Estimated Tax Payment – Mandatory e-Pay Requirement Reminder
As the 2011 tax year comes to close, we know that many of your personal income tax clients make their final 2011 estimated tax payment in December in order to deduct the payment on their 2011 federal return. We thought this would be a great time to remind you that some of your clients may be required to make their estimated tax payments electronically.
Individual taxpayers whose tax liability is greater than $80,000, or who make an estimated tax or extension payment that exceeds $20,000 for taxable years beginning on or after January 1, 2009, are required to make all future payments regardless of type, amount, or tax year electronically. Taxpayers who fail to pay electronically will be subject to the mandatory e-pay penalty of one percent of the amount paid unless the failure to pay electronically was for reasonable cause and not willful neglect (California Taxation and Revenue Code 19011.5).Taxpayers can request a waiver from mandatory e-pay if they meet certain requirements by filing FTB 4107, Mandatory e-pay Election to Discontinue or Waiver Request. We notify the taxpayer in writing if the request is approved or denied. If the individual granted the waiver later meets e-pay requirements, they must resume making payments electronically.
For more information on mandatory e-pay requirement, go to our website and search mandatory e-pay.