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Steve Sims, Taxpayers' Rights Advocate.

CalCPA Meeting Summary

On October 26, we attended the California Society of Certified Public Accountants (CalCPA) Annual Liaison meeting. Our staff gave updates on our filing season, audit matters, and collection policy information. We also participated in a question and answer session on emerging issues. The following are some of the questions and answers discussed at the meeting:

Mandatory E-Pay
Question: Several California Practitioners have expressed a desire we make better information available to practitioners when a taxpayer is subject to mandatory e-pay. Clients, especially new ones, are sometimes unaware that they are subject to it and incur penalties when they don’t use it. It has been suggested that information could be noted in their MyFTB Account page.

Answer: This suggestion is already being worked on, and is planned for implementation, within MyFTB Account, beginning January 2012.  
Payments Made to Accounts with No Balance Due
Question: A practitioner recently experienced a problem in attempting to have a refund check applied to a taxpayer’s account for 2010 which showed no tax due, but which would show additional tax due once an amended return for that year was processed. The practitioner had the taxpayer return the 2010 refund check with a letter explaining that an amended 2010 return was filed and the refund check was to be applied to the tax that would be due with the amended return. The amount of the refund was again refunded to the taxpayer with another check. A call to the Practitioner’s Hotline resulted in the following situation: It was suggested by the Hotline personnel that they couldn’t post a payment to an account that didn’t show a balance owing; therefore, we should wait until the amended return has been processed and the additional tax is added to the account. At that time, the refund check can be returned to us with request that it be applied to the balance due.

It seems that you are rather rigid and selective when it will and won’t accept payments made by taxpayers to be applied to a particular year. Is there any restriction on your ability to apply payments to tax years at the request of the taxpayer, either as a payment or deposit? If there aren’t restrictions, why won’t you accept these types of payments? If you are restricted in accepting these types of payments, might it be subject to proposed legislation to allow such authority?

Answer: Unfortunately, since the refund was submitted prior to the amended return being processed, due to system limitations, another refund was issued to the taxpayer. Staff have already spoken to the representative and advised that in future situations like this, to send the refund check (or payment) and the amended return together so they could be linked. This will result in the payment being accurately credited to the appropriate account and tax year.

In regards to future efforts to apply payments as a “tax deposit” to any particular tax year, you should follow the procedures outlined in the September 2006 Tax News Article, New Tax Deposit Forms.
My FTB Account
Question: We as practitioners appreciate the information that you make available on MyFTB Account. That said, we would like to make some suggestions that would help us use this more efficiently and effectively.

If we want to access multiple years for one particular client, we have to go back to the Client Selection page and re-enter all of the data. It would be a lot more efficient if we could move from year to year using minimal amount of key strokes.

Answer: Once a client has been selected, it is not necessary re-enter all the information/”secrets” to see different tax years. Once in a client’s account, you can select different options or tax years by using the navigation buttons at the bottom of the page (e.g., the “Back” button or the “MyFTB Account Options” link). If you click the “Exit MyFTB Account” link or “Select another client” link, then you will need to enter all the information/secrets again to view that client’s information.
Account Summary
Question: It doesn’t appear that any information is available under this option if there isn’t a balance due. This type of history can be valuable when looking to see what transactions we have on file in the current or previous years.

Answer: Currently, tax year information is not available in MyFTB Account if there is no balance due on a tax year. We understand this information may be important and valuable. We are currently evaluating when we will be able to make this information available.
Question: One of the required pieces of information for logging on to a taxpayer’s account is an item shown on the prior year’s California return. In the case of a business entity in its first year, this information is not available. Is it possible to access this taxpayer account in the first year?

Answer: At this time, there is no option to access a taxpayer’s account that hasn’t filed a return. The issue is that without a return being filed, there isn’t really information in our system that we would be able to use for authentication/verification online.
Question: Do you have an estimated date when we will be able to get information related to trust and estates on MyFTB Account?

Answer: Currently, we estimate trusts and estates will be able to access MyFTB Account mid to late 2012.

Steve Sims, EA
Taxpayers’ Rights Advocate

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