Sharing Your Tax Documents with Your Financial Planner

Dear Diary,

In 2013, I worked hard and got that raise I was hoping for. But when it came to filing taxes …

I like to refer to a tax return as a “financial diary”.It contains so much valuable and personal financial information – how much you made last year working, capital gains/loss, interest, dividends, IRA distributions, Social Security benefits, pension benefits, taxable income, your marginal vs. effective tax rate, just to name a few.All of these items help guide us throughout the year to make strategic investment and planning recommendations, based on your current and projected tax situation.As financial planners, we look at your return as a “diary” of what happened in your financial life last year that could help us take advantage of planning opportunities in the future. We do not let taxes be the sole driver in any investment or financial planning decision, however, as comprehensive advisors; tax planning is an integral part of our process of determining what financial choices will benefit you the most.

A team approach adds value for clients

We partner with many tax professionals to keep us all on the same page.By coordinating with other experts, we work as a team to better serve you, our clients.For example, if we are considering completing a Roth IRA conversion for a client, we will contact the client’s tax advisor to get his or her opinion on the conversion and estimate any tax liability or other ramifications.With so many moving parts in financial planning, being able to speak to other experts is key to providing great service and value to clients.

Sharing your “diary” made simple

Because taxes are such an important part of financial planning, we request that clients send us their most recent return once completed each year.Typically, this is something most clients will send to us prior to their annual meeting, however, the sooner we can get them, the better.This allows us to spend more time taking a closer look at the return to see if there are any potential planning opportunities that we can help uncover.We also now have the option for clients to sign a form that authorizes us to contact your CPA or tax advisor directly to have them send us your return once filed to save you any time and hassle it may create.Our goal is to take as much off your plate as possible to make life easier on you.

If you ever have questions on your tax situation or would like to speak to us in greater detail about financial planning, please don’t hesitate to contact us. We are here to help!

Nick Defenthaler, CFP® is a Support Associate at Center for Financial Planning, Inc. Nick currently assists Center planners and clients, and is a contributor to Money Centered and Center Connections.

You should discuss any tax or legal matters with the appropriate professional.