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PO BOX 1468 MS A181
SACRAMENTO CA 95812-1468
TELEPHONE (916) 845-6304 FAX (916) 845-0412

Changes to California's Check Casher Information Reporting Program

The purpose of this letter is to inform you of recent changes to the laws affecting the
information reporting requirements for California check casher businesses.


Information reporting requirements for California check casher businesses went into effect January 1,
2006 (Civil Code Section 1789.30 and Revenue and Taxation Code Section 18631.7). The law requires
check cashers who cash checks in the course of their trade or business to file an information
return with us for customers that cash checks totaling more than ten thousand dollars ($10,000) in
one or more transactions within the calendar year. This law required all checks to be reported,
regardless of type.

Check casher

"Check casher" means a person or entity that for compensation engages, in whole or in part, in
the business of cashing checks, warrants, drafts, money orders, or other commercial paper
serving the same purpose. (Civil Code Section 1789.31.)

Who is not considered a check casher?

The check casher law does not apply to state and federally chartered banks, saving associations,
credit unions, and industrial loan companies. "Check casher" also does not include retail seller
engaged primarily in the business of selling consumer goods, including consumables, to retail
buyers that cashes check or issues money orders for a minimum flat fee not exceeding two dollars
($2) as a service to its customers that is incidental to its main purpose or business (Civil Code
Section 1789.31 (a)).

Amended law

In September 2007, California enacted Assembly Bill 1747 into law, which amended Civil Code Section
1789.30 and Revenue and Taxation Code Section 18631.7 to exclude payroll, government, and one-party
checks from the check casher information reporting requirement. The new reporting requirements are
effective January 1, 2008. To accommodate businesses, the excluded items can be omitted from the 2007
reporting requirement.

No other changes were made to the information reporting requirements.

How does this affect check cashers?

Check cashers are no longer required to report transactions involving:

FTB 4067 MEO (REV 12-2007) Side 1

ã Payroll checks - a check for wages subject to withholding pursuant to section 13020
of the Unemployment Insurance Code and treated as a payroll check pursuant to
section 1789.35 of the Civil Code for fee-setting purposes.

ã Government checks - a check issued by a federal, state, or local governmental entity and treated
as a government check pursuant to section 17989.35 of the Civil Code for fee-setting purposes.

ã One-party checks - a check drawn upon the maker's account and presented by the maker.

Some examples of reportable check cashing transactions include:

ã Insurance claims settlement payments.

ã All third-party checks and money orders.

ã Individual or business checks not considered payroll checks.

Reporting procedures

For the 2007 reporting year, we will only accept files submitted on CD-ROM. When formatting your
files, please use the revised 2007 record layout. You can find it on our Check Casher Program Web
page, located at, (Key search word - check casher).

In order to accommodate businesses that have already completed their system programming for
2008, we will accept files formatted in either the 2006 or the 2007 version of the record layout.

Additional instructions on how to format returns using the record layout, samples of properly formatted
returns, and other helpful information is on our Web page, If you have additional
questions, email us at

Waiver process

Check casher information reporting is still relatively new to California businesses. To

accomodate businesses that were unable to secure resources in time to file, we issued waivers
for the 2006 reporting year. If we granted you a waiver for the 2006 reporting year, we are
automatically extending your waiver by one additional year, through the 2007 reporting year. If
you are unable to report the required information for the 2007 reporting year and did not receive a
waiver for the 2006 reporting year, you must submit to us FTB 3607, Waiver Request Form. You can
download from our Website at or call our Forms by Phone automated service at:


Select 2 for Business Entity Information

Select "To Order Forms," and follow the recorded instructions and enter the 3-digit code: 820

Please allow 10-15 working days to receive your forms. If you live outside California, please allow three
weeks to receive your order.

Waiver requests must be postmarked no later than March 31, 2008. Note: Persons who fail to file
California's check casher information reports are subject to sections 6721 and 6724 of the Internal
Revenue Code. A conviction of willful failure to file the timely and correct return can result in fines,
imprisonment, or a combination of both.

Stay informed - Use our website

Visit our Web page for complete information about our Check Casher Information Reporting program.
Access the FTB Website at Key in "Check Casher" in the search box, then click
on the search button. If you need further assistance, send us an email at

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