The key method of reducing the tax liability is the careful planning the economical activities of the individual or the business.

In those cases where an individual is a major player in a particular business or a group of businesses it is strongly recommended to review the entire group together.

There are two different kinds of planning activities. One is a short term planning. Normally this planning is done to solve current issues that will effect the tax liability of the taxpayer within the current year. The second is the long term planning that will effect the economic structure and the tax burden in the future. Some of the conclusions reached can effect the individual behavior for a lifetime as well as his or her estate.

Normally, there is a difference when planning is done for individuals versus businesses. However, now more than ever, planning for both is required with the flourishing economy of late, especially in the High-Tech industry where salaries, bonuses and options are exceeding the seven digit numbers. For individuals, the employment agreement, terms and personal behavior are the most common factors in the tax planning. For businesses, the business structure, investment policies, tax deferment and other shelters are key issues.

In any event the planner should be familiar with his client, to understand his needs and consideration.