FTB 3840 Missing Form – What to Do If You Received a Like-Kind Exchange Notice

FTB 3840 Missing Form – What to Do If You Received a Like-Kind Exchange Notice

The California Franchise Tax Board (FTB) may send you a letter titled "Request for Missing Form FTB 3840 – IRS 8824 Filer." This notice usually means they expected you to file Form FTB 3840 to report a like-kind exchange (also called a 1031 exchange) on your California return, and they didn’t receive it.

To avoid penalties and keep your exchange records clean, follow the checklist below.

📌 What You Should Upload

✅ Scan all pages of the FTB notice, front and back, into one clear PDF file.

✅ Upload the closing statement for the California property you sold.

✅ Upload the closing statement for the California property you purchased (if you acquired one in the same exchange).

✅ Include any 1031 Exchange documents, including a copy of your original exchange agreement and any completed IRS or state forms.

💡 Use your client portal to securely upload these files. Then message your relationship manager to confirm submission.

🔄 How We Handle It

  1. Review Documents: Our team will review your scanned notice and exchange documentation.
  2. Clarify Filing Status: We'll determine if the exchange was reported and whether the state has jurisdiction.
  3. Draft Response: We will prepare a written response to FTB and submit any missing forms if needed.
  4. Confirmation: You’ll receive an update once FTB accepts the resolution or requests more info.

⏳ Deadlines & Penalties

📅 Deadline: Respond within 30 days from the date listed on the notice.

💸 Penalty: FTB may assess a late penalty of $18 per month for each missing form, up to $54 total.

❓ Frequently Asked Questions

  • What if I didn’t do a like-kind exchange?
    Still upload the notice and let us know. We’ll respond to FTB explaining the situation.
  • What if the exchange wasn’t in California?
    We’ll clarify location and facts in our letter to FTB—your obligation may not apply if the properties were outside of CA.
  • Can I ignore this?
    No. Unaddressed notices can lead to penalties or delays in processing your state return.

🔗 Related Articles

📎 Tags

FTB 3840, California Franchise Tax Board, Like-Kind Exchange, 1031 Exchange, IRS 8824, State Notices, Real Estate Sale, State Tax Compliance, Missing Form Penalty

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