State offers tax payment plans

SACRAMENTO
February 4, 2010 9:58am

California taxpayers who don’t have the money to pay their income taxes may be able to get some relief under programs announced Thursday by the state Franchise Tax Board.

FTB specialists can establish payment plans, grant temporary relief from state tax liens, or, in some cases, delay collection actions, it says.

The board generally approves installment payment requests if the balance owed is less than $25,000 and can be paid within 60 months.

It says it often can grant relief from state tax liens within two weeks for financially distressed homeowners trying to sell or refinance their homes. When a home sells for less than the loan balance, FTB can sometimes remove its tax lien from the property to allow the homeowner to complete the sale.

Tax liens typically must be paid before a real estate escrow can close. The tax lien remains in effect on any other property the taxpayer currently holds or later acquires.

FTB can help people refinancing or modifying an existing home loan, it says. Homeowners can request that FTB allow the new or modified loan to have priority over the tax lien. This allows prior home loans to be refinanced or modified without first having to pay the lien.

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