IRS audits we’ve got a really good measure of technical skill at the firm can deal with things that are extremely complex.
The IRS doesn’t throw people in jail just because they owe money in taxes rather the way.
It is every small business owner’s worst nightmare … they have been notified by the IRS that they are going to be audited. IRS audits have a lot of bad connotations, but on a very basic level, an IRS audit is the IRS coming in and checking that your tax return was filed correctly.
With higher than average state income tax imposed on business and personal income, California can be an expensive state to do business in. The state’s small businesses are particularly hard hit under its tax laws. California has a higher than average state income tax imposed on business and personal income. Even if your California business is structured as a pass-through entity, meaning income should only be taxed at one level; the California Franchise Tax Board may still be double-taxing your income.The Franchise Tax Board is the agency responsible for administering personal and business income tax in the State of California. While the state generally follows the lead of the IRS in setting policy, it does not do so in every instance.
Our last few posts have been about how the various California state tax agencies handle tax liens.
A brief review:
We previously discussed how the Board of Equalization handles tax liens. For this post in our series, we would like to talk about how the California Franchise Tax Board addresses the use of liens. There are differences between the way the various California tax agencies and the IRS use tax liens about which you need to take note to stay out of hot water.
In Part 1, you learned what a lien is, how taxpayers are notified of a lien, and what elements are required for a valid lien. In Part 2, you will read how a lien can impact your credit report, who has access to a list of those with liens, and what happens during bankruptcy and other financial events if a lien is involved.
The tax community is a house somewhat divided over the effectiveness of liens. On the one hand, the government needs to protect their interests in regards to taxes owed them. On the other hand, tax liens are filed against taxpayers with few or no assets to file a lien against.
