California Tax Relief

As the largest state in the U.S. in terms of population, California feels the brunt of a down-turned economy. With billions of dollars of debt on the books, the state has started throwing around all kinds of ideas to make money, including raising taxes and potentially legalizing marijuana. Unfortunately, this also means that anyone who owes money to the State of California is going to see a lot more pressure to settle his or her debt.

No one will be more targeted than delinquent taxpayers because the state knows they have the legal right to collect this money. California business owners in particular face stronger action as Gov. Arnold Schwarzenegger wants to reform California’s tax structure so that it is less reliant on income tax, thus increasing business taxes. Currently, personal income taxes amount to 44 percent of the state's total tax revenue. According to the Los Angeles Times, this ratio would decrease to 31 percent under the new plan. To make up for the drop in personal income tax, California businesses will have to contribute more. And you can bet that the State of California will keep a closer watch over those businesses with back taxes and will pursue aggressively individuals and businesses alike who have failed to file a state tax return.

On September 14, 2009 the California Franchise Tax Board (FTB) sent over 2,500 notices to San Diego County businesses that failed to file a state tax return in 2007. The FTB expects this action to collect more than $30 million in back taxes in 2009 and into 2010. Residents and businesses in California can expect more of this kind of boosted efforts to collect revenue over the next months.

The bottom line is that as California is forced to deal with huge debt issues, the state will increase efforts to pursue individuals and businesses owing back taxes. The time to settle an outstanding tax debt in California is now, before they come looking for you.

If you live in California and owe back taxes or have failed to file a tax return, there are limited opportunities for you to find tax debt relief and potentially not pay as much as the IRS says you owe. Click here to talk to someone who understands California tax debt laws today.