GAINES GAZETTE
April 2021
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Tax Filing Deadline Extended to May 17, 2021 |
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The Internal Revenue Service (IRS) recently extended the 2020 tax year federal income tax filing due date for individuals only from April 15, 2021, to May 17, 2021.
Following the IRS, the Franchise Tax Board (FTB) extended California’s state tax filing and payment deadline for individuals to May 17; however, the extension does not apply to estimated tax payments due on April 15.
Both agencies stress that taxpayers who pay their 2020 personal income taxes in full by May 17, 2021, will not be subject to penalties and interest. This relief is available to all individual taxpayers without filing a request or contacting IRS or FTB.
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During our March meeting, the Board voted unanimously to re-establish the BOE Advisory Council, which will provide recommendations and feedback to Board Members and BOE staff. The Council will include representatives from county assessor offices, legislative tax policy committees, labor unions, enrolled agents, tax lawyers, and other stakeholders, and will meet twice a year beginning in July.
The Executive Director reported that thousands of “legacy documents” have been restored to the BOE’s website after being temporarily removed during the BOE's website upgrade. She also announced that the Board will continue meeting virtually until at least December 2021.
Finally, we discussed progress on the implementation of Proposition 19. The BOE is tracking critical legislation (Senate Bill 539) that will help answer questions about the unclear provisions of the measure. We are continually updating our Prop 19 webpage to ensure the public has the latest, most up-to-date information.
We are proud as a Board to continue meeting our constitutional duties using various virtual platforms and remain committed to our mission to serve Californians through fair, effective, and efficient tax administration in support of state and local governments.
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Sales Tax Increases in California |
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I wanted to ensure that taxpayers are aware of the sales and use tax increases that took effect in many California cities and counties on April 1, 2021. The cities in District 1 include Turlock (8.625%); Bishop, Exeter, Rancho Cordova, South Lake Tahoe, and Victorville (8.75%); Montclair (9.00%); and San Fernando, Lancaster, and Palmdale (10.25%).
The California Department of Tax and Fee Administration notified business owners in a special notice distributed in February.
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Recall Process Holds Elected Officials Accountable |
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The following is an excerpt from my recent opinion piece published in the Bakersfield Californian on the current effort to recall Governor Newsom and why the recall process is an important tool for California voters:
Governor Newsom looks certain to face a recall election. Voters – even his supporters – should be thankful that California has citizen empowerment tools to check corrupt, incompetent, unresponsive or simply unpopular government officials. If you favor accountability, look kindly upon the recall effort as a means of voters being heard.
It was not always so. In the early 20th century, California state and local governments, media, and courtrooms operated as little more than subsidiaries of the mighty railroads, which abused the public faith by buying and selling influence as though it was rail stock. Republican reform Governor Hiram Johnson revolted against railroad dominance by creating a direct-democracy end run around the moneyed Colossus that so easily and thoroughly controlled the state.
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As of this week, both sections of Proposition 19 have been fully implemented.
Starting February 16, 2021, parents and grandparents were no longer allowed to transfer property to their children or grandchildren without triggering an increase in property tax liability, unless the property is a family farm or was the parent or grandparent's principal residence and will continue to be used as the child or grandchild's principal residence.
Beginning April 1, 2021, eligible homeowners are allowed to transfer their Proposition 13 base year assessment to a higher-priced home anywhere in the state, paying increased property taxes only on the difference between the sales price and the new purchase price, assuming those prices were at fair market value.
Passed last November, the implementation timeline was tight, but Board Members worked closely with BOE staff, County Assessors, and Legislature to get as much clarification on the measure as possible.
Currently, the BOE is supporting two bills making their way through the state legislature. Senate Bill 539 (Hertzberg) will help clarify many vague and inconsistent provisions of the law. The bill was approved by a Senate committee on March 8 and will now head to the full Senate for a vote.
Senate Bill 668 (Bates) will delay the implementation date of the intergenerational transfer exclusion (parent-child and grandparent-grandchild) provisions to February 16, 2023. The bill will provide more time for County Assessors, the BOE, and the Legislature to clarify ambiguities in the new law. The bill is currently awaiting a hearing in the Senate Governance and Finance Committee.
While these bills make their way through the legislative process, the BOE will continue to update its Proposition 19 guidance. These updates can be found on my website.
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State Revenue $14.3 Billion Ahead of Projections |
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Governor Newsom’s January budget projection anticipated that California would collect $111.5 billion in general fund revenue by this point in the fiscal year. Instead, the state has collected $125.8 billion. This is in addition to the pandemic relief bill signed last month by President Biden that earmarked $26 billion in federal funds for California.
The Governor’s May Revision of the state's 2021-22 Budget is due next month and will take into account this unexpected windfall, giving Californians good news as state legislators began preparing for the new fiscal year that begins July 1.
One thing is certain, with this incredible amount of surplus revenue, there should be absolutely no need to raise taxes or fees on hardworking California families.
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Property Tax Postponement Program |
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The 2020-21 State Controller’s Property Tax Postponement (PTP) Program allows homeowners who are seniors, blind, or have a disability to defer current-year property taxes on their principal residence if they meet certain criteria including 40 percent equity in the home and an annual household income of $45,000 or less.
Governor Newsom extended the PTP filing deadline for homeowners in counties affected by wildfires to June 1, 2021. Those counties include Butte, Del Norte, Fresno, Glenn, Humboldt, Lake, Lassen, Los Angeles, Madera, Mariposa, Mendocino, Monterey, Napa, Nevada, Plumas, San Bernardino, San Diego, San Mateo, Santa Clara, Santa Cruz, Sierra, Siskiyou, Solano, Sonoma, Stanislaus, Tehama, Trinity, Tulare, Tuolumne, Yolo, and Yuba.
Funding for the program is limited, and applications will be processed in the order received. For more information, please visit my Resources page.
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As a Board Member, my number one priority is to advocate for taxpayers. I believe hardworking Californians deserve to have someone working on their behalf to streamline and promote efficiency in state government.
Should you need assistance with tax-related problems or have questions, visit my website for information on how to contact my office or email me directly anytime.
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