How do I set up an installment agreement with the California FTB if I can't pay my tax bill in full?

You can request a payment plan, called an installment agreement, from the California Franchise Tax Board (FTB) to pay your tax bill over time. Here are the steps to set up an agreement: Step 1: Gather Your Documents and Information Before you apply, collect your most recent FTB tax notice, your Social Security number or Individual Taxpayer Identification Number (ITIN), the tax year(s) you owe for, and your bank account information if you plan to use automatic debit. Step 2: File All Required Tax Returns You must have filed all past-due tax returns before the FTB will approve a payment plan. If you have unfiled returns, complete and submit them immediately. Pay as much as you can by the original tax deadline to minimize penalties and interest. Step 3: Apply for the Installment Agreement The easiest way to apply is online through your MyFTB account at ftb.ca.gov. This is the fastest method if you owe less than $25,000 and can pay it off within five years. You can also apply by calling the FTB at (800) 852-5711 or by mailing a completed Form FTB 3567, Installment Agreement Request. Step 4: Make Your Payments on Time Once your agreement is approved, you must make every monthly payment on time. The best way to ensure this is by setting up automatic withdrawals from your bank account. Failure to pay on time will void the agreement. Important Details and Nuances An installment agreement does not stop interest and late-payment penalties from accumulating on your unpaid balance. The FTB charges a one-time $34 setup fee, which will be added to your balance. The FTB will also apply any future state tax refunds you are owed to your tax debt until it is paid in full. Warnings and Limitations If you miss a payment or fail to file and pay future taxes on time, the FTB will cancel your agreement and may begin collection actions, such as a wage garnishment or bank levy. For significant tax debts, the FTB may still file a state tax lien against your property even if you are in an active installment agreement. This is general information and does not constitute legal advice. For complex situations, such as large tax debts or business taxes, you should consult with a qualified California tax attorney.