More On Tax Planningfrom The Advisor's Professional Library
- Charitable Giving Charitable giving can reduce your clients’ tax liabilities. However, the general and verification rules for the deduction of charitable gifts must be understood in order to take full tax advantage of such gifts.
- Annuities: Estate Tax The value of certain types of annuities may be included in an estate’s value. Understanding the intricacies of these inclusions is a critically important aspect of estate planning.
As the hurricane season began on June 1, the IRS issued tips that wealth managers and their clients can use to keep records and information safe and accessible, and document valuables in the event of a disaster. But these tips also apply to those outside of hurricane territory—virtually everyone can find these tips useful, as the devastating tornado swarms of April and May certainly underscore.
The IRS suggests implementing these five simple tips:
- Back-up records electronically, including “bank statements, tax returns, insurance policies,” the agency said. Using online statements or documents, available from so many providers now makes it much easier, and where that isn’t available, suggest that clients scan paper copies and save all of this securely on CD, DVD, external hard drive or a back-up storage service.
- Photograph or videotape valuables in the home, which the IRS says can help document valuables in case of loss for insurance purposes an store these with a “friend or family member who lives outside the area,” the IRS stated in the release.
- Review and update an emergency plans annually, as personal and business changes can affect “preparedness needs.”
- Check on fiduciary bonds, if you are an employer who uses a payroll service, the IRS suggests. This “could protect the employer in the event of default by the payroll service provider,” the IRS release notes.
- And finally, if disaster does strike, the IRS can provide copies of prior returns, which can be obtained by filing Form 4506, “Request for Copy of Tax Return.”