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IRS Solutions
IRS Solutions, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 42
Experience:  CPA, CFS. Individual, corporation, estate, trust, non-profit tax filings. Tax debt relief.
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My partner and I have an LLC in California. We have filed tax

Customer Question

My partner and I have an LLC in California. We have filed tax returns for 2009, 2010 and 2011. We have never actually made any money and my partner and I cannot afford to pay the $800 for 2012 that the state requires. We are going to close the bank account and get a fictitious business name filing instead since we still make a bit of money from Amazon and we'll open a new account.

I asked my tax person if we have to pay the $800. He said if we don't mail in the Statement of Operation to the Secretary of State they will eventually shut us down. And he said that the state cannot get the money from us personally since this is for an LLC. He also said if we don't pay the $800 the state will send threatening letters but will eventually stop if we keep ignoring them.

I realize that the best thing to do would be to pay the $800, but it would be a huge hardship on both of us since business has been so dreary this year.

I already know how to dissolve the LLC, but the $800 is the issue here. We cannot afford it. I want to make sure by just ignoring it, will they just shut down the LLC?
Submitted: 5 years ago.
Category: Tax
Expert:  IRS Solutions replied 5 years ago.

IRS Solutions :

IF you do not pay the CA State minimum franchise tax the State will at some point suspend the entity (LLC).

IRS Solutions :

I would consider amending the year ended 2011 to check the Final Return box in addition to filing the dissolution forms. As the entity has not conducted business during the year ended 2012, this may alleviate concerns the State may some day come after you personally for this debt, which I have seen happen only one time, therefore I feel comfortable commenting the State will suspend the entity and not pursue other action.

IRS Solutions :

Please inquire if you have further concerns.