That Wonderful State of Confusion....err I mean California

[Rick Christopherson]

When I got the mail today, I was so freaked out that I even forgot where I set my coffee cup down, which is normally permanently attached to my hand. All I could see was the return address of "Use Tax Administration" before my mind started racing trying to remember whether I have made any large internet purchases or not (which I haven't).

I had recently heard horror stories about huge, $3000 Use Tax bills suddenly getting dumped on consumers for purchases spanning many years. (Mainly because they sidestepped the high state cigarette taxes).  So I feared a huge amount of paperwork looming in my life.

I raced into the kitchen to open the letter. What I read flabbergasted me.

Dear Sir or Madam:

We are contacting you regarding information obtained from shipping documents collected by the California Department of Food and Agriculture (CDFA)..........

OMG! The State of California is reaching out to non-California persons or companies to impose California Law across borders?!? What the heck?

My next thought immediately turned to "How?" How in the world did the State of California even get my business name, let alone that I may have shipped some products to California residents? I am the only person that possesses those records, and very few sales have even been made in Cali.

Then it dawned on me that the only way California could possibly know that I have ever sold a single product in California is if they were scanning U.S. Postal Service packages for return addresses originating from an out of state business. WOW!

Well OK, so I realize I have nothing to lose by completing the 15-line questionnaire on the back because most of the check boxes would be "Does Not Apply", but there was no way I was going to take the time to fill in the "Essay" questions. Sending it back would stave off any potential future problems instead of just blowing it off. (None of it applies to anyone with less than $100,000/yr in sales)

Then, as I was shifting the papers on my desk, I looked down and realized that the return envelope was "Postage Due"!!! Not only did they expect me to fill out this information that they can't legally compel me to do from another state, but then expected me to pay for the postage to send it back to them!!

Yeeeaaaahhhhh. That's gonna happen real soon.  [popcorn]

 

[Kev]

The more I hear about the way California is run, the more I believe the administration previously ran a chocolate factory.

 

[tjbnwi]

Drop it in the mailbox with no postage, write the return address the same as mailing address.

Tom

 

[Rick Christopherson]

Drop it in the mailbox with no postage, write the return address the same as mailing address.

Tom

It's not even worth the hassle of doing that.

When I was planning on filling out the stupid questionnaire, I had planned on using a HUGE black marker to check the boxes.  [big grin] But I'm not even going to bother with that for the postage. Let them go fishing somewhere else.  [crying]

 

[leer]

I quit my job in California when our first daughter was born.  That was back in 1983, and I thought the California was getting pretty crazy back then.

We moved back home to Colorado, but it is pretty much unrecognizable from the Colorado we returned to 30 years ago.  I'm getting that itch to rent a U-Haul, packing our belongings, and hitting the road.  Just not sure where we go.  I guess the good news is that switching to Festool means the U-Haul could be my mobile shop ... [smile]

 

[rmwarren]

Newsweek had an interesting article a couple months ago, so much so that I, ahem, "borrowed" the mag from my doctors office to finish reading it. I have both a doctor and a dentist who (1) have decent magazines, and (2) don't leave me waiting long. Bad combo, but I digress.

Anyway the article's premise was generally that Texas is attracting so many migrants because of low cost of living and lack of regulations/taxes. The author (Tyler Cohen) makes the case that people are willing to trade high cost of living, even when coupled with more social services/government support, for more elbow room and lower costs. There were other conclusions about the future of the middle class and the implications of technology on jobs and incomes. I need to reread it.

Interesting reading if you can get a copy, it was a teaser for his book Average Is Over, which I have not read.

RMW

 

[Sparktrician]

I quit my job in California when our first daughter was born.  That was back in 1983, and I thought the California was getting pretty crazy back then.

We moved back home to Colorado, but it is pretty much unrecognizable from the Colorado we returned to 30 years ago.  I'm getting that itch to rent a U-Haul, packing our belongings, and hitting the road.  Just not sure where we go.  I guess the good news is that switching to Festool means the U-Haul could be my mobile shop ... [smile]

I lived in Colorado briefly 14 years ago.  People would ask where I'd come from and I'd say, "Virginia".  The response universally was, "Thank God it's not California".  It didn't take long to find out what they meant by that comment. 

 

[vkumar]

Way to go Rick.  I like your style.
From a tax suffering Californian.

Vijay

 

[unityroad]

Then, as I was shifting the papers on my desk, I looked down and realized that the return envelope was "Postage Due"!!! Not only did they expect me to fill out this information that they can't legally compel me to do from another state, but then expected me to pay for the postage to send it back to them!!

Yeah I tried that ONCE [scared] I think it was the IRS. 

 

[tbellemare]

Drop it in the mailbox with no postage, write the return address the same as mailing address.

Tom

It's not even worth the hassle of doing that.

When I was planning on filling out the stupid questionnaire, I had planned on using a HUGE black marker to check the boxes.   [big grin] But I'm not even going to bother with that for the postage. Let them go fishing somewhere else.  [crying]

I seriously doubt it's real, Rick.

It sounds like a classic information grabbing scam. I get several a day... They come from state, local, and several "Federal agencies".

Tom

 

[Rick Christopherson]

I seriously doubt it's real, Rick.

It sounds like a classic information grabbing scam. I get several a day... They come from state, local, and several "Federal agencies".

Tom

Yes, Tom, it is definitely real and from the State of California. However, I have come to realize that it is the State's version of a phishing scam. They have been sending out a similar letter to CA residents for a while now. The new surprise is that they are now sending it to out-of-state businesses too.

Given the new Federal Law that businesses over $100,000 in sales will be required to file State Sales Taxes, it would appear to be phishing for company names for later use in their database. Or to go after companies that later fail to report.

I've had very few packages shipped to California, so they are really stretching it when they scan just a couple shipping labels to kick off the letter.

Even though it would have been fun messing with them by returning the form with the huge check boxes, doing so would have confirmed that the letter was sent to a business. So even though I am below the threshold for Federal filing, I would be in California's database of businesses shipping to CA. Who knows what they might do with that in the future.

 

[copcarcollector]

Given the new Federal Law that businesses over $100,000 in sales will be required to file State Sales Taxes,

Did you skip a few Zeros here? I thought the plan was a Million $ plus..?

 

[Rick Christopherson]

Yeah you're right. It is a million. Hmmm? It is the CA form that is listing the $100,000 threshold that made me think that was the Federal threshold too.

 

[copcarcollector]

Whew! I have not reached a million in sales (yet---!), and sure don't want to get involved in this sales tax fiasco...

 

[Slappy]

Rick it was those guides I bought weeks ago [eek]

 

[amt]

I have heard that phone orders are exempt from the state sales tax thingy, and it only applies to orders via internet.  So, if you are approaching $1M, have your customer call in the order