Introduction to The Basics of Tax Planning

The goal of tax planning is to arrange your financial affairs so as to lawfully minimize your taxes. This is called "tax avoidance," as opposed to "tax evasion," which is a crime.

There are a multitude of tax planning strategies, particularly if you own a small business. Some are aimed at one’s individual tax situation, some at the business itself. Many are extremely sophisticated and specific in focus. But regardless of how simple or complex a tax strategy is, its goal will be one or more of the following:

• reducing your (or your business’s) taxable income through investment strategy, deductions and tax credits
• reducing your tax rate
• delaying the time when you must pay the tax