Electronic Funds Transfer

1. Who is required to pay taxes or fees by EFT?
2. Can I participate on a voluntary basis?
3. Will I be assessed a penalty for sending in my payment by check?
4. What is the difference between ACH Debit and ACH Credit?
5. Will I need special equipment or software to make my payments by EFT?
6. Will I receive instructions on how to make my tax or fee payments?
7. What is the most common payment method?
8. Can I change my EFT payment method?
9. What do I need to do if I change financial institutions?
10. What if I do not owe any taxes or fees for the period?
11. What if my tax or fee due date falls on a weekend or holiday?
12. Do I still have to file my tax or fee return?
13. What if I need to file an amended return?
14. What types of payments can I make by EFT?
15. Can the Board of Equalization withdraw funds from my account without my knowledge or permission?
16. What if I have a problem when making a payment by EFT?

1. Who is required to pay taxes or fees by EFT?

Effective January 1, 2000, the Board of Equalization requires all special taxes accounts whose estimated average monthly tax or fee payments (over 12-month period) equal or exceed $20,000 to participate in the EFT program.

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2. Can I participate on a voluntary basis?

Yes. If you are not required to make tax or fee payments through EFT, you can choose to do so on a voluntary basis.

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3. Will I be assessed a penalty for sending in my payment by check?

Yes. If you are required to remit payments through EFT and you remit payment by other means (check, cash, etc.) you will be subject to a 10 percent penalty on the taxes or fees that were due at the time of the payment.

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4. What is the difference between ACH debit and ACH credit?

ACH Debit - you call a toll-free telephone number and provide specific information which authorizes the State to debit your account and credit the State's bank account. This type of transaction is simple and there is no cost to you. (Unless your financial institution charges a fee for the actual transfer of funds.)

ACH Credit - you instruct your financial institution to debit your account and credit the State's bank account. For this type of transaction you must ensure your financial institution has the ability to send ACH credit transactions in the required format. There are normally set-up and transaction fees for which you are responsible.

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5. Will I need special equipment or software to make my payments by EFT?

ACH Debit - to make payments by telephone, no special equipment is needed.

ACH Credit - there may be special hardware and software requirements. Contact your financial institution for any requirements.

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5. Will I receive instructions on how to make my tax or fee payments?

Yes. After we have received and reviewed the completed Authorization Agreement for Electronic Funds Transfer (EFT) (BOE-555-ST) we will send you a letter confirming your EFT start date. We will also provide detailed instructions on how to report your payment.

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7. What is the most common payment method?

The ACH debit is the most common payment method. The ACH debit method is simple, there is no additional cost, it requires no additional programming or special equipment, has a very low error rate, offers the warehousing option, and the Board is able to assist you if an error has occurred and it is necessary to trace a payment.

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8. Can I change my EFT payment method?

Yes, changing payment methods is easy. You must notify us of the change by completing a new Authorization Agreement for Electronic Funds Transfer (EFT) (BOE-555-ST). Once we have been notified of the change, we will send you a confirmation letter and complete instructions on how to report your payment. It takes approximately 48 hours for the change to become effective.

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9. What do I need to do if I change financial institutions?

ACH Debit - you must submit a new Authorization Agreement for Electronic Funds Transfer (EFT) (BOE-555-ST) with the new information.

ACH Credit - you do not need to notify us of the change. However, it will be necessary to contact your new financial institution to verify its ability to originate an ACH credit transaction in the required record formats.

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10. What if I do not owe any taxes or fees for the period?

If you use the ACH debit method for making payments and owe no taxes or fees for the reporting period, you are still required to initiate an EFT payment and report a zero dollar amount.

If you use the ACH credit method for making payments and owe no taxes or fees for the reporting period, you must still contact your financial institution and have them make a zero dollar transaction.

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11. What if my tax or fee due date falls on a weekend or holiday?

If a tax or fee due date falls on a weekend or holiday (national or State of California), the payment is due on the first business day following the weekend or holiday. For example, if the tax or fee due date is January 31 and that date falls on a Saturday, the tax or fee due date will become Monday, February 2 and the funds must settle into the Board's bank account by February 3.

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12. Do I still have to file my tax or fee return?

Yes. Whether you choose the ACH debit or ACH credit method, you must continue to file your tax or fee returns on a timely basis. The reporting due dates and filing requirements have not changed. Your return will be considered timely if it is postmarked on or before the due date. If your return is not filed on a timely basis, even though the EFT payment may have been paid timely, you will be subject to a 10 percent penalty on the amount of tax or fee that was due with the return. If you file on a prepayment basis, you are still required to make prepayments through EFT.

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13. What if I need to file an amended return?

If you need to file an amended return, you must mail or fax in the actual amended return. Any payments that apply to the amended return may be made by EFT, but are not required to be paid by EFT.

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14. What types of payments can I make by EFT?

The following types of payments may be made by EFT for special taxes accounts:

You may make accounts receivable payments to your special taxes accounts as long as you are registered for the special taxes EFT program.

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15. Can the Board of Equalization withdraw funds from my account without my knowledge or permission?

No. ACH debit payments can only be initiated by you or your authorized personnel by using your BOE account number along with the unique security code that you have chosen. ACH credit payments are initiated only by you through your financial institution.

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16. What if I have a problem when making a payment by EFT?

If you experience any problems making an EFT payment, you may call the appropriate division listed below that administers your account between 8:00 a.m. and 5:00 p.m. (Pacific Time), Monday through Friday.