An experienced business attorney can help you keep more of your income, protect your assets, and prepare for personal and business growth. At France Law Firm, our tax attorneys and business law attorneys help Florida businesses and families create proactive strategies that deliver lasting financial benefits.

What Early Tax Planning Really Means for Tallahassee Businesses and Families

Everyone knows to gather receipts in February and March and hire a tax accountant in the spring. It’s something you should do year-round so you understand how legal, financial and personal decisions will affect your tax position before it’s too late to make changes. This also means retaining an experienced tax attorney who can advise you on the best tax strategy for your situation.

Tax preparation focuses on compliance, including filing accurate tax returns and meeting deadlines, while early tax planning focuses on strategy. It anticipates how you should legally reduce your tax burden to position yourself for stability and growth.

Working with a business tax attorney ensures your plan integrates with your overall legal structure. It can mean restructuring your entity, deferring income, optimizing asset depreciation or aligning business budgeting with long-term financial goals. When you plan your taxes early, you have time to change factors that could decrease your tax bill.

How Early Tax Planning Benefits Tallahassee Businesses

Business owners face unique tax challenges, including managing operating expenses and meeting federal and state obligations. The earlier you plan, the more flexibility you have in reducing taxable income and maximizing deductions.

Many tax-saving strategies have a deadline of December 31, including purchasing new equipment, pre-paying certain expenses, and contributing to employee retirement plans. A business tax attorney can help you identify industry-specific deductions and credits.

Additional strategies may include:

• Proactive planning to avoid penalties and cash flow issues
• Ensuring you have the correct entity structure, e.g., corporation, LLC, non-profit, S-Corp, as they are taxed differently
• Strategically planning for employee compensation, e.g, coordinating financial and legal strategies for compensation packages

How Early Tax Planning Protects Families

Tax planning isn’t only for business owners. It’s also crucial for families. Without careful planning, your interconnected business and personal finances can create unexpected tax burdens. An experienced business tax attorney can help:

• Coordinate personal and business income
• Reduce estate and inheritance taxes
• Optimize retirement and education savings
• Protect family assets through legal structuring

Common Mistakes to Avoid

Even well-intentioned business owners and families can make preventable errors that could cost thousands of dollars every year. Some of the most costly mistakes include:

• Waiting until filing season, as most savings opportunities have expired
• Ignoring life changes such as marriage, divorce, new children, children going out on their own, real estate purchases, and adding business partners
• Failing to seek professional help, as do-it-yourself tax software often does not identify complex savings related to business ownership, estates, and trust considerations

The best time to start tax planning is before the year’s last quarter, though working with an experienced tax attorney year-round allows you enough time to make strategic investments or change your tax structure and capitalize on credits.

We work with accountants and financial advisors, and we use our attorney’s estate planning experience to deliver the best strategies to reduce your tax liability. Whether you operate a family-run company or a growing enterprise, we can help you navigate Florida’s complex tax landscape.

Don’t Wait Until Tax Season—Secure Your Business and Family’s Financial Future Today!

Instead of letting another tax season catch you by surprise, contact France Law Firm at 850-224-1040 or by filling out our online contact form to implement a proactive tax plan that protects your business and your family’s financial future.

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Taxes for 2023 and 2024

You may not think the upcoming changes for 2024 are important right now since you will be filing for 2023. However, those changes may affect your long-term tax plans, whether for your estate or your business. France Law Firm has an estate planning attorney who is also a business tax attorney who can help ensure your estate plan, business plan, and tax plan all work together to benefit you now.

Taxes for 2024 apply to the tax returns you file in 2025, while taxes for 2023 apply to the tax returns you file in 2024 (current year).

Per-Barrel Oil Tax

The Inflation Reduction Act reinstated the Hazardous Substance Superfund, which adds yet another tax to each barrel of oil. This tax affects anyone who itemizes and claims fuel for their businesses, as the oil companies are going to pass that tax onto businesses and individuals. While the tax is new in 2023, it is retroactive to Dec. 31, 2016.

Standard Deduction

The standard deduction is changing for 2024. In 2023, it is $27,700 for a couple married filing jointly. For 2024 (taxes filed in 2025), you will have an increase of $1,500 for a standard deduction of $29,200. Rates for other filing statuses are:

• Single People and Those Married Filing Separately: $13,850 for 2023 and $14,600 for 2024
• Heads of Households: $20,800 for 2023 and $21,900 for 2024

Marginal Rates

The tax brackets are remaining the same as the 2023 tax brackets. For 2023 and 2024, the top rate is 37 percent for individuals making over $609,350 and for married couples filing jointly making over $731,200. The additional brackets are as follows:

• 35 percent for individuals making over $243,725 and married couples filing jointly making $487,450
• 32 percent for individuals making over $191,950 and married couples filing jointly making over 383,900
• 24 percent for individuals making over $100,525 and married couples filing jointly making over $201,050
• 22 percent for individuals making over $47,150 and married couples filing jointly making over 94,300
• 12 percent for individuals making over $11,600 and married couples filing joint making over $23,200
• 10 percent for individuals making $11,600 or less or married couples filing jointly making $23,200 or less

Alternative Minimum Tax

The Alternative Minimum Tax (AMT) limits deductions. If an individual or married couple itemizing has too many deductions, the AMT kicks in, so you can’t lower your tax responsibility too much. In 2023, the AMT exemption is $81,300 and starts to phase out at $578,150 for individuals and 126,500, phasing out at $1,156,300 for couples filing jointly.

For 2024, the AMT kicks in at $85,700 for individuals and starts to phase out at $1,156,300.

Earned Income Tax Credit

Qualifying taxpayers who have at least three qualifying children can receive an Earned Income Tax Credit (EITC) of $7,830 in 2024 and $7,430 in 2023.

Estate and Gift Taxes

The basic exclusion for estate taxes (commonly known as the Federal Death Tax) for those who died in 2023 is $12,920,00, and in 2024, $13,610,000.

The annual gift tax exclusion is $17,000 for 2023 and $18,000 for 2024.

Contact France Law Firm

These are just a few of the taxes that will affect the average person or couple filing jointly. Several other changes include the limitation for the qualified transportation fringe benefit, employee salary deductions for contributions to health flexible spending accounts, self-only coverage in Medicare Savings Accounts, foreign earned income, and the maximum credit allowed for adoptions.

When it’s time to start your taxes for 2023 and if you need to make changes to your estate plan based on tax changes for this year and next year, contact a tax attorney and estate planning attorney at France Law Firm for a consultation.

The post Understanding the New Tax Laws: What You Need to Know for the Upcoming Year appeared first on France Law Firm.

The Importance of Taxation Planning

For the average single person, you can have an estate valued up to $5.45 million before your heirs have to worry about paying estate taxes. While that sum may make some people feel like estate planning is only necessary for the super wealthy, the world’s best financial planners say that you shouldn’t overlook the process. Meeting with an estate attorney and an accountant will not only give you peace of mind but it will help you to sort through many of the complex issues and laws that make up estate taxation. Some of the best ways to make sure your money stays in the family include:

• Drawing Up a Will – This is an obvious first step that many people overlook. In fact, according to a 2014 study, nearly 65 percent of Americans do not have a will and 17 percent feel like they don’t need one. But without a will, your estate will likely be divided up in probate court, leaving your loved ones to pick up the bill.
• Revisit Your Beneficiaries – Some of your assets are not eligible to be distributed through a will but instead ask that you name a beneficiary. In these cases, it’s important to make sure that all information is up to date. Whether you need to remove an ex-spouse as a beneficiary or simply name someone to avoid the account going to a probate court, this will also help you determine where your money will go.
• Set Up a Trust – If you have a sizeable estate that needs to be divided up among multiple family members or you want to make sure that your heirs are ready for the responsibility that comes along with their inheritance, you may want to set up a trust. Trusts offer the most tax benefits and protect the assets from estate taxes.

Understanding Estate Laws

Over the past decade, estate laws have been a hot topic in politics and significant changes have been made several times. The 2013 tax act ensured that the basic $5 million estate tax exemption was made “permanent” but it also included a higher rate of 40 percent. While the law will continue to adjust the exemption level for inflation, with an adjustment to $5.43 million ($10.86 for married couples) in 2015, it also includes an exclusion “portability.” This means that if one spouse passes before the other, the surviving spouse can pass on the unused portion of their late spouse’s exclusion. However, this portability is not automatic and the unused portion must be transferred by the surviving spouse’s executor. Additionally, a special tax return must be filed within a period of 9 months. During this time, the surviving spouse is not required to pay estate taxes.

How Can I Optimize My Estate Plan?

If you’re interested in other ways to maximize the amount that you can pass on to your heirs, annual gifting is a great option. In the US an individual can legally gift up to $14,000 per year to another individual, tax-free. However, if you gift more than that sum, it will reduce the amount of your basic lifetime exclusion.

With the help of our experienced estate tax planning attorneys, you can minimize your future estate taxes in a variety of different ways by identifying taxable assets, creating a will or living trust, keeping up to date with federal and state tax law changes and more. Take control of your legacy and give the greatest gift possible to your loved ones with guidance from France Law Firm. Visit our team online today for more information on the benefits of preparing for the future with estate taxation planning.

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Save Money Later By Creating an Estate

When you are in your young adult years, senior years seem like they are so far away that you don’t have to worry about anything for 20 or 30 years. However, death and incapacitation could come at any time. Even if you don’t have a lot – you rent, but you have a car, you are single, but you have a good job and a savings account and may have started a retirement account – you should have an estate plan. A car accident or an unexpected illness could cause you to have to have someone manage your affairs, or could even cause your death.

For people of any age, without a will, your nearest relative will have to go through the probate process. However, if you have a will and a trust, and it’s drafted properly, your heirs might be able to avoid the entire probate process. Trusts help avoid many federal taxes, too. And, if you become incapacitated, a trust seamlessly moves control of your assets to a selected heir with little to no tax ramifications, depending on the size of your estate and how you set the trust up.

Federal Taxes

In 2001, the federal tax exemption for estates was only $650,000. This means that your heirs paid taxes on anything you owned that brought your entire estate value over that amount. In 2016, the exemption was $5.45 million per person. This means that 99.8 percent of the estates do not owe any estate tax.

However, the exemption is always subject to change, thus you should always keep yourself apprised of state and federal estate tax laws and you should be ready to amend your estate documents when laws change. An estate law firm such as France Law Firm will keep up with all of the changes to the tax laws, and working with your accountant, will be able to draft an estate plan to help you take advantage of any tax incentives, whether state or federal.

Checklist for Tax Incentives

Know and List Beneficiaries

Certain accounts and policies require beneficiaries. Upon your death, these accounts and policies go to the person named. If a beneficiary passes or you decide to change a beneficiary on an account, be sure to make the change as soon as possible after the event that caused the change. Find out from the account servicer whether you need additional documents to avoid having that account go through probate court. Sometimes the servicer of your retirement account will require additional documentation or will require your heirs to take your estate through probate.

If you choose not to name a beneficiary, your heirs will have to take your estate through probate. This could become costly, even if you put that account in your will.

Draft a will. Not only will you ensure that your assets are distributed to those you want to have them, but a will could save your heirs the a lot of hassle with the probate court after your death. Even if your estate has to go through probate, it’s less costly and quicker if you have a will.

Create a Trust. A trust could become beneficial prior to your death, and could save your family taxes an other headaches. A trust attorney will go over your situation with you to determine the best type of trust to set up depending on your situation. A living trust allows those named to take over the care of your financial matters should you become incapacitated and cannot handle your own matters. Whether you get into a crash, have dementia or any other issue that causes you the inability to handle your affairs, a living trust seamlessly allows your family to handle your affairs. It also protects your assets from creditors and nursing homes.

With a trust, you will be able to set up conditions on how your money is to be spent or distributed. However, a trust is taxed on income it receives from any type of income it receives, including but not limited to interest and dividends. Thus, you should pay certain expenses from the trust to decrease the tax burden.

Retirement Accounts

Consider converting traditional 401(k) and IRA accounts to Roth Accounts since traditional accounts are subject to income taxes. Should the rules change as to how those accounts are taxed, you may not be able to spread the income taxes out over the lifespan of the beneficiary. A Roth Account allows for tax-free distributions.

Distribute Assets While You are Alive

Gifting your money while you are alive is one tax benefit that you could easily take advantage of. However, this method is limited in that you won’t want to give away all of your money by the time you’re 70 years old and then live until you’re 95 years old. Furthermore, the IRS only allows up to $14,000 per person per year. Putting your assets into a trust may avoid taxes on these assets and allow you to keep control of them while you are alive and while you are able to handle your own affairs.

Contact France Law Firm

Regardless of where you are in life and what age you are, contact France Law Firm to set up an appointment to discuss the best way to take advantage of tax incentives and to set up your estate to avoid probate and other costs associated with passing your assets to your heirs.

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Invest in municipal bonds to generate tax-free income:

Municipal bonds are more attractive on a relative basis to those who find themselves subject to the 3.8% surtax and possibly the highest marginal rate (39.6%). The yield an investor would require in a taxable bond investment to equal the yield of a comparable tax-free municipal bond increases for those specific taxpayers.

Utilize strategies to reduce or avoid taxable income:

If you’re a taxpayer contributing to a retirement plan or an IRA, choosing to fund a flexible spending account or deferring compensation income can reduce your adjusted gross income and help prevent you from reaching an income threshold that can result in a higher tax bill. Utilizing other tax deductions such as charitable giving or mortgage interest can also offset income.

Consider Roth IRA/401(k) contributions or conversions:

Utilizing Roth accounts can be an effective way to combat the future tax rates in light of long-term federal budget challenges. Younger investors or those in lower tax brackets can greatly benefit from creating a source of tax-free income in retirement

Asset “location:” Allocate assets by tax status:

Consider placing a larger percentage of your stock holdings outside of retirement accounts and a larger percentage of your fixed-income holdings in retirement accounts. When it comes to stock investments, allocating more of your buy-and-hold or dividend-paying investments to taxable accounts may increase your chance of benefiting from a lower tax rate on applicable dividends and long-term capital gains.

Be mindful of irrevocable trusts and taxes:

Due to the low income threshold which will bring income retained within an irrevocable trust up to the highest marginal tax rates, trustees may benefit from reconsidering investment choices within the trust, such as municipal bonds and life insurance.

Review estate planning documents and strategies:

It’s crucial to plan for an orderly transfer of assets or for unforeseen circumstances. Some strategies include proper beneficiary designations on retirement accounts and insurance contracts, wills, power of attorney, healthcare directives, and revocable trusts.  

Plan for potential state estate taxes:

Most people are well aware of the federal estate tax, but certain residents need to be aware of state estate or inheritance taxes too. Many states are “decoupled” from the federal estate tax system, which is why it’s important to consult a with an attorney on state-specific laws and options.

Evaluate whether to transfer wealth during lifetime or at death:

The unified lifetime exemption amount for gifts and estates allows taxpayers the flexibility of deciding to transfer wealth during life or death. Choosing to transfer assets after death allows individuals the ability to maintain full control of their property while living and the benefit of step-up in cost basis at death.

Consult with an attorney to see if more complex strategies are appropriate:

Especially for those individuals and families with significant wealth who may benefit from more complicated strategies from transferring wealth, it’s critical to consult with an attorney. With increased scrutiny among lawmakers that may prompt restrictions in how these strategies are implemented, it would be prudent to examine these alternatives while they are still an option.

Since personal circumstances vary widely, it is so critical to consult with a qualified tax or legal professional who understands your specific circumstances and goals. At France Law Firm, we’re able to create sound income taxation strategies to protect your assets. Be prepared with the experience and knowledge of our team on your side, contact us today to discuss your options.

The post Nine Smart Strategies for Tax Planning appeared first on France Law Firm.

1. Contribute the maximum amount to your 401(k). Take advantage of the ability to make pre-tax contributions and any employer-matching programs available.

2. Use a Health Savings Account. HSAs allow you to save money for health-related expenses, and then withdraw the money tax-free at any age – as long as the funds are being used for health expenses.

3. Open a Traditional IRA or Roth IRA. Depending on your financial situation and expected contributions, an IRA can be an essential tool for retirement planning and tax management.

When considering your long-term financial plans, is there room for improvement? Seeking sound legal advice can help you to provide for your future, leave a legacy for your loved ones, and minimize the tax burden along the way.

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