Taxpayer Beware

You're Facing a Tax Issue. Now What?

September 28, 2022 California Tax Education Council Season 2 Episode 1
Taxpayer Beware
You're Facing a Tax Issue. Now What?
Show Notes Transcript

It can happen to the most honest of us. It could be fraud. It could be a financial issue. But it happened. You're facing a tax issue. Is there anywhere you can go to for help?

CTEC Chair, Brandon Chanley, chats with the Brenda Voet - Taxpayer Advocate for the Franchise Tax Board. Hear stories of how she's helped taxpayers with taxing situations and who you can trust for help.

Hello everyone. Thanks for downloading tax payer beware. This podcast was created by the California tax education council or Ctech for short.


Ctech is a nonprofit organization required by state law to basically do one task, and that's to protect you against fraud, and help you find a California approved tax preparer. By law, only an attorney, CPA, enrolled agent, or registered tax preparer with Ctech can charge a fee to do your taxes. Anyone who isn't one of these four is breaking state law, and there are thousands doing just that. I'm your host, Brandon Chanley. We have a lot to cover. So let's get started.


 It can happen to the best of us. You follow the rules, pay your taxes, but it happened. You're facing a tax issue. Now what? Welcome to season two of this episode. Today, we have the ultimate authority to help us answer the question, the taxpayer advocate for the franchise tax board, Brenda Voet. Brenda, thanks for joining us today.


It is my pleasure to be here. Thank you so much for allowing me this opportunity to share with you some of the information that we have available to help.


You know, it is one of those scary things.


Nobody wants to get a letter for anything, you know, you don't wanna go in from the IRS, don't wanna go in from FTB, but it happens and, and things arrive. And I think when, when that does people tend to panic and say, what do I do? Right. So, what would be the first step? Would FTB only reach out via mail first and what would be the normal process or the step somebody would take from there.


So yeah, the normal process for us to contact anyone is with a letter. And, the hardest thing is to open that letter.


The thinner the letter, the better the information. The thicker, the letter, well, you know, there there's .. it gets worse and worse each time. So if you get a letter, it looks like it's from the franchise tax board, and you wanna make sure that it is from the franchise tax board, I always encourage everybody to go to our website at ftb.ca.gov we have a place there where you can click on, did you get a letter from us?


And if you click on that, it will show you what the mailing address and the telephone number are on that letter that we send out. And that's a good way just to make sure that it's not from somebody else. But, um, I do wanna share, we also have a new feature through the "my FTB" application that we have.


And what that feature is, is that if there is a letter that is mailed or electronically sent to any California taxpayers that have selected it, we will send them a text message or an email. And what that's gonna do is inform them t hat, they should go look at their, my FTB account because there may be a letter or information.




To kind of give everybody information too, would that account automatically be set up or is that something everybody should just go and set up an FTB account?


I would love for everyone to go and set up a my FTB account. What it is is, if we are able to provide you information about your account, you set up the account it's secure, if you have a representative, they can get access to limited information, but if you have a power of attorney that you submit to us, then they'll have access to everything. And some of the best features of my FTB is that you can review the account balances that are due on a tax return. You can see tax returns that were filed.


You can have a list of all the returns and images of those. You also will have, like I said, those notices and correspondence. So your representative with the power of attorney, you won't be able to see those,  but taxpayers can see those directly. And it's super easy to set up a my FTB account. Before, you used to have to go through a pretty long process, but now you go in, we ask you some critical questions and we're able to give you access right then and there, versus the, the old, old school way where we'd have to send out a pin number to you in a letter and come back, that's all gone.


It's now real time access to a lot of very good information that everybody should know. We're trying to share what we have  with taxpayers so that they know what we have, and then it helps also for the tax professional community, to be able to better communicate with the franchise tax board.


We have secure chat, we have ways of, of being able to, to share information back and forth.


Okay.


So, I encourage tax professionals to set up their professional account and tax payers as individuals to set up my FTB account.


Great. Great. Okay. And, and then. You know, speaking of your title's taxpayer advocate.


So, could you kind of go into detail? So I, I get a letter, let's say my letter comes, I call start the process, how would I need to be involved with the taxpayer advocate or when would I need to get involved with that process or at all? Like, can you kind of explain how that works and, and how your department gets involved?


Most of the time we don't get involved.


Okay.


Because most of the time, what I call our normal channels work and our normal channels are contacting the business area that sent the letter or calling into our, our phone centers. They can give you good information. Tax practitioners can call our tax practitioner hotline directly and, and get information, uh, that way. So we, we have a lot of different normal channels that work. So when those don't work or there's a communication breakdown, you're trying to explain something to somebody and they don't quite understand it. And you've talked to their supervisor, we're here to help. We're here to help coordinate those conversations when we can, or if it's a unique situation where we need to get other program areas, communicating with each other about the issue, we can facilitate that also. .


So what, what's kind of the normal, the normal process or expectation, I guess I should say. So if I, I go through the normal channels, I contact, I reach out to someone what's kind of normal process to hear back from someone. I mean, granted, you know, holidays, things would be in there obviously weekends, but what's kind of the normal process?


So, it, it all depends really on the situation.


Okay.


If you're in an audit situation, it could take 30 days. Because they wanna analyze the information to get back. If you've provided information for, um, let's say we reached out to you and we're concerned because the tax return has been filed.


Mm-hmm  


Using your information and we wanna make sure that it was truly, you.


We'll send you a letter asking you for information you can call in and we can verify that. And then we can make sure that if it wasn't you filing that return, we don't process it. If we're still waiting for yours to come in, we'll be able to flag the account and take action on that. So it, it just really all depends on what needs to be communicated, why we're reaching out to you, for the length of time. But you know, the state agencies that we always give you the four to six weeks, so, and, one of the things with us, having moved to a teleworking environment moreso, we have really been able to maintain the ability to get the work done.  We've had people who are able to come on in and get the work done that had to be manually done, but we've also been able to pivot very quickly and get people to be able to work remotely. So the timeframes that we had prior to the pandemic happening, we've been able to keep most of those.


Just to kind of recap, then it sounds like if you get a letter, you go through the process you feel like  they're not understanding the process, that's when they would reach out to your group and you'd be able to assist them as well as you can. So it almost like , you know, the insides and outs of the, of FTB to be able to help him navigate through the process. Is that a fair assumption?


That's a fair assumption. My team has been working really hard on creating relationships with all of our different program areas so that we know who to reach out to, to have those conversations and get information quickly   and be able to resolve things quickly. So it's, it's been something that we've been building and, and working on, and it has been very successful for us.


One of the other things that we can do very quickly is if somebody has a financial hardship, and they need to have  a hold placed on their account so that an action doesn't happen. We don't garnish wages or do anything like that. We do have the ability to be able to help with that. So, um, people can call the, uh, we have a 800 number call center, which is 800 883 5910. And we're able to help with those immediate situations also.


Okay. So they are, they're, you know, they're willing to work and, and help people through the what, what is a very scary situation, but that's good. That there's there's ways to help. That's awesome. Um, If you could tell me, tell me a little bit to more of, you know, the  advocation team. What other things do you do from education or things that are going on in the state of California? What all are you guys involved in?


When I took over, I thought that most of the activities were going to be helping taxpayers with account resolution and everything. And I'm finding that that's really not a significant portion because most of our program areas are doing such a great job.


What I am finding, is, we're in the business of communicating.  And we do that. We have a tax news publication and it's free to everyone, goes directly into your email and every month we do our best to try to share with you information about  what you may need to know to get a good t ax return completed.


If there's new law changes, if there's a new letter coming out, if there are tips or tricks that can help you through the process, we try to really give you information on that. We also do education and outreach and just as I'm partnering with you today, to do this, w e also partner with other tax professional communities and mostly giving California tax updates.


We, we try to make sure that we let them know, uh, new legislation. What are the changes, if there's new forms that are gonna come out, new changes in the earned income tax credit   or qualifying for different credits. So a lot of that, and then one of our most popular education outreach is for our small business community. And we share with them the forms of ownership, common forms of ownership in California and what it takes to enter into those different forms of ownership, how to file,  what the responsibilities are. So those are some main areas where we spend a lot of time to try to make sure that we're communicating good and timely, proactive information out to taxpayers and to the tax practitioner community.


Okay, that's good. That's good. So, another kind of question that I would like to, to, you know, make everybody aware.. So how would the process work? So they've reached out. They're not getting anywhere need help. They reach out to you. What would  be your next steps that you would go through  when you're talking to them?


My team is, basically.. Has audit background. So as auditors, we love to get the facts from everybody. And so that's how the conversation basically will be. What's being asked, what's the letter we'll look to see if we have something called a taxpayer folder that is universally used throughout the franchise tax board so that we can have one area where we can understand, has communication been done with other areas, what action was being taken?


What information are we needing? So we, we can look into that. We can reach out to the, to the other areas, but what would happen is you would work directly with one of my technical advisors, or you would work with one of our executive and advocate service team members. So it, it sounds like two different areas, and we have nuances in what we do, but we will make sure that you have one person that you would be able to contact and work through the entire process on that.


Okay. And about how many you're in your department and in the group?


So in the taxpayer rights advocate office, we're a small yet mighty team. We only have 10 of us here.


Oh, okay.


But we have others that we can reach out to with the executive and service team and advocate service team. And they help us with account analysis and putting, holds on accounts   and doing information. And they also help our executive officer if she has anyone from any of the state elected officials. So state senators, state assembly people, if they have constituents that reach out and have an issue, that'll also help. So that's a team of about 30.


Okay.


That, so, you know, there's there's 40 of us, but we have 6 million taxpayers, so  


Wow. Yeah.


The best way to do it is that normal channel to, to talk to the program area first.


Through, through the call center and the program.


Yeah. Yeah. Because even when we can help, we may not be able to help as quickly as we'd like to, because as I said, a lot of us are auditors, so we have to have that factual foundation built and it may take a little bit of the extra time versus having that conversation with somebody who who's been looking at your issue  and question for a longer time period, they have more background and they may be able to help you quicker.


Yeah.


But like I said before, we're here to facilitate those conversations. We're here to make sure that everyone is being treated fairly and equitably and really making sure that the proper amount of tax is being paid.


And if, if someone doesn't feel as if they're, they're being heard or that's being communicated or they don't understand why a document needs to be done, sometimes you just need to have a conversation with somebody else to see if we can come up with a, a, a plan  or a, a course of action that needs to be taken.


And for me, this sounds like a great resource. It can get pretty muddy in the water, so to speak, and you're wondering, what are they saying? And are they listening? Are they understanding what I'm saying to them and back, and it's great that your department can jump in there and help be an advocate for them. I mean, that's the key word in the, in the phrase there, "advocate.". So that's great.


Yeah. I have had a couple people who think advocate means that I have to take their side, so,


Right, right, right.  Yeah. For sure


that I, I need to make sure that it's within the law and that


 But yeah, that's a, that's a good disclaimer for sure, gotta get that out there. That's great. Is there anything else you wanna share  about the department, what you guys do?


Sometimes it's easier to say what we can't do versus what we can do.


Yeah, that's good. That's good.


The reason I say it that way is because everything's unique.


Mm-hmm.


 If we dealt with the same thing over and over again, we would figure out how to create a process  to get that done.


Right. Right.


But we deal with the things that are outside. So, it's easier for me to let you know, like I said before, if you haven't talked to somebody and I, we are the first place that you call, we're not gonna be able to help you. We're gonna plug you back into the normal channels first.


Right.  


If you're on the phone and you're on hold and you're frustrated because you feel like you're not getting through and you're gonna wanna reach out to us. We're not gonna be able to help you cuz we're gonna get you back in there.


One of my favorite stories is that I received an email from the prior advocate, who received an email from a tax representative who was frustrated because they couldn't get through on the phone. So by the time everything got to me and I got one of my team members to reach back out, we learned that the tax professional was on hold emailed the prior advocate who emailed me and they got everything taken care of and resolved by the time, by


the time the email chain.


So it was kind of an interesting thing with that. But if there is gonna be a, a delay or if you're trying to get through, like I said before, because there's gonna be an economic hardship that can call, we also can't get involved if it involves a question of constitutionality for the tax system. I had one gentleman call up and he was very passionate. He really wanted me to advocate for the gas tax relief. And he had a very well laid out argument and plan. And unfortunately I had to let him know that he needed to talk to his elected official cause yeah. We only enforce the law.


That's above my pay grade. That's one of those you can say, right?


Yeah. So we can't do that. If it's an identity theft, we won't get involved cause we have a team that is just really very focused in on that. And they all have all the tools and resources. And also if it's a claim for refund, because a claim for refund usually involves a lot of analysis


mm-hmm  


and a process in on that, and we wanna make sure that that program area that, that is working on that has the opportunity. But again, you know, if you're working on that and you're talking with someone and the communication you know, needs to be facilitated, we can help with that. So I know that's not what we can do, but sometimes


 I think that helps


but it's easier to understand what we can't do.


Yeah, no, I agree. That's that's better, better framing of it. Don't call me for these things.  


Exactly.


That's great. So if you could, if you don't mind, can you just tell people how do they reach your office if they did need your assistance or wanted to get a hold of you? what's the best way.


So if it's something that deals with a hardship or needing immediate action, the best way to do it is to call 800 883 5910. That's our executive and advocate services line. They can help through that. For the advocate, can reach out to us at FTBadvocate.ca.gov  there's an email that way to reach us.


We don't have a direct phone line. But you can email me, which is brenda.voet, V O E T ftb.ca dot GOV.  Another thing that we have, that's kind of new in the way that we're using it, we have a systemic issues management system. So if you have a question about something that you think is impacting more than one of your clients,   you can submit that if you go to ftb.ca.gov down at the bottom, it says taxpayer advocate. We have a link to it, or the tax pro there's a blue bar on top, and there's the words tax pro on our website. Either way we'll get you to report an issue.


Okay.


And if you key in your question there, what we do is we'll facilitate getting an answer for that question, and be able to provide that to you. And it's a good way for us to learn. Maybe there's an issue that we don't know about, and we really do need to look, does our system need to be updated, do our forms need to be updated, and it helps us to understand how we can do our job better and it can get, changes made in there, but it also will give you a, a timely answer. We try to get to those within a couple weeks to share with you the answer to that issue.


Okay, great.


That's a new way.


Well, I, I tell you, this is, it is been eye opening for me, and I hope our listeners enjoy it as well. You know, if you get that letter from the FTB.


Don't be scared there's there's people that can help.  But the key is don't ignore it. Don't ignore the letter, right? It's not just gonna magically disappear.


The thicker the letter, the more  yeah. Worse, worse the information is.


So get the ball rolling through the normal chains, call the number that's on there, they'll get you in contact with the right group and, and people that you need to talk to. But if you feel you're not getting the help you need or need some help, know that Brenda and her team's there to help you. So, Brenda, I really appreciate the time. Thank you for joining us.


Thank you so much. This was really a pleasure, it was nice to be able to share with you some of the amazing things that, that my small yet mighty team does.


Powerful. No, that's good. Yeah. Mighty team. I love it. Thanks a lot. Hope you have a great day.


I hope you do the same. Thank you.