Moving Words – Taxes

Timothy Brady

“The only difference between death and taxes is that death doesn’t get worse every time Congress meets.”  – Will Rogers

We all know two things in life are unavoidable – death and taxes. But while unavoidable, we all can do something to ensure we don’t pay any more to the government than is absolutely necessary.

Now is the time for all successful movers to make sure their tax plan is intact, and they have the best tax experts providing them with correct advice, so they pay the lowest possible taxes legally allowed.

The words “tax planning” have become associated with the wealthy, right? Wrong! If you pay taxes, you need tax planning. If you only visit your tax preparer in April to get your taxes done, what can he really do for you? Once the tax year has closed, you can’t spend or shuffle money to gain tax advantages. Tax preparation is the final step in a quality tax plan; tax planning is how you reduce the amount you pay, and to be successful you need a qualified tax advisor.

You should have both a short-term (12 months) and a long-term (3-5 years) plan developed by a professional tax advisor. A superior tax advisor will save you much more than his (ahem) tax-deductible fee.

There’s a significant difference between a ‘tax preparer’ and a ‘tax advisor’ or expert:

A tax preparer receives payment for professionally preparing income tax returns. Anyone can become a ‘tax preparer’ by taking a short   course on how to correctly fill out a tax return and passing a test. This type of tax preparer is not qualified to interpret the tax code.

There are three types of professional tax advisors: CPAs, Enrolled Agents, and Tax Attorneys. As an owner of a moving and storage company, it’s very important for you to find an expert in the moving business tax issues and regulations. All three of these experts are required by law to take Continuing Education courses in their areas of tax expertise.

What to look for in a sharp tax expert:

• Experience — How long have they worked with clients in logistics and transportation? What about the moving and storage business?
• Full Time — Do they have a 12-month practice? You need tax advice all year from the person who’s going to prepare your tax returns.
• Audit Experience — How often does he represent a client before the IRS, and does he back up the returns he’s prepared? When was the last audit in which he represented a client? What was the outcome of that audit?
• Creativity — Does she understand the tax code so she can ‘push the envelope,’ but not create a tax penalty risk for his clients?
• Aggressiveness — Is he willing to argue his interpretations of the tax code before an Auditor?
• Continuing Education — Does she take several hours of tax code classes that apply to issues pertaining to the moving business annually to be sure she understands all changes made that year?
• Stability — How many moving and storage or relocation company clients do they have? How many of these moving industry clients are long-term?                                                                         

It’s not just the letters that follow a tax advisor’s name that qualifies him/her to be your tax expert; it’s knowledge of the moving industry and how it relates to the tax code. You can have the most qualified moving and storage tax expert in the country; but unless you provide that expert with complete expense and income records, no talent, knowledge and skill can produce the results you need. This is where having their expertise, knowledge and advice becomes invaluable, to you and your company.

“The avoidance of taxes is the only intellectual pursuit that still carries any reward.” –  John Maynard Keynes