Screen CALetter - California Client Documents and Elections (1040)

Show expandable text

New (tax) year, new help!

Fixed Assets and UltraTax CS 2023 help is now on Help and Support. We're still moving articles, but you can find most content for the 2023 tax year there. Continue using the Help & How-To Center for tax years 2022 and older.

See also: 1040 California frequently asked questions

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

Paragraph: Number

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 > California tab, click the Letter Insert or Filing Instructions button, and then click the Custom Paragraphs tab. For details, see Client documents overview.

Paragraph: Description

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 > Tax Elections. UltraTax CS comes with several blank state election statements that can be customized for specific needs. For details, see Editing or creating tax elections.

Election: Number

Enter the election number that corresponds to the election statement required for this client. UltraTax CS prints up to three statements with the return.

Election: Description

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 64 or Form 540NR, line 74 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 Screen CAAmd. 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 Screen CALetter. 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 Screen CALetter.

Use this section to indicate the taxpayer meets requirements for mandatory electronic payments.

Requirements met 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 2019 determine whether or not the taxpayer is subject to the mandate in 2019. Use code 3 to proforma code 1 to next year’s Screen CALetter in order to force the taxpayer to mandated status in 2019.

Was this article helpful?

Thank you for the feedback!