The California Franchise Tax has contacted THOUSANDS of businesses to file California income tax returns, but they may not be required to file.
FTB Tax News article starts out:
“We recently sent letters to over 41,000 California businesses that have not filed their 2015 state income tax returns.” Actually the article should read “may not” have filed their income taxes.
The article does point out later on that the business being contacted is a “potential nonfiler”, see below:
The article goes on to state….“Each year we review more than 10 million income records received from the IRS, the Employment Development Department, the Board of Equalization, financial institutions, and other businesses. We match this information against our tax records to identify potential nonfilers. Last fiscal year, we collected approximately $63.2 million from businesses that failed to file tax returns.
We give business nonfilers 30 days to file a tax return or show why one is not required. Businesses that disregard the letter will get a tax assessment based on income and other information reported to us. The tax assessment includes interest, fees, and penalties.”
Although the FTB Filing Enforcement program has become more effective at identifying nonfilers, do not automatically assume that the FTB is correct. This is especially true for out-of-state businesses. Doing business rules can vary depending on the tax year involved and type of business entity.
Before you file we can talk about it! I have already heard from a few of you, including a taxpayer in Japan. If you want to talk contact me at email@example.com
To view the complete Tax News article click on the link below.