program's record-breaking year
The Franchise Tax Board's (FTB) filing enforcement (FE) program collected a record breaking $524 million this past year. During fiscal year 2005-2006 our nonfiler program issued:
- 754,613 Request or Demand for Tax Return letters.
- 509,066 Notices of Proposed Assessment.
As of August 31, 2006, we have received approximately 200,000 tax returns.
Each year we receive more than 160 million information records. The records come from the Internal Revenue Service, the State Employment Development Department, the State Board of Equalization, employers, and banks. FTB also receives information on occupational licenses and mortgage interest payments. We match these records against our records of tax returns filed. If there is no return on file, we notify the taxpayer with a Request or Demand for Tax Return letter, and give them time to respond.
Taxpayers' top five reasons for explaining why they didn't file their tax returns on time:
- "A major life event occurred." Divorce topped the list, with death of a loved one a close second.
- "I didn't have the records needed to file."
- "I didn't have the money to pay."
- "I didn't have the tax forms."
Some of the more creative responses include "I have emotional problems concerning doing my taxes," and "This year I filed my return about a year sooner than last year." In other words, "I'm getting better!"
We continuously strive to improve our filing enforcement program, and the services that are available to both the taxpayer, and the tax preparer communities. Listening to the feedback we receive from preparers and taxpayers prompted us to implement some new services that you may not be aware of:
- A 24x7 Website at www.ftb.ca.gov/inc. At this Website, you can request additional time to file a tax return. This service may assist those who are experiencing a life crisis, or who need more time to obtain records to file a return.
- An online application to request payment arrangements. The application is available at www.ftb.ca.gov. Select the "Filing" tab at the top of the page. The link is located under "Paying your tax," "Request an installment agreement."
- Online ability to respond to the Request or Demand for Tax Return Letter. Either you or your client may access our 24x7 Website at www.ftb.ca.gov/inc. Enter the unique number from the letter, and select "I don't think I have a requirement to file." An online form will display, and guide you through providing the information we need to resolve your account. In most cases, if your client does not have a requirement to file, the case can be closed online, and you can print a confirmation letter from the Website.
We realize that our annual filing enforcement process can have a great impact on the tax preparer community. If you have any suggestions for improvements, we'd love to hear from you! Please contact Kurt Vickner at firstname.lastname@example.org with your suggestions and ideas.