Month: March 2026

Filing Your 2025 Taxes? Why Accuracy Matters More Than Ever This Year

Filing Your 2025 Taxes?Tax season is here, and while the IRS opened its doors for 2025 returns on Jan. 26, with the familiar April 15 deadline intact, this year’s filing experience is shaping up to be anything but routine. A perfect storm of workforce cuts, rushed new tax breaks, and strained systems means that getting your return right the first time has never been more important.

A Smaller IRS With a Bigger Job

The numbers tell a sobering story. According to the Taxpayer Advocate, the IRS entered this filing season with 27 percent fewer employees than it had just a year ago. Congressional funding clawbacks combined with the Department of Government Efficiency’s push for retirements and reductions have hollowed out the agency’s capacity at nearly every level.

The Treasury Inspector General for Tax Administration warned that the IRS could struggle this year, noting that by Dec. 30, 2025, the agency had managed to onboard only two percent of the employees it was authorized to hire for submission processing. The culprits? New hiring procedures imposed by the Trump Administration and delays stemming from last year’s record 43-day government shutdown.

What does this mean for you? Automated systems will continue handling straightforward electronic returns efficiently. But anything requiring human attention, whether that’s an amended filing, identity verification or a return flagged for errors, will move at a crawl. Phone lines will be even harder to get through than usual, if you can get through at all.

New Deductions, New Confusion

Adding complexity to an already strained system, the One Big Beautiful Bill Act that President Trump signed in July introduced a set of temporary tax breaks that took effect retroactively for 2025. These include deductions for tips, overtime, seniors, and car loan interest, all requiring new forms, schedules and guidance that had to be produced in a hurry.

The potential for mistakes is significant, especially for the 45 percent of filers who prepare their own returns. Most 2025 W2 forms will not break out overtime pay separately, leaving taxpayers to figure it out themselves. And despite the political rhetoric around “no tax on Social Security,” the reality is a larger deduction for seniors that phases out as income rises. Some recipients may not realize they still need to report their benefits as taxable income.

The SALT cap increase from $10,000 to $40,000 is good news for many, but it also means taxpayers should take a fresh look at whether itemizing now makes more sense than claiming the standard deduction.

Direct Deposit or Prepare to Wait

The IRS is pushing hard for electronic refunds, and for good reason. Most error free, electronically filed returns with direct deposit are processed within 21 days. But if you prefer a paper check or accidentally provide incorrect bank account information, expect a much longer wait with fewer staff available to sort out problems.

Returns sent by mail? Plan on six weeks or more. Amended returns are averaging five months or longer, and the IRS is already working through an elevated backlog from prior years.

The Bottom Line

Accuracy matters more than speed this year. The system still works well for straightforward, completely correct returns, but it is far less forgiving when something goes wrong. If you are uncertain about how to handle one of the new deductions or think you might be missing documentation, filing for an automatic extension is a smarter move than submitting a return with errors.

File electronically. Double-check every entry. Use direct deposit. And if your situation is at all complicated, seek out a tax professional who can help you navigate a filing season where the margin for error has never been thinner.

Understanding Hidden Values

Understanding Hidden ValuesCompanies that have assets on their balance sheet, but the values of those assets aren’t accurately reflected, are considered to have hidden value. As part of an investor’s fundamental analysis of a potential investment, it looks at a company’s financial statements, the state of the macro economy, and the business’ competitive position relative to its industry. It looks at assets’ book value, reflected on the balance sheet, compared to what the market values it on a fair value or market price. The difference between the balance sheet price and the prevailing market value is what may be hidden.

Defining Hidden Value

Common areas where hidden value may be found include natural resources, real estate, a business’ customer base, and inventory. When investors evaluate a project and conduct accurate analysis between the balance sheet’s book value and the hidden value they believe the market will price it to in the future, investors may take advantage of the increase in value through early investing.

Real Estate

When it comes to real estate, by the way of generally accepted accounting principles (GAAP), real estate asset purchases are reported at historical cost. However, real estate values oftentimes rise but are not necessarily reflected on the company’s balance sheet. Since the price is reflected on the balance sheet, minus depreciation, if the real estate’s appraisal sells for at or near the appraised price, the difference shows the potential for hidden value.

Asset Considerations

Regardless of the type of asset, and depending on how the items have been cared for, hidden value may exist in the difference between financial statement value and real-world production capability. Assets that are taken care of impeccably, such as machinery, despite following a depreciation schedule, may have actual value above their reported value. Where intellectual property is involved, the amortization schedule may not reflect the full value if the company uses the IP or licenses it for revenue.

Inventory accounting methods, specifically last-in, first-out (LIFO), can impact hidden value considerations. When inflation is elevated, this method denotes the latest costs to the cost of goods sold. More mature inventory at lower costs is kept on the balance sheet for longer periods. This accounting method reduces the assets’ fair value recorded on the final inventory figure, as well as potentially creating tax benefits by lowering the business’ recorded income.

Customer Loyalty

Businesses that have a strong base of loyal customers often own an undervalued asset of customer loyalty. When customers have established a positive relationship with a company, it can make customers more open to new products or services. By opening an easier reception for future growth, the business creates an asset that’s not completely reflected on the balance sheet.

Conclusion

Regardless of the industry or the type of company, implementing effective accounting analysis and recording is one way to maximize one’s tax obligations and maximize asset value to investors and purchasers. Understanding how to do it is the first step in identifying and strategizing current and future financial plans.

What Your Tax Preparer Wishes You Already Knew

Most people approach tax season thinking about one thing: getting their return done. What they rarely think about is what the experience looks like from the other side of the desk. Having seen it from both angles, I can tell you there’s a real difference between clients who make a preparer’s job easy and those who quietly make it harder than it needs to be.

Here’s why that matters to you specifically: being a better client isn’t about being polite for politeness’ sake. It translates directly into lower bills, faster turnarounds, and better advice. This is entirely in your own interest.

First, Understand How You’re Being Charged

The way the preparer bills you should shape how you work with them. There are three common arrangements, and each one rewards organization in a different way.

If you’re on a flat fee, the dollar amount doesn’t change whether your documents are immaculate or a complete mess. But here’s what does change: a preparer who powers through your tidy file in two hours now has time to actually think about your situation. That might mean spotting a deduction you’ve been missing for years or flagging something worth changing before next filing season. Advice like that can easily be worth more than the return preparation itself, but it only happens when there’s time and mental energy left over to give it.

Hourly billing leaves no room for ambiguity. Every follow-up email, every clarifying phone call, every minute your return sits untouched while you track down a missing form, it all runs the meter. Most of that extra cost is entirely preventable with a little upfront effort.

The hybrid model, which is a base fee with overage charges for complexity, is the most common setup you’ll encounter. Most preparers are generous about absorbing minor extra work without comment. But when documents arrive in scattered batches, questions go unanswered for days, and the timeline keeps slipping, that goodwill has a limit. And again, the extra charges that result are almost always avoidable.

There’s one more piece to this that doesn’t show up on any invoice. Tax preparers are human, and like anyone doing service work, they have clients they genuinely enjoy and clients they quietly dread. The ones they enjoy tend to get more, for example, a heads-up about a planning opportunity, a faster turnaround when things are hectic, and a little extra thought applied to their situation. Difficult clients still receive competent, professional service. They just don’t get the extras. That’s not a policy; it’s just how people work.

The Three Things That Actually Move the Needle

None of this requires becoming a tax expert. It really comes down to three habits.

Send everything at once, and send it organized. Before you submit anything, set aside an evening to go through your documents. W-2s, 1099s, interest statements, charitable contribution records, mortgage forms, gather everything. If your preparer sends you an intake organizer or questionnaire, use it. It exists because it tells them exactly what they need in the format that’s easiest to work with. If they don’t use one, just organize things logically and label your files clearly. “Scan_final_2” is not a file name. A small amount of effort on your end saves a disproportionate amount of time on theirs.

Don’t send documents as they trickle in. It’s tempting to forward your W-2 the moment it hits your inbox, making you feel like you’ve gotten ahead of things. In practice, piecemeal delivery creates more problems than it solves, for example, things get overlooked, work gets duplicated, and many preparers won’t even open a file until they believe everything has arrived. There are legitimate exceptions: a K-1 that shows up late, a corrected 1099 that comes in after the fact. Any experienced preparer will understand those situations. But make them the exception rather than your default approach.

Respond promptly when they reach out. When your preparer sends you a question, it usually means they’re actively working on your file and have hit a wall they can’t get past without your input. A week-long delay doesn’t just slow things down; it forces them to set your return aside entirely and context-switch back to it later. That kind of stop-and-start cycle costs time, and depending on your billing arrangement, it may cost you money too.

Conclusion

A single organized evening and a commitment to responding quickly when questions come up. That’s genuinely most of what separates the clients’ preparers who enjoy working with them from the ones they don’t. In return, you get a smoother process, a more accurate return, and very likely some guidance you’d never have received if you’d shown up with a shoebox and gone quiet.

5 Tax Tips for High Earners

5 Tax Tips for High EarnersIf you’re a high-income earner, generally defined as household incomes over $350,000, there are some key things you might want to keep in mind come tax season. Here are a few of the strategies to consider that not only maximize your financial benefits but also minimize tax liabilities.

Boost Retirement Contributions

By increasing savings in your 401(k) and IRA accounts, you can reduce your current tax liability while building your nest egg. Here’s a closer look:

  • 401(k)s – In 2026, you can contribute up to $24,500. If you’re over 50, there’s a catch-up option of an extra $8,000, and better still, if you’re between 60-63, the catch-up contribution limit increases to $11,250. By doing these things, you lower your income and, thus, your tax bill.
  • Traditional IRAs – You can contribute up to $7,500 in 2026 with an additional catch-up contribution of $1,100 for individuals age 50 and older. Note that while you can make traditional IRA contributions regardless of income levels, the tax deduction phases out at certain income thresholds.
  • Roth IRAs – These products are popular because they let you sock away after-tax dollars. That said, your eligibility to contribute, capped at $7,500 in 2026, varies with income levels. Taxes are paid up front, but withdrawals, including earnings, are tax-free later. Woot! Beware, however, that the ability to directly contribute to a Roth IRA starts to phase out at $153,000 for single filers and $242,000 for those married filing jointly.

Implement Tax-Efficient Investments

Here are three more strategies to consider for reducing your tax burden:

  • Buy municipal bonds. With these securities, you may gain tax-free income that reduces your taxable income.
  • Buy dividend-paying stocks. Payouts from stocks give you lower-taxed income and wealth growth.
  • Invest in opportunity zones. These zones, defined as underserved, low-income communities, not only offer tax deferral but also provide community investment. Paying it forward pays yourself – and others.

Leverage Charitable Giving

And being strategic about it is critical when trying to reduce your tax bill. For instance, you might set up a donor-advised fund (DAF), which is an efficient way to manage your giving while securing tax benefits. You can set one up through a financial institution or a community foundation. Once you contribute, you’ll get an immediate tax deduction. However, this deduction is subject to certain limitations based on your adjusted gross income (AGI) – 60 percent for cash contributions and 30 percent for contributions of appreciated securities. Still, it reduces your taxable income for the current year. And that’s a good thing.

Gift Assets to Your Family

This is another good strategic move. Both you and your relatives will love it. In fact, the IRS lets you give up to $19,000 per year (as of 2026) without triggering gift taxes. Think college tuition or home down payments. However, while gifting assets can reduce the size of your taxable estate, it does not reduce your taxable income for income tax purposes. But here’s the upside: By using the gift tax exclusion, you’ll avoid increasing your estate tax liability later on.

Utilize Qualified Charitable Distributions (QCDs)

If you’re retired and over 70 ½, QCDs offer a powerful tax advantage. Get this: you can transfer up to $111,000 annually (in 2026) directly from your IRA to qualified charities without counting that amount as taxable income.

These are just a few of the ways high-earners can strategize for taxes. But no matter what tools and strategies you harness, the goal is to put together a smart plan so you can keep more of what you earn.

 

Sources

https://www.farther.com/foundations/tax-planning-strategies-for-high-income-earners#:~:text=401(k)%20and%20IRA%20Contributions,situation%20and%20provide%20personalized%20advice

https://finance.yahoo.com/news/minimum-salary-required-considered-top-170108488.html?guccounter=1

The Value of Diversifying with International Stocks

The Value of Diversifying with International StocksWhen investors think about building a strong equity portfolio, U.S. stocks often dominate the conversation. The United States is home to many of the world’s most innovative, profitable, and well-known companies, and has a history of delivering strong long-term returns. However, the United States is not the only country with successful, growth-oriented businesses. In fact, nearly half of the global equity market is located outside the United States, offering investors a much broader opportunity than in domestic markets alone.

Despite this reality, many investors stick to a home country bias. This behavioral tendency means they prefer companies headquartered in their own country because they’re more familiar and feel safer. Unfortunately, home country bias can unintentionally increase portfolio risk. A singular concentration of investments in one geographic region exposes investors to country-specific economic cycles, policy changes, and market disruptions, while limiting access to attractive opportunities elsewhere in the world.

Global investing offers the following benefits:

  • Overall Diversification – Spreading investments across different markets, sectors, industries, companies and currencies in various countries improves opportunities for higher growth potential while balancing risk.
  • Highly Regarded Brand Names – Investing internationally offers access to a larger universe of well-established global brands. Household names such as Toyota, Nestlé, and Samsung are headquartered outside the United States, yet they generate revenues throughout the world, boasting strong balance sheets, consistent cash flow, and favorable long-term prospects. International stocks offer investors exposure to global innovation and consumption trends beyond U.S. markets.
  • Sector Diversification – In recent years, the U.S. stock market has become saturated with information technology and related industries – even among broad market index funds. While tech is a powerful growth driver, this concentration increases portfolio risk if the sector underperforms. International markets tend to have greater representation in other sectors, such as industrials, financials, materials, and consumer staples, so adding international stocks can help diversify overall sector exposure.
  • Currency Diversification – International investing exposes U.S. investors to foreign currencies, which reflect the economic conditions of their respective countries. Because currencies do not always move in tandem, holding assets denominated in multiple currencies can help reduce overall portfolio volatility. For example, if the U.S. dollar weakens, gains from foreign currencies may partially offset losses in U.S. dollar-denominated investments. While currency movements can add risk in the short term, they may provide an additional layer of diversification over the long term.
  • Country Diversification – International investing extends beyond developed markets to include emerging economies around the globe. Emerging markets are countries experiencing rapid economic growth, industrialization, and rising household incomes. Examples include India, Brazil, South Korea, and Taiwan. While emerging markets can offer higher growth potential, they also tend to be more volatile. For this reason, investors should consider allocating only a modest portion of their international exposure to emerging markets as part of a diversified strategy.

Diversify Risk Via Your Investment Vehicle

While international stocks offer diversification and growth potential, they also come with distinct risks, including regulatory differences, lower market liquidity, and political instability. Also note that international investments may involve higher transaction costs compared to domestic securities, especially when purchasing individual foreign stocks

Investors can help mitigate these risks by choosing inherently diversified investment vehicles, such as international mutual funds and exchange-traded funds (ETFs). Broad index-tracking funds are often the most cost-effective way to gain exposure, while professionally managed mutual funds can actively navigate changing global conditions.

International stocks provide access to companies, markets, and currencies that cannot be reached through domestic investments alone. When thoughtfully integrated into a portfolio, they may enhance diversification and improve long-term risk-adjusted returns.