Hi.
I am getting audited for 2018 for my short-term rental business in California ( LLC ) but all the receipts for the expenses have been stolen with other stuff in one of my apartments by guests during COVID and all the receipts I was gathering are gone. What should I do? How can I back... Read more »
answered on May 7, 2022
If you paid those expenses using credit/debit cards, you may be able to use your bank statements or credit card statements as proof. If you paid cash, do your best to document your cash payments and explain to the auditor why you are unable to produce the receipts.
My friend is starting up a business, he’s doing good and now needs a shop to work. He does not have the credit to lease a place. He asked me to help him lease in exchange for 10% of earnings. What would I have to report to the IRS or does his total earnings affect me in any way? I am aware I’m... Read more »
answered on May 6, 2022
Although not mandatory, I hope you have this agreement in writing. The 10% payment in exchange for co-signing a lease is considered in the broad definition of gross income. So, the short answer is yes, it must be reported to the IRS. Your friend may also have an obligation to issue you a 1099, so... Read more »
I also used worked from home so I’m filling out line 30.
answered on May 4, 2022
With the presumption that you live in California, the income and expenses you claimed in your Sch. C are generally allowed in California with some exceptions. In preparing your CA return, you start with your adjusted gross income (AGI) then you adjust for additions and subtractions. For instance,... Read more »
To qualify for the rebate, I had to 1) Sell my current home to Zillow, 2) Purchase my new home through an approved Zillow real estate agent, and 3) Finance my new home through Zillow Home Loans. After all three requirements were met, I received a Rebate of 2% of my former home's selling... Read more »
answered on May 4, 2022
You are correct. Generally when a company pays a customer compensation in the form of a rebate as an inducement to use their services (sell/buy/loan), that payment is not considered income. Price adjustments and rebates are not considered in the broad definition of gross income.
On the filing of article incorporation of a NPO, two purposes available for ticking : Public purpose and Charitable purpose. What’s the difference? Also If Public purpose is checked can the organization still get 501(c)(3) tax exempt status ?
answered on Apr 28, 2022
A good question. It's not helpful that courts in California have frequently used the terms "public purpose" and "charitable purpose" interchangeably.
Taking your last question first: the IRS will not likely deny a 501(c)(3) determination if you check the box for... Read more »
answered on Apr 22, 2022
Unfortunately, the California Revenue and Taxation Code allows the FTB to do this.
It's important to note that relief from the levies may very well be available.
It's best to immediately establish contact with an experienced tax attorney to help you with this.
I live in California, but have a house in Puerto Rice. Is there a withholding of 15% to the IRS for the sale of my house for $400k
answered on Apr 21, 2022
The IRS only requires 15% of the sales price be withheld on the sale of United States real property interests by foreign persons.
Normally, I am self-employed (independent contractor) freelance exec. assistant and run my business from my apartment and use Schedule C to deduct expenses for that business. However, from Jan. to Sept 2021 I collected Pandemic Unemployment Assistance and did not have any earned income and my PUA... Read more »
answered on May 4, 2022
Just to clarify, it you looked for work unrelated to your business, the expenses may not qualify. However, if the expenses are related to maintaining your current business, they may qualify as expenses even if you didn't have earned income for that year.
I had a tax issue and the issue has gone to IRS court. Can I do a settlement with the IRS instead of going to court? The Tax Agent who has handled my case bailed out at the last moment. Is it advisable to go with an attorney who may charge up to 25k start and may go up? Where should I get good... Read more »
answered on Apr 3, 2022
Yes, you most certainly settle your case. In fact, a very high percentage of Tax Court cases are settled.
I can afford to not work. But a past employer wants me to work for them. Ideally, i want my taxable income to be as low as possible when i sell our house, correct?
answered on Mar 29, 2022
If this home qualifies as your primary residence, you will qualify for a capital gain exclusion of $250k, if single, or $500k, if married. If this is an investment property, you may defer taxable gain by doing a 1031 exchange. There are also ways to change the characteristics of properties in... Read more »
I have a question regarding taxes…my employer last year classified me as an independent contractor, however i was looking into CA state law and based on what I was reading, I should have been classified as an employee. The employer gave me a 1099 and now I owe around $3000 in taxes. Is there... Read more »
answered on Mar 11, 2022
In the employment law context, if you are actually an employee and not an IC, you have the protections of the California Labor Codes that you can adjudicate against your employer. Specifically, as an employee, you are entitled to overtime pay ( if you work more than 8 hours per day/ more than 40... Read more »
After I confronted my boss about him illegally giving me a 1099 since I’m not a independent contractor nor self employed i demanded a w2 . He messaged me insisting I was and he said if I ask for a W-2 he said say good bye to my freedoms and basically my flexibility I’ve been given as... Read more »
answered on Mar 9, 2022
It is unlawful to retaliate against an employee who refuses to participate in illegal activity. It sounds like your employer is retaliating against you for refusing to go along with 1099 which you believe is improper in your case.
I suggest you consult with an employment law attorney who... Read more »
He gives me 1099 as self employed even though I’m not and I’m paid every two weeks and stay in office.
answered on Mar 8, 2022
First, it needs to be determined whether you are actually an independent contractor (IC) and not an employee. Just because the employer characterizes you as an IC, does not make it so. In California, it is not easy to qualify to be an IC if the employer exercises control over you and you are... Read more »
The employer name on the w-2 is the company's HR outsourcing company, not the company I'm working for. Is this legal to do? This would affect my personal obligations such as for example buying a house or applying for a visa.
answered on Feb 24, 2022
The name of your employer from your pay stubs should match what is on your W-2 because the law requires the true name of the employer to be on the pay stubs. Abbreviations can be ok if they are not concealing the name of the employer.
Mother died about 7 years ago- no one changed the ownership of the deed or house to my siblings. Now my siblings want nothing to do with it and I am stuck with the house. The house in 2006 had a loan pulled out of it for 201,500. But i have had to make payments on the mortgage to make sure its... Read more »
answered on Feb 24, 2022
you will need to contact and consult with a probate attorney as to your options.
The home has been equally owned by the sisters for 50 years. They both have family who would ultimately inherit the property. Would the tax basis change? Would the property taxes change?
answered on Feb 21, 2022
Converting a single-family residence to a duplex will not necessarily increase the value of the home. However, if the value is increased, the property taxes will be reassessed to reflect the increased value of the home. Per the California Board of Equalization website, new construction or... Read more »
My grandma moved the property into a living trust in the mid 90's. She passed away in 2019 and the trust became irrevocable. The trust gives a life estate to my uncle. His daughter (my cousin) and I are executors of the trust. As the grandchildren we get the remainder of the property to do... Read more »
answered on Feb 15, 2022
Depending on the language in the trust, you should qualify for the Grandparent\Grandchild exemption. You can take a copy of the trust to the County Assessor's office and explain the situation to them. If that doesn't work, contact a lawyer in your area for assistance. Best wishes!
I'll be working from a home office, based in California. Would like to incorporate in Florida.
The nature of the job is either consulting to tech. companies or offering engineering services or selling them designs which I make on my own.
answered on Feb 13, 2022
Generally, if a foreign corporation (e.g. a different state) is operating/doing business in a different state than the state in which they are incorporated, they register with the state agency that regulates corporations (in California, the Secretary of State) as a foreign business entity (e.g. a... Read more »
answered on Feb 3, 2022
Yes, you are allowed to pay yourself a salary. Work with your accountant to be sure you are getting the best tax advantages.
A family member of mine was bequeathed a house from a living trust. He has not claimed it because he doesn’t work so he can get medi-cal to cover the medical care that he needs. Would he be able to claim it and transfer it to someone else without it affecting his qualifications for medical or his... Read more »
answered on Jan 19, 2022
No. Deeds are public records that anyone can see and receive a copy of simply by asking the County Recorder and paying the copying fee. Many counties have their deeds online for easy access. Also, be aware that there is a “look back period” before someone can qualify for some needs-based... Read more »
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