Executive summary Taxpayers’ Bill of Rights Annual Report to the Legislature
The Franchise Tax Board (FTB) navigated many new challenges over the past year amid the ongoing, once-in-a-century pandemic. We quickly adjusted to, and informed taxpayers on, a number of new COVID-19-related tax laws. We provided taxpayers with relief by delaying Tax Day for the second year in a row and balanced the responsibility of collecting 75 percent of California’s tax revenue with issuing payments from two multi-billion-dollar rounds of the state’s Golden State Stimulus program.
FTB continued to put a substantial emphasis on helping taxpayers cope with COVID-19’s economic impacts. In February, FTB suspended – until July 31, 2021 – collection activities under its Income Tax Refund Offset program. In March, consistent with the Internal Revenue Service (IRS), we pushed back the state tax filing and payment deadline for individual taxpayers from April 15 to May 17, 2021. This spring, we also extended the use of the e-Signature option – pushing the deadline back from December 31, 2020, to December 31, 2021 – for taxpayers and their representatives to submit paper returns and other documents. And we helped taxpayers experiencing financial hardship by offering payment plans and modifications of, or releases from, garnishment or levy.
In light of the pandemic, FTB curtailed in-person meetings by continuing to use alternative communication methods to interact with taxpayers for audit, claims, and protest programs. Extending a practice that began in 2020, we used virtual platforms to conduct new correspondence and field audits. We also granted more time for responding to document requests, and through the end of 2021, we will accept electronically signed waivers to extend the statute of limitations.
I’m especially proud of how FTB staff responded to this year’s urgent call to issue two rounds of Golden State Stimulus payments, bringing financial relief to millions of Californians. Upon enactment of both stimulus rounds, we quickly posted detailed eligibility information on the FTB website. Above all, we strived to balance the need to issue the payments as soon as possible with the imperative to ensure we sent the correct payment amounts to the right taxpayers.
Looking inward, FTB launched the next phase of its 30-year project to ensure operational excellence by modernizing its IT systems. We believe this next, five-year phase – the second of three – is essential to protect state tax revenue and ensure excellent customer service. Known by its acronym “EDR2,” the Enterprise Data to Revenue project will replace FTB’s aging audit, filing enforcement, and underpayment systems, which are close to 20 years old, on average.
As we strive to improve taxpayer services, we will continue to foster strong relationships with our stakeholders, especially tax professionals, whose input is invaluable.
With the above in mind, I humbly submit this year’s Taxpayers’ Bill of Rights Annual Report to the Legislature for your review. Thank you for your support as we work together to serve the great State of California.