If you haven’t had to pay any state taxes for the past few years but now face a liability, you might be wondering, why do I owe state taxes this year? It’s a pretty common question that many taxpayers struggle to find the answer to.
You may not even be aware that you owe state taxes this year. It all depends on how your income has changed over the previous year and whether you still have any credits or deductions available to you that were used previously to reduce your taxes.
The Employment Development Department, or EDD, is one of the largest California state departments and is responsible for administering the payroll tax regulations for California businesses and individuals
In California, state income taxes are generally among the highest in the country, but the burden is spread among different segments of the population. The rate of California income tax is arranged on something of a sliding scale, separated by income tax brackets.
Filing for bankruptcy may feel like accidentally stepping off a cliff – it’s not something most people can mentally prepare themselves for in advance.
“Whether you agree that raising taxes during an economic recession is bad for the economy or not, state and local governments should be doing everything in their power to bid Congress to provide more direct aid. This would minimize the need for tax increases or spending cuts,” wrote Michael Mazerov in Tax Notes.
{{cta(’09b64408-9310-4451-9a41-0234b45d370e’,’justifyright’)}}Are you a marketplace facilitator or out-of-state business who has received a tax return demand from the California Franchise Tax Board? If so, read this before you respond. We’ve provided the essential background information you need to formulate a plan prior to your response.
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.
Sometimes your financial fortunes take a turn for the worse, and you find yourself owing back taxes to the Franchise Tax Board. You don’t even have two coins to rub together, much less make installment payments, yet you are looking for an alternative to filing for bankruptcy. An Offer in Compromise is also off the table; you just don’t have the money.
Taxpayers often confuse the terms tax lien and tax levy and do not understand the difference in actions represented by these concepts. While liens and levies can both be filed by the IRS and the California Franchise Tax Board (FTB) and there are many similarities to when they are issued and how they can be removed, liens and levies are terms for very different actions.
As if taxes were not complicated and frightening enough, the federal and state taxing authorities have a variety of devices in their arsenal to compel payment and stave off penalties.
Tax liens, one of the most common of those devices, can cause trouble not just with your property and bank accounts, but with your credit score and ability to obtain lines of credit.