When tax season rolls around, it’s easy to feel like taxes are just one more burden on your already full plate.
Most of us deal with them reactively, scrambling at the last minute to gather paperwork, answer questions from our accountants, and hope we come out on the other side without owing more than we expected.
But what if taxes didn’t have to be such a hassle? What if we approached them as part of a larger strategy for financial growth and business success?
As a business owner or executive, you have a unique opportunity to take control of your tax situation by changing how you think about it. By shifting your mindset and adopting smarter habits, you can reduce stress, make better decisions, and even use taxes as a tool to achieve your personal and business goals.
Here’s how you can start thinking differently about taxes, along with some practical steps to help you take action.
Think long term
Be proactive, not reactive: Most people only think about taxes when they have to—whether it’s tax season or when they receive a notice from the IRS. However, proactive tax planning can significantly improve both your financial situation and your peace of mind. By thinking ahead and treating tax planning as a year-round responsibility, you’ll avoid last-minute surprises and stress. Even more importantly, you’ll discover opportunities to save money and make better financial decisions.
The growth mindset: Taxes aren’t just a bill to be paid or an expense to minimize; they are part of the bigger picture of your overall financial strategy. When you view taxes as an integral piece of your personal and business financial puzzle, it changes the way you approach them. Instead of focusing on short-term tax avoidance, you’ll begin thinking about how taxes fit into your long-term growth plans. Are you making decisions that align with your vision for the future? How can your tax strategy support your goals, whether they involve reinvesting in your business, expanding operations, or growing your personal wealth?
Build better habits
Review financial situation: Many executives and business owners schedule regular check-ins with their teams to review business performance or discuss progress on key goals. The same discipline should apply to tax planning. Instead of reviewing your tax situation once a year, set up quarterly or biannual check-ins to assess where you stand. Are there any new deductions you can take advantage of? Have your financial goals shifted? Are you anticipating changes in tax laws that may impact your strategy?
Delegate, stay engaged: If you’re running a business or leading a company, you probably already work with a team of experts to help with the financial side of things, including tax advisors, CPAs, and attorneys. Delegating the detailed work to these professionals is a smart move, but that doesn’t mean you should step out of the loop entirely. Stay engaged in high-level discussions about your tax strategy and make sure you understand how their recommendations fit into your overall financial goals.
Make taxes less stressful
Taxes and decision-making: Whether you’re buying new equipment, considering expansion, or even making personal investments, it’s important to factor taxes into your decision-making process. Understanding the tax implications of major decisions helps you avoid surprises down the road. For example, purchasing a new piece of equipment for your business might offer immediate tax benefits through deductions or credits, but it’s also important to consider the long-term financial impact.
Structure pay wisely: As a business owner or executive, how you take your compensation can have a big[TP1] impact on your tax liability. From salaries and bonuses to stock options or retirement contributions, different forms of compensation come with different tax consequences. It’s worth working with a financial planner or CPA to make sure your compensation package is structured in the most tax-efficient way possible. Small changes here can lead to significant savings over time.
Managing the stress
Calm under pressure: Let’s face it: taxes can be stressful, especially if you feel unprepared or unsure about what to expect. But allowing that stress to take over can lead to poor decision-making or even avoidance. By staying calm and practicing mindfulness around tax season, you’ll be better equipped to make clear-headed decisions. This can be as simple as setting reminders to start early, organizing your paperwork throughout the year, and keeping lines of communication open with your advisors.
Clear communication: One of the easiest ways to avoid stress around taxes is by making sure that everyone involved in your tax planning is on the same page. Whether it’s your accountant, financial planner, or business partners, clear and open communication ensures that nothing gets overlooked. This not only reduces the chance of errors but also makes tax season a much smoother process for everyone involved.
Personal and business tax needs
Tax strategies: If you own a business, it’s easy to get caught up in the day-to-day demands of running the company and forget how your business tax strategy impacts your personal finances. Successful executives and business owners think holistically about their tax planning. Are your business decisions aligned with your personal financial goals? For example, if your goal is to save for retirement or invest in real estate, your business tax strategy should support these objectives.
Keep things simple: You don’t need to become an expert on tax laws, but you do need a strategy. Simplifying your approach by setting up automated payments, working with trusted advisors, and establishing clear routines can make tax planning much more manageable. This will free up your time and energy to focus on growing your business and achieving your personal financial goals.
Key questions
Here are a few questions you can ask yourself to shift your thinking around taxes:
— “Am I thinking about taxes as part of my overall financial strategy?”
—“What small steps can I take now to make tax planning easier in the future?”
— “Who can I rely on to help me with the details while I stay focused on the big picture?”
Thinking ahead
Stay informed: While you don’t need to become a tax expert, having a basic understanding of how taxes affect your business and personal finances will help you make better decisions. Don’t hesitate to ask questions, read up on new tax laws, and stay informed so you can take advantage of opportunities as they arise.
Plan for the future: Taxes play a role in many of the major decisions you’ll make — whether you’re planning for retirement, thinking about succession, or growing your business. By staying proactive and planning ahead, you can avoid surprises and ensure that your tax strategy supports your long-term goals.
By changing your approach to taxes — from mindset to actions — you can reduce stress, stay in control, and even unlock new opportunities for growth. Taxes don’t have to be a headache; With the right strategy, they can be a valuable tool for your personal and business success.
Patti Cotton serves as a thought partner to CEOs and their teams to help manage complexity and change. Reach her at Patti@PattiCotton.com .
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