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Tax Preparation & Tax Planning

Tax Advisors provide year round income tax preparation and tax planning for individuals and small to medium size businesses. Our team of professionals will work with you on creating specific strategies tailored to maximize your tax deductions. Tax Advisors can also assist you in identifying financial planning opportunities, help you create a budget or work with you on choosing a correct business entity.

Our firm specializes in individual, business and Real Estate investment returns. Tax Advisors will prepare your income tax returns at a very competitive rate and relieve you of anxieties associated with tax filing. We can file your current or back year taxes for any state including multi-state and part-year residency. Your tax returns will be filed electronically (e-filed) and, if desired, available refunds will be directly deposited into your bank account.

We recognize the importance of filing an accurate tax return while paying the minimum tax allowed by law. Keep more of what you earn. Contact Tax Advisors today and receive a free no-obligation consultation with one of our tax professionals.

Special Tax Situations

Individuals, Businesses, Real Estate Investors & Brokers, Employee Stock Options, Amended Returns.

Business Formation

Sole-proprietors, Partnerships, LLCs, S-Corporations, C-Corporations.

Tax Advisors

Going the extra mile, and then some.


Form No. Reporting Information Due Date
1042-S Foreign Source Income Reporting Mar. 15
1094-C, 1095-C Affordable Care Act reporting Mar. 2
1098 Home mortgage interest Jan. 31
1098-E Student loan interest Jan. 31
1098-T Tuition, reimbursements, scholarships, grants Jan. 31
1099-A Acquisition or abandonment of secured property Jan. 31
1099-B Sales, barters, and redemptions of securities Feb. 15
1099-C Cancellation/forgiveness of debt income (incl. mortgages) Jan. 31
1099-DlV Dividends, capital gains and distributions Jan. 31
1099-G Govt payments, including tax refunds & unemployment compensation Jan. 31
1099-INT Interest income Jan. 31
1099-K Credit card payments in course of trade or business Jan. 31
1099-LTC Payments under a long term care insurance contract Jan. 31
1099-MlSC (Rents) Rents & royalties, prizes awards non-employee compensation Feb. 15
1099-MISC (Attorney's fees) Attorney's fees 8 substitute payments Jan. 31
1099-R Retirement plan distributions (including IRAs profit sharing plans) Feb. 15
1099-S (Real Estate) Information about real estate gales Jan. 31
1099-SA (Distributions) Distributions from HSA, Archer MSA, or Medicare Advantage MSA Jan. 31 For contributions, May 15
5498 Contributions (including a rollover) to any individual retirement account, including a SEP, SIMPLE and Roth IRA May 31
5498-ESA Contributions to an HSA or Archer MSA and FMV of an HSA, Archer MSA or Medicare Advantage MSA Jan. 31
SSA-1099 Social Security payments Jan. 31
W-2 Wages, including sick pay and benefits Jan. 31
W-2G Gambling winnings Jan. 31

2017 Tax Deadlines for 2016 Tax Filing:

Beginning with the 2017 filing season, partnership returns will be due on March 15 (the 15th day of the third month for fiscal year partnerships). C corporation returns will be due on April 15 (the 15th day of fourth month for fiscal year corporations). S corporation returns will continue to be due on March 15. The due date for LLC returns depends on whether the LLC is treated as a partnership, C corporation, or S corporation. California FTB conforms to the federal changes.

TIPA signed, which will retroactively extend a package of expired tax breaks for 2014

On December 19, the President signed the Tax Increase Prevention Act of 2014 (HR 5771), which extends most of the expiring provisions through December 31, 2014. Here is a list of the extensions:

Individual provisions

  • State and local sales tax deduction
  • $250 teachers' deduction for classroom supplies
  • Debt discharge on principal residence
  • Mortgage insurance premium deduction
  • IRA-to-charity exclusion
  • Increased excludable employer-provided mass transit and parking benefits
  • Liberalized rules for qualified conservation contributions
  • Above-line deduction for qualified tuition expenses

Business provisions

  • Enhanced IRC §179 with a limit of $500,000
  • 50% bonus depreciation (includes $8,000 boost to first-year depreciation on qualifying vehicles)
  • 15-year depreciation on qualified leasehold and retail improvements and restaurant property
  • 7-year depreciation for motorsport racetrack facilities
  • 5-year period for built-in gains tax
  • Exclusion of 100% of gain on sale of small business stock
  • Expensing election for costs of film and television production
  • Classification of certain race horses as three-year property
  • Accelerated depreciation for business property on an Indian reservation
  • Research Tax Credit
  • Work Opportunity Tax Credit
  • Enhanced charitable deduction for contributions of food inventory

Energy provisions

  • Nonbusiness energy property credit
  • New energy-efficient home credit
  • Energy efficient commercial buildings deduction
  • Alternate fuels and mixtures excise tax credit

The following provisions were not extended:

  • Health coverage tax credit for displaced workers and retirees
  • Plug-in credit for two- and three-wheeled vehicles
  • Energy efficient appliance credit
  • New York Liberty Zone tax-exempt bond financing
  • Partial expensing of refinery equipment

The bill also will adjust, for inflation, failure-to-file and failure-to-pay penalties for tax returns required to be filed after December 31, 2014.

The law also includes the ABLE Act, which provides a new type of tax-advantaged savings plan for disabled individuals. (New IRC §529A) They are closely modeled after IRC §529 Qualified Tuition Plans.

IRS announces January 30 opening day

The tax return filing season will begin January 30 for most taxpayers, not on January 22 as originally planned. This means that January 30 is the first day they will accept e-filed returns. Although they will accept paper-filed returns before that date, they will not begin processing them until then.

The IRS also announced that the processing date for returns containing certain forms will be delayed until “late February or into March.” Two of the more common forms on the list are Form 4562, Depreciation and Amortization (Including Information on Listed Property), and Form 8582, Passive Activity Loss Limitations

Cancellation of Debt (COD) – Insolvency

Cancelation of debt should generally be reported as an income on your tax return, but luckily there are three exceptions:

  1. mortgage discharged after a foreclosure or debt reduced through mortgage restructuring on your principal residence
  2. bankruptcy and
  3. insolvency

For purposes of relief under the cancellation of debt income rules, you are insolvent if the total of all of your liabilities was more than the fair market value (FMV) of all of your assets immediately before the cancellation. For purposes of this calculation, your assets include the value of everything you own liabilities include the entire amount of recourse debts (debts that you are personally responsible for but not guaranteed with specific collateral, like your credit cards), the amount of nonrecourse debt (secured debt, like a mortgage).

How it works:

If under the tax laws, you were insolvent immediately before the cancellation of debt, you would not include that canceled debt in income. Generally, your canceled debt would be reported to you on a form 1099-C. Of course, the lending institution or bank which issued you the form 1099-C does not know that you qualify for an exception so you are going to have to let the IRS know why you are not including the amount of that 1099-C in income for tax purposes. You do this by completing a federal Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness. The IRS also offers Publication 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments (for Individuals) to assist you with the insolvency calculations.

77 percent of U.S. tax-payers received a refund on 2009 returns

About 77 percent of U.S. tax-payers received a refund on 2009 returns, averaging $2,994 each.

Is Your Social Security Taxable?

Social Security benefits are taxed depending on your total income from all sources. Here is how to calculate how much of your Social Security benefits is taxable.

Provisional Income

Provisional income is your total worldwide income, including tax-exempt income, plus half of your Social Security benefits.

Base Amounts

The following base amounts are used in figuring your taxable Social Security:

Filing Status Base Additional
Single $25,000 $34,000
Head of Household (HH) $25,000 $34,000
Married Filing Jointly (MFJ) $25,000 $34,000
Qualifying Widow (er) $25,000 $34,000
Taxable Social Security Benefits

  1. If your provisional income is below the base amounts for your filing status, then your Social Security benefits are not taxable.
  2. If you provisional income is between the base amount and the additional amount, then 50% of your Social Security benefits over the base amount are taxable.
  3. If your provisional income is over the additional amount, then $4,500 (or $6,000 if Married Filing Jointly) plus 85% of your Social Security benefits over the additional amount are taxable.
  4. The taxable portion of your Social Security benefits cannot exceed 85% of your total benefits.


New Tax Relief/Job Creation Act of 2010 bill extends Bush-era tax cuts, provides payroll tax relief, and reinstates the estate tax.

Extended Provisions

The bill extends these provisions, which had expired on December 31, 2009:

  • State & local sales tax deduction
  • Higher education tuition deduction
  • $250 above-the-line teacher’s classroom expense deduction
  • Charitable contributions of IRA
  • Charitable contributions of appreciated property for conservation purposes

(Note: the additional standard deduction for property tax was not extended.)

The bill provides an AMT patch. The exemption amounts for 2010 and 2011 are:

  2010 2011
Single/Head of Household $47,450 $48,450
Married filing joint/surviving spouse $72,450 $74,450
Married filing separate $36,225 $37,225

In addition, nonrefundable personal credits can be applied against AMT for two more years.

Here is a partial list of extensions of current law (these changes are effective through 2011 unless otherwise noted):

  • 2010 individual tax rates (effective through 2012)
  • 2010 rates on dividends and capital gains (effective through 2012)
  • No phase-out of itemized deductions or personal exemptions
  • Increased standard deduction and 15% bracket for married couples
  • $1,000 Child Tax Credit will continue
  • Earned Income Tax Credit enhancements
  • Maximum expenses for the Child and Dependent Care Credit remain at $3,000/$6,000
  • Deduction of mortgage insurance premiums
  • American Opportunity Tax Credit
  • Exclusion for employer educational assistance
  • Student loan interest deduction
  • Increased contributions to Coverdell Education Savings Accounts
  • Adoption Credit and exclusion for employer adoption assistance
Payroll Tax Cut

The Act reduces the employee-share of the OASDI portion of Social Security tax from 6.2% to 4.2% for wages earned in calendar year 2011, up to the taxable wage base of $106,800. This reduction applies to all wage earners and self-employed individuals with no reduction for income (i.e., no AGI phase-outs).

Business incentives

The Act provides the following business incentives:

  • 100% bonus depreciation for investments made after September 8, 2010, and before January 1, 2012
  • The §179 threshold will be $125,000/$500,000 for tax years beginning in 2012 (the limits are set at $500,000/$2 million for 2010 and 2011 under SBJA)
  • Extension of the R&D credit
  • Extension of the 100% small business stock exclusion
  • Extension of transit benefits
  • Extension of a number of business extenders
Energy Incentives

Many business energy incentives were extended, and the individual credit for energy efficiency improvements was also extended. However, the amount allowed returns to the pre-2009 lifetime limit of $500 (rather than the 2009/2010 maximum of $1,500).

Estate Taxes

The federal estate tax exemption is increased to $5 million with a maximum rate of 35% for 2011 and 2012. For decedents dying in 2010, the executor may elect to use the $5 million exemption and 35% rate, or the no estate tax and carryover basis provisions under EGTRRA.

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Payroll Tax Cut Extended

The House and Senate voted today to extend the payroll tax cut and unemployment benefits, while also avoiding a Medicare fee cut for doctors for the rest of the year. President Obama has promised to sign the legislation, which means Americans will continue to receive bigger paychecks through the rest of the year.

Investors might face higher taxes on dividends next year

If the tax cuts are allowed to expire at the end of the year, stock dividends will be subject to a much higher tax.

Right now, the tax on stock dividends typically is a maximum 15%. But if the Bush tax cuts expire and we revert to previous levels, dividends would be subject to an income-tax rate of as much as 39.6%. For instance, if the cuts were to expire, a married couple filing jointly with $100,000 in taxable income would be in the 28% tax bracket – the rate prior to the tax cuts – and would be subject to that rate on dividends.

There is talk that the tax cuts may only be extended for families earning less than $250,000 a year, or individuals earning less than $200,000. If that happens, then those earning more than that amount might be subject to a higher dividend tax.

If you would like details on provisions that affect you, please contact us.

The Hiring Incentives to Restore Employment (HIRE) Act of 2010

The Hiring Incentives to Restore Employment (HIRE) Act of 2010, created two new employer tax benefits to reward organizations for hiring and retaining unemployed or part-time workers.

Payroll tax exemption – provides employers with an exemption from the employer’s 6.2 percent share of social security tax on wages paid to qualifying employees, effective for wages paid from March 19, 2010 through December 31, 2010.

New hire retention credit – in addition, if the employee stays on for a full year, the business will also be eligible for a tax credit of up to $1,000.

FTB to Cease First-Time Buyer Tax Credit Program August 15, 2010

As of August 4, FTB has received 31,460 applications. Because some of the applications are invalid or duplicates, FTB will continue to accept them through August 15, to ensure that enough valid applications are received to properly allocate the full $100 million of tax credit. FTB estimates that it can award approximately 17,500-20,000 credit certificates to unique and valid applicants. However, once the funds are exhausted, any remaining applications will be denied.

The State is providing $100 million in tax credits to first-time home buyers. The credit will be allocated on a first-come, first-served basis using the date and time stamp on the fax submission, until the money is exhausted. The tax credit is available to those who purchased a qualified principal residence and did not own one during the last three years. This credit is five percent of the purchase price or $10,000, whichever is less. Taxpayers must claim the credit on their tax return in equal amounts over the following three tax years.

To apply, the buyer must complete and fax an FTB Form 3549-A, Application for New Home / First-Time Buyer Credit, along with the final settlement statement. It must be faxed to FTB within two weeks (14 calendar days) after the close of escrow. The fax number is 916.855.5577.

Taxpayers must receive a certificate of allocation from FTB to claim the tax credit on their California personal income tax return. FTB expects to send the allocation certificates over the next few months starting in August.

California homebuyers still have time to qualify for the state’s other $100 million home tax credit for the purchase of a new home. The New Home Credit is available for taxpayers who purchase (close escrow) a new home on or after May 1, 2010, and before August 1, 2011, as long as they enter into an enforceable contract executed before January 1, 2011. The seller must certify that the home has never been previously occupied.

FTB releases information on COD for short sales (01-14-14)

The FTB has updated their website to include information about mortgage debt relief for taxpayers who sold their principal residences through a short sale in 2013.

According to an IRS Information Letter dated September 19, 2013, the IRS determined that California taxpayers who sell their principal residences for less than what is owed through a short sale do not incur COD income. The FTB guidance confirms that California will follow this treatment.

The FTB clearly states that the IRS guidance is limited to California short sales only, and that the IRS guidance did not specifically address other types of real estate transactions, such as non-judicial foreclosures and mortgage loan modifications.

To view the new information, go to:

2010 Tax Year Earned Income Tax Credit

Earned Income and adjusted gross income (AGI) must each be less than:

  • $43,352 ($48,362 married filing jointly) with three or more qualifying children
  • $40,363 ($45,373 married filing jointly) with two qualifying children
  • $35,535 ($40,545 married filing jointly) with one qualifying child
  • $13,460 ($18,470 married filing jointly) with no qualifying children

Tax Year 2010 maximum credit:

  • $5,666 with three or more qualifying children
  • $5,036 with two qualifying children
  • $3,050 with one qualifying child
  • $457 with no qualifying children.

Investment income must be $3,100 or less for the year.

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Tax Advisors

7224 Shoreline Dr. # 175
San Diego, CA 92122
Phone: (858) 552-1360

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Today's tax laws are becoming so complex that filing even a simple return can be rather confusing. It is easy to overlook deductions and credits to which you are entitled. Even if you use tax preparation software there is no substitute for the assistance of an experienced tax professional.

Tax Advisors offer a broad range of services for individuals, small to medium size businesses and Real Estate investors. Our professionals will work with you on implementing customized tax planning strategies, help you get refunds faster and provide you and your family with timely financial advice.

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