Wikinvest Wire

I'm glad we owe them money this year

Friday, January 16, 2009

Maybe, just to exacerbate the situation by about a billionth of a percent, we'll file an extension this year to avoid promptly paying the money we owe the state of California. Those who have been sending money to Sacramento all year long, expecting tax refunds this spring, are in for a bit of a surprise it seems, according to this report at CNN/Money.

California withholds tax refunds
Cash-strapped state says those who overpaid in 2008 are out of luck, while other checks will be held for 30 days as it tries to ward off bankruptcy.

SAN FRANCISCO (Reuters) -- California will not pay tax refunds for individuals and business that overpaid 2008 taxes, in order to conserve dwindling cash for priority payments including school spending and debt repayment required by state law, the state's controller office said Friday.

Other state checks to be postponed for 30 days include payments for vendors who provide services and products to the state government and state checks to a million aged, blind and disabled Californians to cover rent and utilities bills, State Controller John Chiang's office said in a statement.

Various state officials have been warning in recent weeks that the most populous U.S. state's coffers would run dry if Gov. Arnold Schwarzenegger and lawmakers fail to balance the state's current budget. The governor in his state of the state speech Thursday said California faces insolvency within weeks if it does not balance its books.
Surely, living close enough to Sacramento that our local news comes direct from the state capital has not been a positive factor in our view of things here in the Golden State.

12 comments:

Nick said...

Here's to hoping the lawsuits are filed quickly, resolved expediently, and the state is punished severely in compensatory damages. AINAL, but AFAIK, this would be very, very clear-cut illegal. The state can't go bankrupt, default on debt, or refuse to pay their obligations as long as they continue to have taxation authority: that's what backs the state's financial obligations. For the sake of some g-damn accountability in this out-of-control spend-happy liberal disaster we call a state, I hope the court seizes control of the tax income in the state general fund to pay the debts, and explicitly cuts off any new spending until either the idiots in the state government can produce some tiny amount of spending control, or we the people can wise up and fire all of them.

The day of reckoning is long overdue for California. If even there's a small chance we can break the vicious multi-generational cycle of liberal tax-and-spend lunacy, out-of-control entitlements, idiotic representation and ambivalent voters who keep hiring the same despicable politicians to waste their money without being accountable, than I say bring on the financial apocalypse.

Chuck Ponzi said...

Tim,

I used to prepare taxes before I moved to SoCal, and what you're describing is a common misconception (although I cannot comment on California's specifics).

Generally, an extension will remove your requirement to file on time, but as long as you owe money, you will be charged a penalty for owed taxes not paid by April 15th. Most companies pay an estimated amount greater than the liability just to avoid that scenario.

Of course, the penalty only applies when the shortfall exceeds a certain percentage.

Good luck to you on not getting penalized.

Chuck

Tim said...

Chuck,

Don't bring me down man.

bradinsb said...

Its getting time for me to consider leaving this State.
Nice blog Tim

shayre said...

Arnold Shrugged!

Sometimes your golden man, that's all I've got to say.

donna said...

Please pay so I can get MY friggin refund eventually!

And Nick, you're an idiot. As bad as Arnie, almost.

Anthony J. Alfidi said...

Surprise taxpayers! I'm still happy to be a Californian. At least the weather's nice.

dearieme said...

Are you quite sure you want to leave California?
http://www.timesonline.co.uk/tol/life_and_style/food_and_drink/eating_out/giles_coren/article5501708.ece

Dan said...

"Where the wavin' wheat, can sure smell sweet..." no wait, that's Oklahoma.. "California here I come, right back where I started from" Yowza!

Anonymous said...

Its not the CA I grew up in! It was nice before all the Repubs from the mid-west and all the mexican nationals got here.

little larry sellers said...

Last I heard, 41 states and the District of Columbia are expected to face budget shortfalls this year, so this could soon be a familiar story around the country. As usual, California appears to be leading the way on a new trend.

Anonymous said...

"The state can't go bankrupt, default on debt, or refuse to pay their obligations as long as they continue to have taxation authority: that's what backs the state's financial obligations. "

See, this is what happens when you listen to Republicans and discover that taxcuts now equal tax hikes in the future.

Now the money that's left has to pay for the lights to stay on and the salaries for the workers.

So yeah.

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