If you're unable to pay your California income tax balance in full, you may be able to request a payment plan using Form 3567, Installment Agreement Request. An installment agreement allows you to make monthly payments over time instead of paying your balance all at once, subject to Franchise Tax Board (FTB) approval. Interest and applicable penalties continue to accrue until the balance is paid in full.
What Is Form 3567?
Form 3567 is used to request a California installment agreement with the Franchise Tax Board (FTB). If approved, you may make fixed monthly payments until your tax liability is paid in full. Approval is based on your ability to pay and your compliance history. The FTB may request additional financial information or file a tax lien as a condition of approval.
Eligibility Requirements
You may be eligible for an installment agreement if all the following apply:
- Your California tax liability does not exceed $25,000.
- The repayment period does not exceed 60 months.
- You have filed all required California personal income tax returns.
- You are not currently in an active installment agreement.
Terms and Conditions
By entering into an installment agreement, you agree to:
- Make all monthly payments on time until the balance is paid in full.
- Maintain adequate funds in your bank account if using automatic withdrawals.
- File all future California income tax returns on time.
- Pay all future California tax liabilities on time.
- Ensure your state and federal withholding is sufficient to cover future tax liabilities.
- Make required estimated tax payments if you receive income from sources other than wages.
- Pay the installment agreement fee, which is currently $34 and is added to your balance due.
Financial Hardship Certification
If your tax liability exceeds $10,000 and the requested installment agreement period exceeds 36 months, you must certify that you are experiencing a financial hardship. Installment agreements meeting these criteria are subject to additional review by the FTB.
Electronic Funds Transfer (EFT)
Form 3567 allows you to authorize automatic monthly payments directly from your checking or savings account.
When completing the EFT section:
- Enter your bank routing number and account number.
- Select a payment date no later than the 28th day of the month. If a later date is selected, the FTB will withdraw the payment on the 28th.
- Sign the EFT authorization section.
Failure to maintain sufficient funds may result in collection activity, additional fees, or termination of the installment agreement.
Program Pathway
- State
- Edit California Return (Click the 3 dots)
- Miscellaneous Forms
- Installment Agreement, Form 3567
Will Form 3567 Be E-Filed?
No.
If you complete Form 3567 in the program, the form must be mailed directly to the California Franchise Tax Board and will not be transmitted with your e-filed California return.
Important Information
- The FTB recommends making the largest monthly payment you can afford because interest and applicable penalties continue to accrue until the balance is paid in full.
- Future California tax refunds may be applied to your outstanding balance. This does not replace your required monthly installment payments.
- If you currently have an installment agreement, wage garnishment, bank levy, warrant, or continuous order to withhold, contact the FTB directly regarding available payment plan options.
- The FTB may request additional financial information or file a tax lien before approving an installment agreement.
- Processing an installment agreement request may take up to 90 days. While your request is under review, continue making payments whenever possible to reduce additional interest and penalties and help prevent collection actions.
Additional Information
For additional information regarding California payment plans and installment agreements, visit the California Franchise Tax Board website.