California taps highest income taxpayers for more revenue

Forbes reports on California's war on productive people:

Last week one of my clients let me know of his growing frustration over being singled out as a deep pocket for special treatment by his state…and his belief that he could enjoy his lifestyle just as well if his family headquartered in Nevada, Washington or Texas.

He had just received a penalty for $2470 for mailing his 2010 California income tax extension payment on April 15. There was no late payment; the problem was that he MAILED the funds rather than allowing the state to electronically withdraw them from his account.

January 1 of this year the CA Franchise Tax Board [FTB] began enforcing a 2008 law that requires individuals to remit all future payments electronically once they make an estimated tax or extension payment over $20,000 or file an original return with a tax liability over $80,000. Once a person meets the mandatory e-pay threshold, they are required to make all subsequent payments electronically, regardless of the amount, type, or taxable year.

If a taxpayer is required to make electronic payments but pays by other means, FTB will assess a penalty equal to 1 percent of the amount paid. The $2470 was this new 1% penalty.

As Dr. Helen says, it's time to be Going John Galt. California would rather have businesses created somewhere else.