Square Inc. Lacks Valid Claim Against California Income Tax

Incorrect statements from the California Franchise Tax Board aren’t enough for Square Inc. to have a valid claim for refund that it can appeal to the Office of Tax Appeals, a panel of the office’s judges said in an opinion posted Tuesday.

Without a valid refund claim, the office lacks jurisdiction to consider the payment processing company’s appeal, in which Square argues it’s a financial corporation instead of a general corporation for tax purposes. The company’s corporation type could change its ability to use net operating loss carryovers in various years, according to the opinion. ...