1/12/2017 · SWART ENTERPRISES, INC.
Plaintiff and Respondent, v. FRANCHISE TAX BOARD, Defendant and Appellant. F070922 Decided: January 12, 2017 Kamala D. Harris, Attorney General, Paul D. Gifford and Diane Spencer Shaw, Assistant Attorneys General, Molly K. Mosley, Jane O’Donnell, and Craig D. Rust, Deputy Attorneys General, for Defendant and Appellant.
Swart timely filed a complaint seeking a tax refund and declaratory relief. After briefing and argument on the parties’ cross-motions for summary judgment, the trial court entered an order granting Swart’s motion for summary judgment and denying the FTB’s motion for summary judgment. Swart was awarded a refund in the amount of $1,106.71.
Overview. On January 12, 2017, the California Court of Appeal issued a published decision in Swart Enterprises, Inc. v. Franchise Tax Board, 7 Cal. App. 5th 497 (2017), holding that an out-of-state corporation was not “doing business” in California within the meaning of Cal. Rev. & Tax Code Section 23101 when the corporation’s only connection to …
3/18/2016 · Swart challenged the FTB’s determination and appealed the case to the Superior Court of California for Fresno County. On appeal, the trial court agreed with the LLC members and held that “[p]assively holding an investment does not appear to constitute ‘doing business’ or [being] actively engaged in a transaction for gain or profit.”, 2/23/2017 · Swart Enterprises , Inc. v . FTB, 7 Cal.App.5th 497, 212 Cal.Rptr.3d 670 (Jan. 12, 2017). Full Opinion at https://goo.gl/szvOng For more on this issue, see Peter J. Reilly’s write-up here .
Swart Enterprises, Inc. (Swart), is a small family-owned corporation, incorporated in Iowa. Swart operates a 60-acre farm in Kansas, where it occasionally feeds cattle for beef sales in Nebraska.
On January 12, 2017, the Court of Appeal issued a published decision in Swart Enterprises, Inc. v. Franchise Tax Board (Cal. App. 5th Dist. 2017) 7 Cal. App. 5th 497 (“Swart”). In this case, the Court of Appeal held that Swart Enterprises, Inc.
an Iowa corporation (Foreign Business Entity), was not doing business in California and therefore was not subject to the $800 minimum franchise tax the Franchise Tax Board (“ FTB.
The California Office of Tax Appeals (OTA) recently released to the public an opinion dated September 25, 2018 that rejected the California Franchise Tax Board’s (FTB) extremely narrow interpretation and application of Swart Enterprises, Inc. v. Franchise Tax Board, 7 Cal.App.5 th 497 (2017) involving California’s “doing business” standard.
A California Superior Court (trial court) recently issued a ruling in favor of the taxpayer in Swart Enterprises, Inc. v. California Franchise Tax Board (“Swart”). 1 In its ruling the court concluded that an Iowa corporation, whose only connection to California was its passive membership in a manager-managed California limited liability company (“LLC”), was not “doing business” in California and was.
10/23/2018 · The FTB reached a limit in Swart Enterprises , Inc. v . Franchise Tax Board , Cal. Ct. App. (5th App. Dist.), 7 Cal. App. 5th 497 (2017). In that case, a California appeals court ruled against the FTB’s claim that a foreign corporation with a passive .02% ownership in a California LLC was doing business in California.
