Need Help With A Calif. Return

[WhiteOleander]

Have a truck driver who lives here in Texas. He goes to Calif. to pick up loads from a Calif. based company. They have issued the W-2 with wages to Calif.

But, from what I read, this is not taxable to him because he is a non-resident. It says that the rule is for Railroad workers and truckers. It says he is taxed on the income from his state of residency.

Do I have this correct. There is no other Caolf. scource income. There is no Calif. W/H.

I plan to file the return. But, not have it taxable.

Thanks from Texas.

[DTS]

Truckers

I don't do any truckers, so I needed to look this up in Pub 1031, as this was new to me. After reading, I agree with you.

Dennis

[WhiteOleander]

Thanks so much.

[Kram BergGold]

Try getting W-2 fixed

It might be worrth a phone call to get employer to reissue the W-2 showing TX wages.

[S T]

Knowing Calif

I would also try to have the W-2 reissued with state TX. His tax home is probably Texas,

Calif Employer should recognize that and file as State - Texas, I am sure he is not the only out of state Truck Driver.

Since Texas does not have a State Tax, the client can not file for the credit, taxes paid to other state, and California will more than likely aggressively pursue a tax return and income tax paid.

I don't believe that this client wants to file a 540NR at all in Calif.

Sandy

[taxmandan]

I don't do any truckers, so I needed to look this up in Pub 1031, as this was new to me. After reading, I agree with you.

Dennis

Is that a California Pub? I don't see it in the IRS website Pubs list.

[S T]

Pub 1031

Yes, it is Calif Franchise Tax Board Publication,

Guidelines for determining Residency Status.http://www.ftb.ca.gov/forms/07_forms/07_1031.pdf

Sandy

[Gene V]

This might be of some help, this is how you would file if you where driving to Oregon.

Interstate Transportation Wages (Amtrak Act)

Nonresidents. Are you a nonresident of Oregon with regularly assigned duties in Oregon and at least one other state? If you meet the qualifications below, Oregon will not tax you on these wages. File Form 40N and show this income is exempt by entering a zero in the Oregon column for these wages, Write “Amtrak” at the top of your return in blue or black ink.

Maybe California has similar filing instructions.

Gene

[WhiteOleander]

Thanks for all the input. We did discuss getting the W-2 corrected. But, the client said the company told him they had to put it on there because of the rules involving the "VDSI" (I thibk that's what it's called) that they have to account for.

So, client did not want to continue the agruement with them

[DTS]

Wo

It's VPDI, voluntary plan disablity insurance.

Since they won't correct the W-2 and you decide to file the 540NR, give a call to 1(916) 845-7057 and see how they want you to handle this. I have overridden the Sch CA-NR a couple of times to show the correct allocation and this may be an easy fix for you, if you decide to file in CA. If you do, maybe, a preparer note along with the return to explain.

Dennis

[WhiteOleander]

It's VPDI, voluntary plan disablity insurance.

Since they won't correct the W-2 and you decide to file the 540NR, give a call to 1(916) 845-7057 and see how they want you to handle this. I have overridden the Sch CA-NR a couple of times to show the correct allocation and this may be an easy fix for you, if you decide to file in CA. If you do, maybe, a preparer note along with the return to explain.

Dennis

Thanks Dennis. It is finished. The trucker is gone. He did not want to file the return. for CA.

I know CA is very agressive about people filing. So, we'll see if he comes back with a letter.

[Y2KEA]

The trucker MUST file a 540NR. I can guarantee you he will get love letters from the FTB.
If he ignores the letters, the FTB will do his own return & demand thousands of dollars plus FTF penalties & interest.
If he only comes into CA to pick up & does not make any deliveries in CA, he can adjust the wages off using the schedule CANR.

[WhiteOleander]

The trucker MUST file a 540NR. I can guarantee you he will get love letters from the FTB.
If he ignores the letters, the FTB will do his own return & demand thousands of dollars plus FTF penalties & interest.
If he only comes into CA to pick up & does not make any deliveries in CA, he can adjust the wages off using the schedule CANR.

I know. But, I can not force a T/P to file. I can only tell him the requirements.

[S T]

I would document

I would document in writing to the T/P that you advise that he file 540NR form. Yes you are right you can not force him, but you should have something in your files, as this t/p will conveniently plead ignorance when he begins to receive the notices from CA FTB.

Y2KEA is correct, California will aggressively contact the T/P and will prepare a return for him based on the info they have and attach massive penalties, interest, etc. Then there is a real mess to try to clean up.

Sandy

[joanmcq]

Yup, I agree. CA wants their money! Especially now that we have a deficit that rivals many state's budgets...