3 ms·

If you're wondering (like I was) why MA thinks this guy owes anything at all, it's buried in the middle: "Again, I hadn't lived there or worked there since 200

by patmcc 12y ago

If you're wondering (like I was) why MA thinks this guy owes anything at all, it's buried in the middle: "Again, I hadn't lived there or worked there since 2003, but I did own part of a business that was headquartered in MA, and the state was using this fact to harass me for income tax money." So is the MA tax bill based on the profits of that business, or is the state just using it to say "you should pay all your income tax here"? Regardless, his beef should be with MA rather than the bank. I'd hardly fault Chase for complying with a court order - if crossing a state line made you judgement proof, why wouldn't everyone just run up debts, move one state over, and start fresh?

ta75757 12y ago
OP claims "they have not sued me or sent me any sort of court order" Edit: According to [0] they don't need to. They just send you a notice and if you don't respond in time they take what they want. It's not clear what constitutes responding or how to get the case into a court and out of an administrative process. I don't know about the out-of-state bank thing. [0] http://www.mass.gov/dor/businesses/help-and-resources/legal-library/administrative-procedures/ap-631-the-collection-process.html http://www.mass.gov/dor/businesses/help-and-resources/legal-...
- DannyBee 12y ago
  This seems highly unlikely. I only spent one year of law school in MA, but i distinctly remember that any sort of prejudgment attachment required a court order.
  - ta75757 12y ago
    I'd believe that, I didn't do a thorough search. But the document that claims to describe Mass DOR collections doesn't cover it.
    - DannyBee 12y ago
      FWIW: I can find state tax liens with these names on it, but it may or may not be in any way relate to this.
Dylan16807 12y ago
Isn't the problem that there is no judgement? They just filled out a form saying they're owed money. And your scenario doesn't fit here because the 'debt' is from after moving.
conjecTech 12y ago
The first part could easily explain it, particularly if the company was an LLC. If you own a stake an LLC, you are liable for the taxes on the profits on your share of the ownership regardless of whether or not you see any of it(at least in GA). Since the author seemed fairly oblivious to this requirement maybe he hadn't paid them since moving out of the state? Since this seems to be from a couple years ago, do anyone have any closure on this situation now?
- sliverstorm 12y ago
  you are liable for the taxes on the profits on your share of the ownership regardless of whether or not you see any of it Can you explain?
  - dragonwriter 12y ago
    IIRC, an LLC can either be separately taxed or a pass-through entity; in the latter case, the LLC members each pay taxes on their share of the LLC's taxable income. This is true even if all of the income is retained in the LLC.
digz 12y ago
Also possible that this could be related to his sale of Ars Technica. Massachusetts imposes its own capital gains tax, and he may have been liable for a significant portion of that, especially given that it sounds like it was MA domiciled. Or maybe not, but there's lots of ways that he could be legitimately liable for MA taxes while living in a different state. Sounds to me like his beef could be with the Chicago CPA. CPAs are not created equal, and even the big 4 accounting firms make serious mistakes when things get complicated - has happened to me. Usually, when that happens, the CPA is responsible for fixing the problem (paying late fees, filings, etc.), but you're still liable for the underlying tax burden that they may have missed. In any case, would be nice to know what the resolution was!
deleted 12y ago
[deleted]
rodgerd 12y ago
> So is the MA tax bill based on the profits of that business, or is the state just using it to say "you should pay all your income tax here"? Regardless, his beef should be with MA rather than the bank. More to the point, the update makes it clear he doesn't really have a beef with MA: he did owe the taxes.

by patmcc 12y ago

ta75757 12y ago

OP claims "they have not sued me or sent me any sort of court order" Edit: According to [0] they don't need to. They just send you a notice and if you don't respond in time they take what they want. It's not clear what constitutes responding or how to get the case into a court and out of an administrative process. I don't know about the out-of-state bank thing. [0] http://www.mass.gov/dor/businesses/help-and-resources/legal-library/administrative-procedures/ap-631-the-collection-process.html http://www.mass.gov/dor/businesses/help-and-resources/legal-...

DannyBee 12y ago
This seems highly unlikely. I only spent one year of law school in MA, but i distinctly remember that any sort of prejudgment attachment required a court order.
- ta75757 12y ago
  I'd believe that, I didn't do a thorough search. But the document that claims to describe Mass DOR collections doesn't cover it.
  - DannyBee 12y ago
    FWIW: I can find state tax liens with these names on it, but it may or may not be in any way relate to this.

Dylan16807 12y ago

Isn't the problem that there is no judgement? They just filled out a form saying they're owed money. And your scenario doesn't fit here because the 'debt' is from after moving.

conjecTech 12y ago

The first part could easily explain it, particularly if the company was an LLC. If you own a stake an LLC, you are liable for the taxes on the profits on your share of the ownership regardless of whether or not you see any of it(at least in GA). Since the author seemed fairly oblivious to this requirement maybe he hadn't paid them since moving out of the state? Since this seems to be from a couple years ago, do anyone have any closure on this situation now?

sliverstorm 12y ago
you are liable for the taxes on the profits on your share of the ownership regardless of whether or not you see any of it Can you explain?
- dragonwriter 12y ago
  IIRC, an LLC can either be separately taxed or a pass-through entity; in the latter case, the LLC members each pay taxes on their share of the LLC's taxable income. This is true even if all of the income is retained in the LLC.

digz 12y ago

Also possible that this could be related to his sale of Ars Technica. Massachusetts imposes its own capital gains tax, and he may have been liable for a significant portion of that, especially given that it sounds like it was MA domiciled. Or maybe not, but there's lots of ways that he could be legitimately liable for MA taxes while living in a different state. Sounds to me like his beef could be with the Chicago CPA. CPAs are not created equal, and even the big 4 accounting firms make serious mistakes when things get complicated - has happened to me. Usually, when that happens, the CPA is responsible for fixing the problem (paying late fees, filings, etc.), but you're still liable for the underlying tax burden that they may have missed. In any case, would be nice to know what the resolution was!

deleted 12y ago

[deleted]

rodgerd 12y ago

> So is the MA tax bill based on the profits of that business, or is the state just using it to say "you should pay all your income tax here"? Regardless, his beef should be with MA rather than the bank. More to the point, the update makes it clear he doesn't really have a beef with MA: he did owe the taxes.