Volume 99-5 September 1999
is a bimonthlypublication of the CommunicationsServices Bureau, California FranchiseTax Board. Its primary objective isto provide information to incometax professionals about state incometax laws, regulations, policies andprocedures.
Members of the Board:
Kathleen Connell, ChairState ControllerJohan KlehsChair, State Board of EqualizationB. Timothy GageDirector, Department of Finance
Executive Officer:Gerald H. GoldbergEditor:Marvin Meek
To update or correct your address or to subscribe to TAX NEWS (send $12 for a one-year subscription), write:
TAX NEWSPO Box 2708Rancho Cordova, CA 95741-2708or call: (916) 845-7070.
To view TAX NEWS on the Internet or to request an electronic mailsubscription, contact FTB on the Internet:
For information about a client’saccount, contact:
Tax Practitioner Support Unit
(916) 845-7057 (phone)(916) 845-6377 (fax)
For recorded answers to questions onCalifornia taxes, to order forms or check on a refund, call:
(800) 338-0505From outside U.S. (916) 845-6600
To send a facsimile about a client’saccount, transmit to:
(800) 852-5711From outside U.S. (916) 845-6500
TDD (800) 822-6268
FTB on the Internet
Printed on recycled paper.
Responding to requests frompractitioners for an easier power of attorney process, the Franchise TaxBoard unveiled a new automated powerof attorney system in August.FTB can now maintain information abouttaxpayers’ representatives in onecentralized location.The new system features a newcentralized computer database called thePOA file. It uses automation technologyand centralization procedures similar tothose used by the Internal RevenueServices’ centralized authorization file.In the past, powers of attorneys weremanually processed and maintained. Asa result, the original documents weredifficult to track and maintain.Under the new system, whenever an FTBemployee needs to verify your power of attorney, they simply access the POAdatabase. Employees can conductsearches using one of several searchvariables, including social securitynumbers, names or tax years. There isalso a field for the centralizedidentification number assigned torepresentatives by the IRS’ power of attorney system.As part of the new look, FTB also revisedtheir form FTB 3520, “Power of AttorneyDeclaration for Administration of TaxMatters.” The most significant changesare:
You can now use one form forpersonal income tax, bank andcorporation and partnershipclients.
The power of attorney may beauthorized for not more thanthree future years, similar to theIRS form.
The multiple banks andcorporation schedule (formerlyform FTB 3520A) is incorporatedinto this one form.You must submit a new form FTB 3520,“Power of Attorney Declaration forAdministration of Tax Matters.” in orderto ensure that FTB has your most currentPOA information in its new database.
New Look for Power of Attorney
FTB’s Role In Child Support May Expand
At press time, three pieces of legislationthat would increase the Franchise TaxBoard’s role in California’s child supportenforcement activities were awaitingGovernor Gray Davis’ signature.AB 196 establishes a new stateDepartment of Child Support Services(DCSS) within the Health and WelfareAgency. The bill maintains FTB’s role asthe primary collection agency fordelinquent child support and authorizesFTB to collect child support paymentsthat are 60 days delinquent rather than 90days as it has been in the past.AB 150 gives FTB the responsibility of creating a statewide child supportautomation system for California. Thisnew statewide system would provide forthe sharing of all data and case files andthe standardization of functions across allof the counties.California faces millions of dollars infederal penalties because it does not havea statewide child support data, caseregistry and disbursement systems—asmandated by the federal government.The third bill, SB 542, allows third parties(employers, etc.) to send child supportfunds directly to local child supportagencies rather than to FTB. A statewidedisbursement unit will eventually handlethe function of receiving and distributingchild support funds.FTB’s success with procuring automationsystems in the past is the reason for its