Another Tax Season Over … Phew, I made it!
Each year I marvel at just how complicated it is for the IRS to take our money. According to the politicians the wealthiest 1% pay 90% of the taxes. That means that 99% of us struggle through the thousands of pages of instructions, dozens of tax forms; 1099’s, W2’s; 1095 Obamacare forms, health insurance penalties, student loan interest deduction phase outs, the AMT and other paperwork ad nauseam to raise 10% of their tax revenue.
Each of you had been through your version of this nightmare. It’s a bit different for each of us but the story is the same. It is darn near impossible to figure out what information you need to keep, what is deductible and why and how your taxes are being affected by various exemptions, deductions and so on.
Lamenting reality is not one of the proven steps to success so let’s focus on the lesson here.
The IRS is spending 99% of its resources to collect 10% of its revenue. That doesn’t make any sense. The customers (taxpayers) dislike, distrust and fear the IRS. Is this any way to run a railroad? Obviously not.
So my suggestion is to do just the opposite of what the IRS does. You should focus your attention on maximizing the revenue from your top customers. Reduce the costs related to your lowest paying customers or eliminate those clients entirely from your roster.
It is not as easy as it seems. You may have personal relationships or other attachments to these clients. You may have hopes that they will become a good customer at some time in the future. You fear the lower top line revenue. While this may be true, the primary objective of running your business is to increase your bottom line (while providing quality products and services, good working conditions and excellent customer service).
Please take the time to look over the client list and cull the poor performers. Your bottom line will improve: your employees will be happier and ultimately the customers will find a more appropriate source for your service. Everyone is a winner.