Proof of Overcharging Interest and Substantiation of Inaccurate Accounting Allegations

Overcharging Interest:

In the Unlawful Schemes post, I claimed that I caught the FTB overcharging interest. As proof, here is the bill they sent me in the mail showing we owed $3,852.02 by 7-15-14, the pay by phone payment that I made on 7-9-14 while talking with FTB rep Carrey who told me that was the correct total was $3854.74, and the FTB’s 2011 accounting ledger which makes it appear that the $3854.74 was the correct amount of money that was always owed. The overcharge was only $2.77, but if they tack on extra interest to everyone they are illegally raking in millions.

In the Unlawful Schemes post, I also stated that on two of their accounting ledgers, the FTB has a strange adjustment that look like attempts to overcharge interest.

In late 2017, I asked the FTB to send me a copy of my 2014 accounting ledger. In the version that they sent me, the line item says “FTB Adjustment: -$8.37.” When I asked the FTB’s representative what that meant, she said “Oh, it doesn’t really affect you.” In the version that the FTB submitted to the OTA court, they redacted the line completely. When I asked the FTB to send unreacted ledgers, their version says “Write Off.” All three versions of the ledger are here.

I never asked for a copy of my husband’s 2002 ledger (we married in 2003). The 2002 ledger was submitted to the courts because three of the payments we made (one in 2008, one in 2010 and one in 2014) had been “misapplied” to 2002. The FTB redacted a line item altogether. When I asked for un-redacted documents, the line item said “Write Off: -$.12. Both copies of the ledgers are here.

I asked the FTB’s attorney and the Disclosure Department why my ledgers said “FTB Adjustment,” the FTB’s ledgers said “Write-off” and why they tried to hide these adjustments from the judge altogether. The FTB refused to answer, which is a violation of the California Public Records Act (the CA equivalent of FOIA).

I think the scheme is that they send out the bill, then tack on extra interest after the bill goes out. Then if someone pays on time, they “write off” the overcharge. And if that person doesn’t pay on time, the overcharge never gets noticed… it gets lumped into the new principal balance and the next bill with more interest goes out.

Accounting Improprieties:

In the Unlawful Schemes post, I also alleged that the FTB’s accounting ledgers are inaccurate. Unfortunately, in order to definitively prove this, I have to post more personal information than is prudent. However, the three sets of accounting ledgers that I used to prove the overcharge/what looks like attempts at overcharging certainly give you an idea that something is not right with their bookkeeping.

In the tax year 2002 ledger, you can see the return was filed on 4-15-03, yet they applied an estimated tax payment in 2008 and one in 2010. There were no late fees or penalties, so its clear that my husband had paid in full by 4-15-03 and these were FTB “errors.” Then, in 2011, they mysteriously moved money from tax year 2008 to tax year 2002. Six weeks after the mystery move, it was corrected by sending us a refund instead of moving the money to the correct tax year. Then in 2014 they AGAIN misapplied an estimated tax payment to tax year 2002, and AGAIN corrected their “mistake” by sending us a refund instead of applying funds to the correct tax year.

I suspect there is a reason that they kept “misapplying” the estimated tax payments to the year prior to our marriage. It is suspicious that the FTB would be misapplying estimated tax payments to a tax year that had been paid in full and closed 11 years prior. I know that they treat married couples differently than single filers. There must be some kind of ploy with marital status.

The 2011 accounting ledger has two credit elects (our 2010 refund money that we rolled over to 2011 as an estimated tax payment). We only filed one tax return in 2010, there should only be one credit elect.

In the 2014 ledger, the FTB’s internal documents show three credit elects from 2013 rolling over to 2014. Again, we only filed one 2013 tax return, so there should only have been one credit elect. Even weirder, the copy that they sent me in 2017 shows only two credit elect transfers from 2013. Another accounting oddity is with the rollover from 2014 to 2015. We only filed one 2014 return, there should only be one credit elect applied to 2015, yet the FTB’s internal documents shows two. And the copy they sent me only shows one.

Hopefully, this is enough information to give some credibility to my claims of serious accounting improprieties over at the FTB.