California – What You Should Know if You are Behind on Your Taxes

SALT Report 3108 – The California State Board of Equalization released a publication that explains a taxpayer’s rights and your responsibilities when they have a balance due for unpaid taxes, fees, assessments, interest, or penalties.

If a taxpayer receives a notice, the BOE recommends that the taxpayer contact their local office right away.  By doing so, the taxpayer can make payment arrangements, file any missing returns, arrange for a contact person who will explains their rights, and avoid collection proceedings.   If a taxpayer has received a “Notice of Determination,” the taxpayer has the right to file an appeal. To do so, the taxpayer must file a “Petition for Redetermination” within 30 days of the date on the notice.

Failure to pay, or make arrangements to pay, any outstanding liability will result in the BOE taking the following actions:

  • Seizure of your property
  • Placing a levy your bank account or wages
  • Placing a lien on your property
  • Canceling or revoking your seller’s permit, your alcoholic beverage license, or your DMV dealer or driver license
  • Requiring a higher security deposit
  • Removing money from your business
  • Holding you personally liable for the business entities debts
  • Holding you liable as a successor

There are certain situations in which the BOE may provide full or partial relief from collection activities or liability.  For example, taxpayers can limit their total liability by submitting an offer in compromise, or they may qualify as an innocent spouse or former partner, or they may be involved in bankruptcy proceedings.

For Further Information

California State Board of Equalization – Behind on Your Payment?