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The FTB will generally consider an offer in compromise if you can prove that you have no way to pay your outstanding taxes, and when the amount offered is the most the Franchise Tax Board can expect to collect within a reasonable period of time. In this case reasonable amount of time is five-to-seven years.
An offer in compromise (OIC) is a deal between a California taxpayer and the Internal Revenue Service (IRS) or the Franchise Tax Board (FTB) to pay off a tax debt for less than the full amount.
You may bring a court action against the State of California in superior court for damages and costs if you are aggrieved by any FTB officers or employees reckless disregard of published procedures.
The IRS will sometimes consider a settlement that allows you to pay a reduced amount of what you owe in back taxes, which is called an offer in compromise. You must convince the IRS that you cant afford to pay what you owe and offer to pay the reduced amount in a lump sum or in short-term installments.
Not reporting all of your income is an easy-to-avoid red flag that can lead to an audit. Taking excessive business tax deductions and mixing business and personal expenses can lead to an audit. The IRS mostly audits tax returns of those earning more than $200,000 and corporations with more than $10 million in assets.

People also ask

FTB Whats the Difference? The IRS and the FTB both collect income taxes under two different tax codes. The IRS deals with federal taxes using the Internal Revenue Code (IRC). The FTB, on the other hand, deals with state taxes using the California Revenue and Taxation Code.
The bad news is that your chances at the unenviable audit lottery escalate (sometimes docHubly) depending on various factors, including the amount of income you report, the complexity of your return, the types and amounts of deductions or other tax breaks you claim, whether youre engaged in a business, or whether
If you dont agree with a notice of action or a claim for refund denial or if we have not accepted or denied your refund claim within six months, submit an appeal to the Office of Tax Appeals. FTB does not handle appeals. Make sure to: Submit your appeal by the appeal date on your notice.
Any activity that raises a red flag with the FTB can trigger a residency audit. It can be something as simple as living in another state and having a second home in California, to a tip-off from the IRS or another third party. (The IRS and individual states share information, BTW.)
Every corporation that is incorporated, registered, or doing business in California must pay the $800 minimum franchise tax.

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