{"capability_version":"2026-07-01","product":"Tax MCP","summary":"Coverage-bounded, §6694-disciplined tax compute. Computes inside the documented supported envelope (per jurisdiction below); returns a deterministic unsupported/needs_review decline outside it. No LLM in the loop.","supported_envelope":{"jurisdictions":{"federal":{"years":[2020,2021,2022,2023,2024,2025,2026],"filing_statuses":["single","married_filing_jointly","married_filing_separately","head_of_household"],"income_fields_modeled":["wages","medicareWages","federalWithholding","priorYearTax","priorYearAGI","priorYearWasFull12MonthReturn","priorYearCitizenOrResidentAllYear","taxableInterest","ordinaryDividends","qualifiedDividends","netShortTermCapGain","netLongTermCapGain","priorYearCapLossCarryoverST","priorYearCapLossCarryoverLT","capGainAggregates","mortgageInterest","mortgageAvgBalance","stateLocalIncomeTax","realEstateTax","foreignTaxPaid","foreignIncomeAllPassive1099","reit199ADividends","pensionDistributionTaxable","socialSecurityBenefits","taxExemptInterest"],"deduction":"greater_of_standard_or_itemized_salt_and_mortgage","itemized_scope_note":"Itemized = SALT (OBBBA-2025 cap, MAGI-phased) + home mortgage interest (§163(h)(3) $750k limit — supply mortgageAvgBalance). Single/MFJ/HoH; MFS itemized declines (§63(c)(6)(A)). Medical, charitable, and other itemized categories are out of scope.","modeled_surfaces":["ordinary tax","NIIT (Form 8960)","Additional Medicare (Form 8959)","preferential LTCG/QDIV bands","QBI §199A — REIT dividends only (1099-DIV box 5): 20% deduction, never wage/UBIA-limited, capped by the 20%-of-(taxable-income−net-cap-gain) overall limit (binds → declines). Business / PTP-K-1 / SSTB QBI out of scope.","Foreign Tax Credit — §904(j) de-minimis only (≤$300 / $600 MFJ, all-passive-1099 affirmed; over-ceiling or unaffirmed declines; full Form 1116 planned)","simple itemized slice — SALT/property tax (OBBBA-2025 cap) + acquisition-debt mortgage interest (§750k limit), greater-of standard; Single/MFJ/HoH (MFS and incomplete mortgage facts decline). Not full Schedule A — medical/charitable/other itemized categories are out of scope.","capital-loss carryover I/O — prior-year ST/LT capital-loss carryover (priorYearCapLossCarryoverST/LT, caller-asserted POSITIVE magnitudes) applied with the §1211(b) −$3,000 (−$1,500 MFS) annual limit + ST/LT netting; the ending carryover is returned (endingCapLossCarryoverST/LT). Pre-netted SCALAR gains — lot-level / Form 8949 detail, wash sales, §1256, and covered-basis remain decline; the §1250-unrecaptured (25%) and §1(h) 28%-collectibles special-rate portions ARE now modeled (2025) via sec1250UnrecapturedGain / collectibles28Gain — see the special-rate worksheet surface below.","special-rate capital gain — Schedule D Tax Worksheet (2025, iteration 36). The UNRECAPTURED §1250 gain (25% max, Schedule D line 19, sec1250UnrecapturedGain) and the 28%-rate gain (collectibles §408(m) + §1202 taxable portion, Schedule D line 18, collectibles28Gain) — caller-asserted PORTIONS of netLongTermCapGain — are taxed as their own stacked layers ABOVE the 0/15/20 bands, with the line-47 MAX-RATE FLOOR (a low-income filer's §1250 is taxed at their ordinary rate, not a flat 25%). §6694: each is a SUBSET of net LT gain, so sec1250UnrecapturedGain + collectibles28Gain > netLongTermCapGain is contradictory → the return DECLINES (fail-closed, never capped-and-under-taxed); a real portion omitted UNDER-taxes it at 0/15/20, so a preparer must assert it. The AMT is refigured with the same special rates (Form 6251 Part III — §1250 at 25%, 28%-collectibles in the 26/28 ordinary AMT base), so a binding-AMT special-rate return computes the correct tentative minimum tax. 2025 only (other years → special_rate_gain_unmodeled decline); scalar netLongTermCapGain path (not capGainAggregates).","simple passive rental (Schedule E) — a POSITIVE scheduleEIncome (final Schedule E line-26 net) COMPUTES into Schedule 1 line 5 → Schedule 1 line 10 → Form 1040 line 8 → AGI AND the §1411 NIIT base (rental is net investment income), REQUIRING two §6694 affirmations: scheduleERentalIsPassiveFinalNet:true (final passive net — post depreciation/§465 at-risk/absorbed §469 suspended losses, no property disposition/§1250 recapture, rental real estate only, no royalties/K-1) AND scheduleERentalNotSection162Business:true (NOT a §162 trade/business → no §199A QBI). A rental LOSS (§469 PAL / §465 at-risk), a missing affirmation, or a §162/QBI rental → schedule_e_needs_review decline. QBI is never granted on rental (affirmed absent); a §162-business rental must have its 20% QBI deduction computed by a preparer.","self-employment (Schedule C + Schedule SE) — a POSITIVE scheduleCIncome (Schedule C line-31 sole-proprietor net) COMPUTES self-employment tax (§1401/§1402: net × 0.9235 → 12.4% OASDI up to the $176,100 (2025) Social-Security wage base, COORDINATED with the SE earner's W-2 box-3 wages so the OASDI cap is not double-counted, then 2.9% Medicare uncapped) → Schedule 2, PLUS the §164(f) one-half-SE-tax above-the-line deduction (Schedule 1 line 15 → reduces AGI), and the net flows to Schedule 1 line 3 → 1040 line 8 → AGI as ordinary income (NOT the §1411 NIIT base). Net SE earnings are also pulled into Additional Medicare (Form 8959) so a combined wages+SE base over the threshold is surtaxed. The §199A QBI 20% deduction on this income is an OPT-IN via scheduleCQbiEligible (BELOW-THRESHOLD only): 20% × (net − half-SE), capped by 20% × (taxable income − net capital gain) [Form 8995]; the engine DECLINES the at/above-threshold case ($197,300 single/HoH/MFS, $394,600 MFJ, 2025 — Form 8995-A wage/UBIA/SSTB is a preparer surface). REQUIRES scheduleCIsSingleSolePropFinalNetAffirmed:true; and, when the return has W-2 wages, socialSecurityWages (the SE earner's box 3) — absent → schedule_c_se_needs_social_security_wages (box-1/box-5 cannot substitute; assuming $0 over-collects OASDI and, via the half-SE deduction, under-taxes a phase-out). A Schedule C LOSS → schedule_c_loss_needs_review. OUT OF SCOPE → schedule_c_needs_review: depreciation/§179/bonus, multiple Schedule Cs, two-spouse SE allocation (the OASDI cap is per-individual), SE health-insurance (§162(l)), home-office (§280A), farm (Schedule F)/clergy/statutory-employee, the §1402 optional methods, and above-threshold / SSTB / wage-limited QBI (Form 8995-A). STATE: CA CONFORMS (iteration 39) — a CA return with a Schedule C net taxes it in CA AGI as ordinary income (no CA SE tax, no CA §199A QBI — QBI is below-AGI and never reaches the CA base), requiring TWO CA attestations: caScheduleCSelfEmployedForCaPurposesAffirmed (AB5/ABC worker classification — CA disallows the half-SE for a reclassified employee) AND caScheduleCNoStateBusinessAdjustmentsAffirmed (zero Schedule CA 540 line-3 business-income adjustment — no CA/federal depreciation-§179 difference, no bonus depreciation, no PPP/grant exclusion difference; Codex R251-001), absent either → decline. NY ALSO CONFORMS (iteration 42) — a NY return with a Schedule C net taxes it in NY AGI as ordinary income, requiring nyScheduleCNoStateBusinessAdjustmentsAffirmed (zero Form IT-225 §168(k)-bonus / 2025-R&E / §179-SUV business addition; NY needs no worker-classification affirmation as it has no AB5/§164(f) disallowance), absent → decline (ny_schedule_c_adjustment_needs_review). A VERIFY flag names the separate NY MCTMT (for an individual, reported on Form IT-201 lines 54a–54e; SE earnings in the MCTD over $50k) + NYC UBT (Form NYC-202), which the engine does not compute.","fully-taxable pension / annuity / IRA distribution (1040 line 5b, 1099-R box 2a) — a POSITIVE pensionDistributionTaxable COMPUTES as ORDINARY income → AGI + ordinary tax ONLY (deliberately NOT the §1411 NIIT base — pension is not net investment income — and NOT the Additional-Medicare base — not wages), REQUIRING pensionDistributionFullyTaxableAffirmed:true. NOT modeled (a caller must NOT affirm → pension_needs_review decline): box-2b 'taxable amount not determined', basis/after-tax contributions, QCD, rollover, Roth conversion, NUA, and the early-distribution 10% additional tax (Form 5329). NY EXCLUDES the pension on the state return (iteration 30 — IT-201 line 26 govt full / line 29 private $20k@59½; see the ny jurisdiction block below). CA CONFORMS to federal pension taxation (iteration 32) — a CA pension return COMPUTES and TAXES the pension in CA AGI (no exclusion), with a VERIFY flag naming the one CA divergence the engine does not model: Tier-2 railroad retirement (RRB-1099-R), which CA excludes (45 U.S.C. §231m).","Social Security benefit taxation (§86 worksheet → 1040 line 6b) — a POSITIVE socialSecurityBenefits (SSA-1099 box 5 gross) COMPUTES the TAXABLE portion (0/50/85% tiers by provisional income = other AGI + tax-exempt interest + ½ benefits; base $25k single / $32k MFJ / $0 MFS-lived-with-spouse, adjusted $34k / $44k) as ORDINARY income → AGI + ordinary tax ONLY (NOT the §1411 NIIT or Additional-Medicare base). REQUIRES socialSecurityStandardCaseAffirmed:true AND taxExemptInterest supplied — a positive value also requires taxExemptInterestNoPrivateActivityBonds:true (line 2a may include PAB interest, an AMT preference the engine does not model) — AND, for MFS, socialSecurityMfsLivedWithSpouse. NOT modeled (→ social_security_needs_review decline): §86(e) lump-sum election, negative box 5 (repayment/§1341, schema-rejected), foreign/totalization SS, railroad RRB-1099 Tier-1. CA/NY fully EXCLUDE the taxable Social Security on the state return (iteration 29 — Schedule CA (540) line 6 col B / IT-201 line 27; see the ca/ny jurisdiction blocks below).","underpayment-of-estimated-tax penalty — Form 2210 SAFE-HARBOR determination (IRC §6654, iteration 40, slice 1). OPT-IN via priorYearTax: the response carries underpaymentPenalty naming the exemption that zeroes the penalty with certainty — §6654(e)(1) $1,000 de-minimis (current tax − withholding < $1,000), §6654(d)(1)(B) withholding ≥ the required annual payment = min(90% of current tax, safe-harbor% × prior-year tax) where safe-harbor% is 110% if prior AGI > $150k/$75k-MFS else 100% and the prior-year harbor needs a full 12-month prior return, or §6654(e)(2) prior-year tax $0 on a 12-month return AND the taxpayer was a US citizen/resident throughout the prior year (§6654(e)(2)(C)). When none holds → status:needs_preparer (a penalty MAY be owed). In that case the response ALSO carries an advisory penaltyCeiling (iteration 41) — a conservative UPPER BOUND on the §6654 penalty computed under the taxpayer-least-favorable assumptions (single maximum quarterly rate, full accrual to the April 15 due date, no estimated payments); it is guaranteed ≥ the true penalty and is explicitly NOT a Form 1040 line-38 filed value (the exact per-installment amount is a preparer task). The ceiling is emitted only for a tax year whose IRS underpayment rates are fully published (fail-closed otherwise). Withholding is treated as paid evenly (§6654(g)); withholding base = federal + Additional-Medicare withholding. It is a SEPARATE line and does not change tax/AGI/refund. Federal only (CA FTB 5805 / NY IT-2105.9 are later slices).","Child Tax Credit + Credit for Other Dependents (Schedule 8812 Part I, NON-refundable — iteration 33). qualifyingChildrenForCtc × $2,200 (2025, OBBBA) + otherDependentsForOdc × $500, phased out 5% of AGI-over-$400k-MFJ/$200k-others (excess rounded UP to the next $1,000), then limited to tax liability → reduces 1040 line 22. REQUIRES childTaxCreditChildrenQualifyAffirmed / otherDependentsQualifyForOdcAffirmed (SSN-by-due-date, dependency, residency, support, age-under-17 — engine-invisible; over-claim under-taxes → positive count without the affirmation declines child_tax_credit_needs_review). The REFUNDABLE Additional Child Tax Credit (ACTC, Schedule 8812 Part II — iteration 34) is ALSO modeled: unused CTC → refund, capped at min(unused CTC, qualifying-children × $1,700, 15% × (earned income − $2,500)); earned income = W-2 wages (a retiree/investment filer with $0 wages gets $0 ACTC); it lands in owedOrRefund (line 28, refundable — can make owed negative). For 3+ children the engine computes the 15% path and FLAGS the Part II-B alternate (withheld SS/Medicare) which may yield more (engine under-credits = over-tax-safe). Federal only — the CA exemption credit + NY Empire State Child Credit use their own dependent inputs.","Schedule D / Form 8949 netting front-end (capGainAggregates) — per-BOX 1099-B aggregates ({broker, boxType A/B/D/E, proceeds, basis}) netted by the engine into ST/LT (A/B=short, D/E=long), across MULTIPLE brokers, feeding the same §1211(b) cap + carryover worksheet. COMPUTES only COVERED (A/D) boxes with a present positive basis, no wash-sale flag, no adjustment code; ANY other box (noncovered/blank-or-$0-basis/wash-flagged/adjustment-coded) → WHOLE-RETURN decline (capital_gain_lots_need_review), no tax-number leakage. Mutually exclusive with the pre-netted scalars. A cross-account/cross-spouse wash sale is undetectable from per-broker 1099-Bs → every multi-broker computed return carries a VERIFY flag. Lot-level dates/holding-period, wash-sale COMPUTATION, §1256, equity-comp $0-basis remain out of scope (decline). Tag an equity-comp sale with equityCompType (RSU/ESPP/ISO/NSO) → a grant-type-SPECIFIC whole-return decline (equity_comp_basis_adjustment_needs_review) naming the exact Form 8949 / AMT adjustment a preparer must apply (no tax-number leakage). The engine does not attest a broker Stock-Plan-Supplement adjusted basis (§6694: broker-attested ≠ IRS-reported — a policy decision, not modeled). Tag a §1256 contract with sec1256:true → a §1256-specific decline (section_1256_needs_review) — the Form 6781 60/40 split is inseparable from §475(f) mark-to-market, straddles, and the loss-carryback election, so a preparer must complete Form 6781. Tag a crypto disposition with digitalAsset:true → a TY2026+ COVERED (box A/D, IRS-reported basis) crypto box whose units were ALL acquired by purchase AND are NOT collectibles AND are CAPITAL-not-ordinary (digitalAssetAllAcquiredByPurchase:true + digitalAssetNoneAreCollectible:true + digitalAssetIsCapitalNotOrdinary:true) COMPUTES proceeds−basis via the same covered-equity netting path (feeds §1211(b) + §1411 NIIT + §1(h) 0/15/20 LT bands); every other crypto box — pre-2026 (2025 1099-DA is proceeds-only, basis not IRS-reported), a noncovered B/E box, a missing affirmation (purchase or non-collectible), or a wash-flagged box — → digital_asset_needs_review decline. §1091 wash-sale does not apply to crypto (property); staking/mining/airdrop receipt is separately ordinary income at FMV (Rev. Rul. 2023-14), invisible to a disposition compute, which is why the purchase-only affirmation gates it; a §408(m) collectible NFT (Notice 2023-27) is taxed at 28% not 0/15/20, which the non-collectible affirmation gates; dealer/inventory/§988/Box-6 crypto is ORDINARY not capital (§1221, Notice 2014-21), which the capital-not-ordinary affirmation gates. Crypto affirmations require a tagged capGainAggregates digitalAsset box (rejected on scalar cap-gain inputs)."],"decline_codes":["year_not_modeled","special_rate_gain_unmodeled","out_of_scope_income","surtax_additional_medicare","itemized_deduction_needs_review","foreign_tax_credit_needs_review","capital_gain_lots_need_review","equity_comp_basis_adjustment_needs_review","section_1256_needs_review","digital_asset_needs_review","schedule_c_needs_review","schedule_c_loss_needs_review","schedule_c_se_needs_social_security_wages","schedule_e_needs_review","pension_needs_review","social_security_needs_review","child_tax_credit_needs_review","engine_declined"]},"ca":{"years":[2025],"filing_statuses":["single","married_filing_jointly","married_filing_separately","head_of_household"],"modeled_surfaces":["exact-rate schedule (all statuses)","Behavioral Health Services Tax (+1% > $1M)","exemption phase-out","single-status tax table","clean state-conforming non-wage income (taxable interest, ordinary/qualified dividends, net capital gain) taxed at ORDINARY CA brackets — requires stateIncomeConformsToFederal:true","Form 540 line 18 deduction = greater-of(CA standard deduction, caller-asserted caItemizedDeductions). caItemizedDeductions is the FINAL Schedule CA 540 Part II line 30 — AFTER the CA state-income-tax disallowance AND the high-income itemized-reduction worksheet — NOT the federal Schedule A total (over-asserting UNDER-taxes). REQUIRES itemizedDeductionsAreFinalStateAmount:true (a §6694 affirmation; absent → the itemized amount fail-closed declines); MFS + itemized declines (§63(c)(6)(A) spouse-itemizes election). The engine consumes it (like a W-2 box), does not derive it; a VERIFY flag also surfaces the contract.","Schedule CA (540) Part I line 2 col B — US-government-obligation interest SUBTRACTION (R&TC §17143; US-Treasury interest is federally taxable but CA-exempt). caUsObligationInterestSubtraction is a caller-asserted amount of the DIRECT US-obligation interest included in federal taxable interest (1040 line 2b), subtracted from CA AGI ONLY (never federal AGI → the exemption phase-out is untouched). REQUIRES caUsObligationInterestAffirmed:true, and is CAPPED at the supplied taxableInterest (exceeds → declines). SCOPE: direct US-obligation interest only — a RIC/§17145 fund distribution (1099-DIV/line 3b) is out of scope for THIS field (use caUsObligationRicDividendSubtraction). A subtraction over-claimed UNDER-taxes, so it fails closed without the attestation.","Schedule CA (540) Part I line 2 col B — RIC/mutual-fund US-government-obligation DIVIDEND subtraction (R&TC §17145). caUsObligationRicDividendSubtraction is the caller-asserted US-obligation-interest PORTION of a RIC/mutual-fund ORDINARY dividend (1099-DIV box 1a / 1040 line 3b), for a fund holding ≥50% US-obligation assets AT EACH QUARTER-END, subtracted from CA AGI ONLY (never federal AGI). REQUIRES the TWO-PART caUsObligationRicDividendAffirmed:true (amount per the fund's WRITTEN shareholder statement AND the fund MET the 50%-asset test), and is CAPPED at non-qualified ordinary dividends (ordinaryDividends − qualifiedDividends; US-obligation interest is never a qualified dividend). The 50%-asset test is a CLIFF — below 50%, NONE is CA-exempt (do NOT supply; prorating a sub-50% fund UNDER-taxes by the whole amount). A subtraction over-claimed UNDER-taxes, so it fails closed without the attestation.","Schedule CA (540) Part I line 2 col C — out-of-state exempt-interest-dividend ADDITION. caOutOfStateMuniInterestAddition is the caller-asserted CA-taxable portion of box-12 exempt-interest dividends / tax-exempt interest from NON-California municipal obligations (federally tax-exempt, never in federal AGI, but CA-taxable), ADDED to CA AGI ONLY (never federal AGI → the exemption phase-out is untouched). REQUIRES caOutOfStateMuniInterestAffirmed:true (the SOLE guard — exempt-interest dividends have no engine-visible cap). CA munis AND US-territory munis (PR/Guam/USVI) stay CA-exempt and are EXCLUDED, BUT California's 50%-asset test makes the ENTIRE fund dividend CA-taxable (incl. the CA portion) when the fund holds <50% CA/US-territory/US-obligation assets. NOT conformity-gated (a wages-only filer may supply it). An ADDITION is over-tax-safe; absent the affirmation it fails closed.","Schedule CA (540) Part I line 6 col B — U.S. Social Security benefits, FULLY EXCLUDED. CA does not tax Social Security; the engine recomputes the federal §86 taxable portion (1040 line 6b) in-process from socialSecurityBenefits and SUBTRACTS exactly that amount from CA AGI ONLY (never federal AGI → the exemption-credit phase-out, defined on federal AGI, correctly stays SS-inclusive). DERIVED not caller-asserted → the cap is built in (subtracts exactly what was federally included; federal 6b=$0 → $0). REQUIRES the SAME §86 gates as the federal endpoint (socialSecurityStandardCaseAffirmed:true; socialSecurityMfsLivedWithSpouse for MFS) — an unaffirmed SS return declines federally → declines CA. Tax-exempt interest (line 2a) is accepted as a §86 operand but any positive amount DECLINES (state_tax_exempt_interest_unsupported — the Schedule CA line 2 col C out-of-state-muni add-back is not sized in this slice).","Federal pension/IRA (1040 line 5b) — CA CONFORMS and TAXES it (iteration 32). A fully-taxable pension stays in CA AGI and is taxed as ordinary income (Schedule CA 540 line 5a/5b: 'generally no adjustments'); NO CA exclusion. Over-tax-safe by construction (CA has no pension surtax). Requires pensionDistributionFullyTaxableAffirmed. A VERIFY flag (CA-PENSION-TAXED-CONFORMING) fires on every CA pension return naming the ONE CA divergence the engine does NOT model: Tier-2 RAILROAD retirement (RRB-1099-R), which CA EXCLUDES (45 U.S.C. §231m) — a preparer must subtract any Tier-2 portion on Schedule CA 540, else a railroad retiree is over-taxed.","Schedule CA (540) Part I HSA add-backs (R&TC §17215.4 (IRC §223 HSA non-conformity; §17131.4 governs the §106(d) employer-contribution piece) — CA does not recognize HSAs). Three caller-asserted ADDITIONS to CA AGI ONLY (never federal AGI), each requiring caHsaAddbacksAffirmed:true (fail-closed): caHsaEmployerContributionAddition (W-2 box 12 code W employer/cafeteria contribution → Section A line 1h col C); caHsaInterestAddition (interest earned inside the HSA → line 2 col C); caHsaDividendAddition (taxable dividends earned inside the HSA → line 3 col C). All over-tax-safe. NOT modeled (declined/omitted): the SELF-contribution HSA deduction add-back (the engine takes no federal Form 8889 deduction → adding it back would double-count/over-tax); HSA distributions (line 8f); Archer-MSA rollover (R&TC §17215 / IRC §220, +12.5%). Do NOT also report HSA in-account earnings in taxableInterest/ordinaryDividends."],"non_wage_conformity_note":"CA taxes conforming non-wage income at ordinary brackets (no preferential capital-gains rate). Requires stateIncomeConformsToFederal:true affirming NO tax-exempt/out-of-state-muni interest, NO exempt-interest dividends OTHER THAN the out-of-state portion supplied as caOutOfStateMuniInterestAddition (a CA addition), and NO US-Treasury-obligation interest needing a CA subtraction OTHER THAN the explicitly-supplied caUsObligationInterestSubtraction (direct interest) or caUsObligationRicDividendSubtraction (RIC dividend, §17145), capital-gain basis == federal. (HSA add-backs are orthogonal — a separate over-tax-safe set of caller-asserted additions, see modeled_surfaces.) Without it, non-wage income declines. Schedule C sole-prop income NOW COMPUTES for CA (iteration 39 — CA conforms, taxes it in CA AGI; requires caScheduleCSelfEmployedForCaPurposesAffirmed + caScheduleCNoStateBusinessAdjustmentsAffirmed + the federal sole-prop affirmation). Schedule E, non-2025, part-year/nonresident, other states always decline.","decline_note":"Outside the modeled surface (other-status tax tables, credits, payments, OTHER Schedule CA additions/subtractions beyond the four accepted below, unaffirmed non-wage income) declines deterministically. CA itemized IS accepted as a caller-asserted line-30 total (REQUIRES itemizedDeductionsAreFinalStateAmount:true; MFS declines §63(c)(6)(A)); the DIRECT US-obligation interest subtraction IS accepted (caUsObligationInterestSubtraction, REQUIRES caUsObligationInterestAffirmed:true, capped at taxableInterest, direct-only); the RIC/mutual-fund US-obligation DIVIDEND subtraction IS accepted (caUsObligationRicDividendSubtraction, §17145, REQUIRES the two-part caUsObligationRicDividendAffirmed:true, capped at non-qualified ordinary dividends, 50%-asset cliff); the out-of-state exempt-interest-dividend addition IS accepted (caOutOfStateMuniInterestAddition, REQUIRES caOutOfStateMuniInterestAffirmed:true, over-tax-safe, CA + US-territory munis excluded, CA 50%-asset test surfaced); the HSA add-backs ARE accepted (caHsaEmployerContributionAddition / caHsaInterestAddition / caHsaDividendAddition, REQUIRES caHsaAddbacksAffirmed:true, over-tax-safe, §17215.4 (IRC §223; §17131.4 for §106(d) employer contributions) — but the self-contribution deduction add-back, HSA distributions, and Archer rollover (R&TC §17215 / IRC §220) are NOT modeled). See modeled_surfaces."},"ny":{"years":[2025],"modeled_surfaces":["selected NY 2025 compute paths (incl. NYC resident)","clean state-conforming non-wage income (interest / dividends / net capital gain) taxed at ordinary NY brackets — requires stateIncomeConformsToFederal:true AND nyWageAdditions","IT-201 line 34 deduction = greater-of(NY standard deduction, caller-asserted nyItemizedDeductions). nyItemizedDeductions is the FINAL Form IT-196 line 49 — AFTER the NY state/local income-tax ADDBACK and the NY high-income itemized LIMITATION worksheet (IT-196-I line 47: itemized limited to 50% of line-19 charity for NYAGI $1M–$10M, 25% for NYAGI over $10M; line 48 then adds the college-tuition itemized deduction) — NOT the federal Schedule A total (over-asserting UNDER-taxes). The engine consumes it (like a W-2 box), does not derive it or apply the IT-196 limitation; a VERIFY flag surfaces the contract (enhanced, tier-correct, over $1M AGI). The recapture worksheet correctly handles the resulting low-taxable-income/high-AGI case (IT-201-I worksheets 1-11).","IT-201 line 27 — taxable amount of Social Security benefits, FULLY EXCLUDED. NY does not tax Social Security; the engine recomputes the federal §86 taxable portion (1040 line 6b) in-process from socialSecurityBenefits and SUBTRACTS exactly that amount from NY AGI (line 33), NY taxable income (line 38), AND the NY recapture base — never from the Empire State Child Credit phase-out base or IT-201 line 19, which use FEDERAL AGI (correctly SS-inclusive). DERIVED not caller-asserted → cap built in (federal 6b=$0 → $0). REQUIRES the SAME §86 gates as the federal endpoint (socialSecurityStandardCaseAffirmed:true; socialSecurityMfsLivedWithSpouse for MFS) + nyWageAdditions — an unaffirmed SS return declines federally → declines NY. Tax-exempt interest (line 2a) is accepted as a §86 operand but any positive amount DECLINES (state_tax_exempt_interest_unsupported — the IT-225 A-101 non-NY-muni add-back is not sized in this slice).","IT-201 line 26 (government pension) / line 29 (private pension/annuity) — NY EXCLUDES pension, DERIVED from the computed federal line 5b and subtracted from NY AGI (line 33) / taxable income / recapture base ONLY (never the ESC phase-out base or IT-201 line 19, which use federal AGI, correctly pension-INCLUSIVE). Line 26 = NYS/local/federal GOVERNMENT-EMPLOYER pension (incl. U.S. military), FULL exclusion uncapped (§612(c)(3)), gated by nyPensionIsGovernmentPension:true. Per IT-201-I, IRC §457 GOVERNMENT deferred-comp is EXPLICITLY NOT line 26 — it goes to line 29 (capped). Line 29 = PRIVATE pension/annuity (incl. IRC §457 govt deferred comp / IRA / §403(b) / Keogh), min($20,000, line 5b) (§612(c)(3-a)), gated by nyPrivatePensionQualifiesFor20kExclusion:true (attests 59½ before Jan 1 2025 AND the whole 5b is qualifying periodic income). Each affirmation attests the WHOLE single-scalar line 5b is of its class — a MIXED govt+private (or qualifying+non-qualifying) 5b affirms NEITHER (pension stays NY-taxable, or a preparer splits). Both affirmed → decline (pension_exclusion_classification_ambiguous). Neither affirmed → pension stays NY-taxable (over-tax-safe). Requires pensionDistributionFullyTaxableAffirmed + nyWageAdditions."],"non_wage_conformity_note":"NY taxes conforming non-wage income at ordinary brackets / recapture (no preferential rate). Requires stateIncomeConformsToFederal:true (same attestation as CA) AND nyWageAdditions. Without the affirmation, non-wage income declines. Schedule C CONFORMS (iteration 42) with nyScheduleCNoStateBusinessAdjustmentsAffirmed (else ny_schedule_c_adjustment_needs_review) + a VERIFY flag for the separate MCTMT/NYC-UBT. Schedule E RENTAL CONFORMS (iteration 43, NARROW — positive passive net, NY only) with nyScheduleENoStateBusinessAdjustmentsAffirmed (straight-line real property, no §168(k)/cost-seg/§179; else ny_schedule_e_adjustment_needs_review) — NY conforms to §469 PAL (CA Sch E stays declined: separate §469 track). non-2025, part-year/nonresident always decline.","decline_note":"Fails closed without nyWageAdditions; credits/payments beyond the modeled set and unaffirmed non-wage income decline deterministically. NY itemized IS accepted as a caller-asserted IT-196 line-49 total (see modeled_surfaces) but REQUIRES itemizedDeductionsAreFinalStateAmount:true (else declines), and MFS + itemized declines (§63(c)(6)(A) spouse-itemizes election)."}},"reconcile":{"jurisdiction":"ca","non_mutating":true,"review_states":["match","mismatch","unsupported","needs_review"],"note":"Independently computes from source docs and reconciles against a filed return; never fabricates a full return."}},"out_of_scope":["full-return preparation or filing","credits beyond the §904(j) de-minimis foreign tax credit","dependents","itemized deductions beyond SALT + home mortgage interest (medical, charitable, casualty, misc.)","broad payments/refund workflows","Schedule D lot-level / Form 8949 detail, wash sales, §1256, and covered-basis gains — pre-netted scalar ST/LT gains, capital-loss carryover I/O, AND the §1250-unrecaptured (25%) / 28%-collectibles special-rate portions (2025, via sec1250UnrecapturedGain / collectibles28Gain) ARE modeled (see federal.modeled_surfaces)","business / pass-through / QBI compute — a SUPPLIED scheduleCIncome → schedule_c_needs_review decline (SE tax §1401 + §199A QBI guidance), qbiDeduction/other → out_of_scope_income. RENTAL: a POSITIVE scheduleEIncome COMPUTES a bounded simple passive rental (→ Schedule 1 line 5 → Schedule 1 line 10 → Form 1040 line 8 → AGI + §1411 NIIT) when BOTH affirmations are set (scheduleERentalIsPassiveFinalNet + scheduleERentalNotSection162Business — see federal.modeled_surfaces); a rental LOSS, a missing affirmation, or a §162/QBI trade-business → schedule_e_needs_review decline (§469 PAL / §465 at-risk / §199A QBI a preparer owns). All declines are no-tax-number-leakage. BOUNDARY: the engine declines only on a SUPPLIED out-of-scope field — it cannot detect income a caller OMITS (a business/rental filer who sends only wages under-reports; that is a caller/extractor responsibility)","state coverage beyond the jurisdiction surfaces above","ambiguous or corrected source documents outside the documented envelope"],"decline_codes":{"federal":["year_not_modeled","special_rate_gain_unmodeled","out_of_scope_income","surtax_additional_medicare","itemized_deduction_needs_review","foreign_tax_credit_needs_review","capital_gain_lots_need_review","equity_comp_basis_adjustment_needs_review","section_1256_needs_review","digital_asset_needs_review","schedule_c_needs_review","schedule_c_loss_needs_review","schedule_c_se_needs_social_security_wages","schedule_e_needs_review","pension_needs_review","social_security_needs_review","child_tax_credit_needs_review","engine_declined"],"state_and_reconcile":"declines outside the modeled surface; reconcile uses review_states"},"review_states":["match","mismatch","unsupported","needs_review"],"response_uniform_fields":["billed","retry_safe","next_action","reason","provenance"],"billing_semantics":{"computed_200_billable":true,"deterministic_decline_200_billable":true,"validation_4xx_billable":false,"server_5xx_billable":false,"idempotency_key_bills_once":true,"monthly_limit_behavior":"hard_429_cap","overage":"none"},"docs":{"supported_envelope":"https://tax-mcp.com/docs#supported-scope","quickstart":"https://tax-mcp.com/docs","openapi":"https://tax-mcp.com/api/openapi.json"}}