FTB Legal Ruling Issued on the Application of the Statute of Limitations Provisions to Overcollected Amounts Received by FTB Through Involuntary Collection Action
- Viktoriya Barsukova, EA, MBA
- 1 day ago
- 1 min read
On August 21, 2026, FTB issued Legal Ruling 2026-02, relating to the application of the statute of limitations provisions to overcollected amounts received by FTB through involuntary collection action.
Legal Ruling 2026-02 provides clarity as to what constitutes an overcollection that can be returned to a taxpayer even if the statute of limitations for filing a claim for refund has expired. Overcollection occurs when FTB collects an excess amount at the time the collection action is taken as a result of a mechanical or clerical error by FTB. The Legal Ruling describes several circumstances in which the statute of limitations provisions do not apply to the return of payments that were the result of overcollection, and interest is not allowed on the return of an overcollection of tax.
The Legal Ruling applies to individual and business entity taxpayers in situations where amounts are overcollected, as opposed to overpaid, as a result of a clerical or mechanical error and the statute of limitations for filing a claim for refund has expired.
FTB Legal Ruling Issued: https://www.ftb.ca.gov/about-ftb/newsroom/tax-news/index.html#article1
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