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Ely
Ely, Counselor at Law
Category: Legal
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I just recieved a letter from the Ca State tax board saying

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I just recieved a letter from the Ca State tax board saying I owe 14K from years 2004 and 2005. First letter I recieved regarding this surprise. Are there any statute of limitations regarding this type of issue?
I am sorry for your situation. It seems that lately, California has begun enforcing long-due taxes and has sent out notices to many CA expats demanding back taxes from the 1990s.

According to 19057 of the Revenue and Taxation Code, the ordinary statute of limitations on state taxes in CA is four years.

However, if no tax return was ever filed or the Franchise Tax Board (FTB) claims that it was fraudulent, then there is no statute of limitations. And I am guessing that this is the presumption that FTB has here, from 1995 and on.

Unfortunately, FTB's determination is presumed correct and the taxpayer bears the burden of showing error in such determination. Appeal of Cookston, Diane, Nov. 17, 1982, 82-SBE 264, November 17, 1982.

(Read in your case: so until/unless you show that there was no fraud and/or the tax was paid, they can pursue you for the money.)

Even if you claim that the tax return was mailed, you must provide convincing evidence, such as a certified mail receipt, of mailing the return to overcome Franchise Tax Board records indicating that no return was filed. Appeal of La Salle Hotel Co., 66-SBE-071, November 23, 1966; Appeal of Richard L. and Mary D. Marks, 76-SBE-057, May 4, 1976; see also Government Code section 11003, Internal Revenue Code section 7502, and Treas. Reg.

By sending you something from 2004 and 2005, they are likely asserting that you did not file, or filed fraudulently. If they state that you simply did not pay enough or they found a mistake, then they are past the four years of statute of limitations and there is little that they can do. If they state that you filed fraudulently or did not file, you are liable unless you can prove in court otherwise.

Due to the nuance associated with the matter, an attorney is very much recommended, although not required by law.

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Customer: replied 4 years ago.


I did file for those years and even got refunds. I left there in 2005. Problem is....I took a position working for the Army in Germany. Any of my old tax returns are in a goverment storage facility in AZ. The only thing I can see that may have prompted this is that I had to take money from a 401K in WA to pay of a mounting debt. I had to pay the US Treasury 21k fours years after it happened because I was "assumed" the taxes were paid by the 401k before I recieved my monies.


 


Thanks so much for your assistance!

Mason,

You are very welcome. So having these facts come to light, what are you asking now, exactly - how to show that you've filed and that you are not liable?
Customer: replied 4 years ago.


I suppose that is what I am asking. The letter shows no reason for the amounts. It even shows they have made adjustments of 7k in my favor writing off interest and collection fees.

Mason,

The fist thing you'd need to do is call them and ask and clarify: 916.845.6500. You may get this resolved over the telephone.

If not, then I am afraid you may need to give someone a Power of Attorney (possibly an attorney) to get those tax records out of storage and prove that you are not liable.

IMPORTANT INFO: I hope this finds you well. Please use REPLY TO EXPERT to keep talking, or RATE my answer when we are finished. Kindly rate my answer as one of the top three faces and then SUBMIT, because this is how I get credit for my time with you. Rating my answer the bottom two faces does not give me credit and reflects negatively on me as an expert even if my answer is correct. I work very hard to formulate an informative and honest answer for you; please reciprocate my good faith. Do not worry, you may always ask follow ups free after rating.