If you are in a high tax bracket in San Francisco, you are probably a very busy person. Success comes at a price, which is usually measured in time. So, it might be normal to be allowed “extra time” in certain situations.
The other guests could be accommodating if you arrive late for a dinner reservation. If a conference call requires rescheduling because something more urgent popped up, it could be met with friendly support. One thing where all Americans are expected to meet specific deadlines is with the IRS. It doesn’t matter what income bracket we fall into. Everyone is required to manage their tax filings promptly. And for a high income tax earner, there may not be enough time to get through all the details.
Although the IRS has tried to reduce the time it takes to file taxes with “easy filing” technology, it still burdens taxpayers. The IRS reports that e-filings are the bulk of their returns. Yet, the Office of Information and Regulatory Affairs, or OIRA, reported that American taxpayers spend up to 12 billion hours trying to manage their tax responsibilities, with 66% of it around managing the compliance piece.
As your assets increase, yearly tax filings become more complex
Although around 90% of taxes are now filed electronically, the increasingly complex tax laws have still made it a huge burden on taxpayers. And the more assets one has, the more detailed and time-consuming the work is. For a high income earner, tax preparation is no small task! A Bay Area man could be managing several assets, stock options, a start-up business, and properties in various states. His second wife, a high-income earner, comes with her family trust and children, making the new household a blended family. And to add the cherry on top, there’s a new baby on the way! These stories are real. Even when life becomes more intricate, people can adjust. When that life is expected to be tabulated on paper with financial additions and deductions from several sources, that’s a different story.
A recent study by the Pew Research Center `confirmed Americans are “frustrated by the complexity of the federal tax system.” And 53% say it bothers them, which is understandable since the tax code continues to expand. The study also notes that over half of Americans pay more than their fair share. These are all good reasons to work with a CPA on high income earner tax preparation. If you need to get going on your income taxes, contact us. We aim to ensure no one pays a penny more than they are required to!
