Three Types of FTB Audits As with all taxing authorities, the California Franchise Tax Board or FTB, conducts audits of tax returns. There are three types of FTB audits. This blog post will discuss the three types of FTB audits California Taxpayers may face. The first type of audit is a regular audit. This type of audit usually occurs on a random basis and may be triggered by a state or federal agency. The audit involves a review of a taxpayer’s records such as bank statements and receipts to determine whether the taxpayer’s return contains any errors. At the end of the audit, the FTB auditor ..read more

1099-K forms Congress passed legislation in 2021 that required Third Party Settlement Organizations (TPSOs)  such as Venmo, Zelle, and Cash App to issue 1099-K forms to payees who receive $600 or more in a tax year.  While the IRS delayed implementation of the legislation for the 2022 and 2023 calendar years, it  is not likely the IRS will delay implementation of the legislation again.  As such, TPSOs including Venmo, Zelle, and Cash App will most likely start issuing 1099-Ks to payees for the 2024 calendar year. TPSOs similar to Venmo, Zelle, and Cash App are only suppose ..read more

New 529 Rollover Provision For years, the 529 rollover has been a popular way for parents to save for their children’s education. These tax-advantaged accounts offer a variety of benefits, including tax-free growth and qualified withdrawals. However, one of the drawbacks of 529 plans has been that the funds may only be used for qualified educational expenses. As such, if a child did not end up going to college, or they had leftover funds after graduation, there were limited options for accessing the funds. The good news is there is a new 529 rollover provision which provides more flexibility w ..read more

Overlooked Tax Deductions Tax season is upon us, and taxpayers are diligently gathering W-2s, receipts and preparing their tax returns. And just like every other year, according to the IRS, millions of people will miss out on deductions to which they are eligible, that could significantly boost tax refunds. These hidden gems could substantially reduce tax liabilities putting more money back in peoples’ pockets. Here are the Top 10 overlooked tax deductions to boost refunds. 1. State and Local Taxes (SALT): The IRS allows a deduction of up to $10,000 of state and local taxes, including income t ..read more

IRS Extends Tax Filing and Tax Payment Deadlines The IRS recently announced tax filing and tax payment deadline extensions for all San Diego county taxpayers.. To assist residents adversely affected by the recent winter storms, Federal filing deadlines have been extended to June 17, 2024.   The Franchise Tax Board followed suit and also issued a June 17, 2024 extension  for California Personal Income tax and business tax returns.  More details on the IRS Extends Tax Filing and Tax Payment Deadlines for San Diego County Taxpayers. The IRS deadline extension applies to tax p ..read more

Beneficial Ownership Information Reporting The Corporate Transparency Act (CTA), enacted in 2021, has significant implications for many businesses in the United States. Effective January 2024, CTA introduced a new filing requirement for certain business entities  to file reports with the Financial Crimes Enforcement Network (FinCEN) disclosing detailed information concerning their beneficial owners. To ensure compliance and avoid potential penalties, it is crucial to understand the reporting requirements and potential challenges. What is Beneficial Ownership Information Reporting? The Co ..read more

IRS | ERTC | ERC The IRS issued a recent press release announcing Seven Warning Signs a business’ Employee Retention Tax Credit (ERC or ERTC) may be incorrect or even fraudulent.  Businesses that filed incorrect or fraudulent ERC or ERTC claims may not only have to pay back the refunds they received but may also be liable to pay interest and penalties. The IRS has recently announced it would step up its enforcement of erroneous or fraudulent ERC claims.  According to the IRS, the seven signs of incorrect or fraudulent ERC claim are:  Claiming too many quarters; Basing claims o ..read more

ERTC Deadline Congress is currently considering legislation which may affect the deadline for Covid-19 tax relief employers have to file a claim for Employee Retention Tax Credits (ERTCs or ERCs).  The current ERTC deadline is April 15th of this year. The legislation Congress is currently working on will move the deadline to January 31, 2024t. This means businesses that have not yet filed for ERTCs may have only a few days to complete and file their ERTC claims. The ERTC gives eligible employers a credit of up to $5,000 per employee for 2020 and $7,000 per quarter in 2021, leading to a m ..read more

IRS Standard Mileage Rate 2024 The Internal Revenue Service (IRS) has recently announced updates to the standard mileage rates for 2024. Taxpayers use these rates to calculate the deductible costs of operating vehicles for business, medical, moving, and charitable purposes. Here are the key details regarding these changes and how they affect taxpayers. Key Changes in Mileage Rates The business use standard mileage rate has increased by 1.5 cents to 67 cents per mile. This rate is used by self-employed individuals or employees who claim vehicle expenses for business purposes on ..read more

California Small Estate Affidavit Estate planning is an important part of financial planning, but it can be complex. Many times, assets fail to be protected from probate proceedings. However, assets may nonetheless be transferred to the decedent’s successor in interest without having to go through probate by utilizing a Small Estate Affidavit. However, there are a number of pitfalls to be avoided when using a Small Estate Affidavit, as these may delay or prevent the transfer of assets to beneficiaries. To use the California Small Estate Affidavit, the following requirements must be met: The d ..read more