California Tax Board Offers Limited Amnesty
August 1, 2011 (The Sacramento Bee, Calif.) Starting today, the California state Franchise Tax Board is offering limited amnesty to those who may have underreported their income, either through offshore tax shelters or "abusive" tax transactions designed to hide income.
About 47,000 letters went out to California taxpayers, including 402 in Sacramento County, who were identified by data from California, other states and the IRS.
"We want them to come forward, amend their tax return, pay the tax and interest," said FTB spokeswoman Denise Azimi. "In return, they'll avoid criminal prosecution and most, but not all, of their tax penalties are forgiven.
Azimi said the FTB offered a similar program in 2004, when the economy was healthier and tax shelters were more abusive. That program brought in about $1.4 billion from 1,200 taxpayers, she said. This time, the FTB is anticipating a far more modest haul: about $270 million.
"These programs are to help get everyone back into compliance," said Azimi. "Sometimes people just need a way out."
The voluntary compliance program runs through Oct. 31. For more information, contact the FTB: www.ftb.ca.gov and search under "Voluntary Compliance Initiative 2 (VCI 2), or call (888) 825-9868.