Tax & Accounting Questions, Answered by Topic
Yes — always. We believe in getting to know your situation before recommending anything. A free consultation gives both of us the chance to see if we're a good fit. You can reach us on our Contact page.
For a first meeting, don't worry about having everything perfect. If you're coming for tax preparation, it helps to have last year's return, any W-2s or 1099s you've received, and a rough idea of other income sources. For business consultations, just bring what you have — we'll figure out what else is needed together.
Both. Our office is located in Hayward, CA and we welcome in-person visits. We also work with clients remotely via phone, email, and document sharing — so location is rarely a barrier.
Our pricing varies based on the scope and complexity of your needs. We don't believe in one-size-fits-all pricing. After a free consultation, we'll give you a clear, upfront quote before any work begins — no hidden fees, no surprises.
The easiest way is to reach out via our Contact page. Fill out the form or give us a call at (510) 320-3090 and we'll schedule a free initial consultation to discuss your situation and how we can help.
For most individuals, federal and California state income tax returns are due on April 15th. A 6-month extension can be filed — but an extension to file is not an extension to pay. Any taxes owed are still due by April 15th to avoid penalties and interest.
The exact documents depend on your situation, but commonly you'll need:
Don't stress about gathering everything before you reach out — we can guide you through it.
If you miss the deadline without filing an extension, you may be subject to failure-to-file and failure-to-pay penalties from the IRS and California FTB. The sooner you file after the deadline, the better — penalties grow over time. Reach out and we'll help you get caught up as quickly and painlessly as possible.
Yes. If you have net self-employment income of $400 or more, you're required to file a federal tax return and pay self-employment tax (Social Security and Medicare). California has its own requirements as well. Self-employed individuals are also typically expected to make quarterly estimated tax payments throughout the year to avoid underpayment penalties.
If you're self-employed or a business owner and use part of your home exclusively and regularly for business, you may qualify for the home office deduction. W-2 employees generally cannot claim this deduction under current federal tax law. The rules have specific requirements — this is a great question to discuss in a consultation so we can evaluate your specific situation.
A tax deduction reduces your taxable income, which in turn reduces the amount of tax you owe. For example, a $1,000 deduction in the 22% tax bracket saves you $220. A tax credit, on the other hand, directly reduces your tax bill dollar-for-dollar. A $1,000 tax credit reduces what you owe by $1,000 — making credits generally more valuable than deductions of the same amount.
Don't panic — most IRS notices are routine and don't mean you're being audited. Read it carefully to understand what the IRS is asking. Common notices involve balance due, a change to your return, or a request for more information. Whatever the notice, contact us and we'll help you understand it and respond appropriately. Acting quickly is important — most notices have a deadline for response.
An LLC is a legal entity structure that provides liability protection. An S-Corp is a tax classification that an LLC (or corporation) can elect. Many small business owners form an LLC and then elect S-Corp status for potential self-employment tax savings. The right choice depends on your income, industry, and long-term goals — exactly the kind of question we help sort out in a consultation.
The answer depends on your business structure. S-Corp owners who work in the business are required by the IRS to pay themselves a "reasonable salary." Sole proprietors and single-member LLC owners take owner draws and pay self-employment tax on net profits instead. Getting this right matters for compliance and tax planning.
Accounting software is a great tool — but it's only as accurate as the information entered and the person interpreting the results. Many business owners enter data incorrectly, miss deductions, or misclassify transactions without realizing it. An accountant helps you set things up correctly, reviews your books for accuracy, ensures compliance, and prepares your tax filings. Think of the software as the tool and HKC Consulting as the expert who makes sure it's working for you.
If you expect to owe at least $1,000 in federal taxes for the year (and your withholding doesn't cover it), you're generally required to make quarterly estimated payments. This applies to self-employed individuals, business owners, and anyone with significant income that isn't subject to automatic withholding. Quarterly due dates are typically April, June, September, and January.
Cash basis accounting records income when you receive it and expenses when you pay them. Accrual accounting records income when it's earned and expenses when they're incurred — regardless of when money changes hands. Most small businesses use cash basis because it's simpler, but some businesses are required to use accrual. The right method depends on your industry, revenue, and reporting needs.
The IRS generally recommends keeping tax records for at least 3 years from the date you filed your return, but some situations require longer retention:
California FTB has a 4-year statute of limitations in most cases. When in doubt, keep it longer.
We work with QuickBooks (Online and Desktop), Wave, and other common accounting platforms. We're happy to work within your existing setup or recommend the best platform for your business needs.
Yes. We work with small businesses across a wide range of industries in the Bay Area — retail, food service, professional services, construction, e-commerce, and more. We also have specialized expertise in the venture capital industry. If you're not sure whether we're the right fit, just reach out and we'll be honest about whether we can serve you well.
As an employer, you're responsible for withholding federal income tax, Social Security, and Medicare (FICA) from each employee's paycheck, and for matching the Social Security and Medicare contributions. You also owe federal unemployment tax (FUTA) and California state payroll taxes (SDI, ETT, UI). These must be deposited on a schedule set by the IRS and EDD — missing deposits can result in significant penalties.
Federal payroll tax deposit schedules are either monthly or semi-weekly depending on your total payroll tax liability. IRS Form 941 (Employer's Quarterly Federal Tax Return) is due in April, July, October, and January. California DE-9 and DE-9C are also filed quarterly. W-2s must be issued to employees by January 31st each year. We track and file all of this for our payroll clients.
If you're a sole proprietor with no employees (or contractors), you don't need a formal payroll system — you pay yourself through owner draws and pay self-employment tax instead. However, if you elect S-Corp status, you are required to put yourself on payroll and receive a reasonable salary. We can help you determine the right structure and set up payroll if needed.
The IRS and California EDD look at several factors to determine worker classification — including how much control you have over how and when work is done, whether the relationship is permanent, and whether the work is a core part of your business. Misclassifying employees as contractors can lead to serious tax penalties and back payments. If you're unsure about a worker's classification, it's worth getting professional guidance before you run into problems.
Yes — this is one of our areas of specialization. We work with VC funds, management companies, and portfolio businesses, providing fund accounting, LP reporting, K-1 preparation, management fee tracking, and more. The VC world has unique accounting and tax complexities, and we have the experience to navigate them accurately.
A Schedule K-1 is a tax form that reports a partner's or shareholder's share of income, deductions, and credits from a partnership, S-corporation, estate, or trust. If you're an investor in a venture capital fund or a partner in a partnership, you'll receive a K-1 each year — often later than W-2s, typically by March 15th (or later with extensions). You need your K-1 to file your personal or business tax return, and we can help you report it correctly.
Investment gains are taxed differently depending on how long you held the asset. Short-term gains (assets held one year or less) are taxed as ordinary income at your regular tax rate. Long-term gains (assets held more than one year) are taxed at preferential rates — 0%, 15%, or 20% depending on your income. California taxes all capital gains as ordinary income, with no preferential rate. Proper tax planning around investment gains can make a significant difference in what you owe.
Carried interest is the share of profits that fund managers receive as compensation for managing an investment fund — typically around 20% of the fund's gains. Federally, carried interest may qualify for long-term capital gains tax rates if the holding period meets certain requirements (currently 3 years under current law). California taxes carried interest as ordinary income. This is a complex area with evolving rules, and we help our VC clients stay compliant and tax-efficient.