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Lev
Lev, Tax Advisor
Category: Tax
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Experience:  Taxes, Immigration, Labor Relations
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Need info on fines for doing Real Estate business in CA under

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Need info on fines for doing Real Estate business in CA under the status of a NV Corp in '11 & '12.
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I simply forgot that I was supposed to file to do business as a foreign corp. I bought 1 house in '11 & sold it in '12. Only made about $3,700. How much of a fine do you think I will have?

LEV :

Hi and welcome to Just Answer!



If you failed to register a foreign corporation conducting business in California - there following penalties.


1. A court may assigned a Per Diem penalty based on the size of the corporation, the gross business income from California sources, etc.


2. Criminal charges are possible.


3. The corporation may be assigned Not Standing status - and can be barred from any legal protection.


4. You may have a personal liability as an agent of the corporation.


5. Contract singed by the corporation can be voided by the court.


See detailed explanation here - http://EzineArticles.com/681893
Upon certification by the Secretary of State, the Franchise Tax Board assesses a penalty against the business entity.

An underpayment penalty will be charged when taxes are not paid by the due date. The penalty is 5 percent of the unpaid tax as of the due date plus 1/2 of 1 percent each month, or part of a month the tax remains unpaid, not to exceed 40 months. The maximum penalty is 25 percent of the total unpaid tax.


A delinquent penalty will be charged on unpaid taxes if a return is filed late. The penalty is 5 percent of the unpaid tax due for every month that the return is late, up to a maximum penalty of 25 percent of the unpaid tax. The minimum penalty is $135 for tax years beginning on or after January 1, 2011, (before January 1, 2011 is $100) or 100 percent of the unpaid tax, whichever is less.
See for reference - https://www.ftb.ca.gov/forms/misc/1024.pdf
For corporate tax rates - see here - https://www.ftb.ca.gov/forms/2012_California_Tax_Rates_and_Exemptions.shtml


Interest will be charged on any delinquent or late payment from the original due date of the return to the date paid. Interest compounds daily and the interest rate is adjusted twice a year. Current rate is 3%.
See historical rates here - https://www.ftb.ca.gov/individuals/faq/ivr/617.shtml
Just in case you were not able to use the chat - I am switching to Q&A mode and porting the answer below.
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Hi and welcome to Just Answer!

If you failed to register a foreign corporation conducting business in California - there following penalties.

1. A court may assigned a Per Diem penalty based on the size of the corporation, the gross business income from California sources, etc.

2. Criminal charges are possible.

3. The corporation may be assigned Not Standing status - and can be barred from any legal protection.

4. You may have a personal liability as an agent of the corporation.

5. Contract singed by the corporation can be voided by the court.

See detailed explanation here - http://EzineArticles.com/681893
Upon certification by the Secretary of State, the Franchise Tax Board assesses a penalty against the business entity.

An underpayment penalty will be charged when taxes are not paid by the due date. The penalty is 5 percent of the unpaid tax as of the due date plus 1/2 of 1 percent each month, or part of a month the tax remains unpaid, not to exceed 40 months. The maximum penalty is 25 percent of the total unpaid tax.

A delinquent penalty will be charged on unpaid taxes if a return is filed late. The penalty is 5 percent of the unpaid tax due for every month that the return is late, up to a maximum penalty of 25 percent of the unpaid tax. The minimum penalty is $135 for tax years beginning on or after January 1, 2011, (before January 1, 2011 is $100) or 100 percent of the unpaid tax, whichever is less.
See for reference - https://www.ftb.ca.gov/forms/misc/1024.pdf
For corporate tax rates - see here - https://www.ftb.ca.gov/forms/2012_California_Tax_Rates_and_Exemptions.shtml

Interest will be charged on any delinquent or late payment from the original due date of the return to the date paid. Interest compounds daily and the interest rate is adjusted twice a year. Current rate is 3%.
See historical rates here - https://www.ftb.ca.gov/individuals/faq/ivr/617.shtml
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