| Beginning February 1,
2005, California has agreed to forgive any penalties and other charges
(which become very high over time) you might owe on unpaid taxes from years
before 2003. To qualify for this forgiveness you must apply for amnesty
prior to March 31, 2005.
The amnesty will cut your tax bill
if you come clean about taxes you owe, income you did not report or returns
you did not file. If you fail to apply for amnesty during that short
time period, California will impose large additional penalties… even though
you were not aware of the error on an old tax return.
You may not be aware you still owe
taxes in California if you have lived abroad for years. These amounts
can be owed for amounts earned in California for which you did not file
returns or amounts assessed for which the notices have never reached your
new home outside of the USA. The state records go back many years.
In one situation the state went all the way back to 1977. You should
as soon as possible contact the Franchise Tax Board (for income and franchise
taxes) or the Board of Equalization (for sales and use taxes) to see if
any taxes are owed. If the state shows you owe money, you should
consider the amnesty program and file amended or prior year unfilled returns
prior to April 1, 2005.
While the amnesty application is
reasonably simple, there are complicated aspects that could have consequences
to you if it is not prepared correctly. The form to use
for your personal taxes is FTB 2300PIT and for your business and Franchise
tax FTB 2300BE. They can be downloaded at www.ftb.ca.gov - |
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