A common question our Cedar City accountant is asked during tax season is whether tax credits or tax credits are better when it comes to improving your tax return. The answer is—it depends.

Difference Between Tax Credits vs. Tax Deductions

To help you determine whether tax credits or tax deductions are better, it is important you understand how they work. Both tax credits and tax deductions will work to help you save on your taxes, but they do it in different ways.

Tax credits – When you use a tax credit, it can reduce the amount of taxes you owe at a dollar-for-dollar rate reduction. So, say you owe $2,500 in taxes, a $1,000 tax credit will reduce that amount down to $1,500 owed. Also, some tax credits are refundable, so if you have enough tax credits to reduce your taxes below zero, you can have the remaining amount refunded to you. However, many tax credits are non-refundable, so you can only reduce your taxes owed to zero.

Tax deductions – On the other side, a tax reduction work to reduce the taxes you own by percentages. So, say you are in the 22% tax bracket and have a $1,000 tax deduction you can apply. For those in the 22% tax bracket, the $1,000 tax deduction actually will only save you $220 on the taxes you owe.

In some instances, you can use both tax credits and tax deductions on your tax return, though many are dependent on a variety of factors. Our accountant provides tax preparations services and can help you determine what combination will apply to your taxes.

How The Tax Cuts And Jobs Act Affect Tax Credits vs. Tax Deductions

The sweeping changes to the tax law by the Tax Cuts and Job Act passed in 2017 will now affect tax returns filed in 2019. One of the biggest changes is the raising of the standard deduction, which is now:

• Single filer – $12,000
• Married, filing jointly – $24,000
• Married, filing separately – $12,000
• Head of household – $18,000

With the higher standard deduction, most will not bother with itemized deductions, making tax deductions less useful than tax credits. However, if you want to discover if itemization is worth it for you or if the standard deduction is best, our accounting services are available to you.

To work with an experienced tax accountant, contact us for an appointment. Our accountant will help you receive the best tax refund possible.

When we move beyond amassing wealth for ourselves and give to others, we expand our worldview while setting an example of loving kindness for our children. As one notable child, diarist and Holocaust victim Anne Frank once wrote, “No one has ever become poor by giving.”

In fact, including charitable giving in your personal financial plan can yield significant savings on your tax return, particularly when you work with a skilled tax accountant. This leaves you with more money to live and to give, a truly healthful cycle.

It can be hard, though, to negotiate all of the worthy nonprofits to determine where to direct your charitable giving. At AA Tax & Accounting Services, we advise clients to start by looking for ways to help right in Cedar City and the surrounding communities.

The Paiute Indian Tribe Of Utah

One way to do this is to support the efforts of the local indigenous people, the Paiute Indian Tribute of Utah. These include the Indian Peaks Band of Paiute Indians, who count 2,000 acres in Cedar City as their home.

Near-Destruction

As of 2015, the Indian Peaks Band had 48 members. The small number is a testament to how the population of Utah Paiutes–who historians estimate arrived in Utah about 1100 AD–has been decimated over the years.

Once numbering in the thousands, Utah’s Paiute Indians were nearly extinguished, first by contact with European settlers and later with American pioneers. The devastation continued in 1954 when the US government terminated its recognition of the tribe. At one point, the number of Paiutes in Utah dwindled to 800. As of 2015, those numbers rested at 918.

The Long Climb Back

Created in 1980 by an act of Congress, the Paiute Indian Tribe of Utah is comprised of five constituent Bands, including:

• Cedar
• Indian Peaks
• Kanosh
• Koosharem
• Shivwits

Each of these Bands has a longstanding independent identity. What they share in common, however, is the desire to climb back from near-destruction toward a better future.

In 1984, the Paiute Indian Tribe of Utah was granted 4,470 acres of Bureau of Land Management land and $2.5 million in seed money to kickstart economic development. Since then, Utah’s Paiutes have built houses, opened businesses and made strides in healthcare and educational opportunities.

Giving To Youth Education Helps Local Paiutes Move Forward

It’s generally agreed education is the best way to help a community move forward, and this holds true for the Paiute Indian Tribe of Utah.

Scholarship Program

You can invest in the future of neighboring Native Americans by contributing to the PITU Higher Education Fund. Your donations help provide young people in Cedar City and the surrounding areas with college and training. It’s hoped the scholarship program will yield desperately-needed graduates in fields like medicine, engineering and science.

Paiute Tribal Youth Camp

Regaining Paiute culture is as important as reclaiming tribal land. For the past 9 years, teens from Utah’s Paiute bands as well as youths from Nevada and Arizona Bands have been invited to the Paiute Tribal Youth Camp.

During the 4-day camp–held in public lands of traditional significance to Paiutes of the Southwest–participants receive guidance from tribal Elders and Grandmothers as well as indigenous people who’ve forged careers in public land stewardship. The camp is supported by Southern Utah University as well as agencies like the National Park Service, the Bureau of Land Management and the Forest Service.

Tribal elders expose teens to the Paiute language, songs, stories and native plant science. The heaping dose of native culture also includes participation in a traditional fire circle as well as an ancient stick game. Carmen Clark of the Shivwits Band of Paiutes says, “If they know just a little bit, they know where they come from, they’re not lost.”

The teens also get lessons in various areas of land stewardship that may lead to a future career.

Help Fund this Transformative Camp

The Zion Natl Park Forever Project aims to help raise the $15,000 needed to fund the 2019 Tribal Youth Camp. To contribute, click the “Pitch In” tab at the top of the project’s website. Select the amount you wish to contribute and click on the “Informing Tomorrow” button. As you complete your donation, you’re invited to leave a comment. You can note there that you’d like your contribution to go to the Paiute Tribal Youth Camp.

At AA Tax & Accounting Services, we’re happy to help you manage your finances, both business and personal, with a full array of services. If you’d like more information on worthy nonprofits or on thriving financially, contact us today for your appointment.

As the season of giving comes into full swing, the taxable year is also drawing to a close, making it necessary to be sure all your finances are in order so you can file your taxes next year.

To help you make the best holiday tax-deductible donations, our accountant at AA Tax & Accounting Services, LLC has tips on how to make your charitable giving count.

Charitable Contributions And Tax Deductions

Anyone can call themselves a charity but not every organization qualifies for tax-exemption, which means you can’t deduct your donation from your taxes. To qualify, the charity needs to be an IRS-registered 501(c)3 organization. Generally, a registered charity will state their status to make the donation process easier, or you can work with our accountant to determine what organization is right for your donation.

The tax-deductible donation you make does not necessarily have to be made in cash. Some other types of donations which are tax-deductible are:

• Stocks donations
• Appreciated assets such as antiques and artwork
• IRA transferred donation
• Real estate donations

If you have any concerns about the tax-status of a charity, you can look them up on the IRS, using their Tax Exempt Organization Search tool.

What Changes In The 2018 Tax Laws Means For Your Charitable Deductions

With the 2018 changes to the tax laws, the standard deduction has almost doubled for all types of earners. This change can make itemized deductions—like charitable donations—less useful on your taxes. However, as you can generally deduct up to 60% of your adjusted gross income when you donate to a qualified charity, it may still be worth it to your taxes if you are in a position to donate enough to impact your taxes.

Make Sure Your Charitable Donations Still Count

If you want to check that your donation will be able to impact your taxes, you will need to consider your tax bracket and other deductions.

For example, say you are married filing jointly, and you fall into the 22% tax bracket. Your standard deduction is $24,000, so your itemized deduction will need to be more than that to make it worthwhile to itemize your taxes. Some of the most common itemized tax deductions are:

• Charitable donations
• Mortgage interest deductions
• Dental and medical expenses
• Local and state taxes

So, depending on how close your other itemizable deduction bring you, your charitable donation amount may be influenced.

For more tailored, hands-on help with your taxes and accounting needs, contact us. Our accountant will be happy to consult with you.

Including giving in your life provides a direct benefit to both society and your soul. There’s another advantage many people overlook. Your charitable donation can make a noticeable difference in the size of your tax return. This is particularly the case if you’re guided by an expert tax accountant.

It can be hard to decide which nonprofit to support, given there are so many organizations out there doing great things. It makes sense to start in your own backyard, assisting people in your community doing their part to improve the world.

One such organization is Turn Community Services, a Cedar City-based nonprofit that provides support for adults with intellectual disabilities and the people who love them.

Turn Community Services Provides Disabled Adults With Help, Hope

Turn Community Services was founded in 1973 by a group of Utah parents seeking better services for their adult children with intellectual disabilities. At the time, the typical course of action was for parents to place their child in a state institution or have them remain at home, with few opportunities for learning or social interaction.

The nonprofit’s first endeavors were to found residential programs in Ogden and Bountiful, group environments where clients can live in regular homes while receiving the support they need. More than 40 years later, Turn Community Services has expanded to provide a wide array of services throughout Utah. Its reach has grown to include 800 individuals and their families!

Residential Programs

People who live in Turn Community Services’ group homes are assisted with life and social skills and provided with community engagement. There’s a wide range of practical support available to residents, including management of medical needs and personal funds.

Art And Educational Day Services

Turn Community Services also has Art and Educational Day Services that give adults with intellectual disabilities an opportunity for self-expression. While clients learn and create in a safe space, their families can rest easy and pursue activities like work knowing their children are in good hands.

Turn City Center for the Arts in Salt Lake City is a prime example of how a day program can lend support and meaning to adults with intellectual disabilities. Clients at the center are given with instruction and materials to produce artwork. They can also take classes in pursuits like:

• Breakdancing
• Creative writing
• Drama, improv and musical theater
• Hapkido
• Percussion
• Singing
• Yoga

Day services clients produce some remarkable artwork. When it’s sold, a portion of proceeds goes to sustain the program and a portion goes to artists.

Summer Camp

Turn Community Services also offers ongoing summer camps, including one in Cedar City. These afford people with intellectual disabilities, age 6 to 22, with the chance for outdoor discovery and memorable community experiences.

Your contribution to Turn Community Services also helps fund programs like:

• Supported employment
• Family support and respite services
• Mental health counseling

If you’ve been wanting to include charitable giving in your financial plan but haven’t yet done so, it’s never too late to “turn” over a new leaf. Your donation to a nonprofit like Turn Community Services is just one of the many deductions that can bring you benefit when it comes to dealing with the IRS.

If you’d like help with tax preparation, Adrian D. Anderson of AA Tax & Accounting Services in Cedar City is ready to bring new expertise to your money matters, both personal and business. AA Tax & Accounting Services is also skilled in an array of other areas, including services like:

• Business consulting
• Payroll services
• Bookkeeping services
• Startup company planning
• Trust accounting services

Feel free to contact us with any questions or to set up an appointment.

Finding a Cedar City accountant who you can work well with can be a process. To help you determine who will be a good fit for your needs, you should ask these seven questions of any accountant you consult with before you enter into a business relationship with them.

1. What Industries Are You Familiar With?

Some accountants offer services that are more tailored to personal finances, from divorce mediation to tricky tax filing. Other accountants have more experience working with businesses.

If you are a business owner looking for an accountant, you should determine whether or not the accountant has experience working with other enterprises like yours, since they will be able to help you avoid common accounting pitfalls for your industry.

2. Who Are Some Of Your Clients?

This question serves two purposes. First, you can get a clear idea of what size of business the accountant commonly works with and see how well those clients are faring.

Second, you can ask if any of their current or former clients are willing to act as referrals. That way, you can see from a client perspective what it is like to work with that accountant.

3. How Accessible Will You Be For My Business?

Some accountants will charge for responding to communication or have restricted hours. But all business owners know that work issues can arise at any time. So, it is important for you and your accountant to be on the same page when it comes to communication.

It is also worth asking what their preferred communication style is when talking to clients. Some accountants will prefer email or to be left urgent voicemails. If your styles do not mesh, you may have difficulty working with that accountant.

4. What Ways Can You Improve My Company?

If you are looking for a proactive accountant who can help you grow your company, this question is vital. It will give you clear insight into how the accountant perceives their role as part of your business. An accountant who will help you develop further will often recommend some the services they offer that may benefit your business, such as:

• Tax preparation and filing
• Bookkeeping
• Entity restructuring
• Revenue recognition strategies

5. How Will You Protect My Financial Information?

Data miners are only becoming more creative, so it is critical that your accountant protect your financial information. Do they use secure communication methods to transmit financial information? What cloud services do they use to store your business details? You should feel free to ask an accountant any other security questions applicable to your particular industry.

6. What Are Your Rates?

There are multiple ways an accountant may charge for their services. It is essential for you to completely understand what it will cost you to work with them before engaging in business. Some common methods are:

• Hourly billing
• Flat fee for services
• Monthly retainer
• Billed per piece

7. What Other Things Should I Know About Working With You?

While this sounds like a throwaway question, it actually is one last assessment of the accountant. They should not say things like “That pretty much covered everything” or just give you a sales pitch. There is certainly more to know about working with an accountant than you can learn from the six questions above, and any good accountant will be able to tell you more about dealing with them.

If you want to take your search to a reliable accountant in Cedar City, contact us. AA Tax & Accounting Services is ready to answer all your questions and help your finances improve.

Contributing to a local charitable organization is good for your community and good for your soul. Because donations to nonprofits are tax-deductible, they can also be great for your financial bottom line.

Your contributions can make a marked difference in the size of your tax return, particularly if you are under the guidance of tax specialists like the one at AA Tax & Accounting Services.

Why Choose Iron County Care And Share?

Once you decide to include giving in your financial plan, it can be hard to choose a cause. Iron County Care and Share is a terrific option for those who want to help struggling individuals and families by offering them the proverbial hand-up rather than just a handout.

Founded in 1984, Iron County Care and Share starts with the basics—emergency food and shelter—and then aims to foster self-sufficiency among clients. The nonprofit serves people in Iron County living below the poverty line as well as the chronically homeless in Beaver, Washington, Garfield and Kane counties. Many clients are among the most vulnerable of Americans, including those who are:

Iron County Care and Share Offers Emergency Shelter To Homeless Individuals And Families

One of the most important services offered by this ambitious nonprofit is the Iron County Care and Share Emergency Shelter. The 34-bed shelter houses some 400 individuals and families every year.

The staff aims to provide more than a band-aid for those who walk through their doors.
They help clients apply for benefits like food stamps, health insurance and Social Security.

Anyone who stays more than three days meets with a case manager, who works with them to identify the challenges that brought them to a financial crisis. They can then craft a plan to help the client overcome identified hurdles.

Clients who receive help getting into housing are mentored by a case manager who helps them search for employment and, if needed, receive counseling for mental health or substance abuse issues.

Iron County Care And Share Helps Feed Hundreds of Families

Another invaluable service provided by Iron County Care and Share (ICCS) is their food pantry. Each year, the pantry supplies more than 850 households with perishable and nonperishable food as well as necessities like toilet paper, cleaning supplies and hygiene items.

Iron County Care and Share also welcomes financial contributions. They always go straight to people in your area in desperate need, and your donation can be deducted from your taxes.

Our accountant at AA Tax & Accounting Services is familiar with many excellent nonprofits throughout Southern Utah. If you’d like advice on other nonprofit recommendations to help with preparing your taxes, contact us to make an appointment.