Category Archives: California

Arizona Asks Supreme Court to Stop California From Imposing California Tax on Passive LLC Investments

Posted on March 12, 2019 by Russ

We’ve highlighted this issue before. Suppose you are an Arizona resident, and you form Primary LLC in Arizona. Its main purpose is owning a warehouse in Phoenix. But you have some extra money in the LLC, so you invest in … Continue reading →

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No Man Is an Island

Posted on March 11, 2019 by Russ

On Saturday a superb editorial appeared in the Providence Journal, “When Taxpayers Flee a State.” Here’s an excerpt: Despite its name, Rhode Island is not an island unto itself. People are free to come and go, including business executives who … Continue reading →

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No, Manny Machado Can’t Avoid Paying California Tax by Being a Florida Resident

Posted on February 21, 2019 by Russ

Earlier this week Manny Machado reportedly signed a baseball free agent contract to play with the San Diego Padres. He’s being paid $300 million over ten years…but that’s before taxes. An article on a website called “12up” says that Mr. … Continue reading →

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Gilbert Hyatt Wins Again But…

Posted on January 17, 2019 by Russ

The California Office of Tax Appeals upheld the California Board of Equalization’s ruling that Gilbert Hyatt mostly doesn’t owe California income tax in 1991 or 1992. Yes, you’re reading that correctly: This is a case that is 27 years in … Continue reading →

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Gilbert Hyatt and the Franchise Tax Board Head Back to the Supreme Court…Again

Posted on January 6, 2019 by Russ

Back in 1993 (that is not a typographical error), California’s Franchise Tax Board (FTB) initiated a residency audit of Gilbert Hyatt. Mr. Hyatt invented some technology relating to microprocessors in 1990. In 1991 he realized he was going to receive … Continue reading →

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The 2018 Tax Offender of the Year

Posted on December 31, 2018 by Russ

Another year has gone by. And that means it’s once again time for that most prestigious of prestigious awards, the Tax Offender of the Year. As usual, there’s a plethora of nominees. As usual, I wish there weren’t any deserving … Continue reading →

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Taxes No Longer the Top Reason for Businesses Leaving California

Posted on December 24, 2018 by Russ

California: Good News! Your taxes, tops in the country, are no longer the top reason businesses are leaving the Bronze Golden State. It’s not that taxes have improved; rather, your laws and regulatory climate have exceeded taxes as the reason … Continue reading →

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Swart Broadens

Posted on November 29, 2018 by Russ

California’s Franchise Tax Board believes that any business with even a remote tie to California should pay California tax. Let’s say you own a 0.21% interest in Acme LLC. Acme invests in something in California. You have no authority to … Continue reading →

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Regulations Matter, Too

Posted on September 10, 2018 by Russ

I used to have my office in Irvine, California. Today, like most days, the weather in Irvine will be absolutely gorgeous: A high of 79 and a low of 66. You can’t ask for better (weather) climate. How about the … Continue reading →

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You Mean My Checking Account Became a Savings Account?

Posted on May 31, 2018 by Russ

In what is definitely an “Oops” moment, two tax software products from Intuit (Lacerte and Intuit ProConnect Online) incorrectly transmitted information for 2018 California estimated payments. Checking accounts became savings accounts in the transmittal and the payments were rejected: As … Continue reading →

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