Steve Sims EA llc


Announcements and Updates

Interesting...Some Suggested Topics For CA Franchise Tax Board (FTB) Advisory Board Meeting

Practitioners/taxpayers are contributing, thank you very much! I have received the following as either a topic for the meeting or an issue to consider:

FTB Offer In Compromise (OIC) transparency - I (and probably other tax professionals) would like to learn how the FTB calculates its settlements. The purpose of this is so I can tell a client whether filing an OIC would be worth it. Without any guidelines, we have no other option other than just filing one and seeing what happens. A lot of times, it results in an unhappy client if the OIC is rejected and sometimes they blame it on us. 

Faster Power of Attorney (POA) processing - I found the online POA system to be cumbersome and slow. How are we supposed to use this to help a client who is facing a bank levy or wage garnishment? Why can't they accept a POA via fax like the IRS does? 

Reduction of annual fees for limited liability entities - I think the FTB should reduce the $800 annual fee for corporations and LLCs. This fee is one of the highest in the nation and prevents small businesses from taking steps to protect their assets. I have found that business owners that establish limited liability entities tend to be more compliant with laws so they can maintain their limited liability status. 

First-time abatement for certain penalties - Federal and state law impose both a failure to file and a failure to timely pay penalty, which can be abated if the taxpayer can demonstrate that the failure was due to reasonable cause and not willful neglect. In addition, the IRS allows a “first-time” abatement procedure, which requires the agency to abate these penalties if the taxpayer has not previously been required to file a return, or if no prior penalties have been assessed in the past three years.  California law does not automatically conform to changes to federal tax law. Instead, the Legislature must affirmatively conform to federal changes. Senate Bill 375 would allow individual taxpayers in California to also request first-time abatement of the failure to file and the failure to timely pay penalties. Can FTB show support for this legislation?

Please share your thoughts on these issues or any others.  I am your seat at the table, not all suggestions can be tabled during the FTB Advisory Board meeting, but all can be shared with FTB management. (Ok almost

Special thanks to the following for their contributions:

Cameron Hess, Attorney at Law

Steven Chung, Attorney at Law