The California Franchise Tax Board is the state agency that collects income taxes

The California Franchise Tax Board (FTB) is the state agency responsible for collecting personal income taxes, corporate taxes, and other state taxes in California. It is part of the California Department of Tax and Fee Administration. If you earn income in California or own a business there, the FTB is the office that processes your tax returns, issues refunds, and collects unpaid taxes.

The FTB does not set tax rates or write tax law — the California legislature does that. The FTB's job is to administer the tax system: they receive your return, match it against what employers and banks report about you, send you a refund or a bill, and pursue people who owe back taxes. They also answer questions about how to file and what deductions you can claim.

Key Takeaways

  • The FTB collects California personal income tax, corporate tax, and other state taxes from residents and businesses.
  • You file your California state income tax return with the FTB, separate from your federal return to the IRS.
  • The FTB issues refunds, sends tax bills, and pursues collection of unpaid taxes through wage garnishment and bank levies.
  • You can contact the FTB by phone, mail, or through their website to ask about your return, a refund, or a tax bill.
  • The FTB also administers the Earned Income Tax Credit (EITC) and other tax programs for California residents.

What taxes the FTB collects

The FTB collects several types of state taxes. The largest is the personal income tax, which is withheld from paychecks and paid when you file your return. California's income tax rate ranges from 1% to 13.3% depending on your income level, making it one of the highest state income tax rates in the country.

The FTB also collects corporate income tax from businesses, pass-through entity taxes from partnerships and S-corporations, and fiduciary income tax from trusts and estates. They administer the state's Earned Income Tax Credit (EITC), which returns money to low-income working people. The FTB also handles estimated tax payments — quarterly payments that self-employed people and investors make if they do not have taxes withheld from a paycheck.

How to file your California tax return with the FTB

You file your California state income tax return separately from your federal return. Most people file electronically using tax software or a tax preparer, which sends the return directly to the FTB. You can also print a paper return and mail it to the FTB's processing center. The important date is normally April 15, the same as the federal important date, though you can request an extension to October 15.

When you file, you report your income, deductions, and credits. The FTB matches your return against W-2 forms from your employer, 1099 forms from banks and investment firms, and other documents they receive. If your return matches what they have on file, processing is quick. If there is a mismatch, the FTB may send you a notice asking for more information or proposing a change to your tax bill.

You do not need to visit an FTB office to file. The FTB does not have walk-in tax preparation services. If you need help understanding your return or a notice you received, you can call the FTB's phone line or use their website to find answers.

Refunds, bills, and payment options

If you overpaid your taxes during the year, the FTB issues a refund. Most refunds are issued within 30 days of filing if you file electronically, though paper returns take longer. You can check the status of your refund on the FTB website by entering your Social Security number and filing status.

If you owe taxes, the FTB sends you a bill. You can pay by check, money order, electronic transfer, or credit card (though credit card payments include a processing fee). If you cannot pay the full amount, you can set up a payment plan with the FTB. If you do not pay and do not respond to notices, the FTB can garnish your wages, levy your bank account, or place a lien on your property.

What happens if you owe back taxes

If you have unpaid California income taxes from prior years, the FTB pursues collection through several methods. They can withhold your state income tax refund and explore it to what you owe. They can also garnish your wages — meaning they order your employer to send a portion of your paycheck to the FTB instead of to you. The FTB can levy your bank account, taking money directly from your checking or savings account.

The FTB can also place a tax lien on your property, which means they have a legal claim against your home or other assets. A lien does not force a sale, but it prevents you from selling or refinancing without paying the tax debt first. If you owe a large amount and have not paid in many years, the FTB can refer your case to the state attorney general's office for criminal prosecution, though this is rare.

If you owe back taxes, you can contact the FTB to discuss a payment plan or settlement. The FTB also has an Offer in Compromise program that may allow you to settle for less than you owe if you can show financial hardship, though approval is not common.

Contacting the FTB and getting help

You can reach the FTB by phone at 1-800-852-5711 (for personal income tax) or 1-888-792-4900 (for corporate taxes). Wait times are often long, especially during tax season. The FTB website at ftb.ca.gov has forms, instructions, and a searchable database of answers to common questions. You can also create an online account to view your tax records and check the status of a refund or bill.

If you received a notice from the FTB that you do not understand, you can respond in writing or by phone. The FTB has a process for disputing proposed changes to your return. If you disagree with the FTB's decision, you can request a hearing before the California Tax Franchise Board Appeals Bureau, which is a separate office that reviews disputed cases.

Frequently Asked Questions

Do I have to file a California state return if I live in California?

If you are a California resident and earned income in the state, you must file a California return even if you do not owe any tax. Residents are taxed on worldwide income. If you moved out of California during the year, you may owe tax only on income earned while you lived there, but you still file a California return for that portion of the year.

What is the difference between the FTB and the IRS?

The FTB collects California state income taxes. The IRS collects federal income taxes. You file separate returns to each agency. Your federal return goes to the IRS, and your California return goes to the FTB. Some tax software files both at the same time, but they are processed by different agencies.

Can I set up a payment plan if I owe the FTB?

Yes. You can request an installment agreement by phone or through the FTB website. The FTB typically allows monthly payments if you owe less than $25,000. You will pay a setup fee and interest on the unpaid balance, but a payment plan stops wage garnishment and bank levies while you are making payments on time.

How long does the FTB keep records of my tax returns?

The FTB keeps records for at least four years from the date you filed. If you underreported income by 25% or more, they can go back six years. If you did not file a return, there is no time limit — the FTB can pursue collection indefinitely, though they typically focus on recent years first.

What if I disagree with the FTB's decision on my return?

You can request a hearing before the California Tax Franchise Board Appeals Bureau. You must request the hearing in writing within 30 days of receiving the FTB's notice. The appeals process is free, and you can represent yourself or hire a tax professional to help you.