rs-california-state-tax-debt-resolution Archives

California Exit Tax & Wealth Tax: What is it & How it Applies to You

April 23, 2026December 2, 2022 by Brotman Law

Key Takeaways

So, what is the California exit tax? The California exit tax explained:
How much is the California exit tax?
Who has to pay California exit tax?
Why was the California exit tax of 2020 created?
The California Wealth Tax Proposal in a Nutshell

California is known for having some of the most significant in-state taxes in the country with a 13.3% annual income tax rate.

However, did you know that you might still be taxed even after you leave the state?

Yep! Thanks to the California exit tax legislation, depending on how much money you get from in-state activities, such as investments in real estate or business operations, you could still be treated like a Californian on your next tax return!

Join us as we walk you through the California wealth and exit tax questions, such as “what is the exit tax in california,” how much it is, who it applies to, and a deeper dive into the CA wealth tax proposal and the Assembly Bill 2088.

Bankruptcy and Automatic Stay

April 23, 2026January 28, 2022 by Brotman Law

According to United States bankruptcy law, an automatic stay is defined as an automatic injunction, the purpose of which halts the actions of creditors to collect debts from a debtor who has filed for bankruptcy relief.

Key Takeaways

Provisions for automatic stay fall under section 362 of the U.S. Bankruptcy Code, which suggests that the stay begins automatically when the debtor files a petition with the bankruptcy court.
Although a stay is automatic, secured creditors may file a petition with the bankruptcy court for relief against the automatic stay if they can show cause.
The automatic stay protects the debtor against certain actions of the creditor which may include judicial proceedings, actions to obtain the debtor’s property, actions to enforce a lien against the debtor’s property, and set-off indebtedness.

Provisions for automatic stay fall under section 362 of the U.S. Bankruptcy Code, which suggests that the stay begins automatically when the debtor files a petition with the bankruptcy court.

Although a stay is automatic, secured creditors may file a petition with the bankruptcy court for relief against the automatic stay if they can show cause.

The Differences Between the Federal System and the State of California

April 23, 2026December 17, 2021 by Brotman Law

Key Takeaways

Internal Revenue Service
State of California
Representation You Can Count on

As a small business owner, you are used to dealing with the IRS and the state. You file income taxes with the IRS every year and file returns with the state when they are due. Paying tax is paying tax, right? So, why is there such a difference between the way the IRS plays versus the state?

Can Currently Non-Collectible (CNC) Status Stop the FTB?

April 23, 2026September 8, 2021 by Brotman Law

Key Takeaways

The decision to place a taxpayer’s account on CNC is based on an examination of your Collection Information Statement (CIS) that has been completely updated to the time of the examination.
Currently Not Collectible status is meant for severe economic hardship – it is not easily granted.
Periodically, the IRS and FTB will re-evaluate your situation to see if your financial status has changed enough to begin collections again.

Sometimes your financial fortunes take a turn for the worse, and you find yourself owing back taxes to the Franchise Tax Board. You don’t even have two coins to rub together, much less make installment payments, yet you are looking for an alternative to filing for bankruptcy. An Offer in Compromise is also off the table; you just don’t have the money.

Your Rights as a California Taxpayer

April 23, 2026April 30, 2021 by Brotman Law

Key Takeaways

The California Department of Tax and Fee Administration (CDTFA) administers the tax program for both business and property taxes for the State of California.
Sales and use tax
Fuel tax
Cigarette tax
Alcoholic beverage tax

Business taxpayers may take up their concerns directly with the main office of the CDTFA while property tax concerns are addressed by the local county office.
When you deal with the tax agencies of California, you may feel like you do not have any rights.

The California Department of Tax and Fee Administration (CDTFA) administers the tax program for both business and property taxes for the State of California. Business taxes include:

Taxes and Bankruptcy

April 23, 2026July 17, 2020 by Brotman Law

Key Takeaways

Bankruptcy is what we consider a nuclear option.
It can be a very effective tool if the taxpayer has other debts.
But it has a lasting impact on the taxpayer and on their credit and on the perception of their general financial competency.

Taxes and bankruptcy. Bankruptcy is what we consider a nuclear option. It is a very extreme measure. It can be a very effective tool if the taxpayer has other debts. But it has a lasting impact on the taxpayer and on their credit and on the perception of their general financial competency. We generally recommend bankruptcy as a last resort particularly if the taxpayer only has tax liability which is perhaps best settled in the Offer in Compromise program versus going and filing a Chapter Seven. However, bankruptcy can be an effective tool where there are other debts or where an Offer in Compromise might not be the most feasible route to go for a variety of circumstances. Obviously this is based on the individual and the variety of circumstances that surround most people which were all different. But in terms of bankruptcy, we are dealing with liabilities that are income taxes. There cannot be any indicator of fraud or tax evasion. We are dealing with tax that are at least three years old.

Differences Between the Federal Tax System and the California State Tax System

April 23, 2026July 17, 2020 by Brotman Law

Key Takeaways

Briefly I want to talk to you about differences between the federal tax system and the state tax system.
Most FTV actions are initiated from the Sacramento office whether they are levis, phone calls, contacts with tax payers, or any sort of collection actions.
The states have limited resources at the local level.

Briefly I want to talk to you about differences between the federal tax system and the state tax system. As I mentioned, due to limited resources state are usually more aggressive in their collection tactics and their examination tactics than the federal government and the principal reason for this is because taxation for the states is the principal source of revenue racing. A lot of times when there is a budget shortfall the state will lean on their self tax and the federal tax bureau will lean on the income tax to help mandate collections priorities and help raise revenues either through collecting past due liabilities or examining returns and finding new ones. In general, the states because of their limited resources will rely more on in voluntary collections actions than field representatives so there’s much greater reliance at the state level for collections processes that are instituted from a remote location so for example in California the main center of operation for the FTV which is the Franchise Tax for the State of California income tax bureau is in Sacramento. Most FTV actions are initiated from the Sacramento office whether they are levis, phone calls, contacts with tax payers, or any sort of collection actions. The states have limited resources at the local level.

California State Specific Tax Issues

April 23, 2026July 17, 2020 by Brotman Law

Key Takeaways

So now I’d like to talk to you about some issues with regarding that the states have specifically.
In California, we have a number of challenges in dealing with the state taxis that are either less of an issue or non-existent at federal level.
The first as I’ve kind of touched down earlier is overside.

So now I’d like to talk to you about some issues with regarding that the states have specifically. In California, we have a number of challenges in dealing with the state taxis that are either less of an issue or non-existent at federal level. The first as I’ve kind of touched down earlier is overside. There is usually less overside on cases than there is at the federal level. And I mean by that, is the auditor or the collection agent is given a lot more latitude in most cases to handle the cases as they see fit as long as it falls within the administrative guidelines. This particularly has an impact on the examinations process so a lot of the times the auditors are kind of given free rein to define the scope of what the audit is in sales tax or in particular they can do a really detail investigation and go through a number steps that you may not find in the federal process. As a result of this and as a result of the states having fewer resources, there is often times administrative delay when dealing with the state cases. For example, the time frame in California right now is if I were to represent a client in a sales tax audit and me and the auditor just agreed on the result and I filed and appeal, it would take anywhere from 8 to 12 months under the current structure to hear that appeal.