Reap the rewards: ways to shelter income with tax expert Steven Goldglit
AS WE RAPIDLY APPROACH APRIL 18th, THIS YEAR’S DEADLINE FOR FILING PERSONAL TAXES, THE GENERAL HUE AND CRY, BE IT AT A DINING TABLE LADEN WITH HALF-COMPLETED FORMS, YOUR CPA’s OFFICE OR IN A DESPERADO LAST MINUTE VISIT TO A TAX-PREPARATION COMPANY WITH A DUFFLE BAG OF UNSORTED RECEIPTS, IS HOW LITTLE WE END UP WITH, AFTER WITHHOLDING, FOR ALL OF OUR HARD WORK! TO ENCOURAGE SAVING FOR RETIREMENT, OUR FEDERAL GOVERNMENT DOES OFFER TAX BREAKS WHEN SAVING IN SPECIFIC WAYS THAT INCLUDE 401Ks, IRAs, ROTH IRAs, SAVER’S CREDIT, OR TAX-FREE CHARITABLE CONTRIBUTIONS. CHOOSING THE RIGHT PLAN REQUIRES KNOWLEDGE AND PLANNING.
THE BEST WAYS TO STRUCTURE RETIREMENT SAVINGS TO DEFER TAXES IS AN AREA OF EXPERTISE AS REFINED AS THE KNOWLEDGE OF ANTIQUITIES OR OLD MASTER PAINTINGS. A CERTIFIED PUBLIC ACCOUNTANT CAN GUIDE YOU TOWARDS THE OPTIONS THAT ARE THE MOST ADVANTAGEOUS TO YOUR SPECIFIC SITUATION AND GOALS. EXPERIENCE IN THE NUANCES OF A SPECIFIC INDUSTRY ON THE PART OF THE ACCOUNTING FIRM PROVIDES AN ADDITIONAL EDGE.
SINCE ITS INCEPTION, STEVEN GOLDGLIT AND HIS TEAM AT GOLDGLIT & COMPANY OFFER ASTUTE ASSISTANCE IN THE AREA OF FINE ARTS, GRAPHIC ARTS AND CREATIVE FIELDS SUCH AS ARCHITECTURE, DESIGN AND WRITING.
TODAY, THE LRFA BLOG IS PLEASED TO CONTINUE ITS DIALOGUE WITH STEVEN.
STEVEN, THANKS FOR JOINING US. TAX LAWS ARE NEVER STATIC. HOW PROACTIVE IS THE FIRM IN EVALUATING TAX PLANNING OPPORTUNITIES OR PRECAUTIONS THAT CHANGE IN ACCORDANCE WITH THE FEDERAL AND STATE LAWS?
A good CPA firm must be aware of existing tax laws and changes so that they can properly advise their clients. Potential changes to the tax code must also be considered as future changes can impact the timing of decisions. For instance, the current Presidential Administration has indicated a desire to lower both corporate and personal income tax rates. As such, we try to analyze the timing of these changes and advise clients as to when they should engage in selling property or recognizing income. If we don’t stay on top of the tax code our advice to our clients may result in tax payments in excess of what is reasonable, and no one likes that. As such we subscribe to a few services that issue daily reports on the tax code, current tax law cases and potential changes being discussed by Congress. We use this info to properly advise our existing clients.
THERE ARE MANY VEHICLES THAT SHELTER INCOME FOR THE FUTURE. WHAT ARE SOME THAT ARE THE MOST APPROPRIATE FOR ART RELATED INDIVIDUALS AND BUSINESSES IN THE ARTS AND WHY?
Retirement plans are a great way to shelter income in current years and save for later in life. SEP IRA’s are used by self-employed individuals (Artists) and allow for $54,000 (for 2017) to be deducted against current income as a retirement plan contribution. In addition, the income in your retirement plan is not taxed as earned and the tax is deferred until you make a distribution from the plan. You can also use regular IRA’s, Roth IRA’s, profit-sharing plans and defined benefit plans. The proper plan for your business depends upon cash flow, asset base and current income. You can also use insurance products to shelter income – whole life insurance plans and annuities. Real estate has proven to be an effective way to develop wealth within the property, using a refinance option to cash out without incurring a tax liability.
DO YOU WORK WITH CLIENTS SOLELY IN NEW YORK OR THE TRI-STATE AREA OR DOES THE FIRM WORK WITH ARTISTS AND GALLERIES THROUGHOUT THE UNITED STATES?
The majority of our clients are based in NY but have additional business locations outside NY, such as Connecticut, California and Florida. We also have a lot of clients from Europe that have opened in NYC as a second location and we have developed relationships with Accountants and Attorneys overseas.
THE ART BUSINESS, AS ARTIST OR DEALER, IS TRANSACTIONAL AND A DIALOGUE WITH AN EXPERIENCED TAX MANAGEMENT FIRM IS AN INVALUABLE RESOURCE.
IN OUR NEXT POST, STEVEN WILL OUTLINE OTHER ASPECTS TO CONSIDER IN THE ART OF FINANCIAL AND TAX PLANNING IN THE ART BUSINESS.
JOIN US, COMMENT, ASK QUESTIONS. THE LRFA BLOG APPRECIATES THE DIALOGUE!