Franchise Tax Board Send Letters Over Illegal Tax Shelters. The state Franchise Tax Board is sending 10,000 letters to taxpayers who may have used illegal tax shelters and to businesses that sell the shelters, the board announced today. The mailing is in addition to 18,000 letters already sent as part of a continuing crackdown, officials […]
Franchise Tax Board Send Letters Over Illegal Tax Shelters. The state Franchise Tax Board is sending 10,000 letters to taxpayers who may have used illegal tax shelters and to businesses that sell the shelters, the board announced today.
The mailing is in addition to 18,000 letters already sent as part of a continuing crackdown, officials said.
This round includes 125 letters to the promoters of tax shelters, informing them of their responsibilities under legislation signed last year.
The new law increased penalties for investing in illegal shelters and added registration requirements for such shelters.
The letters also require tax shelter promoters to turn over their client lists to the Franchise Tax Board by April 30.
To date, the state program combatting so-called “abusive tax shelters” has collected more than $113 million through its voluntary compliance initiative.
Under the initiative, taxpayers have until April 15 to amend their returns and fully pay the tax and interest due before the state assesses penalties.
Illegal tax shelters cost California an estimated $600 million to $1 billion a year in tax revenue.
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