Awards & Recognition
In addition to having years of experience as a dually licensed Tax Lawyer and CPA in Oakland, our founder and principal attorney, David W. Klasing, possesses decades of experience as a former auditor in public accounting and has represented clients in federal (IRS) and California (FTB, CDTFA (BOE), EDD) audits for nearly 30 years, enabling our tax team to navigate the audit process with precision and skill. Should you be facing an audit, whether a correspondence, office, or field tax audit, we are ready to stand by your side and navigate you through the meetings with the IRS, FTB, CDTFA & EDD. Call (510) 764-1020 or schedule a reduced-rate initial consultation here at our Oakland office or other convenient locations across Northern California.
What Triggers a California State Tax Audit?
Like the IRS, the California Franchise Tax Board (FTB) will look for certain red flags indicating an audit is warranted. These do not need to be explicit signs of criminal tax evasion or other willful activity. It is possible that the FTB could trigger an audit on a person or small business that fits the description of common examples of noncompliance.
Small businesses with multiple parent or subsidiary entities may draw the attention of the FTB for tax auditing. The FTB is also more likely to audit small businesses with a much higher proportion of independent contractors than employees, as many employees are often misclassified as independent contractors in favor of their company. Businesses that meet most of their payroll obligations in cash can also provoke additional government scrutiny. Hence, it would be wise for cash-intensive businesses to keep accurate, detailed, and extensive records.
What is California Sales Tax?
In addition to income, payroll, and employment taxes, business owners must contend with California sales taxes, which are collected and enforced by the California Department of Tax and Fee Administration (CDTFA), a relatively new organization established in 2017. The CDTFA assumed many of the duties formerly managed by the California Board of Equalization (BOE), including those relating to sales tax collection and sales tax auditing of businesses.
Given the recent changes in California sales tax laws, particularly following the U.S. Supreme Court’s decision in Wayfair expanding state authority over online sellers, you would be wise to have our dual-licensed Oakland Internet Sales Tax Attorney & CPAs guide you. Our services include internet sales tax audit representation, small business tax planning, and bookkeeping services, leveraging our deep understanding of the evolving business tax landscape. We are well-versed in the intricacies of California sales tax nexus and the differences between sales and use tax. Rely on the Tax Law Offices of David W. Klasing for comprehensive advisory and representation, ensuring your business navigates and flourishes within California’s complex regulatory framework.
What if I Disagree with the Results of a California State Tax Audit?
Auditors strive for accuracy, but errors occur, nonetheless. Unfortunately, an auditing error can translate to devastating outcomes for the taxpayer. If a taxpayer disagrees with the result of a California tax audit – for example, if the taxpayer believes they were fined improperly – the taxpayer can request appeals, initiating the process of disputing the audit’s outcome.
The California state equivalent of the IRS Office of Appeals is the California Office of Tax Appeals, or OTA, created in 2017 with the passage of the Taxpayer Transparency and Fairness Act. This unbiased and autonomous appeals body handles tax disagreements involving the FTB, EDD, and CDTFA (formerly BOE). To file an appeal with the OTA, the taxpayer must:
- Receive either (1) an Appeals Bureau Decision or (2) a Notice of Action from the CDTFA or FTB
- Meet the appropriate deadline for filing the appeal (which will be specified on the taxpayer’s Appeals Bureau Decision or Notice of Action)
- Submit the proper documents, such as OTA Form L-01 (Request for Appeal)
It is vital to submit clear, detailed, and timely information well-supported by robust legal and factual evidence to give your appeal the greatest likelihood of succeeding. One section of OTA Form L-01 states, “You must identify what you believe is in error or has been omitted from the taxing agency’s decision and explain why the identified errors or omissions justify a different result” – without relying on frivolous tax arguments.
Our dual-licensed Oakland, CA Audit Appeals and Litigation Attorneys and CPAs boast wide-ranging experience in various federal and California state tax matters, representing clients in IRS audits, disputes with the CDTFA, EDD, and FTB, refund claims, tax collection defense, innocent spouse relief, and criminal tax defense. Our proficiency is invaluable in handling cases involving criminal tax exposure, civil tax audits, eggshell audits, reverse eggshell audits, and criminal tax investigations. As seasoned litigators, our team, led by David W. Klasing Esq. M.S.-Tax CPA is prepared to represent you in Tax Court or before the California Office of Tax Appeals. To date, we have never lost in tax court. We won’t take your case if we don’t believe we’ll win.
Contact Our Oakland Office Today
If you have been notified of an upcoming California state tax audit in Oakland or wish to dispute the results of a California tax audit that has already been completed, contact us at the Tax Law Office of David W. Klasing online here or by calling our Oakland office at (510) 764-1020.
Our Oakland office is Conveniently Located at:
505 14th St,
Oakland, CA 94612
(510) 764-1020
