General California Franchise Tax Board tax question for a corporation
Category: Business and Money > Accounting
Asked by: tekin21-ga
List Price: $15.00
27 Aug 2005 16:05 PDT
Expires: 26 Sep 2005 16:05 PDT
Question ID: 561242
If a California corporation was opened for a few years but there was never any activity on it, no income earned, no assets or debts acquired other than the minimum yearly tax, no bank accounts opened, and no taxes filed, what usually happens if the the corporation was ignored and never formally dissolved? After awhile, would the state go after just the corporation for the taxes or can they also go after the directors? I have heard from one CPA that the state would just go after the corporation's assets and send collection notifications, but after a few years they would just send it to the uncollectibles and forget about it. Is this correct?
Re: General California Franchise Tax Board tax question for a corporation
Answered By: taxmama-ga on 30 Aug 2005 08:03 PDT
Dear Tekin, I had a long talk with the good folks at the California FTB last week, when they attached a client's bank account for unpaid corporate taxes resulting from his not closing down the corporation properly. However, they attached a bank account that he had opened using the corporation's name and taxpayer identification number. It was not a personal bank account. So, here's the inside information. To date, the state of California will not go after the assets of an officer of a dormant corporation. As long as you don't have any bank accounts under the corporate ID number, and you never took any assets out of the corporation, they will just send you notices and finally go away. They won't bother your personal assets. It won't affect your personal credit. If you want to see some more information about how this works http://answers.google.com/answers/threadview?id=464509 So, trust your CPA. You're getting good advice. Best wishes. Your TaxMama-ga
rated this answer:
Great answer! Thanks for your help TaxMama!
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