Top Tax Relief Options for California Taxpayers
Introduction: Relief is Possible — You Just Have to Know Your Options
If you’re dealing with significant tax debt, you might feel like there’s no way out. Whether it’s from the California Franchise Tax Board (FTB) or the IRS, the state and federal governments are relentless when it comes to collecting taxes.
But the good news is, you have options.
From
Offers in Compromise to
installment agreements, California taxpayers can access a variety of relief options designed to reduce the burden and get you back on track.
In this guide, we’ll walk you through the top tax relief options available to California taxpayers — including how to explore all tax relief options in Orange County and choose the best one for your unique financial situation.
1. Offer in Compromise (OIC)
What is it?
An Offer in Compromise allows you to settle your tax debt for less than you owe. If you qualify, you pay a reduced amount that the FTB or IRS agrees is the most they can reasonably collect from you.
We help clients settle IRS debt through a CPA-led Offer in Compromise — ensuring the financial disclosure process is handled with precision and backed by expert guidance.
Who qualifies?
- You can’t pay your full tax debt due to financial hardship
- Your tax debt exceeds your ability to pay over time
- You’re in non-collectible status
How to Apply:
You’ll need to provide full financial disclosure, showing your income, expenses, and assets. A tax resolution CPA can help you put together a solid case.
2. Installment Agreements
What is it?
An installment agreement allows you to pay off your debt in smaller, manageable payments over time. It’s one of the most common options for taxpayers who can’t afford to pay in full.
How does it work?
- The FTB or IRS will set up a payment plan based on your financial situation.
- You’ll make monthly payments for 12–72 months.
- Interest and penalties continue to accrue, but you’ll stop the immediate threat of collection actions.
3. Hardship Deferral (Temporary Pause on Collections)
What is it?
If paying your tax debt would cause extreme financial hardship, you may qualify for a hardship deferral. This temporarily suspends collections like levies and garnishments.
We help eligible clients pause California collections through a hardship request so they can stabilize their finances before resuming payments.
Who qualifies?
- You have little to no income
- You can’t afford basic living expenses
- You’re facing serious health issues, a job loss, or a natural disaster
How to Apply:
This process involves submitting your financial details to the FTB or IRS and demonstrating that paying your tax debt would jeopardize your basic needs.
4. Penalty Abatement
What is it?
Penalty abatement allows you to have penalties removed from your tax balance if you have a valid reason for being late, such as illness or natural disaster.
We can help you temporarily stop IRS collection with CNC status while your financial situation improves.
How to Request It:
You must provide proof of reasonable cause (e.g., medical records, disaster declarations) and show that the failure to pay was beyond your control.
5. Innocent Spouse Relief
What is it?
If you filed jointly with your spouse and are now facing tax debt that is solely their responsibility, Innocent Spouse Relief can help protect you from paying their debt.
How It Works:
The IRS or FTB may agree to remove your responsibility for the debt if you can prove:
- You didn’t know about the debt
- The debt is solely related to your spouse’s actions
- You will suffer financial hardship if forced to pay
6. Bankruptcy (Last Resort)
What is it?
In some cases, bankruptcy may eliminate certain tax debts, but this option is typically reserved for extreme cases where all other relief options have been exhausted.
Who Qualifies?
You may qualify for bankruptcy if:
- Your tax debt is older than 3 years
- You’ve filed all required returns
- Your debts exceed your ability to pay
Compare IRS and State Collection Tactics
While both the IRS and California FTB enforce tax collection, their strategies differ. We help you compare IRS and state collection enforcement tactics so you can make informed decisions based on your specific situation.
- The IRS may issue federal liens and levies faster, but also offers more formal relief options like CNC.
- The FTB tends to be aggressive with wage garnishments and bank levies.
- State agencies may not follow the same hardship protocols — knowing the difference can be the key to fast resolution.
How Boulanger CPA Helps with Tax Relief
At Boulanger CPA, we help Orange County residents and California taxpayers navigate these complex relief options. Whether you’re seeking a manageable payment plan, an Offer in Compromise, or penalty removal, we offer personalized, expert tax resolution services.
Contact Us for a Free Tax Relief Consultation
Don't let tax debt control your life any longer. We can help you find the best resolution option and guide you every step of the way.
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Call now:
657-218-5700
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Book online:
orangecounty.cpa/schedule
Serving all of Orange County
Frequently Asked Questions
What are my tax relief options if I owe the IRS or FTB?
You may qualify for an installment agreement, Offer in Compromise, Currently Not Collectible status, or hardship deferral depending on your situation.
Can I settle tax debt for less than I owe?
Yes. If you meet strict financial criteria, both the IRS and California FTB offer settlement programs that allow you to resolve debt for less than the full amount.
What if I can’t afford to pay anything right now?
You may qualify for CNC status (IRS) or a hardship deferral (FTB). These programs pause collections based on documented financial hardship.
What’s the best relief program for payroll or sales tax debt?
For EDD (payroll) or CDTFA (sales tax), programs are more limited but settlement and payment plans are possible. Representation is key for a better outcome.
What if I owe both state and federal taxes?
You’ll need to resolve each debt separately. A CPA can coordinate IRS and California relief options to avoid conflicting enforcement actions.
Why should I hire a local CPA in Orange County?
California agencies enforce tax debt aggressively. A CPA who understands both IRS and state programs can protect your income, bank accounts, and business faster.
📣 About the Author
Marc Boulanger, CPA is the founder of Boulanger CPA and Consulting PC, a boutique tax resolution firm based in Orange County, California and trusted by high-income individuals and business owners across Southern California.
He is the author of Defend What’s Yours: A California Taxpayer’s Guide to Beating the IRS and FTB at Their Own Game, available now on Amazon. The book offers a step-by-step plan for resolving IRS and FTB tax debt without losing your business, your home, or your peace of mind.
With over a decade of experience resolving high-stakes IRS and State tax matters, Marc brings strategic insight to complex cases involving wage garnishments, bank levies, unfiled returns, and six-figure tax debts. He is known for helping clients reduce or eliminate tax liabilities through expertly negotiated settlements and compliance plans.
Marc is a Certified Public Accountant licensed in California and Oklahoma and holds the designation of Certified Tax Representation Consultant. He is a member of the American Society of Tax Problem Solvers (ASTPS) — the national organization founded by the educators and practitioners who have trained thousands of CPAs, EAs, and tax attorneys in IRS representation strategy.
Every case is handled with discretion, proven methodology, and direct CPA-led representation — not call center scripts.
📍 Learn more at www.orangecounty.cpa or call (657) 218-5700.
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