Accounting and Tax Services in Los Angeles
MangoBooks provides accounting and tax services for small businesses, their owners and individuals throughout Los Angeles. The work is led by Felix Park, a licensed California CPA.
Individual Tax Preparation
We prepare federal and California individual income tax returns. The federal return is Form 1040, and the California resident return is Form 540. Part-year residents, such as people who moved into or out of California during the year, and nonresidents who must file a California return use Form 540NR.
The returns we prepare include wages, rental properties, businesses owned directly, income from partnerships and S corporations, stock compensation and income from several states. Rental real estate income is reported on Schedule E, and a sole proprietor's business income on Schedule C.
Business Tax Preparation
We prepare federal and California returns for S corporations, partnerships, LLCs and C corporations. An S corporation files Form 1120-S with the IRS and Form 100S with California. A partnership files Form 1065 with the IRS and Form 565 with California. In California, an LLC files Form 568 whether it has one owner or several, unless it has elected to be taxed as a corporation, in which case it files Form 100 or Form 100S. A C corporation files Form 1120 and California Form 100.
S corporations and partnerships give each owner a Schedule K-1 showing that owner's share of income, deductions and credits, which the owner uses for the personal return.
Tax Planning
Tax planning is the work done during the year, before the returns are prepared. It includes projecting the year's tax, setting estimated payments, and reviewing the tax effect of decisions such as changing entity type, buying or selling property, moving to another state or the vesting of stock awards.
Federal estimated tax is paid in four installments, due April 15, June 15, September 15 and January 15 of the following year. When a due date falls on a Saturday, Sunday or legal holiday, the payment is on time if made the next business day. California uses a different schedule: 30% of the year's estimated tax is due in April, 40% in June, none in September and 30% the following January.
Bookkeeping
We keep the books for small businesses each month, so the records are ready for payroll, tax planning and the business tax return. When the books have fallen behind, catch-up bookkeeping brings them up to date, and monthly bookkeeping can continue from there.
Payroll
We run payroll and prepare the federal and California payroll tax filings. The federal filings include Form 941, the quarterly return for withheld income tax and Social Security and Medicare taxes, and Form 940, the annual federal unemployment tax return. California employers file the DE 9 and DE 9C with the Employment Development Department each quarter.
At year end we prepare Form W-2 for each employee and Form 1099-NEC for nonemployee compensation paid to contractors. For S corporations, payroll includes the owner's salary. The IRS requires an S corporation to pay reasonable compensation to a shareholder-employee for services before making non-wage distributions to that shareholder.
Business Formation
We set up California LLCs and corporations and, when it suits the business, file the election to be taxed as an S corporation. An LLC is formed by filing Articles of Organization with the California Secretary of State, and a corporation by filing Articles of Incorporation. The S corporation election is made on IRS Form 2553.
Every LLC organized or doing business in California pays an $800 annual tax. Corporations, including S corporations, are subject to the $800 minimum franchise tax, which a newly formed corporation does not pay for its first taxable year. California S corporations also pay a 1.5% tax on net income, including in the first year.
Financial Statements
We prepare financial statements from the company's books for business owners and for third parties such as lenders.
Who We Work With
- Small businesses and their owners: the company's books, payroll and tax return handled together with the owner's personal return.
- Rental property owners: reporting for each property, depreciation, and buying or selling a rental.
- Executives with stock compensation: returns and planning for RSUs, stock options and employee stock purchase plans.
- High-net-worth individuals and families: returns and planning for income from K-1s, stock compensation, rental property and sales, including estimated payments above $1,000,000.
- Business owners with $1M+ revenue: books, payroll and the company's return together with the owner's return, with the LLC fee, S corporation salary and the pass-through entity election planned during the year.
- New businesses: LLC or S corporation setup from $950 plus state fees, with the first year's $800 LLC tax, Form 2553 and estimated payments set out from the start.
- S corporation owners: owner salary and payroll, Forms 1120-S and 100S together with the owner's return, and the pass-through entity election.
- Catch-up bookkeeping and unfiled returns: books brought current from $1,500, then the unfiled business and personal returns prepared from them.
- Freelancers and 1099 contractors: Schedule C and self-employment tax, the four estimated payments, the home office and the City of Los Angeles registration for the self-employed.
- Real estate agents and investors: Schedule C or the S corporation return for commission income, Schedule E, depreciation and 1031 reporting for property.
- Dental and medical practices: the professional corporation's books, staff payroll and return, with the dentist's or physician's own return.
- Nonprofits: bookkeeping, Form 990 with California Form 199, the RRF-1 renewal and payroll; no audits.
- Restaurants: books that separate taxable and nontaxable sales, payroll with reported tips and Form 8027, and the Form 8846 credit on the return.
- Amazon, Shopify and e-commerce sellers: settlements and payouts reconciled to gross sales, inventory and cost of goods sold, California's marketplace rules and the returns.
- Contractors and construction companies: books, crew payroll with 1099-NEC for subcontractors, the accounting method for long-term contracts, section 179 on trucks and equipment, and the City of Los Angeles contractor tax.
- Startups: Form 1120 with California Form 100 for a Delaware or California C corporation, monthly books, the research credit on Form 6765 and the founders' returns.
- Film, TV and entertainment industry workers: W-2 returns with residuals and the California Form 2106, Schedule C returns, the loan-out S corporation and its payroll, and content creators.
- Foreign income and expats: FinCEN Form 114 and Form 8938 reporting, the foreign earned income exclusion or the foreign tax credit, and California's add-back on the resident return.
Fees
Fees depend on the scope of work and are set out in a written engagement letter before work begins. Typical ranges for each service are listed in our Fee Guide, along with accounting packages for small businesses.
Frequently Asked Questions
Can MangoBooks prepare both a company's return and the owner's personal return?
Yes. We prepare business returns and individual returns. When we handle a company's books, payroll and tax return together with the owner's personal return, both returns are prepared from the same records.
Can MangoBooks help when the books have fallen behind?
Yes. Catch-up bookkeeping brings the books up to date, and monthly bookkeeping can continue from there.
Does MangoBooks work with clients outside the city of Los Angeles?
Yes. MangoBooks is based in Los Angeles and works with clients elsewhere in Southern California as well. Meetings are scheduled in advance, and documents are exchanged electronically.
Can MangoBooks prepare financial statements for a lender?
Yes. We prepare financial statements for business owners and for third parties such as lenders.
Schedule a Consultation
Call (213) 255-4665 or send us a short message about your situation.
Please do not include Social Security numbers, bank account numbers or tax documents in the form.