ED Magedson – Founder
Franchise Tax BoardPO Box 942857 Sacramento, California USA
Franchise Tax Board California FTB Claiming my General Partnership is an LLC Fraud Sacramento California
Around April, 2012, my dad an I formed a gneral partnership for our proptery management business. We filed a DBA with the county and filed for a tax id as a general partnership with the IRS. In April, 2013, we filed our taxes as usually using our CPA (both personal and for the general partnership).
At the begginingg of August, 2013, I received a notice from the state of California (via the FTB), that as an LLC, I need to file quarterly withholdings. Then, 2 days later I receive a notice saying there is was an error on the partnership tax return (conviently, is doesn't say what the error was) and that we owe the state $800 in income tax.
For those who don't know, California is a rip off. They have a minimum state income tax for LLP, LLC and corporations. There is no income tax for a general partnership, since the income is distributed via agreement between the partners. Then reported and paid via each partner's personal income tax. So my partner and I, already paid any income tax personally. Once again, there is NO income for a general partnership, even though a tax return must be filed for the general partnership. All income taxes are paid personally based on the partnership split agreement.
I sent a copy of the tax bill to my CPA, whom contacted the FTB and the FTB said they would remove the assesment. Well, on 09/14/2013, I received another tax bill for the $800 minimum income tax, plus a $20 monthly penality, plus an underpayment penality of $40 and $9.86 in interest. So now I'm going to have to contact the FTB and find out what their problem is. I'm also going to send this new tax bill to my CPA.
The franchise tax board of California knows no competents. I went a head and went to the secretary of state's coporate/LLC/LLP filing website (kepler.sos.ca.gov) . I looked our business name under the LLC/LLP section and to no suprise, it doesn't show up. I also took a look the tax return filed for the gneral partnership and it is inded checked as a general partnership. So where is the FTB getting this is an LLC/LLP?
I mean I know the state of California is swimming in tons of unsubstainable debt and on the verge of bankruptcy. They are extremely desperate for additional revenue and have gone from being one of the wealthiest state, to one of the poorest in the union. But where are they getting these lies? There is no place any where that our business is indicated, registered ,etc, as an LLC/LLP. So as I said before, I'm going to contact the FTB on Monday and find out what this non-sense is all about (well, we already know what it's about...money and greed). I'll post an update to this shortly. Looks like I may be sueing the state soon.
This report was posted on Ripoff Report on 09/14/2013 02:00 PM and is a permanent record located here: http://www.ripoffreport.com/reports/franchise-tax-board/sacramento-california-94257/franchise-tax-board-california-ftb-claiming-my-general-partnership-is-an-llc-fraud-sacram-1084534. The posting time indicated is Arizona local time. Arizona does not observe daylight savings so the post time may be Mountain or Pacific depending on the time of year.
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