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The California FTB may reject returns in the following scenarios:

Scenario 1 - Update to federal schema

Periodically, the IRS updates e-file specifications and revises the schema version. The application issues updates accordingly. If FTB validates according to an IRS schema version that differs from the one created by the application, the return may reject. If you created the electronic file using the most recent version of UltraTax/1040 and FTB subsequently rejects it, it may be necessary to wait until FTB makes the corresponding updates before resubmitting the electronic record.

Alternatively, you may e-file the California return by using the Include/Suppress federal attachment in electronic record (Force) field on Screen CAELF, (in the California Electronic Filing folder). However, if the federal attachment is required but missing from the electronic record, FTB may suspend processing of the return (rather than issue an e-file rejection) until the federal attachment is received.

Scenario 2 - Federal return is suppressed for e-file

If you are not filing the federal return electronically but are still including it as an attachment to the California electronically filed return, it is still necessary to check the federal return for electronic filing schema errors.

• Step 1: On federal Screen ELF, clear the Suppress the creation of: Federal electronic file when only filing a state return field.
• Step 2: Clear all ELF Critical diagnostics.
• Step 3: Clear all ELF Error Codes identified as "Schema Failure".  To view, run the ELF error checker via File > Print Returns. Mark the box for Government copy and the related box for Create electronic file (even though you are not actually going to create an electronic return at this point). Leave all other boxes blank.  Click the Check E-File button. When the E-File Error Report appears, click the Detail tab to view the errors in the federal 1040 return.
• Step 4: Once you have cleared all "Schema Failure" errors, access federal Screen ELF and mark the Suppress the creation of: Federal electronic file field.

Scenario 3 - Federal Return does not qualify for e-file

If you are unable to clear federal electronic filing Schema Failure errors, FTB will likely reject the California return if the federal return is attached. You may still e-file the California return by using the Include/Suppress federal attachment in electronic record (Force) field on Screen CAELF. However, if the federal attachment is required but missing from the electronic record, FTB may suspend processing of the return (rather than issue an e-file rejection) until the federal attachment is received.

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