Do You Need Tax Clearance Certificates When Buying or Selling a Business in California?
Unpaid taxes often delay California business sales. Tax clearance certificates confirm taxes are paid and protect buyers from liability. Understanding this early keeps deals on track. WHAT ARE TAX CLEARANCES AND WHY DO THEY EXIST? California requires tax clearance to confirm that all business taxes are paid before a sale. Certificates protect buyers from inheriting the seller’s unpaid tax liabilities, called successor liability.
missing returns or suspended status can cause delays.
Employment Development Department (EDD)
The EDD monitors payroll taxes and employee classification, often auditing contractor-heavy businesses claiming “no employees.” California Department of Tax and Fee Administration (CDTFA) The CDTFA often requires extensive documentation and a final sales tax return; audits can delay closing. County Tax Collector Property taxes on business equipment or fixtures must be current. Even a small balance can delay escrow, so sellers should verify payment status early.
WHY TAX CLEARANCES MATTER Without clearances:
WHAT DOES EVERY AGENCY REQUIRES FOR A SMOOTH TAX CLEARANCE? Franchise Tax Board (FTB) The FTB checks state income taxes for corporations, LLCs, and partnerships. Up-to-date filings clear quickly, but
• Buyers can unknowingly inherit thousands in unpaid taxes. • Escrow officers may refuse to close the transaction. • Lenders and landlords may block the transfer until proof is provided.
CONTINUED ON PAGE 4 ...
Spinach Artichoke Pizza Ingredients • 1 loaf frozen bread dough • 2 tbsp garlic herb spreadable cheese • 1 cup shredded mozzarella cheese • 1/2 cup shredded Gruyere cheese
SUDOKU
• 7 oz artichoke hearts, chopped • Several handfuls of fresh spinach • Pepper, to taste
Directions 1. Thaw dough according to package directions and let it rise for 2 hours. 2. Preheat oven to 450 F. 3. Coat a 10-inch cast-iron skillet with non-stick spray, then gently stretch dough to fit. 4. Spread garlic herb cheese evenly across the entire dough layer. 5. Sprinkle mozzarella and Gruyere cheeses evenly over dough, reserving a small amount of each. 6. As the topping, scatter chopped artichoke hearts, followed by a layer of torn spinach leaves, and then the reserved cheeses. Add black pepper to taste. 7. Bake for 15–18 minutes, until the edges are golden brown and crisp.
3
tqdlaw.com | 916-545-2790
Published by Newsletter Pro • NewsletterPro.com
Made with FlippingBook Ebook Creator