Executive summary Taxpayers’ Bill of Rights Annual Report to the Legislature

Like many in state government, we realized just days into 2025 that the year would require special assistance to survivors of devastating disasters. Shortly after the Palisades and Eaton fires ignited on January 7, 2025, in Los Angeles County, the Franchise Tax Board (FTB) joined a multi-agency effort to help survivors rebuild their lives at disaster centers set up near the fire-ravaged communities.

FTB also began planning for state tax relief, such as delaying bills and notices and extending last year’s tax filing and payment due dates from April 15 to October 15 for individuals and businesses in Los Angeles County. And we created new FTB services for survivors, including a dedicated customer service phone line and email address.

Our staff found it humbling and fulfilling to assist the nearly 5,600 survivors who visited several Los Angeles-area Disaster Recovery Centers, where we explained how they could claim a disaster loss, obtain copies of tax returns, change their addresses and more.

Across California in Fiscal Year 2024/2025, FTB staff assisted 6,134 survivors at 13 recovery/assistance centers associated with fires.

Over the last five years, natural disasters and COVID-19 have taught FTB staff to expect the unexpected and pivot quickly to address new challenges, including those posed by one of our largest and most consistent threats—Fraud.

FTB’s Fraud Prevention Team blocked nearly $600 million in improper refunds in Fiscal Year 2024/2025 thanks to their expertise and hard work.

Our approach to identifying and combatting fraud – including various scams and identity theft – is constantly evolving because of the relentless attacks and innovations by bad actors. Last year, for example, we and our state and federal partners battled a texting scam that asked taxpayers to click on a link to a fraudulent version of certain FTB webpages designed to steal personal and banking information.

Historically, tax fraud was largely focused on individual taxpayers. More recently, the expansion of refundable business credits at the federal level has changed aspects of the fraud landscape. FTB continues to adapt its fraud prevention tools and partnerships to address these evolving risks.

Thankfully, we’re not alone in this fight. Our partnerships with other state and federal agencies – including the California Department of Technology, California Highway Patrol, and Federal Bureau of Investigation – have enabled us to stay ahead of fraudsters and their ever-complex and evolving schemes.

Defending against cyber threats was a priority while completing our Enterprise Data to Revenue (EDR2) IT modernization project. Multiple levels of vendor-tested security were built into EDR2 which, among other things, has replaced our aging audit, collections, and filing enforcement systems.

Implementation of EDR2, the second of three planned phases over a 30-year period, was on track in late 2025 to be completed within budget and on time – no later than January 2026. Here’s a small sample of EDR2’s benefits to taxpayers:

• Implementation of new data sources and computer modeling designed to improve our tax collection efforts and to help FTB select tax returns for audit. We expect that over time both will help shrink the gap between the taxes owed and paid.
• Enhanced self-service tools to improve customer experience, including the following:
• Thanks to an expanded MyFTB, individuals can view and print tax computations, view lien and levy information, view protest and hearing information, and more.
• Suspended businesses can apply for a Certificate of Revivor by using our website, or by logging into their MyFTB account.
• Businesses can apply for and manage payment plans in their MyFTB accounts.
• Taxpayers, financial institutions, and employers can respond to a notice online without a MyFTB account.

Beyond EDR2, our continued focus on improving customer service led to the creation of new educational videos. They address some of FTB’s most frequently asked questions, and they direct customers to our self-service tools. Topics for new videos added to our website or YouTube channel include making an online payment via our Web Pay service, checking your refund status with our “Where’s my refund?” page, avoiding and reporting fraud and, for businesses with a balance due, setting up an installment plan online.

Another step we take to ensure FTB offers taxpayers excellent products and services is to create a workplace where our roughly 6,000 employees feel welcomed, valued, and motivated to always bring their best, regardless of background, culture, or personal experience.

Finally, we value and listen closely to the tax professional community, with whom we maintain an open and constructive dialogue. We all share a commitment to ensuring every taxpayer is treated respectfully and files an accurate tax return.

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.

Selvi Stanislaus

Executive Officer