Iraj Pessian & Associates

Certified Public Accountants

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A partnership return is not a 1040 with more pages.

Six kinds of client, each with its own filings, deadlines and places to go wrong. Find yours below and you will see what we would be doing for you, and what usually goes wrong when nobody is watching it.

Small business

Under twenty employees, one location, an owner who is also the bookkeeper on Sundays.

What we do: monthly bookkeeping and reconciliation, payroll with its quarterly filings, sales tax where you have nexus, the annual return, and one planning conversation before the year closes.

  • Schedule C / 1120-S
  • 941 quarterly
  • CA sales tax
  • Estimated payments

Where it usually goes wrong

Payroll deposits missed in a slow month, personal and business spending run through one account, and a year of receipts reconstructed in March at four times the cost of doing it monthly.

Business owners

The person, not the company. Where the business return and the personal one stop being separable.

What we do: salary against distribution, retirement plan choice, the personal return read against the entity’s, and the succession question long before it is urgent.
  • Reasonable compensation
  • SEP / solo 401(k)
  • K-1 planning
  • Exit basis

Where it usually goes wrong

A distribution taken without the tax set aside, a retirement plan chosen for its brochure rather than its numbers, and a sale negotiated before anyone has calculated the basis.

Individuals & families

Rental property, equity compensation, multiple states, a year with a large one-off event in it.

What we do: the return itself, withholding and estimates set so April is not a shock, and the planning around a sale, a move, an inheritance or a divorce.
  • Schedule E
  • RSU / ISO
  • Multi-state
  • Capital gains

Where it usually goes wrong

Equity sold in the wrong tax year, a rental depreciated inconsistently across owners, and residency assumed rather than established after a move.

Corporations

S-corps and C-corps with a board, a lender or a buyer who reads the statements.

What we do: the corporate return, statements prepared to the standard the reader expects, shareholder basis tracked year to year, and the election paperwork kept where it can be found.
  • 1120 / 1120-S
  • Shareholder basis
  • Statements
  • S election

Where it usually goes wrong

Basis never tracked, so a distribution becomes taxable without anyone noticing; and an S election nobody can produce a copy of when the buyer's counsel asks.

Partnerships

Two or more owners, an operating agreement, and allocations that have to match it.

What we do: the 1065 and every K-1, capital accounts maintained rather than estimated, allocations read against the agreement, and the partner-level consequences explained to each partner.
  • Form 1065
  • K-1s
  • Capital accounts
  • Special allocations

Where it usually goes wrong

K-1s issued late, so every partner files an extension; and allocations that follow last year's spreadsheet rather than this year's agreement.

Trusts & estates

Executors and trustees, usually doing this once, usually while grieving.

What we do: the fiduciary return, the decedent’s final personal return, distributions and their tax effect on beneficiaries, and the paperwork sequenced so you are never doing two urgent things at once.
  • Form 1041
  • Final 1040
  • Step-up in basis
  • Beneficiary K-1s

Where it usually goes wrong

Assets distributed before the tax is provided for, a basis step-up never documented, and a trustee who finds out about a filing obligation after the deadline.

Partnerships, as a worked example.

One of the six, taken all the way through, so the rest are legible by comparison. Three partners, one operating agreement, a calendar year end.

The books close, and the agreement is read again

Allocations follow this year's agreement, not last year's spreadsheet. If a partner joined, left or changed percentage mid-year, that is where it is caught.

Capital accounts are brought forward, not estimated

Contributions, distributions, income and loss, per partner. This is the number that decides whether a distribution is taxable, and it is the one most often missing.

The 1065 is filed and every K-1 goes out together

Not one at a time as questions get answered. Partners cannot file until they have theirs, so a late K-1 is three late personal returns.

Each partner is told what it means for them

A K-1 is not self-explanatory. Every partner gets the two or three lines that change their own return, in writing.

Return

Form 1065, plus a K-1 per partner

Due

15 March, calendar-year partnerships

Extended

15 September, on a timely request

Late K-1 costs

Every partner's own return

The other five follow the same shape: read what governs it, bring the carried figures forward, file on the date that actually applies, then explain the consequence to the person who has to sign.

Most clients are two of these at once.

An owner is a business and a person. A trustee is often also a family. Which is why all of it is handled by the same firm, reading one file.

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