Two-Year Hiatus from California’s Mandatory e-pay Penalty Ending

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Starting January 1, 2011, the California mandatory e-pay penalty will be assessed when a person required to make payments electronically pays using any other method.  The penalty is one percent (1%) of the amount paid, unless failure to pay was for reasonable cause and not willful neglect.

Electronic payments are required once a person (1) makes an estimate tax or extension payment (by check or electronically) over $20,000, or (2) files an original return with a tax liability over $80,000.

Taxpayers who were previously notified (in 2009 or 2010) that they meet the e-pay requirement must make their California payments electronically starting January 1, 2011 to avoid the penalty.

For more information, see http://www.ftb.ca.gov/individuals/Mandatory_e-pay.shtml.

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