Is there a smaller lump sum I can pay it off for?

If you cannot afford to pay the full amount AND are willing to fill out a form disclosing all of your assets and liabilities AND swear that it is accurate under penalties of perjury, you may apply to make an Offer in Compromise. Both the IRS and FTB have an OIC Division. If you go to the URL below, it will explain the forms required for California. There will be a similar booklet for IRS purposes. https://www.ftb.ca.gov/forms/misc/4905pit.PDF The paragraph below comes from the FTB's website found at ftb.ca.gov. Offer in Compromise (OIC) An OIC is for taxpayers who do not have, and will not have in the foreseeable future, the income, assets, or means to pay their tax liability. The program allows taxpayers to submit an application and offer a lesser amount for payment of a nondisputed final tax liability. We consider each case?s unique facts and circumstances and generally approve an offer when the amount offered represents the most we can expect to collect within a reasonable period of time. For more information, go to ftb.ca.gov and search for offer in compromise. One of our primary responsibilities is to collect and account for state income tax revenue. In collecting this revenue, we commit to the fair administration of the tax laws and partner with taxpayers and their representatives to resolve compliance issues. We want to help.

Possibly, but you would have to file an Offer In Compromise in order to pay a smaller amount and have the balance of the liability forgiven.