Nonfiler Program Changes to Benefit Taxpayers and Us
Beginning January 1, 2013, we will expand our Delinquency Control (DLC) Program to include limited liability companies (LLCs). This change benefits both the taxpayers and us by ensuring consistency in how we pursue business entities that have a California filing requirement through the nonfiler program.
In addition to pursing business entities with California sourced income, we also administer the DLC Program which currently identifies active corporations, exempt organizations, and limited partnerships that failed to file required tax returns. We send the nonfilers a Request for Past Due Return notice 60 days after the extended due date of the tax return. If the business entity doesn’t file the requested tax return, we send an official Demand for Past Due Return notice and the business entity’s account enters the collection cycle. Although the DLC Program doesn’t establish a liability on the account, we may suspend (domestic) or forfeit (foreign) the business entity organization’s powers, rights, and privileges.
A suspended or forfeited business entity may not:
- Legally transact business.
- Bring an action or defend itself in court.
- Be granted an automatic extension of time to file.
- File a claim for refund.
- File or maintain an appeal before the Board of Equalization.
- Continue a protest.
And may have any contract made by the business entity declared voidable by the other party.
Go to our Limited Liability Companies Tax Information and Frequently Asked Questions, for more information.