Having their status changed from "Suspended" to "Active" means that they have paid their taxes and are now in good standing with the State of California.
Effects Of Suspension
Whichever agency suspends a corporation will mail the corporation a suspension notice, at which time the corporation is thereafter disqualified from exercising its corporate powers, rights and privileges. In other words, the corporation cannot legally operate.
Until the corporation corrects its suspended status the corporation will be unable to transact any business, answer a lawsuit filed against it, initiate litigation, or protect and preserve its name. Any contract executed by a suspended corporation is voidable at the demand of the other party. And, any person who attempts or purports to use any of its corporate privileges is subject to fines and/or imprisonment. The only exceptions to the loss of corporate privileges upon suspension are that the corporation may (1) change its name by amendment to its articles of incorporation, and (2) apply to the FTB for tax-exempt status. Nevertheless, all suspended corporations are still required to pay all the applicable taxes and to file tax returns (even if no money is earned).
The FTB will issue a delinquent penalty for failure to file a timely tax return of 5% per month up to a maximum of 25%. Interest begins on the original due date of the return. The FTB will issue a demand penalty when a corporation fails or refuses to furnish information requested by the FTB or fails to file a tax return after written notice and demand. In either case, the demand penalty is 25% of the FTB's assessment of what is owed or 25% of the tax shown on the return when filed before any refundable credits and payments from the original notice to the date full payment is received.
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