I recently found out that as a business owner I had to issue form 1099-MISC to independent contractors, like, plumber who once fixed sink in our salon. Also, apparently I had to issue 1099-MISC because I was renting out premises where I do business.
However, back in 2011 I did not know that I had to issue 1099 for those two cases.
Now the FTB is inquiring about my missing 2012 tax return because back in 2011 I forgot to mark "Final" checkbox on my 565 form because we changed business structure from General Partnership to Sole proprietorship after the other partner left. I sent to FTB amended 2011 tax return with "Final" marked and everything else being the same. FTB told me that this 2011 tax return will go through their audit department.
Will FTB possibly now take away all my tax deductions that I claimed back in 2011 and for which I did not issue form 1099?