Tips for Filing
Where to send clients’ copy of the "state copy" of an Information Return?
You may be asked by your client where they need to send the “state copy” of an information return. If they filed paper returns with IRS, they do not need to send a paper copy to us. IRS will forward the information to us, whether you are located in or out of the state of California. Any person, including a corporation, partnership, individual, estate, or trust that makes reportable transactions during a calendar year, must file the appropriate information returns (such as a Form W-2, Wage and Tax Statement or a Form 1099) to report those transactions with IRS and us. They are required to furnish each employee a completed Form W-2, and each other payee a completed Form 1099 by January 31. The due date to file electronically with us is March 31.
Generally, our reporting requirements are the same as IRS reporting requirements. See A Guide to Information Returns on the IRS website for a list of all the required returns and what to report.
Your client can use the IRS Combined Federal/State Filing Program, and they will only have to file once. IRS will forward the California returns to us. Only the following forms may be filed under this program:
To request approval to participate in the IRS Combined Federal/State Filing Program, see IRS Publication 1220, Specifications for Filing Forms 1098, 1099, 5498, and W-2G Electronically, or call IRS Information Reporting at 866.455.7438.
We accept the IRS extended due date of March 31 for electronically-filed Forms 1099, 1098, and W-2G. IRS has not extended the due date for filing Form 5498 electronically.
If your client has an exception that requires them to report something different for federal and state purposes, such as a different dollar amount, they will need to file separate returns with IRS and us.
While we encourage them to file electronically, they may file up to 249 paper returns. If they file 250 or more returns, they must file electronically. Mail paper returns to:
FRANCHISE TAX BOARD
PO BOX 942840
SACRAMENTO, CA 94240-6090
Email IRPhelp@ftb.ca.gov if you have questions or comments.
April 17 Filing Date
Due to the Emancipation Day holiday on Monday, April 16, tax returns filed and payments mailed or submitted on Tuesday, April 17, will be considered timely.
What are the common errors taxpayers should avoid?
The top three common tax errors:
- Claiming incorrect estimated tax payments.
- Deducting the wrong amount for the standard or itemized deductions.
- Selecting the wrong amount of tax from the tax table on paper tax returns.
To avoid these errors, we suggest taxpayers:
- Go to ftb.ca.gov and access their account to verify the amounts we have on record for their estimated tax payments, wage and withholding information, and current balance due.
- Accurately add and transfer their total deductions to the correct line of the tax return.
- Double-check that they transferred the correct amount of tax from the tax table.
What should your clients do if they cannot file by April 17?
No problem. All taxpayers get an automatic six-month filing extension to October 15. The extension is only for filing tax returns and not for payment of any taxes that may be due. Be sure to pay the total tax due by April 17 to avoid penalties and interest.
What if your client owes and cannot pay?
First, your clients should always file on time and pay as much as they can with their tax returns. This saves them money in penalties and interest. We realize that unforeseen events occur that prevent your clients from paying their taxes on time.
Your clients, with a financial hardship who cannot pay their taxes in full, can generally arrange to make monthly installment payments if they owe $25,000 or less, and can repay within five years.
Your clients can apply for installment agreements online or by mail. Taxpayers can go to ftb.ca.gov and search for installment agreement. We can approve most requests within a few days. For more information, call 800.689.4776.
Your clients may pay taxes by credit card. We accept Visa, MasterCard, Discover/NOVUS, and American Express.
Website: Official Payments Corporation: www.officialpayments.com.
Telephone: 888.2PAY.TAX or 888.272.9829.
Service providers charge a convenience fee for this service based on the amount charged.
What is use tax and how do you know if your clients owe it?
California law requires residents to pay use tax on purchases made from out-of-state sellers, such as by telephone, Internet, mail, or in person if:
- The seller does not collect California sales or use tax.
- You use, give away, store, or consume the item in California.
New this year, taxpayers can use a "look-up" table to report their use tax obligations on their state return. The estimated amount of use tax due is based on the person’s adjusted gross income. Taxpayers can go to boe.ca.gov for more details.
We advise you to check your clients county property tax bill when deducting real estate taxes as an itemized deduction
We provide guidance to property owners in understanding how to correctly deduct real estate taxes as an itemized deduction on their tax return. Many property owners deduct the entire amount paid from their property tax bills on their state and federal tax returns. This is incorrect as most counties impose special assessments, parcel taxes, fees, and charges that are usually nondeductible.
We advise taxpayers to examine their county property tax bill to determine the deductible and nondeductible portions. Our website provides guidance, including a sample copy of each county’s property tax bill that highlights what amounts are generally deductible and nondeductible. Taxpayers should not rely on the federal Form 1098, Mortgage Interest Statement, which may include information on the total amount of taxes and insurance paid from an impound account.
Beginning in 2012, we plan to add reporting requirements related to real estate tax deductions taken on your return. This may include the property parcel number, deductible, and nondeductible amounts. For more information about the real estate tax deduction, visit ftb.ca.gov and search for real estate tax.
Your clients concerns after filing their tax returns
As the end of filing season approaches, taxpayers contact us with questions or concerns they have after filing their tax return. The following information can help you answer those questions or concerns.
When can my client expect their refund?
e-file - Refunds from e-file returns are usually issued within seven to ten business days from the date the return is accepted. Your client can also request to have the refund directly deposited into a bank account usually within five to seven business days.
Paper returns - Direct deposit of refunds for paper returns are deposited in six to eight weeks about the same time it takes to issue a paper warrant.
How can my client check their refund status?
Your client can check the status of their current year refunds online or calling 800.852.5711. This service is also available in Spanish.
My client sent the check without the payment voucher.
We will cross reference and accept the check, but if this is the first time the taxpayer is filing the tax return, we might need to contact the taxpayer.
My client cannot pay what is owed on the tax return.
If your client is unable to pay the tax owed in full, the taxpayer can make a request for monthly payments. However, interest accrues and an underpayment penalty may be charged on the tax not paid by April 17, 2012, even if the request for monthly payments is approved. To make monthly payments, complete form FTB 3567, Installment Agreement Request, online or mail it to the address on the form.
My client is due a refund for this year, but has a balance due from a prior year or a nontax debt being collected by us; will my client get the refund?
No. All refunds are subject to intercept. Refunds from joint returns may be applied to the debts of either the taxpayer or spouse.