For those of you in California, a warning. The Franchise Tax Board is having some computer issues, at least based on paperwork that my clients and I have recently received. One client recently received a two page bill from the FTB stating, on page 1, that they did not make certain required payments and owed around $1,500. They then listed, on page two, the total charges: over $80,000. When I called the FTB they couldn’t figure out what was wrong (the $1,500 appears accurate, but why their computer is adding an additional $78,500 was a mystery).
Then I received a notice from the FTB requiring my company (Clayton Financial & Tax) to begin making electronic tax payments because estimated tax payments from my company have exceeded $20,000 or total tax liability exceeded $80,000. There’s only one problem: neither happened. The FTB is investigating and promises to get back to me later this week. (At first glance, it appears someone else made a deposit to the FTB and used my corporation number.)
So what should you do when you get paperwork from the FTB (or the IRS) and it’s wrong? First, let your tax preparer know! We have special phone numbers and usually deal with well trained staff at the tax agencies. My standard procedure is upon phone resolution to send a confirmation letter to the tax agency (using certified mail, return receipt requested). This puts into writing what we discussed on the phone.
But why spend the $4.24? Well, when it’s a choice between $4.24 and $78,500.00, I know which number I’ll choose.