Due to the State’s cash flow problems, the Governor and Legislature approved legislation to delay payment of personal income and business tax refunds until there is sufficient cash in the Treasury to pay all claims.
[bull] When will refunds be issued?
All personal income tax refunds affected by the delay have been processed.
[bull] What types of refunds are affected?
This applied to all refund types – paper and direct deposit. Delayed direct deposit refunds will be electronically transmitted when the refund is processed.
[bull] Why were refunds delayed?
To confront the state’s cash problem and avoid the danger of IOUs, the Legislature approved AB 1624, which deferred some payments, including Personal Income and Business Tax Refunds.
[bull] Where to find more information:
Visit the California State Controller’s website at http://www.sco.ca.gov/fiscal_2010-11_budget_payment_status_faq.html.
[bull] Will you still honor my direct deposit request (DDR) when the delay is lifted?
Yes, your DDR will be honored.
[bull] Am I entitled to receive interest because of the delay?
It depends upon the length of the delay. For individual taxpayers, interest on current year refunds is only paid if your refund is not issued within 45 days after April 15, or the date that your return is filed, whichever is later.
[bull] Can I apply my refund as an estimated payment toward my 2010 taxes?
Yes, if on your 2009 return you request that your refund be applied toward your 2010 taxes, we will apply the amount you designate when we process your return.
[bull] If I owe for other debts collected by FTB, will my refund be applied toward that debt?
Yes. You will be refunded the difference, if any.
If you have any questions concerning the content of this Legal Alert, please contact the following from our office, or the attorney with whom you normally consult.