Tax Planning

Tax planning is the analysis of a client’s overall financial situation and conditions in order to craft a financial plan that can be executed in the most tax-efficient manner. Tax planning is an essential component of a well-crafted financial plan. The purpose of tax planning is to ensure that, while a client is planning for retirement, college funds, Investment, etc, they are also losing as little as possible to taxes. Tax planning brings together all the different components of a comprehensive financial plan and figures out how they will work together in the most tax efficient manner. Tax planning itself does not involve investments or accounts, but rather it refers to the direction of said investment and accounts in order to maximize tax savings.

Different between tax deductions and tax credit :

A tax deduction is an amount by which you can reduce your taxable income, which in turns requires fewer amount of tax to be paid.

A tax credit is an amount by which your owed taxes are directly reduced


Tax Planning Strategies :

  1. Understand your tax Bracket
  2. Understand the different between tax deductions and tax credit
  3. Be aware of common and application tax deduction and credits
  4. Know what tax records to keep
  5. Shelter Your Money