Tax season often feels like a challenging time for individuals and businesses alike. With deadlines looming and forms piling up, the pressure to get everything right can sometimes lead to costly errors. Many of these mistakes aren’t just about oversight—they stem from not fully understanding how financial and legal issues intersect in tax matters. That’s where an attorney CPA can make a real difference.
When financial and legal considerations overlap, as they often do with taxes, it helps to work with someone who understands both worlds. We’ve seen firsthand how businesses and individuals can benefit from having someone who knows the tax code and legal frameworks inside and out.
Missing Out On Deductions And Credits
One of the most common tax issues people face is overlooking deductions or credits that they’re eligible for. This can happen because of changing tax laws, unclear recordkeeping, or simply not knowing what to look for.
For example, we worked with a small business owner who didn’t realize they could claim deductions for expenses related to maintaining a home office. They were also unaware that they qualified for tax credits related to energy-efficient upgrades they’d made to their commercial property. By reviewing their situation in depth, we were able to help them file an amended return and recover thousands of dollars.
When you work with an attorney CPA, they bring their financial and legal perspective to the table, helping you spot these opportunities that might otherwise slip by.
Misclassifying Income
Misclassifying income is another common pitfall. This can be particularly tricky for businesses with multiple revenue streams or individuals who earn both W-2 wages and 1099 income.
For instance, we’ve seen freelancers inadvertently treat their business income as personal income without realizing the tax implications. This can lead to overpayment or, worse, red flags for an audit. An attorney CPA helps clarify these distinctions, so your filing accurately reflects your earnings and avoids unnecessary complications.
Errors In Reporting Business Expenses
Another frequent problem we encounter is improper reporting of business expenses. A client we once worked with thought they were managing their bookkeeping well, but they mixed personal and business expenses without realizing the potential consequences.
Not only did this make their tax filing process more cumbersome, but it also put them at risk for penalties. With guidance, they restructured their bookkeeping practices and set clear boundaries between personal and business finances. It was a small adjustment that saved them time, stress, and money.
Issues With Estimated Taxes
For many self-employed individuals and business owners, paying estimated taxes is an unavoidable part of managing their finances. However, figuring out how much to pay and when can be tricky, and mistakes often result in penalties.
One business owner we worked with had been consistently underpaying their quarterly estimates because they relied on rough guesses rather than calculated projections. They were caught off guard by a hefty bill at year-end. By stepping in to adjust their approach, we helped them avoid future penalties and smooth out their cash flow.
Filing Late Or Incorrectly
Late or incorrect filings can lead to penalties that quickly snowball. We’ve seen situations where people underestimated the seriousness of these errors, thinking they could fix things after the fact. While some mistakes can be corrected, others create long-term challenges that could have been avoided with timely action.
It’s not just about meeting deadlines; it’s about doing so with accuracy. Partnering with someone who combines legal insight with financial acumen means having the confidence that your filings are both compliant and comprehensive.
Work With Professionals You Can Trust
Our friends at Skarin Law Group emphasize the importance of aligning financial and legal strategies when handling tax matters. Working with professionals who understand both sides of the equation is key to avoiding errors and protecting your interests.
If you’re concerned about avoiding costly tax mistakes or you’re looking for support with your financial and legal needs, let’s talk. We’re here to help you make the right choices and move forward with clarity. Reach out today to start the conversation.