Committee on Taxation

2022-24 Chair:

  • John Schultz

Vice Chair:

  • Andy Mattson


: Provide up-to-date information and guidance to members on tax laws, programs and regulations. Maintains liaison with the IRS, FTB, BOE and EDD. Review and respond to proposed tax legislation, regulations and revenue rulings.

* This is a state committee with corresponding chapter committees.

Recent News: 

Posted Aug. 16, 2022

Congressional Letter to IRS Urging Action to Address Backlog Ahead of 2023 Tax Year

CalCPA is among the many state CPA societies that joined the AICPA in securing the signatures of 93 members of Congress on a bipartisan, bicameral letter pushing the IRS to further address its backlog and ongoing service issues. Read the full letter.

Posted Feb. 24, 2022

Concerns Regarding Schedules K-2 and K-3 Reporting

CalCPA is among 52 state CPA societies that joined the AICPA in sending a letter to Assistant Treasury Secretary Lily Batchelder and IRS Commissioner Charles Rettig regarding widespread concerns on the Schedules K-2 and K-3 reporting. The Feb. 24 letter states, in part: "The AICPA and state CPA societies across the country call on the Treasury Department and the IRS to delay implementation of the Schedules K-2 and K-3 to 2023 (the 2022 tax year filing season) and to suspend any assessment of penalties against Partnerships or S Corporations for failing to file or failing to timely provide Schedules K-2 and K-3 for the 2021 tax year." Read the full letter.

IRS to Ease Automated Penalty Notices; AICPA Comments

Following calls by the Tax Professionals United for Taxpayer Relief Coalition and members of both the Senate and the House for the IRS to provide meaningful relief to taxpayers ahead of this tax filing season, the IRS announced its intention to stop some notices to taxpayers as they increase resources to process backlogged files. The AICPA believes this action is a positive first step, but more should be and could be done by the IRS, without the need for congressional action, to reduce erroneous automated notices and unnecessary taxpayer contact with the IRS. READ MORE

CalCPA Committee on Taxation/FTB Liaison Meeting

The CalCPA Committee on Taxation held its annual liaison meeting with the FTB in October 2019 and discussed various topics related to tax administration. Download meeting materials:

IRS Issues Guidance

Section 199A

To address longstanding questions regarding treatment of deductions for qualified business income (Section 199A) the IRS recently released regulations, guidance, and FAQ’s. Section 199A, which was born through the Tax Cuts and Jobs Act, the IRS recently released guidance on how to navigate these new provisions. Under Section 199A, owners of sole proprietorships, S corporations or partnerships are able to deduct up to 20% of qualified income earned by the business. While the section is seen as a potential benefit to pass-through entities, questions surrounding definitions and the overall process on how this section would work proved to be an obstacle for CPAs who were trying to advise their clients on how best to move forward under these new regulations.

The newly released regulations provide much anticipated guidance on including who is able to claim the deduction, clarity on definitions such as what is considered a qualified trade or business, ect. Most importantly, the guidance explains how the section works. The IRS will be taking comments on these regulations through mid-October. At their September meeting, CalCPA’s Tax Committee will be discussing these emerging issues and what area may need additional guidance or how the provisions will impact different types of clients.

Additionally, the IRS is expected to release additional regulations in the near future related to how state charitable deduction programs should be treated. With California and a number of states pushing serious proposals to manage new SALT deduction caps, the IRS is expected to weigh in on whether the IRS will accept tax deductions for contributions under newly established state sponsored charities. The IRS has already cautioned against such proposals, but has yet to publish and official opinion. Their position could dramatically impact state tax policy next year.

Section 170(a)(1)

In late August, the IRS released proposed regulations on Section 170(a)(1) addressing the controversial $10,000 cap on state and local deductions, most commonly referred to as SALT deductions. In reaction to the new federal tax code, many states that were negatively affected by the American Tax Cuts and Jobs Act, including California, were looking at possible workarounds to the newly established cap. Without any guidance from the IRS, states thought up creative ways to bypass the cap. Senate Bill 227, authored by Senator Kevin De Leon, would have established a charitable fund within California's general fund that would exchange taxpayers contributions for a state tax credit they could use against their federal taxes. That measure has since died in the legislative process. Legislation, like SB 227, has already passed in New York, New Jersey and Connecticut. 

The IRS's proposed regulations would essentially block these workarounds. The regulations state that if a taxpayer receives a benefit for having made a charitable contribution, then that taxpayer must reduce the amount claimed as a charitable deduction on their federal return. However, if the credit is under 15%, then the taxpayer would receive the full deduction.

Below are links to the proposed regulations as well as articles that provide a brief summary:


Federal Subcommittee

Fed Tax - Powers of Attorney by Stuart Josephs, (Dec. 2017), p. 23

Tax Reform Legislation - Highlights by AICPA, (Dec. 2017), p. 6

Fed Tax by Stuart Josephs, (Oct. 2017), p. 23

IRS News by CalCPA, (Oct. 2017), p. 8

IRS News - IRS Office of Appeals Pilots Virtual Service by CalCPA, (Sept. 2017), p. 9

Fed Tax - Portability Elections - IRS Provides Simplified Method to Obtain Extensions by Stuart Josephs, (Aug. 2017), p. 31

Fed Tax - What's To Come - The Uncertainty of Potential Tax Reform by David Klasing, (July 2017), p. 21

IRS Responds - Chief of Appeals Answers CalCPA's Letter to IRS by Stuart Josephs, (June 2017), p. 19

Fed Tax Update by Stuart Josephs, (May 2017), p. 8

Fed Tax Update by Stuart Josephs, (Mar./Apr. 2017), p. 19

Fed Tax Update by Stuart Josephs, (Nov. 2016) p. 9

Fed Tax - Retirement Plans - Possible Relief for Missing 60 day Rollover Deadline by Stuart Josephs, p. 23

Fed Tax Update by Stuart Josephs, (Sept. 2016) p. 8

IRS News by IRS, p. 9

Proposed Improvements to Disclose Requirements for Income Taxes by FASB, p. 11

IRS News - IRS Security Summit by IRS, (Aug. 2016) p. 3

IRS News - IRS Data Show Tax Gap Growing by IRS, (June 2016) p. 5

Inherited Property - Consistent Basis Required for Income & Estate Taxes by Stuart Josephs, p. 23

IRS News - IRS Resources @ your fingertips: EITC Due Diligence by IRS, (May 2016) p. 10

Fed Tax Update by Stuart Josephs, (March/April 2016) p. 7

Fed Tax - New Tax Laws by Stuart Josephs, p. 23

Fed Tax Update by Stuart Josephs, (Jan./Feb.) p. 7

State Subcommittee

CA Tax - Step Forward - Voluntary Disclosure Programs/Agreements by David Klasing, (Jan./Feb. 2018), p. 21

FTB, POA Updates by Kelly Bluth, (Jan./Feb. 2018), p. 18

CA Tax - California Changin' - Governor Signs Two Key Bills by Mo Huda, Anna Ferraro, John Clausen and Barry Weissman, (Dec. 2017), p. 21

CA Tax - California Competes by David Klasing, (Nov. 2017), p. 23

FTB News by CalCPA, (Nov. 2017), p. 10

CA Tax - BOE's New Look by David Klasing, (Sept. 2017), p. 20

FTB News by FTB, (June 2017), p. 8

FTB News - What's New for 2016 Tax Returns by FTB, (Mar./Apr. 2017), p. 7

FTB Meets COT-Summary of Annual Q&A Session by Stuart Simon, (Jan./Feb. 2017), p. 23

FTB Updates by David Flamer, p. 23

Tax Due Date Conformity by CalCPA GR, (Oct. 2016) p. 6

FTB News - 2016 State Income Tax Rates adjusted for Inflation by FTB, p. 8

Taxing Changes - State Controller Releases Framework for Tax Reform by Jason Fox/Kasey O'Connor, p. 35

10 Pitfalls - FTB Tips on Avoiding POA Declaration Setbacks by Bob Reynolds & Kelly Bluth, p. 23

FTB News - College Access Tax Credit by FTB, (Jan./Feb. 2016) p. 6

CATax - COT-FTB Recap - Top Tax Delinquents, BOE Updates Discussed by Leonard Williams, p. 23

General Information

Tax Season Tool Kit - 2017 CA Tax Update, by Stuart Josephs, (Dec. 2017), p. 19

FastTaxFacts by CalCPA, (Nov. 2017), p. 11

Changes to BOE by Jason Fox, (July 2017), p. 25

Committees Eye Future - Tax Reform and BOE Troubles by Jason Fox, (June 2017), p. 25

Spring is Sprung - Legislature Gears Up for a Busy Session by Jason Fox, (May 2017), p. 89

CA Tax Highlights - CDP Information & a Bitcoin Breakdown by David Klasing, (May 2017), p. 27

Proceed with Caution - Pitfalls in the Preparation of Trust Income Tax Returns by Erin S. Fukuto (Mar./Apr. 2017), p. 11

Financial Pioneering - Tax Planning in an uncertain Environment by Gina DeRosa, p. 12-13

FedTax - Partnership Audits - New, Centralized System for Tax Years Coming in 2017 by Stuart Josephs, p. 31

AICPA Recommends Changes in Estate Tax Basis Rules by AICPA, (July 2016) p. 4

MyFTB - The Ins and Outs of Moving to a New Service by Gina DeRosa, p. 20

FTB News - Enhanced MyFTB Online Services Available by FTB, (March/April 2016) p. 6

Member Alert - TPRs and Form 571-L, Business Property Statements by FTB, p. 10

Estate Planning - Basis Step Ups - Estate Property: Estate and Income Tax Considerations by Erin Fukuto, (March/April 2016) p. 16

FTB News - College Access Tax Credit by FTB, (Jan./Feb. 2016) p. 6

IRS News - Advisory Council Makes Recommendations to IRS by IRS, p. 10