Online Advisor
Timothy W. Tuttle & Associates
 


Volume 18 Edition 6    †††††† Please email comments to newsletter@tuttlefirm.com                  June 2022


Major Events This Month:

Upcoming dates:

June 14

- Flag Day

June 19

- Father's Day

The last thing you may want to do during the summer is start thinking about your 2022 tax return! The best way to lower your tax bill for next year, however, is to start looking for tax cutting strategies as soon as possible.

In this monthís newsletter, read about some tax planning tips to help you lower your 2022 taxes. Also read about tax implications if you have a side hustle, money management tips for couples, and how to make your childís summer break a tax break!

Please feel free to forward the information to someone who may be interested in a topic and call with any questions you may have.

Start Your Tax Planning NOW!

Keeping your taxes as low as possible requires paying attention to your financial situation throughout the year. Here are some tips for getting a head start on tax planning for your 2022 return:

Tax planning can potentially result in a lower bill from the IRS if you start taking action now. Please call if you have questions about your tax situation for 2022.

Hustling for Extra Income

Don't forget the taxman!

From supplementing their current income to replacing income that was lost because of layoffs, the pandemic or other reasons, many people have started side hustles over the past 2 years to help make ends meet.

If you currently have a side hustle, don't forget about the tax implications from earning extra money. Here are several ideas to help you stay on top of your side hustle's taxes:

Money Management Tips for Couples

Couples consistently report finances as the leading cause of stress in their relationship. Here are a few tips to avoid conflict with your long-term partner or spouse.

Make Your Child's Summer Break a Tax Break

As a busy working parent, you may be on the lookout for activities that are available for your kids this summer. There may be a solution thatís also a tax break: Summer camp!

Using the Child and Dependent Care Credit, you can be reimbursed for part of the cost of enrolling your child in a day camp this summer.

Am I eligible?

  1. You, and your spouse if you are married, must both be working.
  2. Your child must be under age 13, your legal dependent, and live in your residence for more than half the year.

Tip: If your spouse doesnít work but is either a full-time student, or is disabled and incapable of self-care, you can still qualify for the credit.

How much can I save?

For 2022, you can claim a maximum credit of $1,050 on up to $3,000 in expenses for one child, or $2,100 on up to $6,000 in expenses for two or more children.

What kind of camps?

The only rule is: no overnight camps.

The credit is designed to help working people care for their kids during the work day, so summer camps where kids stay overnight arenít eligible for this credit.

Other than that, it doesnít matter what kind of camp: soccer camp, chess camp, summer school or even day care. All of these are eligible expenses for this credit.

Other ways to use this credit

While summer day camp costs are a common way to use this credit, any cost to provide care for your children while you are working may be eligible.

For example, you can use this credit to pay a qualified day care center, a housekeeper or a babysitter to take care of your child while you are working. You can even pay a relative to care for your child and claim the credit for that expense, as long as the relative isnít your dependent, minor child or spouse.

This is just one of many possible tax breaks related to children and dependents. Please call if you have questions about this credit, or if youíd like to discuss any other tax savings ideas.

Six Simple Ideas to Help Your Small Business

Here are six ideas to help your business grow and thrive this summer.

  1. Understand your cash flow. One of the biggest causes of business failure is lack of understanding cash flow. At the end of the day, you need enough cash to pay your vendors and your employees. If you run a seasonal business you understand this challenge. The high season sales harvest needs to be ample enough to support you during the slow non-seasonal periods.
    Recommendation: Create a 12-month rolling forecast of revenue and expenses to help understand your cash needs.
  2. Know your pressure points. When looking at your business, there are a few big items that drive your business success. Do you know the top four drivers of your financial success or failure? By staying focused on the key drivers of your business, success will be easier to come by.
    Recommendation: Look at last year's tax return and identify the key financial drivers of your business. Do the same thing with your day-to-day operations and staffing.
  3. Inventory matters. If your business sells physical product, you need a good inventory management system. This system doesn't have to be complex, it just needs to help you keep control of your inventory. Cash turned into inventory that becomes stuck as inventory can create a major cash flow problem.
    Recommendation: Develop an inventory system with periodic counts to ensure you do not have shrink or theft issues, and that can help identify when you need to take action to liquidate old inventory.
  4. Know your customers. Who are your current customers? Are there enough of them? Where can you get more of them? How loyal are they? Are they happy? Several large customers can drive your company's growth or create tremendous risk should they take their business to a competitor.
    Recommendation: Know who your target audience is and then cater your business toward them and what they are looking for in your offerings.
  5. Know your point of difference. Once you know who your target customer is, understand why they buy your product or service. What makes you different from other businesses selling a similar item?
    Recommendation: If you don't know what makes your business better than others, ask your key customers. They will tell you. Then take advantage of this information to generate new customers.
  6. Develop a great support team. Successful small business owners know they cannot do it all themselves. Do you have a good group of support professionals helping you? You need accounting, tax, legal, insurance, and employment help along with your traditional suppliers.
    Recommendation: Conduct an annual review of your resources. Be prepared to review your suppliers and make improvements where necessary.

While libraries are filled with small business advisory books, sometimes focusing on a few basic ideas can help improve your business's outlook. Please call if you wish to discuss your situation.

Make Your Cash Worth More!

Banking tips to help you cash in

Your cash is parked in a bank account. Do you know if it's making or losing you money? Here are some ideas to help you make the most of your banked cash:


As always, should you have any questions or concerns regarding your tax situation please feel free to call.


You are receiving this eNewsletter because you have a business relationship with The Tuttle Firm, or have expressed an interest in our services.  If this is not the case, and you wish to be deleted from our newsletter email list, please send an email to newsletter@tuttlefirm.com and state "Remove Me" in the subject line.

The information contained in this newsletter is of a general nature and should not be acted upon in your specific situation without further details and/or professional assistance. For more information on anything in ONLINE ADVISOR, or for assistance with any of your tax, business, or financial strategy concerns, contact our office.

Timothy W. Tuttle & Associates
www.tuttlefirm.com