John Schoen did an outstanding job of summing up this year’s problem with tax planning in his article, “Planning Your Taxes For Next Year? Good Luck.” I have been asked to look into my crystal ball an awful lot lately and all I see is fog. The Republican-controlled House and the Democratic White House are negotiating and ideas are all over the map as they try to find enough common ground to reach a compromise. So many options have been discussed that it leaves even the most informed tax gurus at a loss to provide the rest of the world any real idea of what will happen. Much less straight forward planning ideas.
What scares me the most is not the uncertainty around 2013 rate changes and potential deduction changes – we have all of next year to contend with that. Instead, as one of John’s contributors points out, there are a lot of 2012 matters that are unresolved and the IRS cannot even produce the tax forms yet. I suspect that most tax filers do not realize what type of preparation goes into a successful filing season. It starts early in the year with the IRS developing tax forms. Software companies then write programs and seek IRS approval. Oh, and most states start with federal taxable income, so they are patiently waiting too. Could it be that last minute filers this year will be this summer and not this spring? Could it be that that the cost of getting accurate tax returns will be like buying gasoline – double the price? Stay tuned; even if the House and President strike an accord, this may only be the beginning!