Have a Tax Question? Ask a Tax Expert
If the letter came from CA FTB then it is CA that is requesting the information.
The Franchise Tax Board (FTB) may request information from you regarding your California income tax return within the California statute of limitations period, which is usually the later of four years from the due date of the return (2017 April) or the date the return is filed.
You will need to supply them with the reimbursement information or they could remove the deduction. You need to request the policy statement from your employer for 2012. The employer would be able to substantiate their policy on reimbursements.
I suggest you also pull out your receipts for the expense you claimed. The $20000 is an amount that would have drawn the attention of the CA FTB but as long as you supply them with the policy (how the company reimburses) and you have records to substantiate the amount you should be fine.
You are required to click a positive rating if I am to be credited with the response.You have to actively click on a rating and click submit. Smiley Faces or Stars.
Checking to see if you responded
If you kept your receipts for the deductions then make copies and send those back to CA FTB. CA will not assess any additional tax until you have had the time to respond.
If you kept no records with your 2012 tax return then do an amended return removing that $20,000 and you will know the additional tax.
Those are your options, either produce your copies of receipts which show you were not reimbursed for the amounts you claimed or amend that CA return and remove the deduction.