SACRAMENTO – Senator Ted Gaines (R-El Dorado) today reported that, per his request, the Franchise Tax Board (FTB) has put into place a dedicated study team to evaluate the taxation of California National Guard Bonus repayments.
“I called on the FTB to create a special task force to aid California National Guard veterans who may need to file amended tax returns resulting from the resolution of this bonus scandal and am pleased to hear they are moving forward,” said Senator Gaines. “I want these veterans to have FTB staff specifically dedicated to their plight so they are not mired in bureaucracy when trying to resolve their tax status. I appreciate the FTB working with these service men and women to ensure our veterans are being honored for their service and not suffering from this betrayal at the hands of the Pentagon.”
The FTB reports that they have reached out to the Internal Revenue Service (IRS) requesting information on the IRS interpretation of the federal tax consequences of the bonus repayment and are awaiting a response.
The FTB is also awaiting the final decision from the Department of Defense regarding the repayment of bonuses. Once the appropriate information is received, the FTB will take action to notify taxpayers and tax professionals of the appropriate tax treatment.