State Board of Equalization Sends Erroneous Tax Notice to 33,000 Small Businesses

Dec 4, 2013 3:45 PM

By Nick Dobis, News Web/Social Media Producer

Jaime Garza, Deputy Director of External Affairs for the California Board of Equalization, confirmed approximately 33,000 account holders statewide received a prepay tax notice in error, including several businesses in the north state.

“We regret the mistake and apologize for creating confusion and frustration,” Garza stated in an email to Action News Now this afternoon. “We have identified the wrongly notified accounts, and will be mailing them a follow up letter to clarify that their reporting frequency has not changed.”

Garza also said a notice will be posted on the board’s website:

The California State Board of Equalization collects taxes and fees which provide approximately 33 percent of California’s annual revenue for state government and funding for counties, cities, and special districts, according to their website. They also administer the state’s sales and use, fuel, alcohol, tobacco and other taxes and collects fees to fund state programs. The board also plays a major role in state property tax assessment and administration.

Action News Now obtained a copy of the letter from Chuck Shelton, owner of Nor Cal Collectables located in Chico. The letter stated that a review of the information provided by Shelton indicated his business “average[s] $17,000 or more per month in taxable sales and purchase...". This amount would require Shelton's business to pay taxes on a quarterly prepayment basis, a claim Shelton denies. The letter also stated the business was required to prepay at least 90 percent of the tax liability for the filing period.

“This letter almost caused me to close my doors,” Shelton admitted in an email this morning.

Several other individuals who identified themselves as north state business owners have stated on the Action News Now Facebook page they too received the erroneous letter.

Garza further stated the board is reviewing its procedures to ensure this type of error does not happen again. If an account holder received a similar notice and has questions, they are encouraged to contact the boards Customer Service Center at (800) 400-7115. The center is open Monday through Friday from 8 a.m. to 5 p.m.

Reporter Cecile Juliette will have a full report on Action News Now at 5 p.m.


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