Source: IRS Notice 2018-54

Under the Tax Cuts and Jobs Act, the deduction for state and local taxes (SALT) on itemized 2018 individual tax returns will be limited to $10,000.  Some states are working on legislation designed to create new state tax credits in lieu of paying state income taxes directly.  Under this Notice, the IRS has announced that it intends to propose regulations reclassifying such payments as payments of SALT and including them within the $10,000 annual limitation thereby shutting down attempts to do an end-run around the new limit.

It’s happening again… The CA FTB is sending collection notices to corporations who are already paid in full.  We’ve seen three such notices this week alone.  In each case the taxpayer had proof of payment AND the FTB website showed the account paid-in-full, yet a notice was sent asking for a (duplicate) payment.

If you received such a notice send it over and we’ll research your individual situation.