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Franchise Tax Board Sends Amnesty Payment Reminders

The Franchise Tax Board (FTB) is mailing nearly 39,000 notices to taxpayers who applied for the recent tax amnesty program and filed all missing tax returns, but still have an outstanding tax balance. The notices give taxpayers 15 days to either pay their outstanding balance due in full or establish an amnesty installment payment plan, according to the FTB.

"Our successful tax amnesty program helped thousands of Californians clean up their tax issues-now, they just need to finish the process,“ said State Controller and FTB Chair Steve Westly. ”The program is bringing much needed revenue to the state without increasing taxes."

The tax amnesty program ended March 31, 2005. It was a limited time chance for taxpayers to file and pay their past due personal or business tax returns for years 2002 and prior without the fear of prosecution and free of most penalties and fees. Tax amnesty legislation contained in last year's state budget came out of an earlier bill introduced by Assembly member Judy Chu (D-Monterey Park) and cosponsored by State Controller Steve Westly and Board of Equalization Chair John Chiang.

If an individual or business fails to pay in full or set up an amnesty installment plan, the FTB may revoke the amnesty application. Revocation means the FTB will reinstate all canceled penalties and fees and impose a new amnesty-related penalty for the years the taxpayer applied for amnesty but did not complete the amnesty requirements. On amnesty eligible years, the penalty equals 50 percent of the interest that accrued on the balance due from the date the tax was due to March 31, 2005, the end of tax amnesty.

To apply for an amnesty installment payment plan, contact the FTB at (800) 689-4776, or visit their Website at www.ftb.ca.gov. Taxpayers may pay their taxes online at the FTB's Website by using Web Pay, which works much like a debit card, or by credit card at Official Payments Corporation (800) 272-9829 or www.officialpayments.com, or by mailing a check or money order to: Franchise Tax Board, PO Box 942867, Sacramento CA 94267-1111.

To date the FTB has processed 172,498 tax amnesty applications and deposited more than $262 million in tax amnesty payments. The FTB expects to receive an added $609 million in revenue by June 30, 2006, the ending date for amnesty payments made through installment payment plans.