Yes, Freedom Day has come and gone – you’re probably thinking we’re referring to last Monday, when we cleared yet another tax filing deadline. Well, that is another significant date, of course, but what we’re really thinking of is the annual “Tax Freedom Day,” as measured annually by the Tax Foundation. About a week earlier than “Accountants Freedom Day” this year, “Tax Freedom Day” came on April 12 – the 102nd day of the new year, and three days later than last year. And the way Obama’s going, who knows how many days later it will hit next year.
And getting right back to Nevada, how about that Assembly Bill 218 – it would tax your bottled water! Will they ever run out of things to tax?
Seems Dem Assemblyman Tick Segerblom (Las Vegas) dreamed this one up – until now, most food items have been exempt, but if Tick has his way, no longer the case for bottled H2O, and the jugs it rides in on.
And speaking of inventive ways to not only find things to tax, but also to find folks who somebody thinks ought to be taxed, check out the latest from California: another lead for the FTB “nonfiler” search efforts is a pilot program by which DMV “luxury” vehicle registrations will allow FTB to intrude on folks who may have a California filing requirement, but who have not filed a return.
You see, if you buy a “luxury” auto (one valued at $40,000 or more at acquisition date), FTB assumes you make at least $84,000, from which you would make the payments on that hot rod. And if you make $84,000, of course, you just might be required to file a California income tax return, and hand over a few bucks each year. If you didn’t (for any of the years 2004 through 2008 at least) expect a nastygram from FTB asking for same.
Which reminds us – don’t be surprised if you’re vacationing in the Golden State, and the CHP notices your Nevada-registered auto – luxury or otherwise. You may find yourself on the receiving end of a not only a notice from FTB, but also from California DMV, wondering why you seem to be present in California an awful lot, and just haven’t gotten around to registering your car there. No joke – this has actually happened to a legitimate Nevada resident we know.
Anyway, we hear FTB began sending “nonfiler” letters for the 2008 tax year in February. You may have received one. Something like 900,000 folks did. Disregard such letters at your peril – ignoring the California Revenooers will get you, ultimately, a Notice of Proposed Assessment, laden with not only the tax they think you owe, but penalties upon penalties. And if you disregard that one, the party’s over after 60 days goes by – assuming they can actually find you.
CONSULT YOUR TAX ADVISOR – This article contains general information about varius tax matters. You should consult your CPA regarding the implications to your own particular situation.
Jeff Quinn, the author of this article, is a shareholder in Ashley Quinn, CPAs and Consultants, Ltd., with offices in Incline Village and Reno. He can be reached at 831-7288, welcomes comments below, at email@example.com, and invites readers to review other commentary at www.taxlawtips.com.