California’s State Controller tracks and has identified 3 new email tax-related scams. One scam is an offer to check on the status of a taxpayer’s tax refund claim. This is a “phishing” scam which attempts to get the taxpayer to reveal his or her social security number. Unsolicited offers like this should be ignored.
An interesting question recently arose for a client who happens to be a lawyer. The client wanted to form a professional law corporation and, for estate planning purposes, wanted his revocable trust to be the sole shareholder of the law corporation. The problem was that the applicable statute, Section 13406(a) of the California Professional Corporation Act, states that only an individual who is a licensed professional (a licensed attorney in our case) can hold shares in a professional corporation. Similarly, the California State Bar states that a law corporation's application for registration must show that each shareholder of the law corporation is a licensed attorney.
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Lenders will be surprised to learn that they may be liable for a borrower’s unpaid payroll tax obligations. Lenders supplying funds to borrowers for the specific purpose of paying wages, with knowledge that the borrower will not be able to meet its payroll tax obligations, may be personally liable for such unpaid taxes. This liability can extend to lenders who have no knowledge of a borrower’s inability to meet payroll tax obligations if the lender could have found out by exercising due diligence.
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