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Discussion:CA letter for a 1990 tax return???

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Discussion Forum Index --> Advanced Tax Questions --> CA letter for a 1990 tax return???


Discussion Forum Index --> Tax Questions --> CA letter for a 1990 tax return???

Kiatd123 (talk|edits) said:

17 June 2013
My client received a letter from the state of CA stating his 1990 tax return was done incorrectly and he owes $3300. They claim he file HoH and should have filed Single. He says he has no records from 23 years ago!! He says he filed the org. return on time in 1991.

He claims he never received any letters before this one. The state did admit that most letters that were sent to him in 1993-1994 were returned to them.

Well, he moved to NY in 1993-1994. Now 23 years later they found him in NY!!

Is this absolutely ridiculous??? Can the state really go after him after 23 years?

JR1 (talk|edits) said:

June 17, 2013
Had something similar in IL on a corp return they claimed was missing that was over 20 years old. Finally had to get a state senator to intervene. I bet CA is even harder to make go away.

WEISSEA (talk|edits) said:

17 June 2013
If the client was audited by the IRS resulting in a change and if either the client or the IRS did not notify CA, then the statute stays open.

Laketahoecpa (talk|edits) said:

17 June 2013
The normal statute for collections in California is 20 years from the last statutory lien date. It could be that California is making last ditch effort to collect before statute expires.

Kiatd123 (talk|edits) said:

18 June 2013
So I should ask the state when the last statutory lien was filed. I'm positive the IRS did not audit. I'm just afraid of opening something up with the state.

Kevinh5 (talk|edits) said:

18 June 2013
Is there a state transcript like the Federal transcript?

Kiatd123 (talk|edits) said:

18 June 2013
Right now all I have is a letter from the state for unpaid taxes.

Kevinh5 (talk|edits) said:

18 June 2013
exactly. That's why I asked the question.

Skassel (talk|edits) said:

18 June 2013
WeissEA stated "If the client was audited by the IRS resulting in a change and if either the client or the IRS did not notify CA, then the statute stays open."


I do not believe this is correct. California has four years to change the return if the taxpayer does not do so within 6 months of the IRS making the change.

Cricktaxea (talk|edits) said:

18 June 2013
No, CA doesn't have a transcript system, you're just dealing with the person in Collections in this case. I would however call them and ask for the pub that allows them to do this and then pull it up and read it carefully. The pub should reference the underlying legislation so read that as well.

As far as the issue in that letter we get those all the time. CA is very diligent about verifying SSN's and filing status probably due to so many illegals living here.

I think Laketahoecpa is right, the guy moved to NY, the original notices went unanswered so 2-3 years later they issued a lien and the time is going to expire on it fairly soon. If your guy can no longer prove the HOH status, then you can probably make a reasonable cause argument about penalties and interest and get those abated and just pay the underlying tax which from 20 odd years ago was probably only a few hundred bucks. That should count as a tax credit to NY plus of course it's deductable on Sch A if he's itemizing.

That might be the path of least resistance here assuming they accept the reasonable cause argument about the penalties considering they've already admitted all those original letters were returned so your guy had no way of knowing about this.

Almost forgot, try the CA Taxpayer Rights Advocate, I should have thought of this in the first place:

https://www.ftb.ca.gov/aboutftb/taxpayer_advocate/

Bob

Skassel (talk|edits) said:

18 June 2013
I have received the FTB equivalent of transcripts many times and it will show when each event took place.

WEISSEA (talk|edits) said:

18 June 2013
"I do not believe this is correct. California has four years to change the return if the taxpayer does not do so within 6 months of the IRS making the change."

Your statement means CA has 4 years after the FTB is notified. In your case FTB was Not notified. Spidell's chart 28-3 CA taxes blue book " Federal audit that results in state underpayment not reported at all. NPA must be issued within "Anytime after the federal changes R&TC 19059(a)."

Skassel (talk|edits) said:

18 June 2013
There is no way that the FTB is independently investigating the filing status for a 1990 return 22 years after the due date for the return. Clearly, the FTB based it upon a change by IRS so the four years would apply.

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