Questions people ask us

HSR Audit & Tax Inc. is a California corporation, Secretary of State entity number 5919529, incorporated September 26, 2023. The office is at 6755 Tampa Ave in Reseda. Our Disclosures page links to the state business search at bizfileonline.sos.ca.gov so you can look it up.

Type the company name or the entity number into the state search and the record shows the status, the filing date, and the agent for service of process. Romelia C. Aguilar, President, leads the company.

You can also call (818) 401-7468 during office hours, Monday to Friday 9:00 AM to 6:00 PM and Saturday 10:00 AM to 2:00 PM, or stop by Tampa Ave. The Disclosures page carries the full entity record.

In California, only four groups may prepare tax returns for a fee: certified public accountants, attorneys, IRS enrolled agents, and CTEC registered tax preparers, who register with the California Tax Education Council. Anyone else charging for this work is operating outside the law.

CTEC registered tax preparers complete approved education each year, hold a surety bond, and renew with the council. You can check any registered preparer by name at ctec.org under Verify a Preparer.

Our Disclosures page explains how this rule applies to our office and where to verify. Before you pay anyone to prepare a return, ask which of the four groups they belong to and look it up.

Yes. Spanish is spoken in our Reseda office, so you can ask questions and go over your return in Spanish. This website is also available in Spanish. Call (818) 401-7468 and ask for help in Spanish when you book.

Se habla español. Bring your documents as they are. IRS and Franchise Tax Board letters arrive in English, and we walk through them with you in the language you prefer.

We prepare your return in English and go over every line with you in Spanish, so you understand what you sign before you sign it. Contact us to set a time, or read this site in Spanish.

Bring photo identification, Social Security cards or ITIN letters for everyone on the return, last year's returns, and every tax form you received, such as W-2s, 1099s, 1095-A, and 1098s. Also bring records of income or expenses that did not arrive on a form.

If you work for yourself, bring a summary of income and expenses, or the bank and card statements we can build one from. Parents should bring the daycare provider’s details, and homeowners the property tax bill. If you had health coverage through Covered California, the 1095-A is required before the return can be filed.

If you are unsure what applies to you, call (818) 401-7468 and we will give you a short list for your situation before you come to Tampa Ave. More on the individual tax preparation page.

Our fee depends on the forms and schedules your return needs and the condition of your records. It is never based on the size of your refund. You get a written quote before any work begins. The Fees page explains what changes the price.

A return with one W-2 and the standard deduction takes less work than one with rental property, a Schedule C, and a box of receipts, and the fee reflects that. Organized records lower the time involved, which lowers the fee.

See the Fees page for how we quote and what is included. A fee that rises with your refund is a warning sign, at any office.

Yes. We serve Northridge, Tarzana, Winnetka, Canoga Park, Lake Balboa, Van Nuys, Encino, Woodland Hills, West Hills, and the wider San Fernando Valley. The office is at 6755 Tampa Ave in Reseda, and office visits are by appointment.

Tampa Ave is a short drive from the 101 at the Tampa exit or along Sherman Way across the Valley. Call (818) 401-7468 to set a time, including extended hours during tax season.

If coming in is hard, ask about other ways to send documents when you call. The Reseda tax preparation page has directions.

A CTEC registered tax preparer completes approved education, holds a bond, and registers with the California Tax Education Council. An enrolled agent passes an IRS exam and can represent taxpayers before the IRS. A certified public accountant is licensed by a state board of accountancy.

All three may prepare returns for a fee in California. The practical difference is representation. Enrolled agents, CPAs, and attorneys have unlimited practice rights before the IRS. A CTEC registered tax preparer has limited practice rights, which matters only if a return is examined and the matter moves beyond correspondence.

Verify a CTEC registration at ctec.org, an enrolled agent in the IRS directory at irs.gov, and a CPA license at cba.ca.gov. Our Disclosures page explains what applies to this office.

Request your IRS wage and income transcripts for each missing year. They show the W-2s and 1099s reported in your name, and we use them to rebuild each return, oldest year first. Filing before the IRS files for you keeps your options open.

Transcripts are free at irs.gov under Get Transcript. Bring any Franchise Tax Board letters you received; they often list the income the state already knows about. If the IRS has already prepared a substitute return for a year, a correct return you file can be processed in its place.

Refunds on old returns expire after a set period, so do not wait on the years that may owe you money. Bring whatever records you have, even partial ones, to prior year and amended returns.

In most cases, yes. California requires its own return, Form 540, from residents with income above the state filing threshold. Your federal return does not cover it; the Franchise Tax Board processes it, not the IRS. We prepare both returns so the numbers match.

The filing threshold changes each year and depends on filing status, age, and dependents; the current table is on ftb.ca.gov under Do you need to file. Even below the threshold, filing can return state withholding taken from your paycheck or claim the California Earned Income Tax Credit.

California does not follow every federal rule, so some deductions and credits differ between the two returns. Part of preparing Form 540 is adjusting for those differences on Schedule CA.

Rideshare income goes on Schedule C as business income, alongside your W-2 wages. You owe income tax and self employment tax on the net profit after mileage and other driving expenses. Keep a mileage log; without one the deduction is hard to support.

Uber and Lyft send a 1099-K, a 1099-NEC, or both, and the app’s yearly tax summary shows online miles and fees that we also use. Phone costs and the share of insurance tied to driving can count when you have records.

Because no tax is withheld from app payments, many drivers owe at filing. Raising withholding at the W-2 job, or paying estimated tax by the quarterly dates, prevents that. See individual tax preparation and tax planning.

Yes. A federal return is corrected with Form 1040-X, and the California return with Schedule X attached to a corrected Form 540. We compare the original to the right figures, prepare both amendments, and tell you what changes before anything is sent.

Not every error needs an amendment. The IRS corrects simple math errors on its own and sends a notice, and a missing form sometimes draws a letter instead. Bring the original return and the document that revealed the mistake, and we will tell you which path applies.

An amendment that increases your refund has a time limit, so do not sit on it. Details on prior year and amended returns.

Every California LLC files Form 568 each year and pays the annual LLC tax to the Franchise Tax Board, even with no income. Federally, a single owner LLC reports on the owner's Schedule C, and an LLC with several owners files a partnership return.

The annual LLC tax is due whether or not the business made money, and the Franchise Tax Board adds a fee once gross receipts pass a set level. Missing Form 568 brings penalties that grow each month, so the LLC return belongs on the calendar next to your personal return.

An LLC that elected S corporation status files Form 1120-S federally and Form 100S with California instead. See small business tax preparation.

For a calendar year S corporation, the federal Form 1120-S and the California Form 100S are due March 15, a month before personal returns. Each shareholder receives a Schedule K-1 from the return, so the business return must be finished before your personal returns.

An extension moves the filing date to September 15 but does not extend the time to pay. California also charges S corporations a franchise tax each year, with a minimum amount due even in a loss year, paid to the Franchise Tax Board.

Owners who work in the business are expected to take a reasonable salary through payroll, which is a frequent question in examinations. Bring the year end balance sheet, payroll reports, and last year’s return to your small business tax preparation appointment.

No. A sole proprietor reports business income and expenses on Schedule C, inside your personal Form 1040, and the profit carries to your California Form 540. You owe self employment tax on the net profit, and business records should stay separate from personal ones.

A separate business bank account makes Schedule C easier to prepare and easier to defend if the IRS asks questions. The City of Los Angeles also requires a business tax registration certificate for businesses operating in the city, which includes Reseda, and that is separate from your income tax returns.

If the business grows, forming an LLC or electing S corporation status may make sense. That is a tax planning conversation to have before December 31, not after.

If the helper was an independent contractor and your payments for the year reached the IRS reporting threshold, you send a Form 1099-NEC by January 31 and file a copy with the IRS. Payments to employees go on a W-2 through payroll instead.

Collect a Form W-9 from every contractor before the first payment so you have the name, address, and taxpayer identification number when January comes. The current threshold is listed on irs.gov under About Form 1099-NEC.

California applies the ABC test to decide whether a worker is a contractor or an employee, and the answer affects payroll taxes, not just the 1099. If you are unsure, raise it before the year ends through tax planning.

If no tax is withheld from your business income and you will owe at filing, the IRS and Franchise Tax Board expect payments during the year, using Form 1040-ES and Form 540-ES, due in April, June, September, and January. Skipping them adds a penalty.

California does not split the payments evenly. The Franchise Tax Board front loads them, with larger shares due in April and June and nothing due in September. The exact percentages are on ftb.ca.gov.

In many cases a safe harbor based on last year’s tax lets you set the amounts once and avoid the penalty even if income rises. We calculate the vouchers as part of tax planning and when we prepare your return.

Open it right away and find the response date. Do not pay or call anyone until you understand what the letter claims. Bring it to us with the return it refers to, and we explain what it means and prepare the written response.

Every IRS notice has a code in the corner, such as CP2000 or CP14, and the Franchise Tax Board labels its letters the same way. The code tells us what the agency wants: a missing form, a math change, a balance due, or proof of something you claimed. Many notices are resolved with one letter and the right attachment.

Even if the notice is correct and you owe, answering by the date keeps penalties and interest from growing. See tax audit support and notice response.

We help you understand the notice, gather the records, and prepare the written response. A registered tax preparer has limited practice rights before the IRS, so for anything beyond correspondence we explain your options and can refer you to an enrolled agent or attorney.

That limit covers an examination that moves beyond correspondence and any matter that goes to appeals or collections. Correspondence examinations, where the IRS asks by mail for proof of a deduction or a credit, are common, and a complete written reply with the right documents closes many of them. We organize the records, draft the reply, and keep copies of everything sent.

If your notice asks for a meeting at an IRS office or a Franchise Tax Board office, bring it to us first so you know what is being asked before you decide how to proceed. See tax audit support and notice response.

A CP2000 is not an audit. An IRS computer matched the W-2s and 1099s on file against your return, found income it believes you left off, and proposes a tax change. You respond by the date on the notice, agreeing or disputing it with proof.

The proposed amount is not always right. A stock sale reported on a 1099-B, for example, shows the full sale price but not what you paid, so the notice taxes the whole amount. A response that shows the cost basis can cut the balance sharply or erase it.

Do not file an amended return in reply to a CP2000; the IRS asks that you answer the notice itself. The Franchise Tax Board usually follows with its own notice once the federal change is final, so the federal answer should be right the first time. See tax audit support and notice response.

Respond by the date on the notice with proof of filing: a copy of the Form 540, the electronic filing acceptance, or the mailing receipt. If the return was never received, file it again as the response. Ignoring the notice leads to a tax assessment.

These letters, titled Request for Tax Return or Demand for Tax Return, go out when the state sees income under your Social Security number, from a W-2, a 1099, or a mortgage interest statement, and has no return on file. Sometimes the return was filed under a different name or filing status than the one being matched.

If you were not required to file for that year, the notice includes a way to say so, and we help you answer it. Bring every page, including the response form, to tax audit support and notice response.

The IRS starts contact by mail, not by phone or text. It never demands payment by gift card or threatens arrest. A real notice carries a code such as CP14 and explains your rights. Check it at irs.gov or bring it to us before responding.

The IRS lists every notice by number at irs.gov under Understanding Your IRS Notice or Letter, with a page that explains what each one means. The Franchise Tax Board does the same at ftb.ca.gov. If the code on your letter is not on the list, be suspicious.

Callers who claim to be the IRS and press for payment today are running a scam. Hang up. If you are unsure about anything you received, call (818) 401-7468 and we will look at it with you.

If you file a Schedule C or a business return, you do bookkeeping; the question is when it happens, each month or in a rush every April. Current books mean a return built from reconciled numbers and records that hold up if the IRS asks.

Bookkeeping at this size is mostly categorizing bank and card transactions, matching them to receipts, and reconciling the account each month so the balance agrees with the statement. Done monthly, it takes a short session. Done once a year, it takes days, and the memory of what a charge was for is gone.

Lenders and landlords ask for a profit and loss statement more often than owners expect, and a set of monthly books produces one on request. See bookkeeping and accounting.

Yes. Catch up work starts with the bank and card statements for the missing months, which we categorize and reconcile in order until the books are current. Start early, because the return cannot be finished until the books are, and a full year takes time.

Bring the statements for every account the business uses, including any personal card that paid business expenses, plus loan statements and last year’s return so opening balances line up. Missing receipts are not a dead end; the statement line and a short note on what it was for carry most of the weight.

Once caught up, moving to monthly bookkeeping keeps you from repeating this next year. See bookkeeping and accounting and small business tax preparation.

Keep everything that supports a number on your return: income forms, bank and card statements, receipts for deductions, and mileage logs. Hold them for as long as the IRS and Franchise Tax Board can examine that return; California's window is longer than the federal one.

The IRS publishes the periods at irs.gov under How long should I keep records, and the Franchise Tax Board’s rule is on ftb.ca.gov. Records for property, equipment, and retirement accounts stay until the asset is sold or the account is closed, plus the examination period.

Photos and scans of receipts count, so scan them as you go and keep the folder backed up. Bookkeeping and accounting clients keep theirs alongside the monthly books.