Michael Gray, CPA's Tax and Business Insight
August 5, 2024
© 2025 by Michael C. Gray
ISSN 1539-395X
A monthly report to help you prepare for your financial future, keep more of what you earn by minimizing your taxes, and build an extraordinary business!
Route to _______ _______ _______ _______ _______
(If you find this information valuable, please pass it on to a friend!)
Table of Contents
- School days, school days.
- Family celebrations.
- Michael Gray's calendar.
- October 15 will soon be here!
- Third quarter estimated tax payment due September 15, 2025.
- Tax advisors and attorneys - Mark your calendars.
- Loads of tax and financial planning ideas and information are included in the 2025 Edition of How to Use Roth & IRA Accounts to Provide a Secure Retirement.
- Updates available for our reports about nonqualified stock options and incentive stock options.
- A "great one" passes away.
- Think Medicare is safe? What President Trump and Congress don't want you to know.
- Disaster relief act passed.
- Is your child or grandchild eligible for CalKIDS?
- Cryptocurrency sale proceeds were taxable.
- Buying a Nevada residence wasn't enough to prove a change in tax residence.
- Do you sell products, services or software to CPAs?
- Attention CPAs-would you like help with marketing your services?
- Attention CPAs-do you need support for tax issues?
- Attention Accountants! Speed up processing your business closings!
- Please share your good experiences with Michael Gray, CPA.
- Financial Insider Weekly past episodes.
- Visit our new book review: Tongue Fu!®
- Follow me on social media!
- Check out my blogs.
- Subscribe/Remove from Michael Gray, CPA's Tax & Business Insight
Turtle at Vasona Park in Los Gatos, California, July 4, 2025 School days, school days.
It's hard to believe, but summer vacation is almost over and most children will be back in school by the end of August! Please drive carefully with those kamikaze kids out there!
Family celebrations.
Janet and I are celebrating our wedding anniversary this month (54 years)! Our other August family celebrations include my granddaughter, Minerva Siemer's birthday and Janet's sister, Gail Johnston, is celebrating a birthday. Happy birthdays!
Michael Gray's calendar.
Michael Gray won't be available from August 6 to August 15, 2025.
October 15 will soon be here!
The extended due date for 2024 individual income tax returns is October 15, 2025. If you've been putting off getting your tax returns finished, now is the time to get in motion.
Third quarter estimated tax payment due September 15, 2025.
Remember the third quarterly federal estimated tax payment is due September 15, 2025. California doesn't have a third quarter estimated tax payment.
Tax advisors and attorneys - Mark your calendars.
Michael Gray will be giving lunchtime update webinars about Tax Provisions of the One Big Beautiful Bill Act during September 2025.
The Silicon Valley Bar Association webinar update for attorneys will at noon on September 18, 2025. Here is a link for registration. https://www.svba.org/events/EventDetails.aspx?id=1983832
The California Society of Certified Public Accountants (CalCPA) Tax Tuesday webinar updates will be in two parts: Provisions Effective in 2025 at noon (Pacific Time) on September 23, 2025 and Provisions Effective After 2025 at noon on September 30, 2025. I'll give the registration information in the September newsletter. Members of CalCPA can watch for information at calcpa.org.
Loads of tax and financial planning ideas and information are included in the 2025 Edition of How to Use Roth & IRA Accounts to Provide a Secure Retirement.
For more information and a 25% discount go to www.rothirainvestingbook.com. Also available at www.amazon.com.
Updates available for our reports about nonqualified stock options and incentive stock options.
I have updated our "special reports", Non-Qualified Stock Options - Executive Tax and Financial Planning Strategies and Incentive Stock Options - Executive Tax and Financial Planning Strategies. If you would like to receive the update, send an email to Dawn Siemer at dgsiemer@taxtrimmers.com with the subject "NQSO Report" or "ISO Report" and she will send it to you.
A "great one" passes away.
Attorney John Hopkins was a leader and mentor in the estate planning community in Santa Clara County and an advocate for charitable giving. John was a great friend and booster for me. Although he retired several years ago, he will be greatly missed. Here are links to my interviews with John about succession planning for a family business.
https://www.youtube.com/watch?v=o-pBmLs6a4E&t=44s
https://www.youtube.com/watch?v=RsY4CwxGGYg&t=4sThink Medicare is safe? What President Trump and Congress don't want you to know.
Did you know that, because of expected federal deficits from the tax cuts in the One Big Beautiful Bill Act OBBBA and the Statutory Pay-As-You-Go Act of 2010, the Congressional Budget Office estimates Medicare funding from 2027 to 2034 could be cut $490 billion? This is not in OBBBA, it's "automatic" under another law. Write to your representatives in Congress to ask them to take action to protect those benefits. Here's a link to a letter from the Congressional Budge Office about this subject. https://www.cbo.gov
Disaster relief act passed.
Congress has passed The Filing Relief for Natural Disasters Act and President Trump signed the Act on July 24, 2025.
Effective for state and federal disaster declarations made after the date of the Act's enactment,
- the mandatory 60-day filing and payment extension period is extended to 120 days for disaster victims, regardless of whether the IRS grants additional filing and payment relief; and
- the Secretary of the Treasury (IRS) is granted the authority, upon request by a state's governor, to apply the disaster-related filing and payment relief available to federally-declared disasters to state-declared disasters.
(The Filing Relief for Natural Disasters Act, P.L. 119-29.)
Is your child or grandchild eligible for CalKIDS?
California has adopted its own college saving account program for newborns and eligible low-income public school children in California, called the California Kids Investment and Development Savings Program (CalKIDS). CalKIDS was enacted as part of the budget in 2017 and was expanded in 2022.
All babies born in California on or after July 1, 2022 will receive up to $100 in a college savings account. In addition, eligible low-income public school students may qualify to receive up to $1,500 in college savings.
CalKIDS accounts can also be linked with new or existing ScholarShare §529 accounts.
The seed amounts are invested in portfolios according to the year the student is expected to enter a post-high school education program.
Enrollment in CalKIDS is automatic. No additional contributions are accepted for the accounts. Families can use a §529 account for additional college savings.
Families can access a CalKIDS account by registering at its website, http://calkids.org. They can opt out by using the opt-out form at the website.
The funds can be used at eligible educational institutions, including community colleges, universities, and vocational and professional schools, as defined at Internal Revenue Code §529(a), and not for K-12 education expenses.
The funds can be used California tax-free for:
- Higher education tuition and related fees;
- Books and required supplies;
- Certain room and board costs; and
- Computer equipment.
Any funds not used by age 26 are forfeited. There is an appeals process if there was a reasonable cause for not using the funds by age 26.
(Spidell's California Taxletter Podcast Transcripts, July 20, 2025, "Podcast: CalKIDS college savings program.")
Cryptocurrency sale proceeds were taxable.
A taxpayer failed to file a California income tax return for 2020. Based on information received from the IRS, the Franchise Tax Board estimated the taxpayer received about $1.5 million from trading cryptocurrency.
The taxpayer prepared a pro-forma 2020 Schedule D and Form 8949, together with a spreadsheet showing he received $2.3 million in short-term proceeds with $2.4 million tax basis, for a short-term capital loss of $100,000.
The Office of Tax Appeals upheld the Franchise Tax Board in finding the taxpayer didn't substantiate his tax basis (cost) for the cryptocurrency that was sold. Therefore, the tax basis was zero, and the entire sale proceeds were taxable income. This case shows the importance of keeping good records for cryptocurrency transactions.
(Appeal of Gedikian, 2025-OTA-420, April 29, 2025.)
Buying a Nevada residence wasn't enough to prove a change in tax residence.
Husband, a retired surgeon and his wife, a nurse, were found to maintain enough California connections to be residents of California, subject to California income tax.
They claimed they bought a residence in Nevada during 2006 so the husband could pursue his business as a professional gambler.
They kept their California home, which was larger than their Nevada home.
Their family connections were in California.
They traveled frequently to California for the wife's medical treatments, to visit their family and to care for aged parents. Their bank records indicated they spent more time in California than in Nevada. Some of the husband's gambling activity was done online in California.
The taxpayers did get Nevada drivers licenses, registered vehicles in Nevada and had businesses registered in both states. The husband didn't register to vote in Nevada until October 2008.
The Office of Tax Appeals upheld the Franchise Tax Board in finding the taxpayers' domicile and tax home was California for 2007, 2008, and 2009.
(Appeal of Tran, 2025-OTA-417, April 28, 2025.)
Do you sell products, services or software to CPAs?
Maybe I can help with writing promotional material and marketing ideas. Call me, Michael Gray, at 408-918-3161 or email mgray@taxtrimmers.com.
Attention CPAs-would you like help with marketing your services?
Maybe I can help with writing promotional material and marketing ideas, including encouraging referrals from your current clients. Call me, Michael Gray, at 408-918-3161 or email mgray@profitadvisors.com.
Attention CPAs-do you need support for tax issues?
Michael Gray, CPA can help you with research and guidance on complex tax planning and tax return reporting issues. mgray@taxtrimmers.com.
Attention Accountants! Speed up processing your 2019 business closings!
Do you still have 2019 business income tax returns on extension that need to be done? Check out this trial balance software, EZ Trial Balance, that's super-easy to set up and use. There is a desktop version and an online version. The online version includes consolidations and ratio analysis for analytical review. http://www.eztrialbalance.com
Please share your good experiences with Michael Gray, CPA.
As you know, more and more people are going to the internet to find information about service providers. We hope you will share some good words about experiences that you have had with our firm. One of the sites where you can share your experiences is yelp.com.
We use Angie's List to assess whether we're doing a good job keeping valued customers like you happy. Please visit AngiesList.com/Review/4258970 in order to grade our quality of work and customer service.
Financial Insider Weekly past episodes
After eight years of production, I have discontinued producing new interviews for Financial Insider Weekly. Doing the show has been a rewarding experience and I consider back episodes to be my legacy of financial literacy education to our community. Back episodes available at https://www.youtube.com/user/financialinsiderweek.
Michael Gray regrets he can no longer personally answer email questions. He will answer selected questions in this newsletter.
For your questions about dependent exemptions, see IRS Publication 501 at www.irs.gov.
Visit our new article!
Follow me on Social Media!
LinkedIn: If you enjoy LinkedIn, please follow me at www.linkedin.com/in/michaelgraycpa and www.linkedin.com/company/the-marketing-alchemist/
I'm also on Bluesky! You can also follow me on Bluesky at https://bsky.app/profile/michaelgraycpa.bsky.social.
I'm also on Instagram. You can also follow me on Instagram at www.instagram.com/michaelgray690/
I'm also on Threads.net. My user name is michaelgray690
Facebook: I've been suspended on Facebook and I'm working on getting my account restored.
Check out my blog.
I have also started a blog at www.michaelgraycpa.com. Check it out!
Home Newsletter Archive Introducing Michael Gray, CPA Articles Tax FAQ Need Help? Other Links
Michael Gray, CPA2482 Wooding Ct.San Jose, CA 95128(408) 918-3162FAX: (408) 938-0610email: mgray@taxtrimmers.comHours: 8am - 5pm PDT Monday - Friday
© 2026
Connect on LinkedIn
Connect on BlueSky
Connect on Instagram
Our Blog
