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Screen CALetter - California Client Documents and Elections (1040)

Overview

Use this screen to enter client-specific filing instruction information, to select election statements to attach to this client's return, and to indicate mandatory electronic payments.

Custom Paragraphs

Enter the paragraph number or press F4 to view a list of available paragraphs. Choose the number that corresponds to the paragraph statement required for this client. If you enter information in this field, UltraTax CS prints the custom paragraph indicated in the filing instructions. UltraTax CS prints up to three paragraphs with the return.
These fields become available after you have created a custom paragraph. To open the Document Editing window where you can create a custom paragraph, choose Setup, 1040 Individual, and then California tab, select the Letter Insert or Filing Instructions button, and then select the Custom Paragraphs tab.
UltraTax CS automatically updates this field with the custom paragraph description associated with the selection made in the
Paragraph Number
 field.

Election Statements

Use this section to select election statements to be attached to this client's return. Statements are created by choosing Setup, 1040 Individual, California tab, and then Tax Elections. UltraTax CS comes with several blank state election statements that can be customized for specific needs.
Enter the election number that corresponds to the election statement required for this client. UltraTax CS prints up to three statements with the return.
UltraTax CS automatically updates this field with the election description associated with the selection made in the
Election Number
 field.

Mandatory Electronic Payments

The California e-pay mandate requires taxpayers to submit all future payments to the California Franchise Tax Board via electronic means if the tax liability on the return exceeds $80,000 or if any payment submitted (via any means) exceeds $20,000. A taxpayer may be subject to penalty on any future payment (regardless of the amount of the future payment) not submitted to FTB via electronic means.
Visit https://www.ftb.ca.gov/individuals/Mandatory_e-Pay.shtml for detailed information.
UltraTax CS designates the taxpayer as subject to the mandate if any of the following conditions are met:
  • Tax liability on Form 540, line 65 or Form 540NR, line 75 exceeds $80,000
  • Form 540/540NR payment exceeds $20,000 (regardless of method of payment)
  • Extension payment exceeds $20,000
  • Estimate payment exceeds $20,000 (regardless of method of payment)
  • Schedule X balance due exceeds $20,000
  • X
     is entered in the
    Subject to e-pay mandate with originally filed return
     field on the CAAmd Screen. UltraTax CS updates this field accordingly when transferring original information to the screen.
  • 1
     is entered in the
    Requirements met for mandatory electronic payments
     field on the CALetter Screen. UltraTax CS proformas a
    1
     to this field when the requirements were met in the prior year.
Per Franchise Tax Board:
  • Tax liability reflects tax (including other taxes) after credits.
  • A taxpayer who was subject to the mandate with an originally filed returns remains subject to the mandate if filing an amended return, even if the corrected return does not meet conditions for the mandate.
  • The mandate is applied based on actual payments remitted rather than actual amounts due. The means of payment is not considered in determining whether a taxpayer is subject to the mandate. Thus, if a taxpayer submits a payment via paper check or via electronic means, the payment could meet the conditions for the mandate.
When the requirements are met for mandatory electronic payments, UltraTax CS suppresses the printing of payment vouchers (for both the return balance due and next year's estimates) and includes text in the filing instructions indicating that the taxpayer is subject to the e-pay mandate. When preparing an extension with an amount due, Form 3519 prints regardless of whether or not the taxpayer is subject to the mandate. Likewise, for an amended return, Schedule X prints even if the amount due with amended return exceeds the threshold. If the taxpayer is subject to the mandate, extension filing instructions, amended filing instructions, and text on Form 3519 direct the taxpayer to make payment electronically.
To allow for customization of filing instructions, transmittal letter variable
1
 when the requirements are met or when forced on the CALetter Screen.
Use this section to indicate the taxpayer meets requirements for mandatory electronic payments.
Enter
1
 to indicate taxpayer is subject to the e-pay mandate. UltraTax CS proformas
1
 to this field when the requirements were met in the prior year.
When
2
 or
3
 is entered in this field, UltraTax CS prints any applicable payment vouchers (return balance due and/or next year's estimates) and omits the e-pay mandate paragraph from the filing instructions. Use code
2
 to have UltraTax CS
2024
 determine whether or not the taxpayer is subject to the mandate in
2024
. Use code
3
 to proforma code
1
 to next year's CALetter Screen in order to force the taxpayer to mandated status in
2024
.
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