Tuesday, August 25, 2015

California Tar and Feathers Top Delinquent Taxpayers

California has adopted the old school method of tarring and feathering delinquent taxpayers to bring public humiliation and shame to certain businesses and individuals who cannot afford to pay the taxes they owe.  In doing so, the California Franchise Tax Board (FTB) has recently mailed Notice of Public Disclosure of Tax Delinquency letters to the top delinquent personal income and business entity taxpayers who owe over $100,000 where the amount due is subject to a recorded notice of state tax lien.
 
These lovely little letters give those taxpayers notice that the FTB intends to publicly disclose their names, addresses, and amounts due on its public website during the week of October 12, 2015. The list will also include occupational or professional license information, including license number and status, and the names of principal officers and their titles.  Businesses and individuals appearing on the list are subject to having their occupational, professional, and driver’s licenses suspended by the issuing agencies. In addition, California state agencies are prohibited from entering into contracts with taxpayers on the list for the acquisition of goods or services.
 
So what steps should one take if you appear on the list?  Taxpayers who receive a Notice of Public Disclosure of Tax Delinquency letter may contact the FTB at (888) 426-8555 for personal income tax or (888) 426-8751 for business entity taxes, or they may contact a tax professional who can assist in removing you from the list and resolving the tax issue.  
 
Although this type of public tar and feathering has the potential to destroy reputations and businesses, California believes this form of public shaming is worth it because the theory is that it will increase the chances of getting the taxes paid.   At the Federal level, its against the law for the IRS to disclose personal tax information to any third party unless its necessary and particular to an actual ongoing investigation or audit.  This is the complete opposite for the FTB. In fact, the FTB publishes and updates this public shaming list biannually.
 
Now a bit curious if you or someone you know might be on the list?  The list of the top 500 delinquent taxpayers was updated on August 19, 2015, and can be viewed on the FTB’s website at https://www.ftb.ca.gov/aboutFTB/Delinquent_Taxpayers.shtml#CORP.
 
If you need assistance concerning taxes involving the State or the IRS, do not hesitate to contact a tax lawyer in Orange County.   The Orange County Tax Attorneys at Wilson Tax Law Group or www.wilsontaxlaw.com have experience in both State IRS and state tax matters. You can reach the Wilson Tax Law Group or info@wilsontaxlaw.com at 949-397-2292.
                                                                               Delinquent California Taxpayer