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All Topics > Expired Tags > Can The DMV Put A Lien On My Bank Account?

Can The DMV Put A Lien On My Bank Account?

 
Question 
I had a vehicle that had back owed registration fees. I donated the vehicle to Kars4Kids earlier this month. The California DMV took out a lien on my bank account in the amount of $1060.00 just yesterday. After I made the donation, I received an email stating that the Release of Liability had already been filed. My question is if the ROL was filed, is the state still allowed to levy my bank account after the date of the ROL filing? I am ignorant of the details of how this all works and am curious to know if I have the right to dispute the lien. I appreciate any advice. Thanks in advance!

Answer 

The DMV, or the California State Franchise Tax Board to be exact, has the right to collect back vehicle registration fees owed during or after a vehicle owner ceases ownership of the vehicle.

It should be noted that reporting the sale or transfer of a vehicle to the DMV does not constitute a transfer of ownership. The vehicle record is not permanently transferred out of your name until the DMV receives a completed application for transfer of ownership and payment of appropriate fees from the new owner.

Here is a link to the DMV Notice of Transfer and Release of Liability webpage... File NRL Online

None the less and regardless of whether a DMV Notice of Transfer and Release of Liability REG 138 (NRL) has been filed, it does not release the vehicle's prior owner from the obligation of paying delinquent or back registration fees. As such, the DMV will report the delinquent fees to the California State Franchise Tax Board (FTB) and the FTB may collect involuntary payment through methods such as bank and wage levies.

Brief Overview of the Delinquent Vehicle Registration Collections Process

The California DMV mails annual vehicle registration renewal notices 60 days before a vehicle's registration expiration date. The address the renewal notice is mailed to is the last known registered vehicle mailing address. If you do not pay registration renewal fees before or on the registration expiration date, the DMV will send a delinquent notice marked Final Notice 30 days after the expiration date. This is your second notice and a cue that the DMV is serious about receiving your registration renewal payment or at least needs information on why you will not be making a payment, e.g. vehicle was sold, junked, wrecked or will be PNO (placed under planned non operation status). The third and final notice that will be sent, and after which if fees are still unpaid, result in a collection account being opened, is also marked Final Notice and is sent 30 days after the second notice. This notice will advise you that your unpaid account is being referred to the Franchise Tax Board for collection action.

The DMV itself lacks the authority to collect involuntary payment from vehicle owners. Involuntary payment means the FTB collects payment without your acceptance and/or approval, thus refer back owed fees to the FTB for collection and retain management responsibility for all referred accounts. Disputes or complaints which arise related to the vehicle's registration are handled by the DMV's Liaison Section or referred to your local DMV field office for resolution. This allows vehicle owners to deal directly with their local DMV field office and if need be make payment directly to the DMV; even after a collection account has been opened. This proves to be most helpful to vehicle owners in resolving delinquent vehicle registration collections.

Generally, by the time the DMV receives an account referral, registration fees are 90 days delinquent. Demand for Payment Notices are immediately issued (this is your 3rd notice). If you do not respond to the notice within 10 days, they will forward the account to the FTB and begin involuntary collection action, such as bank and wage levies.

Bank levy: Once the DMV issues a bank levy attaching the debtor’s bank accounts, they provide the debtor at least 10 days from the notice date to pay the debt voluntarily before the bank automatically forwards the funds to them.

Wage levy: Once the DMV issues a wage levy to a debtor’s employer, they provide the debtor at least 10 days from the notice date to pay the debt voluntarily before the employer is required to begin withholding up to 25 percent of the debtor’s disposable income.

The Franchise Tax Board will determine whether to collect involuntary payment via a bank or wage levy depending on the information available to them.

How Do I Pay a Delinquent Registration "Demand for Payment" Notice?

There are three methods by which you may pay your delinquent vehicle registration fees and close your collection account.

By Mail - Make your personal check, cashier's check, or money order payable to DMV and write your vehicle license plate number on the front of your money order or check. Cash and credit cards are not accepted. Mail your payment and a copy of the demand for payment letter to:

DMV
Revenue Services Support Unit
Mail Station C140
PO Box 825341
Sacramento, CA 94232-5341

In person at your local DMV branch office - You may visit your local DMV branch office and pay delinquent registration fees in person. For faster service, we recommend making an appointment online or call 1-800-777-0133 to make an appointment. You must bring with you:

A copy of the demand for payment letter or your vehicle's license plate number.
Cash, or an ATM/Debit card, or a personal check, cashier's check, or money order made payable to DMV. Credit cards are not accepted at field offices.

Online - Visit our registration renewal webpage to pay your DMV delinquent registration fees online.

Frequently Asked Delinquent Vehicle Registration Questions

I received a notice that a levy is going to be placed on my bank account or my wages are going to be garnished, but I've already paid the late registration fees I owed. How do I stop the wage garnishment or bank levy?

After you've made full DMV payment online, by mail, or directly at a DMV branch office, you must contact the Revenue Services Support Unit at (916) 657-8120 to stop the wage garnishment or bank levy and to close your collections account.

I owe back fees. Can I make partial payments to the DMV?

To be exact, you can not make partial payments to the Department of Motor Vehicles. The DMV does not offer payment plans of any sort. You may however make partial payments to the Franchise Tax Board. If you've received a Demand for Payment letter from the Franchise Tax Board this means your account is in collections. You will have the ability to make partial payments after speaking with a FTB agent however, it should be noted, partial payments will not stop the collection process and a partial payment does not allow you to operate or park your vehicle on the public streets and/or roadways. Only a full payment will close your DMV collection account and reinstate your vehicle's registration.

I received a Demand for Payment letter after I already paid my fees. Should I disregard the notice?

Yes, you may disregard the demand for payment letter if you've paid your registration fees within the last 30 days of receiving the notice. Demand for Payment letters are printed and mailed in advance. They do not reflect recent payments. We do recommend however that you contact the Revenue Services Support Unit at (916) 657-8120 to verify that in fact your payment has been received.

Can I close a collection account if my vehicle was junked or wrecked?

Yes, you may close a collection account on a junked or wrecked vehicle however it may require you still pay delinquent registration fees. If your vehicle was deemed a total loss by your insurance company, wrecked, or you chose to junk it, consideration must be given to the vehicle's registration expiration date in order to determine whether you'll be required to pay registration fees before your collection account is closed.

Junked, wrecked or totaled AFTER registration expiration: The registration fees and penalties remain due and must be paid to close the account.

Junked, wrecked or totaled BEFORE registration expiration: Registration fees and penalties may be waived by sending supporting documents (police report, accident report, copy of insurance settlements, etc.) with a copy of your demand for payment letter to the DMV Revenue Services Support Unit as addressed above.

I have a vehicle I haven't driven since its registration expired and I don't plan on driving it anymore. Do I still have to pay registration fees to close the collection account?

This depends on when the vehicle's registration expired. If it's been less than 90 days since the expiration date you can place the vehicle under Planned Non-Operation (PNO) status and close the collection account by submitting the following to DMV:

- A Certificate of Non-Operation/Planned Non-Operation Certification (PDF) (REG 102) form
- The fee for planned non-operation
- The registration penalties shown on the Demand for Payment letter

If the vehicle's registration has expired more than 90 days it can not be put on PNO and the full year registration fees and penalties must be paid to close the collection account.


 
 



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