There are lots of reasons why individuals and businesses should consider hiring a professional accountant to prepare their taxes each year. Many benefits could be coming your way, meaning more money in your pocket. Any tax problems or hassles from the IRS can also be avoided when you have a professional accountant working for you. Tax rates change each year, which is another reason it is important to have someone you can turn to during tax season. Franklin P. Sparkman handles tax preparations for both individuals and businesses.
When most people think of tax preparation, what comes to mind is filing a 1040 before the middle of April. However, there is much more to it than that. There is no reason every individual should not have their own tax strategy customized to fit their specific needs. A reduction in taxes can benefit individuals with retirement income, gifts received, estates and more. Franklin P. Sparkman specializes in maximizing tax deductions for individuals and their families.
Tax accounting in the United States concentrates on the preparation, analysis and presentation of tax payments and tax returns. The U.S. tax system requires the use of specialised accounting principles for tax purposes which can differ from the generally accepted accounting principles (GAAP) for financial reporting. U.S. tax law covers four basic forms of business ownership: sole proprietorship, partnership, corporation, and limited liability company. Corporate and personal income are taxed at different rates, both varying according to income levels and including varying marginal rates (taxed on each additional dollar of income) and average rates (set as a percentage of overall income).
At least a bachelor's degree in accounting or a related field is required for most accountant and auditor job positions, and some employers prefer applicants with a master's degree. A degree in accounting may also be required for, or may be used to fulfill the requirements for, membership to professional accounting bodies. For example, the education during an accounting degree can be used to fulfill the American Institute of CPA's (AICPA) 150 semester hour requirement, and associate membership with the Certified Public Accountants Association of the UK is available after gaining a degree in finance or accounting.
For example, if an investor in a 25% tax bracket had $10,000 in long-term capital gains, there would be a tax liability of $1,500. If the same investor sold underperforming investments carrying $10,000 in long-term capital losses, the losses would offset the gains, resulting in a tax liability of 0. If the same losing investment were brought back, then a minimum of 30 days would have to pass to avoid incurring a wash sale.
Both the words accounting and accountancy were in use in Great Britain by the mid-1800s, and are derived from the words accompting and accountantship used in the 18th century. In Middle English (used roughly between the 12th and the late 15th century) the verb "to account" had the form accounten, which was derived from the Old French word aconter, which is in turn related to the Vulgar Latin word computare, meaning "to reckon". The base of computare is putare, which "variously meant to prune, to purify, to correct an account, hence, to count or calculate, as well as to think".
Accounting is one of the key functions for almost any business. It may be handled by a bookkeeper or an accountant at a small firm, or by sizable finance departments with dozens of employees at larger companies. The reports generated by various streams of accounting, such as cost accounting and managerial accounting, are invaluable in helping management make informed business decisions.