Top 12 tax scams

It’s a new year and a good time to remind your clients about the top tax scams. / more+

Pass-through entities must timely file original tax returns claiming new jobs tax credit in order for owners to claim the credit

A new jobs tax credit of $3,000 is available to small businesses with 20 or less employees for each additional net full-time employee hired and employed in California for tax years beginning on or after January 1, 2009. The total amount of the credit that we can allocate may not exceed $400 million, and claims must be made before a statutorily provided “cut-off” filing date. / more+

Using the Annualization Method in 2009 and 2010

Estimated tax payments have undergone many changes since we started filing season one year ago. / more+

Small Business

Timing is everything

Is your client considering making an S corporation election? Selling or exchanging 50 percent or more of the total interests in an LLC or limited partnership? / more+

Ask the Advocate

Withholding and estimate tax payment changes

This summer the California legislature again revised the estimated tax payment percentages, and also passed some clean-up legislation to clear up confusion on how wage earners with only wage withholding would meet the new estimated tax payment requirements. / more+

Inside FTB

Take a look at the changes happening here at FTB. / more+

Criminal Corner

Our monthly summary on bringing tax criminals to justice, and closing the tax gap one case at a time. / more+

Big Business

California code of civil procedure and foreclosures

Will you clarify how California civil procedures interact with the Internal Revenue Code (IRC)? Specifically how does California Civil Procedure Code (CCP) Sections interact with IRC Section 108, Income from Discharge Indebtedness? / more+

Franchise Tax Board (FTB) today announced it has begun contacting more than 35,000 companies that did business in California in 2007, but failed to file a state tax return for that year. FTB annually reviews more than 5 million income records from government agencies and financial institutions, and matches them against tax records filed to determine whether some businesses have yet to file. As part of this annual effort, FTB collected approximately $31 million last year from businesses that failed to file tax returns.

Businesses contacted by FTB will have 30 days to file their delinquent tax return or show why one is not due. If no action is taken, FTB will issue a tax assessment that may include penalties and fees. With the state’s automatic seven-month extension, companies doing business in California are provided up to 10 and one half months to timely file their California state tax return.

Failure to file tax returns is one part of the tax gap that is defined as the difference between taxes owed and taxes paid. California estimates its annual tax gap to be $6.5 billion per year.

For those receiving notices, information is available by calling 866.204.7902. Callers should be prepared to provide the 15 digit notice number.