New California laws

Customer Service Dashboard: The goal is provide tools and resources in resolving tax matters. The “Customer Service Dashboard” was launched in March 1, 2017 with estimated time frames for your wait time. For more information go to:

Deductions for Taxes Paid or California Other State Tax Credit (OSTC) Legal Ruling 2017-01:  California resident is allowed to OSTC for net income taxes paid to other state. California nonresident is allowed OSTC for net income taxes paid to taxpayer’s resident state that is also taxed in California if the resident state 1) does not tax income of California resident or 2) allows OSTC to California resident on income sourced within the state.

California Competes Tax Credit: The credit is an income or franchise tax credit, available to businesses that stay or expand in California. Applications for the credit started from March 6, 2017 through March 27, 2017 at or goto:

New Filing Deadline for Partnerships and Limited Liability Companies Who Are Partnerships: The new filing deadline is now March 15 previously April 15, for calendar year filers. For fiscal year filers, the new filing deadline is the 15th day of the 3rd month following the close of the taxable year.  Extension deadline is now September 15 previously October 15 for calendar year filers and for fiscal year filers, the extended deadline is the 15th day of the 9th month following the close of the taxable year. For more information go to:

City County Business Tax Program (CBBT):  Starting in January 2017 under a reciprocal fully executed standard agreement, California counties are eligible to exchange taxpayer data. The data exchange will identify businesses that are not reporting income and not filing income tax returns; and give leads to counties locate unlicensed businesses and not paying business taxes.

California’s Earned Income Tax Credit (Cal EITC).  If your earned income is not more than $14,161, you may be qualified for the credit and could receive up to $6,000 if you qualify for both Cal EITC and Federal EITC. To amend a previously filed return for the credit, file Form 540X and Form 3514 to claim the credit.

Cash and Non-Cash Charitable Contributions: Payments to an individual are not deductible. If you itemize deduction reported in Schedule A of Federal Form 1040, then charitable deduction is deductible in California subject to certain limitations and documentation requirements. To check if the charitable organization qualifies for income tax deduction go to:

Failure to Respond Penalty:  The penalty is 25 percent based on total assessed tax liability for failure to file a return and provide information. The imposed penalty will apply if the taxpayer has a tax due and filing requirement.

Disclaimer: Any accounting, business or tax advice contained in this communication is not intended as a thorough, in-depth analysis of specific issues, or a substitute for a formal opinion, nor is it sufficient to avoid tax-related penalties.

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Al-os & Associates  Accountancy Corporation provides accounting and tax services to individuals, corporations, LLCs and business entities. The Firm has a niche in defending taxpayers audited by the IRS and other governmental agencies.


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