Tuesday, September 15, 2009

Thousands of Businesses Need to File State Tax Returns

From Business Wire.com:

The Franchise Tax Board (FTB) today announced it has begun contacting more than 35,000 companies that did business in California in 2007 but failed to file a state tax return for that year.

The FTB annually reviews more than 5 million income records from government agencies and financial institutions and matches them against tax records filed to determine whether some businesses have yet to file. As part of this annual effort, FTB collected approximately $31 million last year from businesses that failed to file tax returns.

Businesses contacted by FTB will have 30 days to file their delinquent tax return or show why one is not due. If no action is taken, the FTB will issue a tax assessment that may include penalties and fees. With the state`s automatic seven-month extension, companies doing business in California are provided up to 10 and one half months to timely file their California state tax return.

The failure to file tax returns is one part of the tax gap that is defined as the difference between taxes owed and taxes paid. California estimates its annual tax gap to be $6.5 billion per year.

For those receiving notices, information is available by calling 866.204.7902. Callers should be prepared to provide the 15 digit notice number.

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