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FTB follows IRS tax shelter initiative.


The Franchise Tax franchise tax n. a state tax on corporations or businesses. (See: tax, corporation) Board will follow the IRS tax shelter
Tax Shelter
An investment selected mainly because it provides favorable tax treatment.

Notes:
The IRS watches tax shelters carefully. If an investment is made for the sole purpose of avoiding or evading taxes, you could be forced to pay tax (or even penalties).
See also: Income Shifting, Tax Evasion, Tax Haven, Tax Shield
 settlement initiative as outlined in IRS Announcement 2005-80, effectively creating the California Tax Shelter Resolution Initiative to run alongside the federal initiative.

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Only taxpayers who are qualified to participate in the IRS initiative and who complete the requirements of the program are eligible for the California initiative, wherein participants can avoid most California tax shelter penalties, including the non-economic substance transaction understatement penalty.

For more, visit www.ftb.ca.gov/aboutFTB/press/2006/06_03.html.
COPYRIGHT 2006 California Society of Certified Public Accountants
No portion of this article can be reproduced without the express written permission from the copyright holder.
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Article Details
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Title Annotation:Franchise Tax Board; Internal Revenue Service
Publication:California CPA
Article Type:Brief article
Geographic Code:1USA
Date:Mar 1, 2006
Words:88
Previous Article:California Summit on Financial Literacy.
Next Article:FTB extends pit installment agreement pilot program.(Franchise Tax Board)(Brief article)
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