It has been a long time since developed nations have tasted serious inflation. Unless you are near 60 or older you will not have experienced the last time inflation was a serious issue in the 1970s into the early 1980s.
Coupled with low inflation is low interest rates. It is hard to miss the pattern of interest rates since 1982. Each increase in interest rates was followed by a new low in interest rates until we bumped against zero and stayed there for much of the past decade.
The stock market loves low interest rates. The constantly declining interest rates gave us a stock market that has relentlessly climbed. In the early 1980s the price/earnings (p/e) ratio for large capitalization stocks was in the single digits and the dividend yield was in the 6% vicinity. Now the p/e multiple is closer to 30 and the dividend yield is below 2%.
The tax profession is aging. Attracting new people to the profession is difficult because it lacks the glamour of other professions. But sit in any public forum and mention you are a tax professional and you will be inundated with tax questions and offers to take them on as new clients. The tax profession is a good field with ample opportunity to do good, but few even consider accounting or tax as a career option.
A government would be considered intolerable if it taxed people 10% of their time in service of the government. Yet idleness taxes many of us much more if we consider all the time spent checking email, our phone, social media and news feeds. All these activities add nothing of value to our lives or to those around us and is no worse than the government taxing you a percent of your time.
This is a step-by-step guide in preparing a tax return, with a filled-in Form 3115, where a cost segregation study is involved, including depreciation adjustments.
Taxes. They come in many forms. Some are hidden: corporate taxes are built into the cost of goods and services you buy; excise taxes are included into products like gasoline.
Others are more visible like sales and property taxes. And then we come to the most visible and dreaded tax of all: income tax. When people complain about taxes they are usually talking about income taxes.
Avoiding income taxes should be easy considering the size of the tax code and the millions of loopholes available. And that is the problem. The tax code is so big that it is daunting so most people have their eyes roll back in their head when they should be facing the tax code head on.
The most common mistake I see in my practice when a client starts a new business or side hustle is that they try to be everything to everyone. This leads to overwhelm, burnout and alienates the ideal client. By identifying your ideal client you increase your chances you will have clients you love working with. And that takes the work out of work.