowered payment because they consulted with a tax advisor. For others, this is more than they needed to pay because they didn’t take the extra step of seeking out a tax consultant.
But who do you turn to when you have questions regarding your taxes?
This guide will explain what a tax consultant is and why you need to seek out their advice.
What Is a Tax Advisor?
The job description for a tax advisor is a financial professional with advanced knowledge of tax accounting and tax law. Their advanced training helps them to assist clients in minimizing tax liability while remaining compliant with the law.
Sometimes a tax advisor embodies more than one title. They could also be a tax attorney, Certified Public Accountant (CPA), financial advisor, or enrolled agent.
How to Find a Tax Advisor Near Me
The easiest way to find a local tax advisor is to look online. You will find a long list of options to sort through. Narrow down your choice to the best tax advisors by looking for those with a professional reputation and established track record.
It can also help to look for ones with a complete website. Tax advisors that have a blog can showcase their knowledge and experience. For example, https://wealthability.com/blog/how-to-choose-a-tax-advisor/ explains how to choose a tax advisor.
Do I Need a Tax Advisor?
It’s smart to enlist the advice of a tax advisor for preparing taxes, estate planning, or doing anything with finances that could affect your tax liability. You may need a tax advisor if you own property, earn a lot of money, are getting audited, have children, have a large number of assets, are a business owner, or invest.
Your tax advisor can help you sort through the multiple properties you own and potential tax implications. The more money you earn, the higher your tax bracket will be. A tax advisor can help you manage your money to legally lower your tax burden.
Successful investing can result in capital gains taxes. Your tax advisor can help you offset these gains and suggest ways to reduce taxable income and in turn, lower your tax bill. There are strategic ways to reduce your taxable income and maximise your profits. A tax advisor will be able to identify and recommend the best tax deductions for your financial situation.
Tax Advisor vs. CPA
A tax consultant is an expert in tax-related laws and regulations. A CPA’s main skill set is preparing your taxes. There’s no formal certification to become a tax consultant like there is to become a CPA.
Many tax advisors obtain a Master of Science in Taxation or Accredited Tax Consultant credential. Someone can be both a CPA and a tax consultant.
Tax Consulting Cost
A tax consultant’s fees can vary greatly based on your location, experience, and the services you are looking for. A reputable tax consultant will offer a free consultation. This is an opportunity for the two of you to determine if working together would be a good fit.
Hire a Tax Advisor Today
Hiring a tax advisor is going one step further than hiring someone to prepare your taxes. This is smart if you have a complex financial situation. Your tax advisor will help you navigate the complicated IRS laws and regulations to legally lower your tax liability.
Check out our other finance articles for more helpful money advice.
