How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask R. Klein, EA Your Own Question

R. Klein, EA
R. Klein, EA, Enrolled Agent
Category: Tax
Satisfied Customers: 2882
Experience:  Over 20 Years experience
63817126
Type Your Tax Question Here...
R. Klein, EA is online now
A new question is answered every 9 seconds

Hi 10 years ago me and my business partner form an LLC together,

Customer Question

Hi 10 years ago me and my business partner form an LLC together, which is 2002 and in 2003 we dissolve it and did not do any business using that LLC . suddenly we received a notice fro IRS Stating that the LLC is still active and we did not file tax return for the last 10 years, stating that we own them in over 15k of back taxes. How should we dispute this kind of case what forms? the LLC was form in California

thank you
David
Submitted: 1 year ago.
Category: Tax
Expert:  R. Klein, EA replied 1 year ago.

R. Klein, EA :

Thank you for contacting me about your Tax issue. I will work hard to help you understand the issue clearly.

R. Klein, EA :

Was the notice of back taxes from the IRS or from the California Franchise Tax Board? I'm thinking it's more likely the latter....

R. Klein, EA :

In any case, California considers any entity that is not formally dissolved to be open. You cannot close an LLC or corporation by simply ignoring it and hoping it goes away. California levies a minimum $800 per year tax on all entities until the entity dissolves.

R. Klein, EA :

Failure to file and pay the tax will not only result in the $800 being due for all those past taxes, but penalties and interest accrue as well. Complaining to the FTB "I forgot" won't do anything. California needs the cash and the officers of the LLC are legally bound under California law.

R. Klein, EA :

If the taxes are from the IRS, how to treat this situation is a little bit different.

Customer :

Yes the California franchise tax board mail us the letter. My Partner said he dissolve the by mail in the certificated of cancellation, but now they said it is still active. Is there any procedure to challenge this outcome.

R. Klein, EA :

You Said They Said.

R. Klein, EA :

Follow this link for instructions on how to terminate your entity: https://www.ftb.ca.gov/businesses/faq/Closing_a_Business_Entity.shtml

R. Klein, EA :

That's the first step you'll need to take. Whether you "did do it" before or not, it obviously was not completed, so it will need to be done to stop more penalties and taxes due.

Customer :

Ok once I resolve the business identity what other step I can reduce or appeal and settle this 10 years of files, which accumulate to roughly 15k today.

Customer :

It seems they should've contact us in 2 to 3 years rather then 10 years later state we never file tax or terminate this llc.

R. Klein, EA :

Once you have terminated your LLC, then you can set up a payment plan with California. You may wish to engage a CA CPA to see if they can negotiate some of the penalties, but other than that, you are likely stuck paying the taxes and interest.

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
< Last | Next >
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
  • I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight. Bonnie Chesnee, SC
  • Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation. John Minneapolis, MN
  • Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with. Orville Hesperia, California
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA
 
 
 

Meet The Experts:

 
 
 
  • Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
< Last | Next >
  • http://ww2.justanswer.com/uploads/KU/KUMI95/2013-9-30_195031_kumar.64x64.jpg Wallstreet Esq.'s Avatar

    Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
  • http://ww2.justanswer.com/uploads/CU/Cuttinggirl/2011-10-29_03719_wcrop2.64x64.jpg Wendy Reed's Avatar

    Wendy Reed

    Enrolled Agent

    Satisfied Customers:

    3052
    15+ years tax preparation and tax advice.
  • http://ww2.justanswer.com/uploads/CATax/2009-08-04_204548_Mark.jpg Mark D's Avatar

    Mark D

    Enrolled Agent

    Satisfied Customers:

    985
    MBA, EA, Specializing in Business and Individual Tax Returns and Issues
  • http://ww2.justanswer.com/uploads/IN/insearchoftheanswer/2013-8-16_0233_attorney.64x64.jpg Richard's Avatar

    Richard

    Tax Attorney

    Satisfied Customers:

    3229
    29 years of experience as a tax, real estate, and business attorney.
  • http://ww2.justanswer.com/uploads/MY/MyVirtualCPA/2012-7-5_44024_cookmegan1.64x64.jpg Megan C's Avatar

    Megan C

    Certified Public Accountant (CPA)

    Satisfied Customers:

    6121
    Licensed CPA, CFE, CMA who teaches accounting courses at Master's Level
  • http://ww2.justanswer.com/uploads/JG/jgordosea/2012-6-7_43138_GordosVeritas.64x64.jpg jgordosea's Avatar

    jgordosea

    Enrolled Agent

    Satisfied Customers:

    2783
    I've prepared all types of taxes since 1987.
  • http://ww2.justanswer.com/uploads/OZ/ozaukeecpa/2012-6-7_193219_Picture1croppedandshrunk.64x64.jpg MequonCPA's Avatar

    MequonCPA

    Certified Public Accountant (CPA)

    Satisfied Customers:

    2231
    CPA, Over 30 yrs experience w/individuals and small businesses. Masters in Tax.