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The team at SWC simplifies complex tax issues, helps you build and leverage your wealth to enhance your personal and financial freedom, and offers unparalleled peace of mind at every step along the way.

What You Should Know About California’s Parent-Child Property Tax Exclusion

Start Here: California’s parent-child property tax exclusion can help preserve a family’s lower property tax value when a home passes from one generation to the next. The rules changed significantly under Proposition 19, which was passed into law in November of 2020. To qualify for the exclusion now depends on how the property is used, who receives it, when required forms are filed, and the home’s value. If you’d like a deeper overview of Prop 19, including the rules for transferring your property’s taxable value when you move, see our companion blog post, Understanding Proposition 19: Property Tax Planning for California Homeowners.

Passing a home from one generation to the next often involves more than estate planning. California property tax rules can have a lasting effect on the cost of owning inherited property, and understanding those rules before making a transfer can help your family members and loved ones avoid unexpected tax consequences.

Here at SWC, we closely monitor changes to federal tax law and California property tax rules. Our ongoing attention allows us to incorporate new tax planning opportunities into each client’s personalized tax-saving and wealth-building strategy while helping them make informed financial decisions.

Understanding California’s Parent-Child Property Tax Exclusion

California generally reassesses real property (aka, real estate) to its current market value when ownership changes hands. A higher assessed value often results in higher annual property taxes.

One important exception applies to certain transfers between parents and children. When all of the state’s statutory requirements have been met, the transfer may qualify for an exclusion from reassessment, allowing the child to retain some or all of the parents’ existing taxable value instead of receiving a full reassessment.

Proposition 19 substantially changed these rules for transfers occurring on or after Feb. 16, 2021. Today, the exclusion is more  narrowly applied than it was under prior law.

Who Qualifies as a “Child” for California’s Parent-Child Property Tax Exclusion?

For purposes of the parent-child exclusion, California law generally recognizes the following relationships: Continue reading… Continue reading… Continue reading…

Understanding Proposition 19: Property Tax Planning for California Homeowners

By |2026-07-23T16:27:11-07:00July 23, 2026|Categories: California Tax Planning|Tags: , |0 Comments
Start Here: Prop 19 (aka, Assembly Constitutional Amendment No. 11) allows certain California homeowners to transfer the taxable value of their principal residence to a replacement principal residence anywhere in the state. It also provides a limited property tax exclusion for qualifying transfers of a family home or family farm between generations. Read this post to determine whether taking advantage of Prop 19 might reduce the property tax impact of moving within California or transferring qualifying property to a child or grandchild. Timing, occupancy, property value, and filing requirements can affect the available property tax relief. (If you’d like help, contact our San Diego tax planning and financial strategy firm by phone at (858) 487-4580 or email: admin@swc.cpa. We’re here to help!)

California property laws continue to evolve, creating both opportunities and tax planning considerations for homeowners and families alike. Proposition “Prop” 19, for instance, changed the rules governing certain property tax transfers, affecting homeowners who relocate within California as well as families planning to transfer real estate from one generation to the next.

As one of California’s premier tax planning and financial strategy firms, we closely monitor changes to federal tax law and the state’s property tax rules. That ongoing attention allows us to incorporate new planning opportunities into each client’s personalized tax-saving and approach to wealth-building while helping them avoid costly surprises.

In this SWC blog post, we discuss two parts of Prop. 19 that may affect your property taxes:

  • Base year value transfers for qualifying homeowners who relocate within California
  • Intergenerational transfer exclusions for qualifying family homes or family farms

Understanding California Prop 19

California voters approved Prop 19 on Nov. 3, 2020. Senate Bill 539 later established procedures for its intergenerational exclusions and base-year value transfers, which is just a fancy way of saying a set the rules for property tax transfer and family inheritance provisions.

As a result of the new law, beginning April 1, 2021, qualifying California homeowners could sell their principal residence and transfer its taxable value to a replacement principal residence anywhere in California. A homeowner may also qualify based on age or a severe and permanent disability. Separate rules cover qualifying victims of wildfire or a governor-declared disaster.

Understanding Taxable Value: Taxable value simply means the property’s base year value plus inflationary adjustments. You may also see this amount called the factored base year value.

For example, suppose you’ve owned a home in San Diego for the last 20 years and its taxable value has reached $400,000. Assume the County Assessor determines that the home’s current market value equals $1 million.

If you sell that home and buy another principal residence anywhere in California with an equal or lower market value, you may transfer the $400,000 taxable value to the home you bought. In other words, your property tax would generally begin with the transferred $400,000 taxable value rather than the replacement home’s full market value.

A higher-priced home may also qualify.

Suppose the replacement home has a market value of $1.3 million and you purchase it before selling the original home. The difference in market value equals $300,000: Continue reading… Continue reading… Continue reading…

Summer 2026 Tax Updates Business Owners, Investors & California Taxpayers Should Know

Summer may feel like a quiet time for tax planning, especially after the spring filing rush. In reality, some of the most important tax planning windows open midyear, when business owners, real estate investors, individuals, and families still have time to make informed decisions before the end of the year.

This summer, several federal tax updates deserve attention. Some involve deadlines. Others are focused on Internal Revenue Service (IRS) account access, digital assets, qualified small business stock (QSBS), Health Savings Accounts (HSAs), disaster relief, and Employee Retention Credit claims (refundable tax credits for businesses and non-profits that kept employees on their payroll during pandemic-related government shutdowns or significant revenue declines). And for California taxpayers, the state’s Franchise Tax Board (FTB) identity verification notices deserve a closer look.

In this post, we explain what has changed, who may be affected, and what steps you may need to take before the next tax season catches you by surprise. First up, summer deadlines.

Summer 2026 Tax Deadlines for Individuals and Business Owners

Two July deadlines stand out for taxpayers and business owners.

First, July 6, 2026, marks the deadline for certain Section 174 elections tied to research and experimental expenditures. These rules may matter for businesses with software development, product development, engineering, scientific research, or other innovation-related costs.

Second, July 10, 2026, marks an extended deadline tied to possible COVID-era refund claims for penalties and interest. This deadline stems from litigation involving whether certain filing and payment deadlines received automatic disaster-related postponement during the COVID-19 disaster period (Jan. 20, 2021 – July 10, 2023).

Here’s what that means in plain English: Some taxpayers who paid penalties or interest connected to COVID-era filing or payment timing may have a potential refund claim. The rules remain technical, and the IRS may challenge claims depending on the facts, so it’s best to ask about this during your Summer 2026 Mid-Year Tax Appointment with us here at SWC.

IRS Business Tax Account Access: What Business Owners Should Review in Summer 2026

The IRS has continued to expand online access for business taxpayers. For S corporations and C corporations, certain individuals, known as Designated Officials, can use the IRS Business Tax Account to view information such as Continue reading… Continue reading… Continue reading…

Midyear Tax Planning for Small Businesses: How to Reduce Your 2026 Tax Bill

If you’re like most small-business owners, taxes probably aren’t even a blip on your radar screen right now. After all, you just filed your tax returns on April 15, so why bring up taxes less than two months later?

The reason? Summer is the best time to take a fresh look at your business tax situation. With several months remaining in the year, you have time to make adjustments that could reduce your 2026 tax bill, improve cash flow, reduce tax liabilities, and help you avoid unpleasant surprises next spring. The important thing is to act before year-end. Many of the most effective tax-saving and wealth-building strategies work best when implemented well in advance, not in a last-minute scramble in December.

Last week, we presented forward-looking advice for saving on personal income taxes. This week, we shift our attention to helping small-business owners keep more of their hard-earned profits. The following tax-saving strategies and tactics can help you identify opportunities, evaluate your options, and position your business for a stronger financial finish to 2026.

Maximize Your Qualified Business Income (QBI) Deduction

One of the most valuable tax breaks available to many business owners is the Qualified Business Income (QBI) deduction. It allows many owners of pass-through businesses to deduct up to 20 percent of their business income right off the top. For example, if your business generates $100,000 in qualified business income, you may be able to deduct up to $20,000 and pay federal income tax on the remaining $80,000. Pass-through businesses (income passes through the business to the owners) include:

  • Sole proprietorships
  • Single-member limited liability companies (LLCs)
  • Partnerships
  • Multi-member LLCs
  • S corporations

Here are a few key details about the QBI deduction: Continue reading… Continue reading… Continue reading…

Get a Jump on Your 2026 Taxes with Mid-Year Tax Planning

With your April 15 tax filing still visible in your rearview mirror, the last thing you probably want to think about is next year’s tax return. After weeks of gathering documents and tracking down deductions, it’s understandable if your thinking has shifted from tax planning to planning your summer vacation.

But summer is one of the best times to take a fresh look at your tax situation. The pressure of filing season is behind you, and you still have plenty of time before year-end deadlines start looming. Small adjustments made now can add up to considerable savings on next year’s tax bill.

A little planning during the summer months can pay dividends leading up to April 15, 2027. Whether you’re hoping to reduce your tax bill or avoid unpleasant surprises next year, we are here to help with your mid-year tax planning. That way, you can fully enjoy your summer, confident that your tax situation is well in hand.

In this post, we share several tax-planning strategies to consider as we head into summer 2026.

Graphic for a blog post about planning ahead for a 2026 tax filing.

Review Your Tax Withholdings or Estimated Tax Payments

Taxes have a way of sneaking up on people. A raise, a side gig, a new deduction, or even a change in family circumstances can throw you off course. The result? An unwelcome surprise come spring. The first order of business is to make sure you’re sending the right amount of money to the taxing authorities throughout the year in the form of tax withholdings and/or estimated tax payments:

  • Tax withholdings: Use the IRS Tax Withholding Estimator at to figure out the right amounts to have your employer(s) withhold (and remit) to taxing authorities on your behalf. You’ll need recent pay stubs (for you and your spouse, if you’re married), details of other income, and your most recent tax return (which can be very helpful in helping you gauge whether you’re underpaying or overpaying).
  • Estimated tax payments: If you’re self-employed or have additional income from a side job or another source, you should be making quarterly estimated tax payments to both federal and state tax agencies. Start with your expected total annual income, subtract any deductions (or the standard deduction), and estimate your tax based on applicable tax brackets. Then, subtract any withholdings from your day job income. Don’t overlook Social Security income and income from other sources.

Reconsider Standard Versus Itemized Deductions

If you normally claim the standard deduction, consider itemizing. If you normally itemize, consider claiming the standard deduction. For 2026: Continue reading… Continue reading… Continue reading…

Getting Paid to Play College Sports: Compensation and Tax Implications

By |2025-12-18T17:44:12-08:00December 18, 2025|Categories: Independent Contractor|Tags: , , , |0 Comments

Student-athletes at American colleges and universities can now get paid for competing in sports (much like professional athletes), and they can earn additional income from the use of their name, image, and likeness (NIL).

An added bonus? They can enjoy all of these perks without suffering penalties for being paid to play. This change in rules has created a fast-growing market that includes brand endorsements, appearances, and income from untraditional sources, including participation in social media-related activities.

NIL Graphic for Tax Purposes

As NIL activities expand, businesses, collectives, and schools face important questions about taxes, worker classification, and compliance. The recent Grant House and Sedona Prince v. National Collegiate Athletic Association, et al. court case (aka the NCAA House settlement), which allows schools to pay athletes directly and allocates billions in “back pay,” raises the stakes for any businesses and brands that are involved with NIL deals.

Understanding NIL Collectives: Collectives are groups, usually formed by boosters or supporters of a college, that help student-athletes find and manage opportunities to earn money from their name, image, and likeness. Some collectives act like talent agents and simply connect athletes with companies that want to work with them. Others pay athletes directly for things like appearances or promotional work.

In this post, we explain what NIL is, how student-athletes are classified for tax purposes, the role that collectives play, and how the new rules affect businesses that engage student-athletes.

Giving Athletes the Rights to Their Personal and Professional Assets

The term “NIL rights” refers to a person’s right to control the commercial use of their identity, including their name, photos, likeness, gestures, or appearance. In practice, this means that all college athletes, not just football and basketball players, are allowed to earn money from the following: Continue reading… Continue reading… Continue reading…

8 Year-End Tax-Savings Steps for Business Owners

If you own, operate, or participate in the managements of a business, taxes are always on your mind, especially at the end of every quarter, when estimated payments are due, and the end of the year, when you file your return. As tax year 2025 comes to a close, we at SWC are committed to helping you avoid any surprises while taking full advantage of all the tax breaks your business qualifies for.

Our recent post, “10 Year-End Tax-Savings Tips for 2025 for Individual Filers” revealed ways that any individual taxpayer can trim their tax bill. In this post, we focus our attention on tax-savings strategies specifically for business owners, starting with the often overlooked review of your businesses estimated tax payments.

1. Review Your Estimated Tax Payments

Finding out your business owes thousands, or tens of thousands of dollars, in taxes because it didn’t pay sufficient estimated taxes over the course of the year, and then having to pay a penalty on top of that, is one of the nasty surprises we want to help you avoid. You have one last chance to correct any shortfall. Here are a couple easy ways to calculate the amount of estimated tax you’re likely to owe:

  • Use last year’s percentage: If the business earned about the same amount of money this year as you did last year, look at the percentage of its income paid in taxes last year (federal, state, and local), and multiply that percentage by the company’s projected income for this year. For example, if the business earned about $200,000 last year and this year and paid 35 percent in combined income tax and self-employment tax last year, expect to pay about 35 percent this year. For a more accurate estimate, subtract business expenses from gross income before multiplying the percentage.
  • Use an online tax estimator: You can find plenty of federal income tax estimators online. However, most are helpful only for estimating the amount of federal income tax you’re likely to owe. The estimate is not likely to include your self-employment tax or state and local taxes. Many calculators are designed only for estimating taxes on employment income, not business income.

After estimating the total income and self-employment tax the business is likely to owe, subtract the amount of estimated tax you have already paid to determine the balances owed to the US Treasury and state and local tax agencies, and then pay those balances by Jan. 15, 2026.

2. Reduce Business Income with Business Expenses

Business expenses are one of the most effective tools for reducing taxable business income because they directly lower net profit (the amount the Internal Revenue Service (IRS) uses to calculate your company’s tax bill). Deductible expenses include the following:

  • Office supplies, software, and subscriptions
  • Equipment purchases
  • Vehicle expenses/mileage
  • Utilities, rent, phone, and internet
  • Contractor payments

Be sure to take advantage of Section 179 expensing, which enables businesses to immediately deduct the full cost of qualifying equipment and certain improvements in the year they’re placed in service instead of having to depreciate them over the course of several years.

For tax years beginning in 2025, your business can immediately deduct up to $2.5m of qualifying business property placed in service. This covers most equipment, off-the-shelf software, and certain improvements to commercial buildings (known as Qualified Improvement Property, or QIP).

Be aware of the following limitations:

  • For purchases made between Jan. 1 and Jan. 19, 2025, the business is only allowed to deduct 40 percent of the cost right away using bonus depreciation. But for anything purchased after Jan. 19, 2025, you can usually deduct 100 percent of the cost in the first year, as long as the asset is placed in service during 2025.
  • Section 179 cannot create a business loss.
  • The deduction phases out once total qualifying purchases exceed $4 million, disappearing completely at $6.5 million.
  • Rules get more complex for partnerships, S corporations, and LLCs taxed as either, so professional guidance from a the pros here at SWC may be needed.

Contact us for details on how the limits work and whether they will affect you or your business entity.

3. Set Up a Retirement Plan for Your Business (If You Haven’t Already)

If you don’t have a retirement plan for your business, you could be missing out on one of the most powerful tax-savings and wealth-building tools available. These plans allow you to make sizable tax-deductible contributions.

Most small businesses use defined contribution plans, such as the following, which are easier to manage than traditional pension plans: Continue reading… Continue reading… Continue reading…

10 Year-End Tax-Savings Tips for 2025 for Individual Filers

The end of the tax year is fast approaching, which means there’s still time  to execute some year-end tax-savings strategies, but not that much time. The One Big Beautiful Bill Act (H.R. 1) has extended and enhanced many taxpayer-friendly provisions, and you’d be wise to act now to take full advantage of them.

Here at SWC, we hate to see anyone pay more in taxes than they’re legally obligated to, which is why we offer year-end tax projection meetings for our clients from October through December. If you haven’t scheduled yours yet, use the Contact page on our website (click on the Appointments link to get started).

Tax Tips Photo

To demonstrate our commitment to helping as many people as possible minimize their tax burden and use the money they save to build long-term wealth, we present these 10 year-end tax-savings tips.

Tip No. 1: Review Your Tax Withholdings and Estimated Tax Payments

To avoid having to pay an underpayment penalty, take a look at how much income tax you already handed over to the government for the 2025 tax year in the form of withholdings from your paychecks and any estimated tax payments you’ve made.

To avoid an underpayment penalty on your federal income tax, your withholding and/or estimated tax payments must be at least one of the following:

  • 90 percent of this year’s total tax liability
  • 100 percent of last tax total tax liability
  • 110 percent of last year’s tax liability if your current year’s adjusted gross income (AGI) is more than $150,000 ($75,000 if you’re married filing as single).

If you had unexpected income or capital gains during the year, we here at SWC can help you project your 2025 tax liability and take steps to avoid underpayment penalties. To schedule a consultation, reach us by visiting the Contact page of our website.

Tip No. 2: Consider Bunching Itemized Deductions

Each year, you can deduct the greater of your itemized deductions (mortgage interest, charitable contributions, medical expenses, and state and local taxes) or the standard deduction. The 2025 standard deduction is: Continue reading… Continue reading… Continue reading…

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