Deferral period for installment agreement payments ends July 16, 2020 July 2020 Tax News
If you have been keeping up with our COVID-19 FAQs page, you are aware that similar to the IRS, we have placed a temporary suspension on the following collection activities through July 15:
- Personal income tax
- Business entity tax
- Nontax debt (court-ordered debt and vehicle registration collection)
This included Installment Agreements (IA).
If a taxpayer has an existing IA and was not able to comply with the terms, they could request to temporarily skip their payments until July 15, 2020, and we would not default the IA. However, the deferral period will end soon.
Beginning July 16, 2020 we will default IA if:
- A payment has been missed, and they did not request a skip payment.
- A new debt incurred during the deferral period that has now placed them outside of the IA criteria.
We will send a default notice, Notice of Intent to Cancel (Form 4021) if their IA is being defaulted.
If they receive a default notice and want to request an IA reset, contact us at (800) 689-4776, through Live Chat, or by secure email through your MyFTB account.
Any missed payments can be made up by July 16, 2020. Making up missed payments may not always prevent the IA from being defaulted. If they have made up any missed payments and receive a default notice, contact us.
If a taxpayer requested that their payments be skipped, they do not need to contact us now. Their installment plan will resume after the number of skip payments they requested has been completed.
The normally scheduled payment would resume on their normal date selected for the deduction. If the taxpayer did not request to skip payments, they will receive a notice of default for their IA. Any subsequent IA would be a new plan and not an extension of their prior plan. Interest will continue to accrue on their unpaid balance.
For those taxpayers still unable to make payments due to Coronavirus issues, they may be able to renegotiate their IAs by contacting us. Our staff are trained in assisting customers and have the administrative authority to:
- Delay, modify or release levies and garnishments.
- Allow for skipped Installment Agreement payments.
- Delay collection on accounts as warranted.
- Abate penalties when reasonable cause has been demonstrated;
- Place taxpayers into hardship or an installment agreement as warranted.
Going forward, our existing procedures will continue to be used. Taxpayers seeking an IA can request it online, by phone, by Live Chat or mail.