2025 Tax Preparation for San Diego and La Jolla individuals, high-Income earners, physicians and healthcare professionals, business owners, businesses and private practices is significant, as 2025 is the first-year individual, business and trust tax returns will be filed following the 2025 OBBBA tax bill, evolving California requirements, increased IRS and FTB scrutiny, and the growing complexity of income sources.

In our work with professionals and closely held businesses in La Jolla, San Diego, and throughout Southern California, we consistently see that sophisticated taxpayers do not struggle because they lack information—they struggle because their financial lives are multidimensional - any most are working with tax professionals lacking the experience and expertise to handle the tax complexity of their evolving net worth.

Individual Tax Preparation for High-Income Earners

High-income individuals—particularly physicians and senior professionals—often assume their tax returns are straightforward because income is earned through employment. In practice, this is rarely the case.

Common complexities include:

• Professional compensation, incentive bonus and equity awards and deferred income, income from side 1099 activities, pass-through businesses and/or private practices and or trust income

• Investment portfolios with complex investments K-1s and cost-basis reporting

• Real estate rentals and real estate transactions

• AMT, NIIT and additional Medicare tax for high-income earners

• CA PTET tax

• Life events such as marriage, divorce, relocation, or real estate transactions

  
  

Physicians and Healthcare Professionals: Unique Tax Considerations

Physicians and healthcare professionals face a distinct set of challenges. Compensation structures, productivity incentives, call pay, and outside income often interact in ways that materially affect tax outcomes.

In addition to personal income, many physicians have:

• Ownership interests in practices, surgery centers, or real estate

• Retirement plans layered across hospital and private entities

• Side ventures, consulting income, or locum tenens work

• Trusts or family entities requiring coordination

Business Owners, Entrepreneurs, and Private Practices

For business owners and private practices, tax preparation is inseparable from the entity itself. S corporations, partnerships, LLCs, and professional corporations flow income directly to owners, making alignment critical.

Key areas requiring precision include:

• Passthrough income and Schedule K-1 accuracy

• Reasonable compensation and payroll compliance

• Depreciation, amortization, and asset reporting

• California-specific filings and payments

• Estimated taxes and prior-year carryforwards

Even small errors at the entity level can cascade into significant issues on the owner’s individual return.

Trust and Fiduciary Tax Preparation

Many high-income families also have trusts as part of their financial structure. Trust tax preparation requires a higher level of technical precision and attention to detail.

Common considerations include:

• Form 1041 fiduciary income tax returns

• Allocation of income between trust and beneficiaries

• Accurate beneficiary Schedule K-1 reporting

• Coordination with individual beneficiary returns

• Federal and California fiduciary compliance

Because trusts are subject to compressed tax brackets, income reaches top tax rates far more quickly than individual income.

Common Issues We See in 2025 Tax Preparation

Across high-income individual, business, and trust returns, several issues arise repeatedly:

• Incorrect K-1 reporting between entities and owners

• Errors in classifying income streams

• Missing or incomplete tax forms

• Missing or incorrect itemized deduction and or tax credit calculations

• Missing or incorrect capital gains, stock option and AMT calculations

• Missing or incorrect QBI and or PTET calculations

• Missing or incorrect reporting for rentals, 103 exchanges and installment sales

• Trust distributions misreported by beneficiaries

• Estimated tax payments misapplied or omitted

• California credits and carryforwards not properly tracked

These issues are rarely the result of negligence. More often, they stem from fragmented preparation across multiple providers or high-volume tax preparers with little attention to details and accuracy.

Why Integrated Tax Preparation Matters

One of the most important differentiators in high-income tax preparation is integration. When individual, business, and trust returns are prepared independently, gaps form.

Integrated preparation:

• Reduces inconsistencies across filings

• Lowers audit and notice risk

• Identifies issues before returns are filed

• Provides clarity rather than surprises

What High-Income Clients Should Expect

Professional tax preparation for sophisticated clients is deliberate and methodical. It includes:

• Thoughtful document intake and review

• Clarifying questions before filing—not after

• Verification of prior-year data and carryforwards

• Alignment between federal and California returns

• Clear communication throughout the process

This approach protects not only accuracy—but peace of mind.

The Takeaway

For 2025, tax preparation for high-income individuals, physicians, healthcare professionals, and business owners requires experience, precision, and coordination.

At Natalie C. Papagni, CPA – Tax, Planning and Advisory Services, we provide integrated tax preparation for individuals, businesses, and trusts—designed for upwardly mobile clients and clients with complex financial lives who value clarity, accuracy, precision and time and cost efficiency. How can we help? Le get our conversation started today.

About us

Natalie C. Papagni, CPA – Tax, Planning and Advisory Services

provides tax, planning and advisory services to individuals and high-income earners, physicians and healthcare professionals, business owners - entrepreneurs and new and existing businesses and private practices serious about saving taxes and minimizing multi-year tax liabilities, filing accurate and efficient tax returns, transforming financial complexity into clarity, planning for their financial future and achieving what matters most.

Natalie C. Papagni, CPA

Tax, Planning and Advisory Services

4727 Executive Drive Suite 300

San Diego, CA 92121

858.754.8277

service@lajollataxcpa.com

www.lajollataxcpa.com