Some Good News – Some Bad – From California
Historically, California has not permitted the carry back of net operating losses – only carry forward. For taxable years beginning on or after January 1, 2013, however, a net operating loss may be carried back with some limitations:
- The amount of the NOL arising in 2013 itself is limited to 50% of the total (better than nothing!)
- The amount of the NOL attributable to tax year 2014 is limited to 75% of the total
- The amount of the NOL attributable to taxable year 2015 and thereafter will be 100%
All of this, of course, if California doesn’t change the law again (like it is so good at doing) if the politicians decide they need the dough.
And if your LLC fails to file with California (like a few do), get ready to pay a $2,000 penalty starting in 2013 if you receive a nastygram from the FTB demanding a return, and you don’t get around to it for 60 days or more.
And while we’re on the subject of states and their revenue-raising shenanigans, you can plan to keep paying sales taxes related to online purchases if your vendor has some “brick and mortar” presence in your state. Seems that the U.S. Supreme Court, this month, has declined to take up a constitutional challenge by Amazon and Overstock.com to a 2008 New York law which imposed sales taxes on some purchasers.
And here comes the latest and greatest word from our old friend, the “Treasury Inspector General for Tax Administration” (TIGTA) who recently opined that IRS needs to improve its procedures to ensure that taxpayers can successfully access their tax account info online in a secure manner.
Seems the “Restructuring and Reform Act of 1998” (RRA) mandated that IRS develop procedures to allow taxpayers filing returns electronically to review their accounts online. Since the enactment of this legislation, the IRS initiated the My IRS Account project to provide taxpayers with an online system to view, access, update, and manage their tax account. After 32 months of development and something like $10 million spent, the project was cancelled due to an ineffective enterprise-wide eAuthentication solution – the process of establishing and verifying user identities electronically.
TIGTA found that none of the current applications that IRS has developed and implemented met the intent of RRA 98.
CONSULT YOUR TAX ADVISOR – This article contains general information about various 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 may be reached at 831-7288, welcomes comments at firstname.lastname@example.org, and invites readers to consider his other commentary at http://blog.nolo.com/taxes.