Tax Buddha™ Tax service has been preparing returns since 1999 and specializes in returns for businesses and business owners, whether Corporation, Partnership, LLC, or Sole Proprietorship. We also prepare returns for individuals without business activity. This service grew out of the bookkeeping services we have provided since the late 1980s—we were assembling the numbers properly for other tax preparers, which is often considered the “difficult” task by business owners, and we decided to become licensed to prepare the returns as well.
We have gained extensive expertise in a variety of businesses through our bookkeeping activities. This affords us a better perspective on what is actually occurring in a business and so we are able to utilize the tax code to its best effect.
An example of this regards IRS Code Section 179 which allows for accelerated depreciation of assets to the extent of income in the first year of purchase of new assets. When a business is first starting out and doesn’t have much profit, most preparers will not take Section 179 deductions because it is limited by the low income of the company. We, on the other hand will, when appropriate, take the full Section 179 deduction even though we can’t utilize the deduction in the first year because we know it can be carried over to the next year, thereby eliminating the second year profit and any tax liability. Most business owners like having little or no tax in their first years.
Many preparers do not like to prepare entity tax returns because they believe them to be more difficult. And it is true that corporate returns are more complex and require more information to file accurately. We feel this is an advantage because it is likely that the IRS sees corporate returns as more accurate, and although no guarantee, less likely to be audited. We are unafraid of the complexity of corporate returns, and there can be tax savings in the complexity. An example of this would be the net tax savings of an “S-Corporation” over the sole proprietorship. Please see our section on incorporations for more information on this tax saving strategy.