A qualifying relative is a person who is not a qualifying child of anyone else in San Diego, Mira Mesa, Scripps Ranch, Rancho Penasquitos, 4S Ranch, Rancho Bernardo, Poway and Sabre Springs and who meets three test.  If you need assistance in determining if your relative qualifies to claim as a dependent, please call Steve Pearson, Certified Public Accountant at (858)695-1040.

Tax credits are available for purchases of “Qualified Hybrid Motor Vehicles” and “Advance Lean-Burn Technology Motor Vehicles” for residents in San Diego, Mira Mesa, Scripps Ranch, Rancho Penasquitos, 4S Ranch, Rancho Bernardo, Poway and Sabre Springs.  If you need assistance in determining if your vehicle qualifies, please call Steve Pearson, Certified Public Accountant at (858) 695-1040.

Over-the-counter drugs purchased without a prescription reimbursed through a flexible spending arrangement (FSA) or other employer health plan are not taxable in 2010 to empolyees in San Diego, Mira Mesa, Scripps Ranch, Rancho Penasquitos, 4S Ranch, Rancho Bernardo, Sabre Springs and Poway.  Please note that they are not deductible as a medical expense on Schedule A, itemized deductions.  If you need assistance, please call Steve Pearson, Certified Public Acountant at (858)695-1040.

The IRS just relaeased a draft version of the proposed change to the 2011 W-2 Form for reporting the cost of employer-sponsored health coverage provided by the employer for companies in San Diego, Mira Mesa, Scripps Ranch, 4S Ranch, Rancho Penasquitos, Rancho Bernardo, Poway and Sabre Springs.  If you need assistance in planning for this new change, please call Steve Pearson, Certified Public Acountant.

Life Insurance paid because of the death of the insured may not be subject to federal income taxes for residents of Mira Mesa, San Diego, Scripps Ranch, Poway, Rancho Penasquitos, Rancho Bernardo and 4S Ranch.  If you need help in this area, please call Steve Pearson, Certified Public Accountant at 858-695-1040.

Converting a traditional IRA to a Roth IRA may save tax dollars by reducing your Social Security income that is subject to income tax for San Diego, Mira Mesa, Scripps Ranch, Rancho Bernardo, Rancho Penasquitos residents.  For additional information whether you should convert and save tax dollars, please call Steve Pearson, CPA at 858-695-1040.

A new law recently eliminated the ability for earned income recipents to receive the option of getting the tax credit paid out to them in advance starting in 2011.  However, earned income recipents can adjust their W-4 forms to in order not to over pay their withholding in San Diego, Mira Mesa, Scripps Ranch, Rancho Penasquitos, Rancho Bernardo, and Poway.  If you need assistance please call Steve Pearson, CPA at 858-695-1040.

The California State Board of Equalization (BOE) required, because of a recent law change, many businesses to register and file use tax returns.  Businesses would owe use tax on out-of-state purchases made without sales tax for their use in California.  As a former BOE tax auditor I know and understand the registration and filing requirements and can help determine which purchases are subject to use taxes.  Please call Steve Pearson, CPA at (858) 695-1040.

The cost of sending your child to a day camp in San Diego, Mira Mesa, Scripps Ranch, Rancho Penasquitos, Ranco Bernardo, 4S Ranch may be deductible as work-related expense, even if the camp specializes in a particular activity, such as soccer or computers.  Certain qualifications must be met in order to claim the credit.  To see if you qualify, please call Steve Pearson, Certified Public Accountant at (858)695-1040.
Steve Pearson, CPA

Self employed individuals in San Diego, Mira Mesa, Scripps Ranch, Rancho Penasquitos, Rancho Bernardo, and 4S Ranch can deduct vehicle business expenses on their income tax returns if (1)the vehicle is used in the business, (2)it is ordinary and necessary, (3) it is incurred in carrying on business.  In addition, you will need the (1) the total miles for the year, (2) the total business miles driven driven for the year, (3) date the vehicle placed in service, (4) the cost of the vehicle and (5) the vehicle expenses.  In order to substantiate that it is incurred in carrying on business it will be necessary to to keep a log of the miles and the business purpose and the destination.  The Tax court recently denied mileage deductions for a self employed individual that had kept a log of the business miles but did not record the business purpose of the trip and the destination.  If you need help in your business expense deductions, please call me at (858) 695-1040.
Steve Pearson, Certified Public Accountant