Let's have a look at where you spend your planning time. Jot down the answers to the 4 questions below before continuing to read this brief.
To answer these questions, think in terms of hours. I devote
· _____________planning my vacations and other recreation.
· _____________planning my home improvements.
· _____________planning my trips to the grocery store.
· _____________planning my taxes.
Let's now compare the amount of time you spend with the amount of money you pay. According to the Tax Freedom Foundation, you work 116 days to pay your taxes and only 62 days to pay your second largest expense—housing and household cost. Add up the time spent on house improvements and supermarket shopping excursions. Is it roughly half of the time you spend on tax planning?
How about the time you devote to trip planning? When it comes to money spent, the foundation states that it takes 116 days of work to pay your taxes and just 22 days to pay for entertainment. That's all there is to it in terms of money. How does your time compare to that of others? Do you take six times as long tax planning?
Every year, you should devote effort to tax planning. Tax planning saves you money, which you may put toward your business, personal, and leisure pursuits.
Note: One additional dollar in deductions saves 39% of that dollar in taxes.
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