State contact: California contacting businesses about 2011 returns.

• Author: Williams, Len
• Position: CA Tax

The FTB is contacting more than 90,000 California business entities that have not filed their 2011 state income tax returns. Businesses contacted will have 30 days lo tile a tax return or show why there is no filing requirement.

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However, 2011 returns aren't the only ones the FTB is going after. It's also going after returns from some past years, usually where taxpayers haven't informed their CPAs as to what's been going on.

A partner of a large local firm tells of a client who formed an LLC into which he transferred a limited partnership, but never told his CPA. Now the CPA has seven years or LLC: returns to do.

Another LLC Matter on TaxTalk

A married couple formed an LLC many years ago for their rental properties, but subsequently had their attorney withdraw the rental properties from the LLC. The attorney did that, but didn't dissolve the LLC. The FTB recently sent the couple a for several thousand dollars for several years of not having filed and paid the $800 minimum fee.

The question is whether or not they have to pay.

The lawyers on the TaxTalk list serve opined no, under these circumstances, since the LLC has no assets. If the LLC is defunct and has no assets, there are certain procedures that the FTB must pursue to hold the LLC's members responsible for the LLC's taxes. An LW is a legal entity under state law and all creditors, including tax agencies, collect using state law. This situation is different than the liability for trust fund taxes.

This is not the venue to pursue all of the permutations and combinations of what either the FTB or the taxpayers may do. It's simply to get out the word that receiving such a bill for an abandoned or defunct LLC doesn't necessarily mean that it has to be paid. Rather, delve into it further and have the client confer with a tax attorney about it.

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Assessed Valuations

Dan Walters of the Aacramento Bee has been around a long time, and frequently comments on developments that pertain of taxes of various types. His Aug. 2 column pointed out that assessed valuations on real estate didn't drop dramatically during this past recession. However, he notes that valuations on real estate in 2013 are poised to register a sharp gain., based on reports from local assessors by the State Board of Equalization. He states that the governor's...