California statute of limitaions on unpaid income taxes

[gypsyjoe]

What is the name of your state? California

I worked in California in 1981. I am currently a resident of Maine and have been for years.

I did NOT FILE State income taxes with California for that year.

Last week I received an "Income Tax Amnesty Application", stating that I owed almost $10,000. in back taxes for 1981.

My question is two fold. First, what is the statute of limitations for unpaid/non filed income taxes in California? Secondly, should I file the application that they sent me, inspite of the fact that I have no means to pay?

Thanks for any help you can offer
Gypsy

[Snipes5]

There is NO statute of limitations on UNFILED tax returns. They have 10 years to collect the unpaid taxes, after filing date or due date, whichever is later.

DO NOT file the paper they sent you without talking to an Enrolled Agent or Tax Attorney with California experience.

Your best bet will probably be to fill out and submit a proper return for that year. It is highly likely that their determination of what you "owe" is almost entirely invented by them. They take your income, assume you have no deductions or credits, add penalties and interest, and tell you that's what you owe.

Get professional advice. Do not attempt to tackle the FTB by yourself.

Snipes

[Jo-Ann]

State: California

Quoting from above post: There is NO statute of limitations on UNFILED tax returns. They have 10 years to collect the unpaid taxes, after filing date or due date, whichever is later.

I'm confused by this. Do you mean that they have 10 years from the year 1981, or 10 years from the date of their notice in 2005 saying that monies are owed? This is for unfiled taxes.

What if absolutely no contact has been made by them between 1981 and 2005?

And what if taxes were filed but paperwork has been lost over the course of the past 23 years, and there has been no attempt on California's part to contact us with the claim that monies are owed?

Thanks much for your help.

[LaserJoc]

**Laws of California**

I saw this thread and I too just received an "Income Tax Amnesty Application", stating that I owed almost $15,000 in back taxes for 1984. Moreover, as far as I can remember I did file, but have NO supporting documentation due to a fire and I purge files that are older than 10 years. In addition, if I didn’t file, I have NO idea what I would have made.

So, CA is making allegations that most people in my position CAN NOT defend or we'll be forced to pay for an out-of-state defense. Do you think… they’re doing this because of the Billion dollar deficit they're in???

I am a Republican. But if this is what they're doing to clean up their mess I think I'll go independent.

If people do owe this money, perhaps what CA should do is grant a repayment plan that covers the same amount of years it took them to find/fabricate these allegations!

What to do???

[Snipes5]

There is no statute of limitations on unfiled tax returns. This means they can attempt to collect them FOREVER, until you die, and then try to get the money from your heirs.

Once you file, the 10 year collection clock will start ticking.

Spend the money to consult with a California Tax Attorney. I am sure a good Attorney should be able to sort this out quickly with a minimum of fuss.

Seriously, don't try to handle this yourself. The California Franchise Tax Board is evil.

Again, do not try to handle this one on your own. The few $$ you save won't be worth it in the long run.

Snipes

[Jo-Ann]

State: California

Thanks, Snipes, good advice, I'm sure.

Quoting from LaserJoc's post: Do you think… they’re doing this because of the Billion dollar deficit they're in???

That's how my husband and I see it. They're shaking the tree and seeing what falls out.

I plan to ignore the amnesty letter, which conveniently does not give the original sum they think was owed.

Once they send an actual bill with details, we will appeal it and fight them all the way to Tax Court. Recent experience with another branch of the IRS has proven that in the end, there are actual human beings behind the desk, sometimes willing to listen to what the taypayers are trying to say.

[Snipes5]

The IRS is a lot nicer than the FTB.

The FTB is ruthless. If they want you, they will get you, and your little dog, too. And since there is no SOL, they are legally permitted to do that.

Snipes

[LaserJoc]

Originally Posted by Jo-Ann

State: California

Thanks, Snipes, good advice, I'm sure.

Quoting from LaserJoc's post: Do you think… they’re doing this because of the Billion dollar deficit they're in???

That's how my husband and I see it. They're shaking the tree and seeing what falls out.

I plan to ignore the amnesty letter, which conveniently does not give the original sum they think was owed.

Once they send an actual bill with details, we will appeal it and fight them all the way to Tax Court. Recent experience with another branch of the IRS has proven that in the end, there are actual human beings behind the desk, sometimes willing to listen to what the taypayers are trying to say.

I wonder if there are enough people out there to fight this thing as a group instead of individually. There is power in numbers!

[Snipes5]

I highly doubt any court will look kindly on a bunch of people who didn't bother to file their tax returns, who are now mad because the tax man has come calling.

Snipes

[LaserJoc]

I'm not implying that if I didn't (which I can't prove I did file, but I certainly don't remeber NOT filing) file that I get out of paying what's fair. I mostly object to them waiting 20+ years to contact me and then say I owe interest for all those years. I haven't moved much, so if they found me now, at an address that I just moved to 6 months ago after living 8+ years at the previous one, they could have found me 19 years ago.

[abezon]

You can write the FTB & request a copy of your return. If the FTB can't or won't send it, write the IRS & request a copy of your federal return. This will allow you to reconstruct the correct CA return.

And hire an enrolled agent or tax attorney. The FTB has no respect for whatever you say, but if your attorney says the same thing, they'll listen.

[cougar81]

I haven't lived in California since 1985. I too got the Amnesty letter for 1984 taxes, and I did pay the California tax. This is the first I've heard anything from them; after 20 years of nothing!

I've read in this string that there's 10 years for them to collect after I submitted my taxes. How do I tell them to fish somewhere else to fix their deficit?

What happens if I ignore them?

PS - This is a great website. Thanks in advance for your help.

[Snipes5]

Don't ignore them. That's always bad.

Hire an Enrolled Agent familiar with CA to help you deal with them. It will be money well spent.

Snipes

[klh43]

I also received one of these amnesty letters from 1988. Can they take the refund I am expecting back from the IRS?

Thanks

[abezon]

Yes, they can. If you can't get this fixed before you file your federal taxes, at least adjust your withholding so that there is no refund next year for them to grab.