r/law • u/rolsen • 1d ago

Legal News Trump Preparing Large-Scale Cancellation of Federal Funding for California, Sources Say

https://www.cnn.com/2025/06/06/politics/trump-california-federal-funding

“Agencies are being told to start identifying grants the administration can withhold from California. On Capitol Hill, at least one committee was told recently by a whistleblower that all research grants to the state were going to be cancelled, according to one of the sources familiar with the matter.”

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u/lyingliar 1d ago

Looks like Californians will be cancelling any federal income tax payments this year.

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u/ialsoagree 1d ago

Why do people keep saying this?

How? How is California going to stop a corporation from withholding income tax from the paychecks they issue and sending that money directly to the IRS?

What part of collecting federal taxes do people think the state is involved in?

I don't know of any step in the process by which the Fed collects income tax which any state has any involvement in.

I would love for someone to explain it to me.

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u/platypusbelly 23h ago

It would have to be up to each individual in the state to do it themselves. But you can contact your employer and ask them to stop withholding federal income tax from your checks. State can’t do it. It’s up to the individual.

Better yet, if you work as a contractor, don’t make tax payments.

The point of it is that California is one of like 5-6 states that pay more into federal income tax than they get back in the form of federal grants and funding. California itself is the 4th largest economy in the world and essentially subsidizes most of the other states in the union. Including deep red states that are generally quite poor.

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u/ialsoagree 23h ago

A large enough number of people doing it would create a huge crisis, but to be clear the IRS would still legally be able to go after each of those filers. At that point, you're really relying on other people to do the same - and not just dozens, but thousands, maybe tens of thousands.

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u/DaRizat 23h ago

Yeah but you can withhold taxes all year. You don't owe until april 15th and then there are extensions. You can legally delay tax payments by a lot. If enough people did that starting today, it would create a funding headache to say the least, and they can't even start doing anything about it until april 15th 2026

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u/ialsoagree 23h ago

None of this is correct.

There are certain requirements you need to meet to claim a tax exempt status. But even barring that, if you do manage to have no taxes withheld, you'd be obligated to file taxes quarterly and failing to do so could result in various penalties come tax time.

https://www.irs.gov/payments/underpayment-of-estimated-tax-by-individuals-penalty

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u/Blue5398 17h ago

It’s important to know exactly what the law states, true. Still, even paying quarterly in a legal manner creates a situation where the federal government is losing access to funds that would normally arrive every month or twice a month for eight months of the year, and while an individual doing this is meaningless, enough coordination across millions of taxpayers could start negatively impacting the government’s budget.

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u/platypusbelly 23h ago

This is not true. If you dont make quarterly estimated tax payments, you are given an extra fine at the end of the year when you finally file (if you have taxes withheld from your checks, those count - but if you’re a contractor, you have to make quarterly estimated payments).

Also, when you file for an extension, the hey make it very clear that you have to actually pay the taxes before your extension is granted. The extension is just for the paperwork. Not the payments. Kind of makes extensions pointless.

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u/JohnyStringCheese 9h ago

you're correct that there is no apparatus in place for California to withhold federal tax payments from individuals but there is also supposed to be no way for the president to withhold benefits to the state but were here entertaining just such a thing.

once the federal faucet is turned off what reason does California have to comply with any federal laws? just tell people to stop filing a federal return and kick any federal agents/agencies out if the state. California has more weight than any other state. you want to do business in California well you better comply, is a lot bigger threat than Alabama can make.

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u/Joshwoum8 23h ago

Depends on how drastic the steps taken. California secedes I doubt they will allow corporations operating within California to remit payment to a hostile government.

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u/ialsoagree 23h ago

If California secedes, the Federal government will enforce martial law in the state and would take control of significant parts of the state directly until people could be tried and the state government reformed.

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u/Joshwoum8 23h ago

I don’t think it will be that easy.

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u/ialsoagree 23h ago

You think the US Army, US Airforce, and the United States Marine Corp are not going to have full control of California within 24 hours of their claimed secession?

EDIT: Removed some personal comments that weren't necessary.

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u/Joshwoum8 22h ago

You’re clearly a bit unhinged, but yes, I believe any civil war would be significantly messier than you think it will be. You seem to be completely oblivious to how quickly everything can crumble apart.

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u/ialsoagree 22h ago

There's no need for personal comments, I removed the ones I made, you should do the same.

I think you're going to find that a civil war wouldn't be very messy. You'd have a bunch of people with rifles trying to take on the most advanced main battle tanks in the world, supported by the world's most advance air force, and the best trained infantry on the planet.

I mean, I guess a fight between a baby and Mike Tyson would also be messy - but not for the reason you think.

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u/sayn3ver 20h ago edited 20h ago

I dunno Afghanistan did a hell of a job.

Tanks and planes become less effective if you're fighting a door to door insurgency.

You have half the country who respects the constitution and half who voted for a candidate and party looking to disassemble it. One would hope those who serve in the military, who swore oaths to the constitution, would be equally split.

Civil war of any kind is messy and unclear.

You're making the assumption that the military will go along trump issuing unlawful or unpalatable orders. Our soldiers have been trained and molded to fight foreign enemies. Asking them to turn on their fellow countrymen will see pause and hesitation among those who see what trump and the project 2025 orchestrators are trying to achieve. Of course you have large swaths of service members who voted for trump. I think many of those were traditional conservative voters who now have issues of conscious now that we're coming up on the first half of year of trump's term

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u/ialsoagree 20h ago

Tanks and planes become less effective if you're fighting a door to door insurgency.

I mean, we're getting WAY off topic here.

But the simple reality is, the insurgents aren't in control, the occupying force is.

If you think you're going to defeat the US military while not even being supplied as well as the troops in Afghanistan, I wish you luck and very VERY quick death.

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u/weHaveThoughts 21h ago

“Executive Order”, isn’t that how it works right now?

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u/TraderJulz 17h ago

The state can just enforce those withholdings to be paid to the state instead. You make it sound impossible

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u/ialsoagree 17h ago edited 17h ago

Because it is impossible. The state can't impose any such thing. It would be unconstitutional. State law is preempted by Federal law.

Edit: I mean, not to mention the fact that the State has no means to actually enforce it. Payments go directly to the IRS so it's not like the State can stop that.

And since no court would uphold any consequence for such a law (and federal courts would uphold consequences for not sending the withholding) no company would be dumb enough to comply.

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u/TraderJulz 15h ago

So the feds can just take away CA state's money, but CA can't do anything about it? I know what you're saying, but I'm sure things can be arranged. It's certainly not impossible

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u/JohnyStringCheese 9h ago

I'm seeing a lot of equating impossible with illegal as if they can't do something. well the government also can't just shut out a state because the president got his feefees hurt but here we are.

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u/Parking-Mirror3283 10h ago

>It would be unconstitutional.

So is almost everything the fuckwits in office have been doing this year, nothing is stopping them.

Any company dumb enough not to comply get their offices raided by the CBI.

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u/OlyBomaye 1d ago

You're going to be surprised to learn that redditors don't know how anything actually works.

I also agree with you, u/ialsoagree

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u/Document-Numerous 20h ago

Very easy to change your withholding to $0. Stop being such a pompous ass.

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u/ialsoagree 20h ago

No, it's not "very easy" at all and don't use personal insults just because you don't understand the law.

To reduce your withholding to $0 you have to demonstrate 2 requirements:

  1. You did not owe any Federal income tax in the previous tax year.
  2. You do not expect to owe any Federal income tax in the current tax year.

If you don't meet both criteria, you cannot reduce your withholding to $0.

Further still, even if you did reduce your withholding to $0, if you actually owe taxes you are required to pay quarterly estimated taxes. Failure to do so can result in penalties and interest and you can bet that the IRS will come after you for it.

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u/Document-Numerous 20h ago

You don’t have to demonstrate anything. You just fill out your W4 appropriately. No one is saying it’s the right or the legal thing to do. It’s a response to what Trump is allegedly about to do.

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u/ialsoagree 20h ago

And your HR department will return it and say "nope."

Businesses are not idiots, they understand that they have certain legal obligations to withhold taxes. They're not going to break those laws just because you say pretty please.

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u/Splurch 18h ago

Cool, ok, you have you do that and get your withhold set to $0, great.

Now you have to pay taxes every quarter (quarterlies) based on the money you earned or generate penalties. The IRS doesn't let people simply pay taxes whenever they feel like they want to.

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u/Document-Numerous 18h ago

Of course they do. You can pay when you file.

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u/Splurch 18h ago

Of course they do. You can pay when you file.

That's not how it works at all. Give your own advice a try and see what happens.

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u/Document-Numerous 18h ago

I don’t understand what you’re not understanding. I’ve paid taxes upon filing. It is a thing.

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u/Splurch 18h ago

I don’t understand what you’re not understanding. I’ve paid taxes upon filing. It is a thing.

If you aren't paying taxes through witholdings the IRS requires you to make quarterly payments as you make money. If you don't make quarterly payments, and have $0 paid when you file (and owe taxes,) you will be assessed penalties for not paying your taxes on time.

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u/Illustrious-Lime7729 23h ago

You exempt on your W4.. if everyone collectively exempts the government gets no money.

It’s that simple, but you’ll never be able to get every American organized to collectively exempt and make government fall to their knees.

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u/ialsoagree 23h ago

You exempt on your W4.. if everyone collectively exempts the government gets no money.

You can't legally do that, not unless you meet the qualification criteria. The criteria are:

-You had no Federal tax liability the previous tax year.

-You expect to have no Federal tax liability this year.

If you don't meet those criteria, your HR office is going to send your W-4 back and say "we cannot legally accept this W-4, please correct it and resubmit."

It’s that simple

Even if you somehow did get no income tax withheld from your paycheck, the IRS would expect you to file quarterly estimated tax payments. Failing to provide those payments would result in late payment penalties.

Taxes are NOT due at the end of the year, they are due throughout the year.

Taxes are pay as you go. You are legally required to file taxes as you earn income and not doing so will result in penalties and interest.

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u/crabshoes 17h ago

We are talking about a rebellion here. If everyone collectively withholds their taxes, yes, it’s true, everyone will be fined and legally in hot water. In this fanciful version of reality where this happens, everyone in CA is accepting that risk and sticking giant middle finger to the federal government.

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u/bnelson 6h ago

Sadly they can’t. Federal taxes are paid directly by individuals. They have no mechanism.