Tax planning never stops: Start the year with a fiscal exam

Schedule your finances for a new year's physical. Advisers may prescribe some nips and tucks or a better fitness regimen.

By Katherine Vogt, AMNews staff. Jan. 19, 2004.

Leonard Kogan, MD, schedules two or three checkups for himself each year. He doesn't see a fellow doctor, and the appointments aren't for any particular disease or disorder. Rather, he makes them so he can keep his finances in order.

Dr. Kogan is a firm believer in frequent fiscal checkups with advisers and accountants. The examinations help him make sure his finances are structured in the most tax-advantaged way. He figures that makes him different from most doctors.

"Most physicians will probably go to their doctor but won't go to their financial helper," said Dr. Kogan, a retired ophthalmologist in the Washington, D.C., area. "They spend so much time on their practice, but not enough on their financial security and their family's financial security."

He knows firsthand the value of paying regular visits to advisers. Over the years, they have helped him with investments, exposed savings and revealed hidden tax deductions.

In fact, experts say the beginning of the year is the best time for taxpayers to put their finances in order. Indeed with tax implications for the whole year ahead, they say it's the right time to make changes to retirement plans, alter the structure of a business entity or make charitable gifts. And with financial records amassed in advance of the April 15 tax deadline, it also can be a ripe time for getting organized, creating a budget and forecasting quarterly tax payments or other expenses.

"It's the time to do it. The ballgame has begun, it's the new year, and it's time to go to bat," said Paul H. Naden, an accountant and lawyer in Baltimore.