california tax attorney

What to Do if the EDD Takes Your Money

The California Employment Development Department can legally withhold money owed to you by the state for repayment of debt.  In other words, either through error or willful action, you owe a monetary debt to the State of California. The EDD is within its legal rights to withhold money from a variety of programs and tax refunds if you do not pay up. It works with the California Franchise Tax...
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Preparing for the 2017 Tax Season

It is that most un-wonderful time of year: tax time. April 15 may be a bit far away, but as a small business owner, you need to get your documentation for 2016 together as soon as possible. Your tax professional will thank you. By the way, one of the changes for next year includes moving a filing deadline from April 15 to March 15 if your business structure is a pass-through. More on that...
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What Happens If You Misclassified a Worker?

What does the employment classification of workers have to do with payroll tax audits? Everything. When the Employment Development Department of the State of California decides to audit, the classification of your workers is the auditor’s sole concern. Additionally, the IRS often adopts the results of the EDD audit to use in assessing federal penalties. For this reason, it is critical to ...
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What Are Your Payroll Tax Responsibilities?

In a previous post, we talked about the difference between independent contractors and employees. One of the biggest differences, and one that often drives intentional worker misclassification, is that employers must withhold and pay payroll taxes for employees whereas they do not for independent contractors.
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Classifying Employees and Independent Contractors

You have hired someone to do work for you. Is that person an employee or an independent contractor? The answer is important because misclassifying an employee as an independent contractor, whether intentionally or through ignorance, can land you in court and in debt for payroll taxes. There are several tests from a variety of regulatory agencies that are used to try to determine employment...
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California Payroll Tax Problems and the EDD

Part of being a business owner is filing and paying payroll taxes for your employees. In California, the Employment Development Department, or EDD, administers these taxes. In addition to receiving tax filings and payments, the EDD also identifies and investigates potential infractions of tax law. What do you do if you develop tax problems and find yourself on the receiving end of an audit?
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Federal Payroll Tax: What the IRS Expects from Business Owners

If you have employees, you are liable for federal payroll taxes. Some taxes are withheld from your employee’s wages, some you must pay yourself. The Internal Revenue Service, or IRS, administers payroll taxes as part of its responsibilities. Remaining in compliance means understanding how and when payroll taxes are calculated, filed, and paid.
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All About California Self-Employment Tax

When you work for someone else, your employer takes care of tax withholdings for you.  When you work for yourself, you are responsible for the withholding and payment of these same taxes. In California, you are not just responsible for federal taxes; you are also required to pay state employment tax. Here is a rundown of the things you need to know to stay out of trouble with the IRS and the ...
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What Are the California Payroll Tax Penalties If I Don't Pay?

As an employer, you are obliged to file payroll tax returns and pay payroll taxes. While the obligation can feel burdensome, especially when times are tough and cash flow is slow, this is obligation that you must never delay.  Substantial penalties may accrue to any employer who doesn’t file correctly, leaving you in a far worse situation than before.
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How to Handle an EDD Lien: Notification, Contributions, and Penalties

As a business owner, you are responsible for paying payroll taxes and filing periodic reports in accordance with your obligations. If you do not do so, you risk having a lien recorded against your property by the EDD. The details of tax liens are confusing to many people, but it’s important to understand what a lien is, why they are issued, and what your options are to avoid or discharge the...
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