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Have You Been a Bad Bad Taxpayer? No Worries California is Willing to Give You a Break
Even if you have been a bad taxpayer, California is willing to give you a break.
Voluntary Compliance Initiative 2 (VCI 2) is an opportunity for taxpayers who underreported their California income tax liabilities, through the use of abusive tax avoidance transactions (ATAT) or offshore financial arrangements (OFA), to amend their returns for 2010 and prior tax years and obtain a waiver of most penalties.
Filing period: August 1, 2011 to October 31, 2011
Applicable tax years: 2010 and prior
Eligibility
You are eligible to participate in VCI 2 if you (or one of your related entities):
- Filed a tax return that underreported your income or tax liability through the use of an ATAT or OFA.
You are eligible even if you:
- Are currently under FTB examination for an ATAT or OFA.
- Are currently under administrative protest or appeal for an ATAT or OFA.
- Participated in the IRS’s Offshore Voluntary Disclosure Initiative.
Participation
You must take the following steps to participate:
- File a completed Participation Agreement form with us between August 1, 2011 and October 31, 2011.
- Attach the form to your amended return to report all income from all sources, without regard to the ATAT and including all income from the OFA.
- Pay all tax and interest by October 31, 2011. See payment options for more information.
Benefits
Participation in VCI 2 will allow you to avoid:
- The cost of litigation.
- Certain penalties and the associated interest.
- Criminal prosecution.
Penalties
You can avoid the following penalties under VCI 2:
- Noneconomic Substance Transaction Understatement Penalty
- Accuracy Related Penalty
- Interest Based Penalty
- Fraud Penalty
If you are eligible but do not participate, you will be subject to the full range of penalties and interest, and may be subject to criminal prosecution.
The Large Corporate Understatement Penalty (LCUP) and the Amnesty Penalty cannot be waived under this initiative.
March FTB News: Includes Info on How to Efile Your California Return With a New Home Credit
Updated Taxpayers´ Bill of Rights
[The FTB] recently revised [their] publication 4058C, California Taxpayers’ Bill of Rights. / more+
Does your client know where to send the “state copy” of an information return?
You may be asked by your client where they need to send the “state copy” of an information return. If they filed paper returns with IRS, they do not need to send a paper copy to FTB. / more+
Available now: Free California source income withholding webinars
[The FTB] will host free California source income withholding webinars in March 2010. / more+
The best way to file a protest
Has your client recently received a Notice of Proposed Assessment for added tax resulting from [an FTB] audit examination? Does your client plan to file a protest? / more+
New home credit can be e-filed
Did you know you can e-file California returns that contain the New Home Credit? / more+
Do all your tax stuff online!
With instant access to taxpayer information, 24 hours a day, doing your tax stuff online will save you, and your clients, time and hassle. / more+
Need W-2 information?
Some clients may have difficulty getting their W-2 information. / more+
Small Business
Small Business Virtual Webinar
[The FTB] partnered with Board of Equalization (BOE) to present cost effective and convenient educational products, including a complete online seminar package that enables taxpayers to get answers to the most commonly asked questions. / more+
Ask the Advocate
FTB responds to tax community´s proposals
The annual Taxpayers´ Bill of Rights Hearing was held December 3, 2009. [The FTB] received several proposals and recommendations from the tax community. / more+
Inside FTB
Take a look at the changes happening at FTB. / more+
Criminal Corner
[The] monthly summary on bringing tax criminals to justice, and closing the tax gap one case at a time. / more+
Big Business
Interested Parties Meeting on Specialized Tax Service Fees
[The FTB] scheduled an interested parties meeting for March 16, 2010, at 1 p.m. to discuss amendment of California Code of Regulations, title 18, section 19591 (Specialized Tax Service Fees), to establish the amount of the fee for the issuance of a limited partnership revival confirmation letter, as required by Revenue and Taxation Code section 19591, subdivision (b)(3), for periods on or after January 1, 2011. / more+
Stacie's Tax Stuff 