As the most populated state in the country, California exceeds many other states across a number of quantifiable records and taxes are no exception. The Golden State not only has the highest tax rates in the country, but also has some of the highest rates of tax delinquency. Being that the largest delinquent tax accounts are publicly published, it becomes very easy to analyze where delinquency is occurring and to what magnitude. Which California cities have the largest number of delinquent taxpayers and the highest amounts of delinquent taxes? The answer can be found below.
Outstanding Taxes By The Numbers
Overall, the top 500 accounts across three different groups of taxes account for over $1 billion in outstanding taxes. There are $576,665, 894.4 on record for individual taxes, $31,873,326.82 accounted for corporate taxes, and $473,376,201.35 due for sales and use taxes.
It probably comes as no surprise that Los Angeles has the highest number of delinquent taxpayers across all three groups of tax types (being the largest city in the state). Los Angeles also had the highest dollar value for outstanding taxes in both corporate tax and sales and use taxes. City businesses on the top 500 list owe a cumulative $4,248,081.55 in corporate taxes and $30,688,938.38 in sales and use taxes. Personal delinquent taxes are a different story entirely. Chula Vista actually takes the lead with a cumulative $272,638,094.76 in delinquent taxes. Chula Vista didn’t even make the top five for cities with the highest number of delinquent accounts. Over 90% of the taxes due in Chula Vista are owed by one single individual who has a tax debt totaling $271,803,896,98. The outstanding delinquent tax values can be considerably high compared to the rest of the nation, because taxes and average income levels are higher in California.
About California’s Top 500 Delinquent Tax List
In 2012, the State of California updated legislation that now requires tax authorities to publicly publish the names and amounts owed for the top 500 delinquent tax accounts in California two times a year. Some big names have made the Top 500 list in the past, including:
- Tori Spelling
- Chris Tucker
- Ted Field
- Pamela Anderson
- Halsey Minor
California taxpayers are given ample opportunity to contest liability and work out a payment plan before being placed on the list. According to the Franchise Tax Board, the publishing of the lists has been very effective in motivating taxpayers to pay their delinquent taxes.
Penalties For Tax Avoidance
Individuals or businesses that fail to pay state taxes have more to fear than just being added to a public list. The law allows the Franchise Tax Board to aggressively pursue payment of tax debts. Taxpayer with state-issued professional, occupational, or driver’s license could have their licenses suspended or revoked. Thus, failing to satisfy state tax debts can affect both mobility and livelihood. Tax authorities can also prohibit state agencies from entering into certain contracts with listed debtors. Moreover, the state can garnish wages, impose interest, place a lien on property, or even issue criminal charges in some cases.
Once an individual or business pays off the tax debt or enters into an installment agreement, they are removed from the list. The penalties for tax avoidance can be very harsh and even crippling in some cases. State tax issues should not be taken lightly.
Help With Franchise Tax Board Tax Issues
There is no reason to live in fear, regardless of where you stand in the Franchise Tax Board collections process. If you have delinquent tax debt and/or the state has already taken action to penalize you for outstanding taxes, RJS Law is here to help. Our attorneys can analyze your situation to determine the best course of action. We may be able to help you reach an installment agreement, make an offer in compromise, or file a dispute. Contact RJS Law by filling out a contact form to receive a complementary case evaluation today.