Yin & Yang: some good news ... and some bad news.

• Author: Williams, Len
• Position: CATax

Good news:

* Gov, Brown signed AB 154, so the California Revenue & Tax Code will be conformed to the Internal Revenue Code as of Jan. 1, 2015.

* There was no bill for sales tax on services this year. However, many feel that it will be introduced again next year.

Bad news:

* Gov. Brown vetoed AB 99, the bill that would have extended California's partial conformity to the Cancellation of Indebtedness principal residence exclusion through Dec. 31, 2014.

To adapt a Biblical expression, "The government giveth and the government taketh away."

How the Board of Equalization Tracks Individuals' Failure to Declare Use Tax Obligations

There are several discovery methods, which can result in a bill being sent to an individual by the BOE, or an unannounced visit. The most common method is to monitor what people report to U.S. Customs and aircraft hangars in California.

The BOE also shares information with other states to gain tips about untaxed high value items shipped into California, such as artwork and antiques.

It's generally a bargain for individuals to report use tax annually on their 540s, according to the use-tax, look-up table in the 540 Instructions. Last year it was .00035 times AGI. It doesn't cover individual purchases of more than $ 1,000, but at least it counts as a use tax return for purposes of tolling the statute of limitations. Absent any use tax reporting, the statute for use tax auditing is eight years, as compared to three for those who have reported some use tax.

Something New: The Executive Advocate Service

The new Executive and Advocate Services handles some of the same taxpayers as the FTB's Taxpayer Advocate Service. Often, a matter referred to the Taxpayer Advocate's office by a taxpayer's CPA will be handled by the Executive and Advocate Services, acting simply as an overflow staff for the Taxpayer Advocate.

However, the primary task of the Executive and Advocate Services is to handle cases when a taxpayer or a taxpayer's representative is unable to resolve an issue through normal channels, or when an FTB action places the taxpayer in an immediate undue hardship.

All requests to use this service must be in writing and include:

* The taxpayer's name;

* Daytime phone number;

* Account number; and

* A detailed...