California Tax Penalties: You May Owe a California Tax Penalty Even if You Owe No Tax

If you haven't filed an income tax return for any year and the Franchise Tax Board sends you a notice, you need respond immediately.

The FTB routinely sends a "demand to file" to many people who may not even owe any tax or meet the filing requirements. The problem is that if you do not respond, the FTB may impose a 25% penalty on its assessment of the tax before applying payments and credits. That is, the FTB will calculate an amount it thinks you owe and base the 25% penalty on that amount.... even though it may be (and probably will be) completely wrong. (R&TC Section 19133)

You can end up owing a penalty even if you don't owe any tax or get a refund.

Even worse, the penalty may become a lien on your property which will prevent you from selling it until paid.

This penalty is in addition to the 25% charge for filing a late return.

Always respond immediately to any tax notice you get..Federal or State! Let me know and I will be glad to help.