In times of uncertainty, financial basics can become the backstop.
“First, a business needs to be financially healthy and have reserves to handle unexpected expenses or loss of revenue. Then sit down with a tax advisor to see what transactions will make the tax situation best for the business,” said Dwight Nakata, a CPA at Yamada & Nakata CPAs in Artesia, Calif. “See if there are tax credits available, as they are more valuable than a tax deduction. A credit reduces your taxes dollar for dollar and a deduction just lowers taxable income.”
Stay the course with long-term investing and tax plans. “Just let us do our job, rebalance the portfolio, harvest losses when prudent and keep making contributions into their various accounts,” Primeau said. “In effect, [clients] get the benefit of purchasing equities on sale. When equity markets rebound, they’ll certainly benefit.”