citation: RTC § 6456

text:
(a) Under regulations prescribed by the board, if: (1) A tax liability under this part was understated by a failure to file a return required to be filed under this part, by the omission of an amount properly includable therein, or by erroneous deductions or credits claimed on a return, and the understatement of tax liability is attributable to one spouse; or any amount of the tax reported on a return was unpaid and the nonpayment of the reported tax liability is attributable to one spouse,(2) The other spouse establishes that he or she did not know of, and had no reason to know of, that understatement or nonpayment, and(3) Taking into account whether or not the other spouse significantly benefited directly or indirectly from the understatement or the nonpayment and taking into account all other facts and circumstances, it is inequitable to hold the other spouse liable for the deficiency in tax attributable to that understatement or nonpayment,then the other spouse shall be relieved of liability for tax (including interest, penalties, and other amounts) to the extent that the liability is attributable to that understatement or nonpayment of tax.

(b) For purposes of this section, the determination of the spouse to whom items of understatement or nonpayment are attributable shall be made without regard to community property laws.

(c) This section shall apply to all calendar quarters subject to the provisions of this part, but shall not apply to any calendar quarter that is more than five years from the final date on the board-issued determination, five years from the return due date for nonpayment on a return, or one year from the first contact with the spouse making a claim under this section; or that has been closed by res judicata, whichever is later.

(d) For purposes of paragraph (2) of subdivision (a), “reason to know” means whether or not a reasonably prudent person would have had reason to know of the understatement or nonpayment.

(e) For purposes of this section, with respect to a failure to file a return or an omission of an item from the return, “attributable to one spouse” may be determined by whether a spouse rendered substantial service as a retailer of taxable items to which the understatement is attributable. If neither spouse rendered substantial services as a retailer, then the attribution of applicable items of understatement shall be treated as community property. An erroneous deduction or credit shall be attributable to the spouse who caused that deduction or credit to be entered on the return.

(f) Under procedures prescribed by the board, if, taking into account all the facts and circumstances, it is inequitable to hold the other spouse liable for any unpaid tax or any deficiency (or any portion of either) attributable to any item for which relief is not available under subdivision (a), the board may relieve the other spouse of that liability.

history: (History: Amended by Stats. 2000, Ch. 1052, Sec. 1. Effective January 1, 2001.)

article: 1. Returns and Payments


kind: section

code: RTC

citation: RTC § 6457

text: Section 6453 shall not be applicable with respect to a lease of tangible personal property, but the lessor shall report the rentals paid by the lessee during the preceding reporting period; a lessee shall report the rentals payable in the preceding reporting period upon which tax has not been paid to his lessor required to collect the tax. The return shall also show the amount of the taxes for the period covered by the return and such other information as the board deems necessary for the proper administration of this part.

history: (History: Amended by Stats. 1965, 1st Ex. Sess., Ch. 2.)

division: 2. OTHER TAXES

part: 1. SALES AND USE TAXES

chapter: 5. Determinations

article: 1. Returns and Payments

path: 2. OTHER TAXES > 1. SALES AND USE TAXES > 5. Determinations > 1. Returns and Payments


citation: RTC § 6459

text:
(a) (1) Except as provided in subdivisions (b) and (c), the board for good cause may extend for not to exceed one month the time for making any return or paying any amount required to be paid under this part. The extension may be granted at any time provided a request therefor is filed with the board within or prior to the period for which the extension may be granted.

(2) Any person to whom an extension is granted shall pay, in addition to the tax, interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the date on which the tax would have been due without the extension until the date of payment.

(b) (1) The board may grant an extension for more than one month if both of the following conditions occur:

(A) A budget for the state has not been adopted by July 1.

(B) The person requesting the extension is a creditor of the state who has not been paid because of the state’s failure to timely adopt a budget.

(2) Any extension granted under this subdivision shall expire no later than the last day of the month following the month in which the budget is adopted or one month from the due date of the return or payment, whichever comes later.

(3) Any person to whom an extension has been granted under this subdivision shall pay, in addition to the tax, interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the date on which the tax would have been due without the extension until the date of payment. However, no interest shall be due on that portion of the payment equivalent to the amount due to the person from the state on the due date of the payment.

(c) (1) In the case of a disaster, the board, for a period not to exceed three months, may extend the time for making any report or return or paying any tax required under this part. The extension may be granted at any time provided a request therefor is filed with the board within or before the period for which the extension may be granted.

(2) Any person to whom an extension is granted shall pay, in addition to the tax, interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the date on which the tax would have been due without the extension until the date of payment.

(3) For purposes of this section, “disaster” means fire, flood, storm, tidal wave, earthquake, or similar public calamity, whether or not resulting from natural causes.

history: (History: Amended by Stats. 2016, Ch. 257, Sec. 1. (AB 1559) Effective September 9, 2016.)

article: 1. Returns and Payments


text:
(a) Subject to subdivision (c), if the Governor issues a state of emergency proclamation, the department may extend the time, for a period not to exceed three months, for making any report or return or paying any tax required under this part for any person in an area identified in the state of emergency proclamation.

(b) If the department makes an extension pursuant to subdivision (a), any person in an area identified in a state of emergency proclamation shall not be required to file a request for the extension.

(c) The department may make the extension in subdivision (a) only during the first 12 months following the issuance of the state of emergency proclamation or the duration of the state of emergency, whichever is less.

history: (History: Added by Stats. 2022, Ch. 474, Sec. 3. (SB 1496) Effective January 1, 2023.)

article: 1. Returns and Payments


citation: RTC § 6470

text: The provisions of this article do not apply to persons filing returns for other than quarterly periods. The provisions of this article apply to taxes imposed under ordinances adopted pursuant to Part 1.5 (commencing with Section 7200), Part 1.6 (commencing with Section 7251), or Article 2 (commencing with Section 37021) of Part 17 of this division in the same manner and to the same extent that the provisions of this article apply to taxes imposed under this part.

history: (History: Amended by Stats. 1969, Ch. 24.)

article: 1.1. Prepayment

path: 2. OTHER TAXES > 1. SALES AND USE TAXES > 5. Determinations > 1.1. Prepayment


citation: RTC § 6471

text:
(a) Upon written notification by the board, any person whose estimated measure of tax liability under this part averages seventeen thousand dollars ($17,000) or more per month, as determined by the board, shall, without regard to the measure of tax in any one month, make prepayments as prescribed in this section.

(1) In the first, third, and fourth calendar quarters, the person shall prepay not less than 90 percent of the amount of state and local tax liability for each of the first two monthly periods of each quarterly period.

(2) In the second calendar quarter, the person shall make a first prepayment of 90 percent of the amount of state and local tax liability for the first monthly period of the quarterly period and a second prepayment of either of the following:

(A) Ninety percent of the amount of state and local tax liability for the second monthly period of the quarterly period, plus 90 percent of the amount of state and local tax liability for the first 15 days of the third monthly period of the quarterly period.

(B) Ninety percent of the amount of state and local tax liability for the second monthly period of the quarterly period, plus 50 percent of 90 percent of the amount of state and local tax liability for the second monthly period of the quarterly period.

(b) Persons engaged in their present business during all of the corresponding quarterly period of the preceding year, or persons who are successors to a business that was in operation during all of that quarterly period, may satisfy the above monthly prepayment requirements for the first, third, and fourth calendar quarters by payment of an amount equal to one-third of the measure of tax liability reported on the return or returns filed for that quarterly period of the preceding year multiplied by the state and local tax rate in effect during the month for which the prepayment is made.

These persons may satisfy their prepayment requirements for the second calendar quarter by making a first prepayment of an amount equal to one-third of the measure of tax liability reported, and a second prepayment of an amount equal to one-half of the measure of tax liability reported, on the return or returns filed for that quarterly period of the preceding year multiplied by the state and local tax rate in effect during the month for which the prepayment is made.

Prepayments shall be made during the quarterly periods designated by the board and during each succeeding quarterly period until further notified in writing by the board.

history: (History: Amended by Stats. 2000, Ch. 135, Sec. 151. Effective January 1, 2001.)

article: 1.1. Prepayment


text: Any person required to make prepayment pursuant to Article 1.5 (commencing with Section 6480) may not be required to make additional prepayment pursuant to this article, provided that more than 75 percent of the gross receipts of that person are from the retail sale of motor vehicle fuel, diesel fuel, aircraft jet fuel, or any combination of those fuels.

history: (History: Amended by Stats. 2001, Ch. 429, Sec. 1. Effective October 2, 2001. Operative January 1, 2002, by Sec. 78 of Ch. 429.)

article: 1.1. Prepayment


text:
The department, in its discretion, may relieve any person from the requirement to make prepayments pursuant to Section 6471 if both of the following apply:

(a) The person is a dealer required to pay any sales or use tax, as applicable, to the Department of Motor Vehicles pursuant to Section 6295.

(b) During the prior calendar year, more than 75 percent of the gross receipts of that person are from retail sales of motor vehicles required to be registered under the Vehicle Code, except for a recreational vehicle that is either truck-mounted, permanently towable on the highways without a permit, or a park trailer, as those terms are defined in Section 18010 of the Health and Safety Code.

history: (History: Added by Stats. 2024, Ch. 499, Sec. 1. (SB 1528) Effective January 1, 2025.)

article: 1.1. Prepayment


citation: RTC § 6472

text:
Except in the case of persons required to remit amounts due in accordance with Article 1.2 (commencing with Section 6479.3), for purposes of Section 6471, a prepayment shall be accompanied by a report of the amount of the prepayment in a form prescribed by the board and shall be made to the board as follows:

(a) In the first, third, and fourth calendar quarters, on or before the 24th day next following the end of each of the first two monthly periods of each quarterly period.

(b) In the second calendar quarter, as follows:

(1) The first prepayment on or before the 24th day next following the end of the first monthly period of the quarterly period.

(2) The second prepayment on or before the 24th day of the third monthly period of the quarterly period for the second monthly period and the first 15 days of the third monthly period of the quarterly period.

history: (History: Amended by Stats. 2000, Ch. 135, Sec. 152. Effective January 1, 2001.)

article: 1.1. Prepayment


citation: RTC § 6473

text: The amount of the prepayment shall constitute a credit against the amount of the taxes due and payable for the quarterly period in which the prepayment became due.

history: (History: Added by Stats. 1966, Ch. 5.)

article: 1.1. Prepayment


citation: RTC § 6474

text: In determining whether a person’s estimated measure of tax liability averages seventeen thousand dollars ($17,000) or more per month for purposes of Section 6471.5, the board may consider tax returns filed pursuant to this part as well as any information in the board’s possession or which may come into its possession.

history: (History: Added by renumbering Section 6474.5 by Stats. 1985, Ch. 106, Sec. 125. Note: The amendment by Stats. 1987, Ch. 1144, did not become operative because the conditions in Sec. 8 of Ch. 1144 failed.)

article: 1.1. Prepayment


citation: RTC § 6476

text: Any person required to make a prepayment pursuant to Section 6471 who fails to make a timely prepayment but makes such prepayment before the last day of the monthly period following the quarterly period in which the prepayment became due, shall also pay a penalty of 6 percent of the amount of prepayment.

article: 1.1. Prepayment


citation: RTC § 6477

text: Any person required to make a prepayment pursuant to Section 6471 or Section 6471.5 who fails to make a prepayment before the last day of the monthly period following the quarterly period in which the prepayment became due and who files a timely return and payment for the quarterly period in which the prepayment became due shall pay a penalty of 6 percent of the amount equal to 90 percent of the tax liability, as prescribed in those sections, for each of the periods during that quarterly period for which a required prepayment was not made.

history: (History: Amended (as amended by Stats. 1983, Ch. 337) by Stats. 1999, Ch. 484, Sec. 3. Effective January 1, 2000. Note: The earlier amendment by Stats. 1987, Ch. 1144, conclusively failed to become operative under conditions in Sec. 8 of Ch. 1144.)

article: 1.1. Prepayment


citation: RTC § 6478

text:
(a) If a failure to make a prepayment as described in Section 6477 is due to negligence or intentional disregard of this part or authorized rules and regulations, the penalty shall be 10 percent instead of 6 percent.

(b) If any part of a deficiency in prepayment is due to negligence or intentional disregard of this part or authorized rules and regulations, a penalty of 10 percent of the deficiency shall be paid.

(c) The provisions of this section shall not apply to amounts subject to the provisions of Sections 6484, 6485, 6511, 6514, and 6591.

(d) The 10 percent negligence penalty shall become due and payable and shall be ascertained and determined in the same manner as the deficiency determination under Article 2 (commencing with Section 6481) of this chapter. The provisions of Article 5 (commencing with Section 6561) of this chapter shall be applicable with respect to the finality of the determination and the right to petition for redetermination.

history: (History: Amended by Stats. 2007, Ch. 342, Sec. 2. Effective January 1, 2008.)

article: 1.1. Prepayment


citation: RTC § 6479

text: Notification by the board, provided for in Section 6471, may be served personally or by mail in the manner prescribed in Section 6486 for service of notice of a deficiency determination.

history: (History: Amended by Stats. 1974, Ch. 610.)

article: 1.1. Prepayment


text:
(a) Except as provided in subdivision (k), any person whose estimated tax liability under this part averages ten thousand dollars ($10,000) or more per month, as determined by the department pursuant to methods of calculation prescribed by the department, shall remit amounts due by an electronic funds transfer under procedures prescribed by the department. Any person who collects use tax on a voluntary basis is not required to remit amounts due by electronic funds transfer.

(b) Any person whose estimated tax liability under this part averages less than ten thousand dollars ($10,000) per month or any person who voluntarily collects use tax may elect to remit amounts due by electronic funds transfer with the approval of the department.

(c) Any person remitting amounts due pursuant to subdivision (a) or (b) shall perform electronic funds transfer in compliance with the due dates set forth in Article 1 (commencing with Section 6451) and Article 1.1 (commencing with Section 6470). Payment is deemed complete on the date the electronic funds transfer is initiated, if settlement to the state’s demand account occurs on or before the banking day following the date the transfer is initiated. If settlement to the state’s demand account does not occur on or before the banking day following the date the transfer is initiated, payment is deemed to occur on the date settlement occurs.

(d) Any person remitting taxes by electronic funds transfer shall, on or before the due date of the remittance, file a return for the preceding reporting period in the form and manner prescribed by the department. Any person who fails to timely file the required return shall pay a penalty of 10 percent of the amount of taxes, exclusive of prepayments, with respect to the period for which the return is required.

(e) (1) Except as provided in paragraph (2), any person required to remit taxes pursuant to this article who remits those taxes by means other than appropriate electronic funds transfer shall pay a penalty of 10 percent of the taxes incorrectly remitted.

(2) A person required to remit prepayments pursuant to this article who remits a prepayment by means other than an appropriate electronic funds transfer shall pay a penalty of 6 percent of the prepayment amount incorrectly remitted.

(f) Except as provided in Sections 6476 and 6477, any person who fails to pay any tax to the state or any amount of tax required to be collected and paid to the state, except amounts of determinations made by the department under Article 2 (commencing with Section 6481) or Article 3 (commencing with Section 6511), within the time required shall pay a penalty of 10 percent of the tax or amount of tax, in addition to the tax or amount of tax, plus interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the date on which the tax or the amount of tax required to be collected became due and payable to the state until the date of payment.

(g) In determining whether a person’s estimated tax liability averages ten thousand dollars ($10,000) or more per month, the department may consider tax returns filed pursuant to this part and any other information in the department’s possession.

(h) Except as provided in subdivision (i), the penalties imposed by subdivisions (d), (e), and (f) shall be limited to a maximum of 10 percent of the taxes due, exclusive of prepayments, for any one return. Any person remitting taxes by electronic funds transfer shall be subject to the penalties under this section and not Section 6591.

(i) The penalties imposed with respect to paragraph (2) of subdivision (e) and Sections 6476 and 6477 shall be limited to a maximum of 6 percent of the prepayment amount.

(j) The department shall promulgate regulations pursuant to Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code for purposes of implementing this section.

(k) (1) On and after January 1, 2022, a person licensed to engage in commercial cannabis activity under Division 10 (commencing with Section 26000) of the Business and Professions Code, may remit amounts due by a means other than electronic funds transfer, if the department deems it necessary to facilitate collection of amounts due.

(2) A person licensed to engage in commercial cannabis activity under Division 10 (commencing with Section 26000) of the Business and Professions Code that failed to remit amounts due by means of electronic funds transfer on and after January 1, 2022, and before January 1, 2023, is not subject to or is relieved of any of the penalties imposed by this section for that failure.

history: (History: Amended by Stats. 2022, Ch. 56, Sec. 13. (AB 195) Effective June 30, 2022.)

path: 2. OTHER TAXES > 1. SALES AND USE TAXES > 5. Determinations > 1.2. Payment by Electronic Funds Transfer


text: If the board finds that a person’s failure to make payment by an appropriate electronic funds transfer in accordance with board procedures is due to reasonable cause and circumstances beyond the person’s control, and occurred notwithstanding the exercise of ordinary care and in the absence of willful neglect, that person shall be relieved of the penalty provided in subdivision (e) of Section 6479.3.

history: (History: Added by Stats. 1991, Ch. 473, Sec. 4.)

article: 1.2. Payment by Electronic Funds Transfer


text:
(a) “Electronic funds transfer” means any transfer of funds, other than a transaction originated by check, draft, or similar paper instrument, that is initiated through an electronic terminal, telephonic instrument, or computer or magnetic tape, so as to order, instruct, or authorize a financial institution to debit or credit an account. Electronic funds transfers shall be accomplished by an automated clearinghouse debit, an automated clearinghouse credit, or by Federal Reserve Wire Transfer (Fedwire).

(b) “Automated clearinghouse” means any federal reserve bank, or an organization established in agreement with the National Automated Clearing House Association, that operates as a clearinghouse for transmitting or receiving entries between banks or bank accounts and which authorizes an electronic transfer of funds between these banks or bank accounts.

(c) “Automated clearinghouse debit” means a transaction in which the state, through its designated depository bank, originates an automated clearinghouse transaction debiting the person’s bank account and crediting the state’s bank account for the amount of tax. Banking costs incurred for the automated clearinghouse debit transaction shall be paid by the state.

(d) “Automated clearinghouse credit” means an automated clearinghouse transaction in which the person through his or her own bank, originates an entry crediting the state’s bank account and debiting his or her own bank account. Banking costs incurred for the automated clearinghouse credit transaction charged to the state shall be paid by the person originating the credit.

(e) “Fedwire transfer” means any transaction originated by a person and utilizing the national electronic payment system to transfer funds through the federal reserve banks, when that person debits his or her own bank account and credits the state’s bank account. Electronic funds transfers pursuant to Section 6479.3 may be made by Fedwire only if payment cannot, for good cause, be made according to subdivision (a), and the use of Fedwire is preapproved by the board. Banking costs incurred for the Fedwire transaction charged to the person and to the state shall be paid by the person originating the transaction.


text:
(a) Any return, declaration, statement, or other document required to be made under this part that is filed using electronic media shall be filed and authenticated pursuant to any method or form the board may prescribe.

(b) Notwithstanding any other law, any return, declaration, statement, or other document otherwise required to be signed that is filed by the taxpayer using electronic media in a form as required by the board shall be deemed to be a signed, valid original document, including upon reproduction to paper form by the board.

(c) Electronic media includes, but is not limited to, computer modem, magnetic media, optical disk, facsimile machine, or telephone.

(d) Payment is deemed timely for electronically filed returns if the transmission is completed on or before the due date of the return.

history: (History: Amended by Stats. 2000, Ch. 923, Sec. 5. Effective January 1, 2001.)


citation: RTC § 6480

text:
(a) For purposes of the imposition of the prepayment of sales tax on motor vehicle fuel or aircraft jet fuel pursuant to this article, the terms “aircraft jet fuel,” “aircraft jet fuel dealer,” “aviation gasoline,” “entry,” “in this state,” “motor vehicle fuel,” “person,” “removal,” “sale,” and “supplier” are defined pursuant to Part 2 (commencing with Section 7301), except as provided in subdivision (b).

(b) For purposes of this article, “motor vehicle fuel” does not include aviation gasoline for use in propelling aircraft.

(c) For purposes of the imposition of the prepayment of sales tax on diesel fuel pursuant to this article, the terms “diesel fuel,” “entry,” “in this state,” “removal,” “person,” and “supplier,” are defined pursuant to Part 31 (commencing with Section 60001).

(d) “Wholesaler” includes every person other than a supplier, dealing in motor vehicle fuel, aircraft jet fuel, or diesel fuel. “Wholesaler” does not include anyone dealing in motor vehicle fuel or diesel fuel in the capacity of an operator of a service station. “Wholesaler” does not include anyone dealing in aircraft jet fuel in the capacity of an aircraft jet fuel dealer.

(e) With respect to diesel fuel and aircraft jet fuel, “sale” means:

(1) The transfer of title or possession, exchange, or barter, conditional or otherwise, in any manner or by any means whatsoever, of aircraft jet fuel or diesel fuel (other than aircraft jet fuel or diesel fuel in a terminal) to a purchaser for a consideration.

(2) The transfer of the inventory position in the aircraft jet fuel or diesel fuel in a terminal if the purchaser becomes the positionholder with respect to the taxable fuel.

(f) For purposes of this article, aircraft jet fuel will be subject to the prepayment of sales tax at such time and in such manner as if it were subject to diesel fuel tax under the Diesel Fuel Tax Law in Part 31 (commencing with Section 60001), except that in the case of bulk transfers, aircraft jet fuel is not subject to the prepayment of sales tax as to the removal of diesel fuel in this state from any refinery as described in paragraph (1) of subdivision (a) of Section 60052, the entry of diesel fuel into this state as described in paragraph (1) of subdivision (b) of Section 60052, or the removal of diesel fuel in this state as described in subdivision (c) of Section 60052.

history: (History: Amended by Stats. 2001, Ch. 429, Sec. 2. Effective October 2, 2001. Operative January 1, 2002, by Sec. 78 of Ch. 429.)

path: 2. OTHER TAXES > 1. SALES AND USE TAXES > 5. Determinations > 1.5. Prepayment of Sales Tax on Motor Vehicle Fuel Distributions


text:
(a) At any time that motor vehicle fuel tax or diesel fuel tax is imposed or would be imposed, but for the dyed diesel fuel exemption in paragraph (1) of subdivision (a) of Section 60100, or the train operator exemption in paragraph (7) of subdivision (a) of Section 60100 or paragraph (11) of subdivision (a) of Section 7401, or, pursuant to subdivision (f) of Section 6480, would be deemed to be imposed, on any removal, entry, or sale in this state of motor vehicle fuel, aircraft jet fuel, or diesel fuel, the supplier shall collect prepayment of retail sales tax from the person to whom the motor vehicle fuel, aircraft jet fuel, or diesel fuel is sold. However, if no sale occurs at the time of imposition of motor vehicle fuel tax or diesel fuel tax, the supplier shall prepay the retail sales tax on that motor vehicle fuel, aircraft jet fuel, or diesel fuel. The prepayment required to be collected by the supplier constitutes a debt owed by the supplier to this state until paid to the board, until satisfactory proof has been submitted to prove that the retailer of the fuel has paid the retail sales tax to the board, or until a supplier or wholesaler who has consumed the fuel has paid the use tax to the board. Each supplier shall report and pay the prepayment amounts to the board, in a form as prescribed by the board, in the period in which the fuel is sold. On each subsequent sale of that fuel, each seller, other than the retailer, shall collect from his or her purchaser a prepayment computed using the rate applicable at the time of sale. Each supplier shall provide his or her purchaser with an invoice for, or other evidence of, the collection of the prepayment amounts which shall be separately stated thereon.

(b) (1) A wholesaler shall collect prepayment of the retail sales tax from the person to whom the motor vehicle fuel, aircraft jet fuel, or diesel fuel is sold. Each wholesaler shall provide his or her purchaser with an invoice for or other evidence of the collection of the prepayment amounts, which shall be separately stated thereon.

(2) Each wholesaler shall report to the board, in a form as prescribed by the board and for the period in which the motor vehicle fuel, aircraft jet fuel, or diesel fuel was sold, all of the following:

(A) The number of gallons of fuel sold and the amount of sales tax prepayments collected by the wholesaler.

(B) The number of tax-paid gallons purchased and the amount of sales tax prepayments made by the wholesaler.

(C) In the event that the amount of sales tax prepayments collected by the wholesaler is greater than the amount of sales tax prepayments made by the wholesaler, then the excess constitutes a debt owed by the wholesaler to the state until paid to the board, or until satisfactory proof has been submitted that the retailer of the fuel has paid the tax to the board.

(c) A supplier or wholesaler who pays the prepayment and issues a resale certificate to the seller, but subsequently consumes the motor vehicle fuel, aircraft jet fuel, or diesel fuel, shall be entitled to a credit against his or her sales and use taxes due and payable for the period in which the prepayment was made, provided that he or she reports and pays the use tax to the board on the consumption of that fuel.

(d) The amount of a prepayment paid by the retailer or a supplier or wholesaler who has consumed the motor vehicle fuel, aircraft jet fuel, or diesel fuel to the seller from whom he or she acquired the fuel shall constitute a credit against his or her sales and use taxes due and payable for the period in which the sale was made. Failure of the supplier or wholesaler to report prepayments or the supplier’s or wholesaler’s failure to comply with any other duty under this article shall not constitute grounds for denial of the credit to the retailer, supplier, or wholesaler, either on a temporary or permanent basis or otherwise. To be entitled to the credit, the retailer, supplier, or wholesaler shall retain for inspection by the board any receipts, invoices, or other documents showing the amount of sales tax prepaid to his or her supplier, together with the evidence of payment.

(e) The rate of the prepayment required to be collected during the period from July 1, 1986, through March 31, 1987, shall be four cents ($0.04) per gallon of motor vehicle fuel distributed or transferred.

(f) The rate of prepayment required to be collected for motor vehicle fuel, aircraft jet fuel, and diesel fuel as established by the board in effect on January 1, 2013, shall remain in effect through June 30, 2013.

(g) On July 1 of each succeeding year, the prepayment rate per gallon for motor vehicle fuel, rounded to the nearest one-half of one cent ($0.005), of the required prepayment shall be established by the board based upon 80 percent of the combined state and local sales tax rate established by Sections 6051, 6051.2, 6051.3, 6051.5, 7202, and 7203.1, and Section 35 of Article XIII of the California Constitution on the arithmetic average selling price (excluding sales tax) as reported by an industry publication of all grades of gasoline sold through a self-service gasoline station. The board shall make its determination of the rate no later than March 1 of the same year as the effective date of the new rate. Immediately upon making its determination and setting of the rate, the board shall each year, no later than May 1, notify every supplier, wholesaler, and retailer of motor vehicle fuel. In the event the price of fuel decreases or increases or an exemption from sales tax for sales of fuel is enacted, and the established rate results in or could result in prepayments which consistently exceed or are significantly lower than the retailers’ sales tax liability, the board may readjust the rate.

(h) On July 1 of each succeeding year, the prepayment rate per gallon for aircraft jet fuel, rounded to the nearest one-half of one cent ($0.005), shall be established by the board based upon 80 percent of the combined state and local sales tax rate established by Sections 6051, 6051.2, 6051.3, 6051.5, 7202, and 7203.1, and Section 35 of Article XIII of the California Constitution on the arithmetic average selling price (excluding sales and state excise taxes) as determined by the board based on published industry reports. The board shall make its determination of the rate no later than March 1 of the same year as the effective date of the new rate. Immediately upon making its determination and setting of the rate, the board shall each year, no later than May 1, notify every supplier, wholesaler, and retailer of aircraft jet fuel. In the event the price of aircraft jet fuel decreases or increases, and the established rate results in prepayments that consistently exceed or are significantly lower than the retailers’ sales tax liability, the board may readjust the rate.

(i) On July 1 of each succeeding year, the prepayment rate per gallon for diesel fuel, rounded to the nearest one-half of one cent ($0.005), shall be established by the board based upon 80 percent of the combined state and local sales tax rate established by Sections 6051, 6051.2, 6051.3, 6051.5, 6051.8, 7202, and 7203.1, and Section 35 of Article XIII of the California Constitution on the arithmetic average selling price (excluding sales and state excise taxes) as determined by the board based on published industry reports. The board shall make its determination of the rate no later than March 1 of the same year as the effective date of the new rate. Immediately upon making its determination and setting of the rate, the board shall each year, no later than May 1, notify every supplier, wholesaler, and retailer of diesel fuel. In the event the rate of sales tax imposed on sales of diesel fuel increases or decreases or the price of diesel fuel decreases or increases, and the established rate results in or could result in prepayments that consistently exceed or are significantly lower than the retailers’ sales tax liability, the board may readjust the rate.

(j) (1) Notwithstanding any other provision of this section, motor vehicle fuel sold by a supplier or wholesaler to a qualified purchaser who, pursuant to a contract with the State of California or its instrumentalities, resells that fuel to the State of California or its instrumentalities shall be exempt from the prepayment requirements.

(2) A qualified purchaser who acquires motor vehicle fuel for subsequent resale to the State of California or its instrumentalities pursuant to this subdivision shall furnish to the supplier or wholesaler from whom the fuel is acquired an exemption certificate, completed in accordance with any instructions or regulations as the board may prescribe. The supplier or wholesaler shall retain the certificate in his or her records in support of the exemption. To qualify for the prepayment exemption, both of the following conditions shall apply:

(A) The qualified purchaser does not take possession of the fuel at any time.

(B) The fuel is delivered into storage tanks owned or leased by the State of California or its instrumentalities via facilities of the supplier or wholesaler, or by common or contract carriers under contract with the supplier or wholesaler.

(3) For purposes of this subdivision, “qualified purchaser” means a wholesaler who does not have or maintain a storage facility or facilities for the purpose of selling motor vehicle fuel.

history: (History: Amended by Stats. 2013, Ch. 523, Sec. 2. (SB 788) Effective January 1, 2014.)

article: 1.5. Prepayment of Sales Tax on Motor Vehicle Fuel Distributions


text:
(a) If the board determines that it is necessary for the efficient administration of this part, the board may require a supplier or wholesaler to provide the board with a list of purchasers to whom the motor vehicle fuel, aircraft jet fuel, or diesel fuel was sold.

(b) In addition to any other reports required under this article, the board may, by rule and otherwise, require additional, other, or supplemental reports, in any form which the board may require, from suppliers or wholesalers with respect to their sales of motor vehicle fuel, aircraft jet fuel, or diesel fuel.

(c) Any supplier or wholesaler who fails to comply with this section is guilty of a misdemeanor punishable as provided in Section 7153.

history: (History: Amended by Stats. 2001, Ch. 429, Sec. 4. Effective October 2, 2001. Operative January 1, 2002, by Sec. 78 of Ch. 429.)


text: The supplier or wholesaler shall file his or her prepayment form together with a remittance of the prepayment amounts, if any, required to be collected pursuant to Section 6480.1 payable to the State Board of Equalization, on or before the last day of the month following the monthly period to which the prepayment form or each prepayment relates.

history: (History: Amended by Stats. 2001, Ch. 429, Sec. 5. Effective October 2, 2001. Operative January 1, 2002, by Sec. 78 of Ch. 429.)


text:
(a) Any supplier or wholesaler who fails to make a timely remittance to the board of the prepayment amounts, if any, required pursuant to Sections 6480.1 and 6480.3 shall also pay a penalty of 10 percent of the amount of the prepayment due but not paid, plus interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the date the prepayment became due and payable to the state until the date of payment.

(b) The penalty amount specified in subdivision (a) shall be 25 percent if the supplier or wholesaler knowingly or intentionally fails to make a timely remittance.

history: (History: Amended by Stats. 2001, Ch. 429, Sec. 6. Effective October 2, 2001. Operative January 1, 2002, by Sec. 78 of Ch. 429.)


text:
(a) The following persons who have paid prepayment amounts either directly to the board or to the person from whom the motor vehicle fuel, aircraft jet fuel, or diesel fuel was purchased shall be refunded those amounts:

(1) Any person who exports the fuel for subsequent sale outside this state.

(2) Any person who sells the fuel which is exempt from the sales or use tax pursuant to Sections 6352, 6357, 6381, and 6396.

(3) Any person who has lost the fuel through fire, flood, theft, leakage, evaporation, shrinkage, spillage, or accident, prior to any retail sale.

(4) Any supplier who has removed fuel from an approved terminal at the terminal rack, but only to the extent that the supplier can show that tax on the same amount of fuel has been paid more than one time by the same supplier.

(5) Any person who is unable to collect the prepayment from the purchaser insofar as the sales of the fuel are represented by accounts which have been found to be worthless and charged off for income tax purposes, or, if the person is not required to file income tax returns, accounts which have been charged off in accordance with generally accepted accounting principles. If partial payments have been made, the payments shall be prorated between amounts due for fuel and amounts due for the related prepayment. If any of those accounts are thereafter in whole or in part collected by the seller, the gallons of fuel represented by the amounts collected shall be included in the first return filed after that collection and the amount of the prepayment thereon paid with the return.

(b) In lieu of a refund, the board may authorize a credit to be taken by the person to whom the refund is due upon his or her prepayment form or sales and use tax return.

history: (History: Amended by Stats. 2001, Ch. 429, Sec. 8. Effective October 2, 2001. Operative January 1, 2002, by Sec. 78 of Ch. 429.)


text:
(a) The board may require any supplier or wholesaler subject to this article to place with the board any security that the board determines is necessary to ensure compliance with this article. The amount of the security shall be fixed by the board but shall not be greater than three times the estimated average liability of suppliers or wholesalers required to file returns for monthly periods, determined in any manner that the board deems proper, or five hundred thousand dollars ($500,000), whichever amount is less. These amounts apply regardless of the type of security placed with the board. The amount of the security may be increased or decreased by the board subject to the maximum amounts. The security required pursuant to this section is in addition to the bond or bonds required pursuant to Section 7486.

(b) The board may sell the security at public auction if it becomes necessary to so do in order to recover any tax or any amount required to be collected or penalty due. Notice of the sale may be served upon the person who placed the security personally or by mail. If service is by mail, service shall be made in the manner prescribed for service of a notice of a deficiency determination and shall be addressed to the person at his or her address as it appears in the records of the board. However, security in the form of a bearer bond issued by the United States or the State of California which has a prevailing market price may be sold by the board at a private sale at a price not lower than the prevailing market price thereof. Upon any sale, any surplus above the amounts due shall be returned to the supplier or wholesaler who placed the security.

history: (History: Amended by Stats. 2001, Ch. 429, Sec. 9. Effective October 2, 2001. Operative January 1, 2002, by Sec. 78 of Ch. 429.)


text:
(a) A person qualified under subdivision (b) may issue a certificate to a seller with respect to the amount of sales tax required to be prepaid pursuant to Section 6480.1 when purchasing diesel fuel from the seller. The certificate shall be completed in accordance with any instructions or regulations as the board may prescribe, and shall clearly specify that the person will purchase the volume of diesel fuel that the person reasonably expects he or she will sell that qualifies for the exemption under Section 6357.1. A seller that receives a properly completed certificate from a person qualified under subdivision (b) shall not be required to collect the prepayment of the retail sales tax otherwise required in Section 6480.1 on that volume of the diesel fuel sold pursuant to the certificate.

(b) A person is qualified for purposes of this section if both of the following conditions are met:

(1) The person sold diesel fuel that was used by the consumer in a manner that qualified, or would have qualified for an exemption under Section 6357.1, and in the prior year, those sales totaled more than 25 percent of the person’s total taxable sales.

(2) The person’s sales consist primarily of either bulk deliveries of fuel or of fuel sales through a cardlock, keylock, or other unattended mechanism, or both. For purposes of the preceding sentence, “bulk deliveries” means transfers of fuel into storage tanks of 500 gallons or more.

(c) A person issuing a certificate pursuant to this section is liable for sales tax that is imposed under the Bradley-Burns Uniform Local Sales and Use Tax Law (Part 1.5 (commencing with Section 7200)) or in accordance with the Transactions and Use Tax Law (Part 1.6 (commencing with Section 7251)) and sales tax that is imposed under Section 6051.2 or 6201.2, or under Section 35 of Article XIII of the California Constitution.

(d) A person issuing a certificate pursuant to this section shall be liable for sales tax on any portion of the gross receipts derived from the sale of fuel that is not sold in a manner that qualifies for an exemption under Section 6357.1.

(e) A person liable for the sales tax under subdivision (c) or (d) of this section shall report and pay that sales tax with the return for the reporting period in which the person sells the fuel.

(f) Any person who gives a certificate pursuant to this section for purchases of diesel fuel that he or she knows at the time of purchase do not qualify for the exemption from the prepayment pursuant to this section for the purpose of evading payment of the prepayment of the retail sales tax is guilty of a misdemeanor punishable as provided in Section 7153. In addition, the person shall be liable to the state for a penalty of one thousand dollars ($1,000) for each certificate issued for personal gain or to evade the payment of taxes.

history: (History: Added by renumbering Section 6480.3 (as added by Stats. 2002, Ch. 446) by Stats. 2004, Ch. 527, Sec. 4. Effective January 1, 2005.)


citation: RTC § 6481

text: If the board is not satisfied with the return or returns of the tax or the amount of tax, or other amount, required to be paid to the state by any person, it may compute and determine the amount required to be paid upon the basis of the facts contained in the return or returns or upon the basis of any information within its possession or that may come into its possession. One or more deficiency determinations may be made of the amount due for one or for more than one period. When a business is discontinued a determination may be made at any time thereafter, within the periods specified in Section 6487, as to liability arising out of that business, irrespective of whether the determination is issued prior to the due date of the liability as otherwise specified in this part.

history: (History: Amended by Stats. 1984, Ch. 930, Sec. 3.)

article: 2. Deficiency Determinations

path: 2. OTHER TAXES > 1. SALES AND USE TAXES > 5. Determinations > 2. Deficiency Determinations


citation: RTC § 6482

text: The amount of the determination, exclusive of penalties, shall bear interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the last day of the month following the quarterly period for which the amount or any portion thereof should have been returned until the date of payment.

history: (History: Amended by Stats. 1984, Ch. 1020, Sec. 3. Operative July 1, 1985, by Sec. 65 of Ch. 1020.)

article: 2. Deficiency Determinations


citation: RTC § 6483

text: In making a determination the board may offset overpayments for a period or periods, together with interest on the overpayments, against underpayments for another period or periods, against penalties, and against the interest on the underpayments. The interest on underpayments and overpayments shall be computed in the manner set forth in Sections 6591 and 6907.

history: (History: Added by Stats. 1941, Ch. 36.)

article: 2. Deficiency Determinations


citation: RTC § 6484

text: If any part of the deficiency for which a deficiency determination is made is due to negligence or intentional disregard of this part or authorized rules and regulations, a penalty of 10 per cent of the amount of the determination shall be added thereto.

article: 2. Deficiency Determinations


citation: RTC § 6485

text: If any part of the deficiency for which a deficiency determination is made is due to fraud or an intent to evade this part or authorized rules and regulations, a penalty of 25 per cent of the amount of the determination shall be added thereto.

article: 2. Deficiency Determinations


text: Any purchaser of a vehicle, vessel, or aircraft who registers it outside the State of California for the purpose of evading the payment of taxes due under this part shall be liable for a penalty of 50 percent of any tax determined to be due on the sales price of the vehicle, vessel, or aircraft.

history: (History: Added by Stats. 1984, Ch. 1490, Sec. 6. Effective September 27, 1984.)

article: 2. Deficiency Determinations


citation: RTC § 6486

text:
The department shall give to the retailer or person storing, using, or consuming tangible personal property written notice of its determination. The notice shall be served in one of the following manners:

(a) By placing the notice in a sealed envelope, with postage paid, addressed to the retailer or person storing, using, or consuming tangible personal property at their address as it appears in the records of the department. Service made pursuant to this subdivision shall be deemed complete at the time of the deposit of the notice in the United States Post Office, or a mailbox, sub-post office, substation, or mail chute, or other facility regularly maintained or provided by the United States Postal Service, without extension of time for any reason.

(b) By personally delivering the notice to the person to be served. Service made pursuant to this subdivision is complete at the time of delivery. Personal service to a corporation may be made by delivery of a notice to any person designated in the Code of Civil Procedure to be served for the corporation with summons and complaint in a civil action.

(c) (1) By delivering the notice electronically via secure transmission when either of the following applies:

(A) The taxpayer requests the notice of determination to be sent electronically via secure transmission.

(B) The department has evidence that the taxpayer no longer receives mail at the address of record and has previously provided an address for electronic mail.

(2) Service provided pursuant to paragraph (1) shall be deemed complete at the time the department electronically transmits the notice via the taxpayer’s secure web portal, without extension of time for any reason.

history: (History: Amended by Stats. 2024, Ch. 499, Sec. 2. (SB 1528) Effective January 1, 2025.)

article: 2. Deficiency Determinations


citation: RTC § 6487

text:
(a) For taxpayers filing returns, other than a return filed pursuant to Section 6452.1, on other than an annual basis, except in the case of fraud, intent to evade this part or authorized rules and regulations, or failure to make a return, every notice of a deficiency determination shall be served within three years after the last day of the calendar month following the quarterly period for which the amount is proposed to be determined or within three years after the return is filed, whichever period expires the later. In the case of failure to make a return, every notice of determination shall be served within eight years after the last day of the calendar month following the quarterly period for which the amount is proposed to be determined.

(b) For taxpayers filing returns on an annual basis, except in the case of fraud, intent to evade this part or authorized rules and regulations, or failure to make a return, every notice of a deficiency determination shall be served within three years after the last day of the calendar month following the one-year period for which the amount is proposed to be determined or within three years after the return is filed, whichever period expires the later. In the case of failure to make a return, every notice of determination shall be served within eight years after the last day of the calendar month following the one-year period for which the amount is proposed to be determined.

(c) The limitation specified in this section does not apply in case of a sales tax proposed to be determined with respect to sales of property for the storage, use, or other consumption of which notice of a deficiency determination has been or is served pursuant to subdivision (a) or (b) or pursuant to Section 6486, 6515, or 6536. The limitation specified in this section does not apply in case of an amount of use tax proposed to be determined with respect to storage, use, or other consumption of property for the sale of which notice of a deficiency determination has been or is served pursuant to subdivision (a) or (b) or pursuant to Section 6486, 6515, or 6536.

history: (History: Amended by Stats. 2024, Ch. 499, Sec. 3. (SB 1528) Effective January 1, 2025.)

article: 2. Deficiency Determinations


text: In the case of a deficiency arising under this part during the lifetime of a decedent, a notice of deficiency determination shall be served within four months after written request therefor, in the form required by the department, by the fiduciary of the estate or trust or by any other person liable for the tax or any portion thereof.

history: (History: Amended by Stats. 2024, Ch. 499, Sec. 6. (SB 1528) Effective January 1, 2025.)

article: 2. Deficiency Determinations


text:
(a) A notice of determination issued pursuant to Section 6486, 6515, or 6536 to an individual who was a general partner, as shown on the department’s records, and who, prior to the period covered by the determination, withdrew from the partnership, causing a change in ownership, and failed to notify the department, shall be served within four years after the last day of the calendar month following the quarterly period in which the change of ownership occurred.

(b) An individual who was a general partner, as shown on the department’s records, who withdraws from a partnership without notifying the department of the change in ownership, shall not be liable for any unpaid, self-assessed liability of the partnership that becomes due at least three years after the last day of the calendar month following the quarterly period in which the change in ownership occurred.

(c) Subdivisions (a) and (b) shall not apply to either of the following:

(1) Cases of fraud or intent to evade this part or other administrative or interpretive regulations.

(2) Any partners who retain an ownership interest in a corporation that is a successor to the partnership.

(d) For purposes of this part, change in ownership means that a new “person,” as defined in Section 6005, is created by the action of the former owner by means of a sale, an incorporation, an addition or elimination of one or more partners, or the termination of a spouse’s ownership or community property interest due to legal separation or divorce.

(e) For purposes of this section, “individual” includes only natural persons.

history: (History: Amended by Stats. 2024, Ch. 499, Sec. 7. (SB 1528) Effective January 1, 2025.)

article: 2. Deficiency Determinations


text:
(a) (1) For persons that elect to report qualified use tax in accordance with Section 6452.1, except in the case of fraud, intent to avoid this part or authorized rules and regulations issued by the department, or the gross understatement of qualified use taxes, every notice of a deficiency determination with respect to the qualified use tax shall be served within three years after the last day for which an acceptable tax return is due or filed, whichever occurs later.

(2) In the case of a gross understatement of qualified use tax, every notice of a deficiency determination with respect to the qualified use tax shall be served within six years after the last day for which an acceptable tax return is due or filed, whichever occurs later.

(3) For purposes of this subdivision, a “gross understatement of qualified use tax” is a deficiency that is in excess of 25 percent of the amount of qualified use tax reported on a person’s acceptable tax return. In the case of married individuals filing separate California personal income tax returns, the total amount of qualified use tax reported will be considered in determining whether there is a gross understatement of qualified use tax.

(4) For purposes of this section, “acceptable tax return” means a timely filed original return that is filed pursuant to Article 1 (commencing with Section 18501), Article 2 (commencing with Section 18601), Section 18633, Section 18633.5 of Chapter 2 (commencing with Section 18501) of Part 10.2, or Article 3 (commencing with Section 23771) of Chapter 4 of Part 11.

(b) This section applies to reporting of purchases of tangible personal property made on or after January 1, 2010, in taxable years beginning on or after January 1, 2010.

history: (History: Amended by Stats. 2024, Ch. 499, Sec. 8. (SB 1528) Effective January 1, 2025.)

article: 2. Deficiency Determinations


text:
(a) Notwithstanding Section 6487, the period during which a deficiency determination may be served to a qualifying retailer is limited to three years after the last day of the calendar month following the quarterly period for which the amount is proposed to be determined. For purposes of this section, a “qualifying retailer” is a retailer that meets all of the following conditions:

(1) The retailer is located outside this state, and has not previously registered with the department.

(2) The retailer is engaged in business in this state, as defined in Section 6203.

(3) The retailer voluntarily registers with the department.

(4) The retailer has not been previously contacted by the department or its agents regarding the provisions of Section 6203.

(5) As determined by the department, the retailer’s failure to file a return or failure to report or pay the tax or amount due required by law was due to reasonable cause and was not a result of negligence or intentional disregard of the law, or because of fraud or an intent to evade the provisions of this part.

(b) If the department or its designee finds that the retailer’s failure to make a timely return or payment is due to reasonable cause and circumstances beyond the retailer’s control, and occurred notwithstanding the exercise of ordinary care and the absence of willful neglect, the retailer shall be relieved of the penalties imposed pursuant to this part. Any retailer seeking relief of penalty shall file a statement under penalty of perjury setting forth the facts upon which they base their claim for relief.

history: (History: Amended by Stats. 2024, Ch. 499, Sec. 4. (SB 1528) Effective January 1, 2025.)

article: 2. Deficiency Determinations


text:
(a) Notwithstanding Section 6487, the period during which a deficiency determination may be served to a qualifying purchaser is limited to three years after the last day of the calendar month following the quarterly period for which the amount is proposed to be determined.

(b) For purposes of this section, a “qualifying purchaser” is a person that voluntarily files an individual use tax return for tangible personal property that is purchased from a retailer outside of this state for storage, use, or other consumption in this state, and that meets all of the following conditions:

(1) The purchaser resides or is located within this state and has not previously done any of the following:

(A) Registered with the department.

(B) Filed an individual use tax return with the department.

(C) Reported an amount on their individual California income tax return.

(2) The purchaser is not engaged in business in this state as a retailer, as defined in Section 6015.

(3) The purchaser has not been contacted by the department regarding failure to report the use tax imposed by Section 6202.

(4) The department has made a determination that the purchaser’s failure to file an individual use tax return or to otherwise report or pay the use tax imposed by Section 6202 was due to reasonable cause and was not caused by reason of negligence, intentional disregard of the law, or by an intent to evade the taxes imposed by this part.

(c) If the department makes a determination that the purchaser’s failure to timely report or remit the taxes imposed by this part is due to reasonable cause or due to circumstances beyond the purchaser’s control, the purchaser may be relieved of any penalties imposed by this part. Any purchaser seeking relief from penalties imposed by this part shall file a statement, signed under penalty of perjury, setting forth the facts that form the basis for the claim for relief.

(d) This section shall not apply to purchases of vehicles, vessels, or aircraft as defined in Article 1 (commencing with Section 6271) of Chapter 3.5.

history: (History: Amended by Stats. 2024, Ch. 499, Sec. 5. (SB 1528) Effective January 1, 2025.)

article: 2. Deficiency Determinations


text:
(a) Notwithstanding Section 6487, a deficiency determination may be issued to a qualifying retailer only for those liabilities arising under this part for sales made on and after April 1, 2016.

(b) For purposes of this section, a “qualifying retailer” is a retailer that meets all of the following conditions:

(1) The retailer is not registered or has not registered with the department under this part prior to December 1, 2018.

(2) The retailer had not filed sales or use tax returns or made sales or use tax payments prior to being contacted by the department.

(3) The retailer voluntarily registers under Chapter 2 (commencing with Section 6051) or Chapter 3 (commencing with Section 6201), as applicable, files completed tax returns for all tax reporting periods for which a determination may be issued under this section, within 90 days after the effective date of this act, and pays in full the taxes due or applies for an installment agreement, but only if final payment under the terms of that installment payment agreement is paid no later than December 31, 2021.

(4) The retailer is or was engaged in business in this state solely because the retailer used a marketplace facilitator, as defined in Section 6041, to facilitate sales for delivery in this state and the marketplace facilitator stored the retailer’s inventory in this state.

(c) A qualifying retailer shall be relieved of the penalties imposed pursuant to this part with respect to sales made from April 1, 2016, to March 31, 2019, inclusive.

history: (History: Added by Stats. 2019, Ch. 34, Sec. 9. (SB 92) Effective June 27, 2019.)

article: 2. Deficiency Determinations


citation: RTC § 6488

text: If before the expiration of the time prescribed in Section 6487 for serving a notice of deficiency determination the taxpayer has consented in writing to service of the notice after such time, the notice may be served at any time prior to the expiration of the period agreed upon. The period so agreed upon may be extended by subsequent agreements in writing made before the expiration of the period previously agreed upon.

history: (History: Amended by Stats. 2024, Ch. 499, Sec. 9. (SB 1528) Effective January 1, 2025.)

article: 2. Deficiency Determinations


citation: RTC § 6511

text: If any person fails to make a return, the board shall make an estimate of the amount of the gross receipts of the person, or, as the case may be, of the amount of the total sales price of tangible personal property sold or purchased by the person, the storage, use, or other consumption of which in this state is subject to the use tax. The estimate shall be made for the period or periods in respect to which the person failed to make a return and shall be based upon any information which is in the board’s possession or may come in its possession. Upon the basis of this estimate the board shall compute and determine the amount of tax or other amount required to be paid to the state, adding to the sum thus arrived at a penalty equal to 10 percent thereof. One or more determinations may be made for one or for more than one period. When a business is discontinued a determination may be made at any time thereafter, within the periods specified in Section 6487, as to liability arising out of that business, irrespective of whether the determination is issued prior to the due date of the liability as otherwise specified in this part.

history: (History: Amended by Stats. 1984, Ch. 930, Sec. 4.)

article: 3. Determinations if No Return Made

path: 2. OTHER TAXES > 1. SALES AND USE TAXES > 5. Determinations > 3. Determinations if No Return Made


citation: RTC § 6512

article: 3. Determinations if No Return Made


citation: RTC § 6513

history: (History: Amended by Stats. 1984, Ch. 1020, Sec. 4. Operative July 1, 1985, by Sec. 65 of Ch. 1020.)

article: 3. Determinations if No Return Made


citation: RTC § 6514

text: If the failure of any person to file a return is due to fraud or an intent to evade this part or rules and regulations, a penalty of 25 per cent of the amount required to be paid by the person, exclusive of penalties, shall be added thereto in addition to the 10 per cent penalty provided in Section 6511.

history: (History: Amended by Stats. 1941, Ch. 247.)

article: 3. Determinations if No Return Made


history: (History: Added by Stats. 1984, Ch. 1490, Sec. 7. Effective September 27, 1984.)

article: 3. Determinations if No Return Made


citation: RTC § 6515

text: Promptly after making its determination, the department shall give to the person written notice of the estimate, determination, and penalty, the notice to be served in the manner prescribed for service of notice of a deficiency determination.

history: (History: Amended by Stats. 2024, Ch. 499, Sec. 10. (SB 1528) Effective January 1, 2025.)

article: 3. Determinations if No Return Made


citation: RTC § 6536

text: If the board believes that the collection of any tax or any amount of tax required to be collected and paid to the state or of any determination or other amount required to be paid to the state will be jeopardized by delay, it shall thereupon make a determination of the tax or amount of tax required to be collected or other amount, noting that fact upon the determination. The amount determined is immediately due and payable.

history: (History: Amended by Stats. 1984, Ch. 930, Sec. 6.)

article: 4. Jeopardy Determinations

path: 2. OTHER TAXES > 1. SALES AND USE TAXES > 5. Determinations > 4. Jeopardy Determinations


citation: RTC § 6537

text: If the amount specified in the determination is not paid within 10 days after service of notice thereof upon the person against whom the determination is made, the amount becomes final at the expiration of the 10 days, unless a petition for redetermination is filed within the 10 days, and the delinquency penalty and the interest provided in Section 6591 shall attach to the amount of the tax or the amount of the tax required to be collected.

history: (History: Added by Stats. 1941, Ch. 36.)

article: 4. Jeopardy Determinations


citation: RTC § 6538

text: The person against whom a jeopardy determination is made may petition for the redetermination thereof pursuant to Article 5 of this chapter. He shall, however, file the petition for redetermination with the board within 10 days after the service upon him of notice of the determination. The person shall also within the 10-day period deposit with the board such security as it may deem necessary to insure compliance with this part. The security may be sold by the board in the manner prescribed by Section 6701.

article: 4. Jeopardy Determinations


text:
In accordance with such rules and regulations as the board may prescribe, the person against whom a jeopardy determination is made may apply for an administrative hearing for one or more of the following purposes:

(a) To establish that the determination is excessive; or

(b) To establish that the sale of property that may be seized after issuance of the jeopardy determination or any part thereof shall be delayed pending the administrative hearing because the sale would result in irreparable injury to the person; or

(c) To request the release of all or a part of the property to the person; or

(d) To request a stay of collection activities.

The application shall be filed within 30 days after service of the notice of jeopardy determination and shall be in writing and state the specific factual and legal grounds upon which it is founded. No security need be posted to file the application and to obtain this hearing. However, if the person does not deposit within the 10-day period prescribed in Section 6538, such security as the board may deem necessary to ensure compliance with this part, the filing of the application shall not operate as a stay of collection activities, except sale of property seized after issuance of the jeopardy determination. Upon a showing of good cause for failure to file a timely application for administrative hearing, the board may allow a filing of the application and grant the person an administrative hearing. The filing of an application pursuant to this section shall not affect provisions of Section 6537 relating to the finality date of the determination or to penalty or interest.

history: (History: Added by Stats. 1977, Ch. 329.)

article: 4. Jeopardy Determinations


citation: RTC § 6539

text: Any notice required by this article shall be served in the manner prescribed for service of notice of a deficiency determination.

history: (History: Amended by Stats. 2024, Ch. 499, Sec. 11. (SB 1528) Effective January 1, 2025.)

article: 4. Jeopardy Determinations


citation: RTC § 6561

text: Any person against whom a determination is made under Article 2 (commencing with Section 6481) or 3 (commencing with Section 6511) or any person directly interested may petition for a redetermination within 30 days after service upon the person of notice thereof. If a petition for redetermination is not filed within the 30-day period, the determination becomes final at the expiration of that period.

history: (History: Amended by Stats. 1982, Ch. 454, Sec. 149.)

article: 5. Redeterminations

path: 2. OTHER TAXES > 1. SALES AND USE TAXES > 5. Determinations > 5. Redeterminations


text: Every petition for redetermination shall be in writing and shall state the specific grounds upon which the petition is founded. The petition may be amended to state additional grounds at any time prior to the date on which the board issues its order or decision upon the petition for redetermination.

history: (History: Added by Stats. 1967, Ch. 881.)

article: 5. Redeterminations


citation: RTC § 6562

text: If a petition for redetermination is filed within the 30-day period, the board shall reconsider the determination and, if the person has so requested in his petition, shall grant the person an oral hearing and shall give him 10 days’ notice of the time and place of the hearing. The board may continue the hearing from time to time as may be necessary.

article: 5. Redeterminations


citation: RTC § 6563

text:
(a) The board may decrease or increase the amount of the determination before it becomes final, but the amount may be increased only if a claim for the increase is asserted by the board at or before the hearing. Unless the penalty imposed by Section 6485 or Section 6514 applies to the amount of the determination as originally made or as increased, the claim for increase must be asserted during one of the following applicable periods:

(1) In the case of any taxpayer whose reported gross receipts and total sales price of property sold or purchased by him or her is less than ten million dollars ($10,000,000) in each calendar quarter of the period or periods to which the determination applies, within three years after the first deficiency determination or within three years after the time tax records requested by the board were made available, whichever is later.

(2) In the case of any other taxpayer, within eight years after the first deficiency determination or within eight years after the time tax records requested by the board were made available, whichever is later.

(b) If the taxpayer and the board mutually agree, the time limits specified in subdivision (a) may be waived.

(c) The board shall specify the information on which it bases its increase.

history: (History: Amended by Stats. 1984, Ch. 1728, Sec. 1.)

article: 5. Redeterminations


citation: RTC § 6564

text: The order or decision of the board upon a petition for redetermination becomes final 30 days after service upon the petitioner of notice thereof.

article: 5. Redeterminations


citation: RTC § 6565

text: All determinations made by the board under Articles 2 or 3 of this chapter are due and payable at the time they become final. If they are not paid when due and payable, a penalty of 10 per cent of the amount of the determination, exclusive of interest and penalties, shall be added thereto.

article: 5. Redeterminations


citation: RTC § 6566

history: (History: Amended by Stats. 2024, Ch. 499, Sec. 12. (SB 1528) Effective January 1, 2025.)

article: 5. Redeterminations


citation: RTC § 6591

text:
(a) Any person who fails to pay any tax to the state or any amount of tax required to be collected and paid to the state, except amounts of determinations made by the board under Article 2 (commencing with Section 6481) or Article 3 (commencing with Section 6511) of this chapter, within the time required shall pay a penalty of 10 percent of the tax or amount of the tax, in addition to the tax or amount of tax, plus interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the date on which the tax or the amount of tax required to be collected became due and payable to the state until the date of payment.

(b) Any person who fails to file a return in accordance with the due date set forth in Section 6451 or the due date established by the board in accordance with Section 6455, shall pay a penalty of 10 percent of the amount of taxes, exclusive of prepayments, with respect to the period for which the return is required.

(c) The penalties imposed by this section shall be limited to a maximum of 10 percent of the taxes for which the return is required, exclusive of any prepayments, for any one return.

history: (History: Amended by Stats. 1996, Ch. 1087, Sec. 29. Effective January 1, 1997.)

article: 6. Interest and Penalties

path: 2. OTHER TAXES > 1. SALES AND USE TAXES > 5. Determinations > 6. Interest and Penalties


text:
(a) An accuracy-related penalty shall be imposed under this part if a person fails to accurately disclose information in the information return required by Section 6452.05 such that the information return is substantially inconsistent with the return required under Section 6452, and that person shall pay a penalty of five thousand dollars ($5,000) for each return not accurately filed.

(b) The accuracy-related penalty imposed by this section shall not be assessed if the penalty of Section 6452.05 is imposed.

history: (History: Added by Stats. 2020, Ch. 17, Sec. 7. (AB 90) Effective June 29, 2020.)

article: 6. Interest and Penalties


text:
(a) (1) For interest required to be paid to the state upon underpayments of tax to the state, “ modified adjusted rate per annum” means the adjusted annual rate established pursuant to subdivision (c), plus three percentage points.

(2) For interest required to be paid by the state upon overpayments of tax, “modified adjusted rate per annum” means the adjusted annual rate established pursuant to subdivision (d).

(b) “Modified adjusted rate per month, or fraction thereof” means the modified adjusted rate per annum divided by 12.

(c) The rate established for interest to be paid upon underpayments of tax shall be determined in accordance with the provisions of Section 6621 of the Internal Revenue Code which establish the underpayment rate, except that the determination specified in Section 6621(b) of the Internal Revenue Code shall be modified to be determined semiannually as follows:

(1) The rate for January shall apply for the following July 1 to December 31, inclusive.

(2) The rate for July shall apply for the following January 1 to June 30, inclusive.

(d) (1) Except as provided in paragraph (2), the rate established for interest to be paid by the state upon overpayments of tax shall be equal to the bond equivalent rate of 13-week treasury bills auctioned, rounded to the nearest full percent (or if a multiple of one-half of 1 percent, the rate shall be increased to the next highest full percent), as follows:

(A) The bond equivalent rate of 13-week treasury bills established at the first auction held during the month of January shall apply for the following July 1 to December 31, inclusive.

(B) The bond equivalent rate of 13-week treasury bills established at the first auction held during the month of July shall apply for the following January 1 to June 30, inclusive.

(2) For the period July 1, 1991, through June 30, 1992, the rate to be paid by the state upon overpayments of tax shall be equal to the bond equivalent rate of 13-week treasury bills established at the auction held on July 1, 1991, rounded to the nearest full percent (or if a multiple of one-half of 1 percent, the rate shall be increased to the next highest full percent).

(e) For purposes of this part, and any other provision of law referencing this method of computation, in computing the amount of any interest required to be paid by the state or by the taxpayer, or any other amount determined by reference to that amount of interest, that interest and that amount shall be computed as simple interest, not compound interest.

history: (History: Amended by Stats. 1991, Ch. 236, Sec. 5.2. Effective July 29, 1991.)

article: 6. Interest and Penalties


text:
(a) If the department finds, taking into account all facts and circumstances, that it is inequitable to compute interest at the modified adjusted rate per month or fraction thereof, as defined in subdivision (b) of Section 6591.5, interest shall be computed at the modified adjusted daily rate from the date on which the tax or prepayment was due until the date of payment, if all of the following occur:

(1) The payment of tax or the prepayment was made one business day after the date the tax or prepayment was due.

(2) The person was granted relief from all penalties that applied to that payment of tax or prepayment.

(3) The person files a request for an adjustment.

(b) For purposes of this section, “modified adjusted daily rate” means the modified adjusted rate per annum as defined in subdivision (a) of Section 6591.5 determined on a daily basis by dividing the modified adjusted rate per annum by 365.

(c) For purposes of this section, “business day” means any day other than a Saturday, Sunday, or any day designated as a state holiday.

(d) This section shall not apply to any payment made pursuant to a deficiency determination, a determination where no return has been filed, or a jeopardy determination issued by the department.

(e) This section shall only apply to electronic payments or prepayments of taxes.

history: (History: Amended by Stats. 2021, Ch. 432, Sec. 14. (SB 824) Effective January 1, 2022.)

article: 6. Interest and Penalties


citation: RTC § 6592

text:
(a) (1) If the department finds that a person’s failure to make a timely return or payment is due to reasonable cause and circumstances beyond the person’s control, and occurred notwithstanding the exercise of ordinary care and the absence of willful neglect, the person shall be relieved of the penalties provided by Sections 6452.05, 6476, 6477, 6479.3, 6480.4, 6511, 6565, 6591, 7051.2, 7073, and 7074.

(2) If the department finds, with respect to the information return required by Section 6452.05, that a person’s failure to accurately disclose information is due to reasonable cause and circumstances beyond the person’s control, and occurred notwithstanding the exercise of ordinary care and the absence of willful neglect, the person shall be relieved of the relevant penalty provided by Section 6591.3.

(b) Except as provided in subdivisions (c) and (d), a person seeking to be relieved of the penalty shall file with the department a statement under penalty of perjury setting forth the facts upon which the person bases the claim for relief.

(c) (1) Subject to paragraph (2), the department may grant relief of the penalty for any person in an area identified in a state of emergency proclamation made by the Governor for the period the state of emergency proclamation is effective, regardless of whether the person has filed a statement with the department pursuant to subdivision (b).

(2) The department may grant the relief in paragraph (1) only during the first 12 months following the issuance of the state of emergency proclamation or the duration of the state of emergency, whichever is less.

(d) The department shall establish criteria that provides for efficient resolution of requests for relief pursuant to this section.

history: (History: Amended by Stats. 2022, Ch. 474, Sec. 4. (SB 1496) Effective January 1, 2023.)

article: 6. Interest and Penalties


text: Any person who is granted relief from the penalty imposed by Section 6476 or 6477 shall pay, in addition to any prepayment, interest at the “modified adjusted rate per month, or fraction thereof” established pursuant to subdivision (b) of Section 6591.5, from the date on which the prepayment would have been due until the date of payment.

history: (History: Added by Stats. 1993, Ch. 1109, Sec. 6. Effective January 1, 1994.)

article: 6. Interest and Penalties


citation: RTC § 6593

text:
(a) If the department finds that a person’s failure to make a timely return or payment was due to a disaster, and occurred notwithstanding the exercise of ordinary care and the absence of willful neglect, the person may be relieved of the interest provided by Sections 6459, 6480.4, 6480.8, 6513, 6591, and 6592.5.

(b) Except as provided in subdivision (c), a person seeking to be relieved of the interest shall file with the department a statement under penalty of perjury setting forth the facts upon which that person bases the claim for relief.

(c) (1) Subject to paragraph (2), the department may grant relief of the interest for any person in an area identified in a state of emergency proclamation made by the Governor for the period the state of emergency proclamation is effective, regardless of whether the person has filed a statement with the department pursuant to subdivision (b).

(2) The department may grant the relief in paragraph (1) only during the first 12 months following the issuance of the state of emergency proclamation or the duration of the state of emergency, whichever is less.

history: (History: Amended by Stats. 2022, Ch. 474, Sec. 5. (SB 1496) Effective January 1, 2023.)

article: 6. Interest and Penalties


text:
(a) The department, in its discretion, may relieve all or any part of the interest imposed on a person by this part under the following circumstances:

(1) Where the failure to pay tax is due in whole or in part to an unreasonable error or delay by an employee of the department acting in their official capacity.

(2) Where failure to pay sales or use tax was the direct result of an error or delay by a state agency that collects the tax on behalf of the California Department of Tax and Fee Administration.

(b) For purposes of this section, an error or delay shall be deemed to have occurred only if no significant aspect of the error or delay is attributable to an act of, or a failure to act by, the taxpayer.

(c) Any person seeking relief under this section shall file with the department a statement under penalty of perjury setting forth the facts on which the claim for relief is based and any other information which the department may require.

(d) The department may grant relief only for interest imposed on tax liabilities that arise during taxable periods commencing on or after July 1, 1999.

history: (History: Amended by Stats. 2022, Ch. 474, Sec. 6. (SB 1496) Effective January 1, 2023.)

article: 6. Interest and Penalties


citation: RTC § 6594

text: Notwithstanding any other provision of this part, no interest or penalties shall be assessed against any person for failure to make payments of any taxes on leases of personal property to the United States government while the board is enjoined from collecting such taxes by order of the United States District Court for the Central District of California in the case of United States of America v. California State Board of Equalization, No. CV 79-03359-R, provided that payment of any applicable taxes is made within 60 days after the board is no longer enjoined from collecting such taxes.

history: (History: Added by renumbering Section 6593 (as added by Stats. 1980, Ch. 1194) by Stats. 1981, Ch. 714, Sec. 403.)

article: 6. Interest and Penalties


citation: RTC § 6596

text:
(a) If the board finds that a person’s failure to make a timely return or payment is due to the person’s reasonable reliance on written advice from the board, the person may be relieved of the taxes imposed by Sections 6051 and 6201 and any penalty or interest added thereto.

(b) For the purpose of this section, a person’s failure to make a timely return or payment shall be considered to be due to reasonable reliance on written advice from the board, only if the board finds that all of the following conditions are satisfied:

(1) The person requested in writing that the board advise him or her whether a particular activity or transaction is subject to tax under this part. The specific facts and circumstances of the activity or transaction shall be fully described in the request.

(2) The board responded in writing to the person regarding the written request for advice, stating whether or not the described activity or transaction is subject to tax, or stating the conditions under which the activity or transaction is subject to tax.

(3) In reasonable reliance on the board’s written advice, the person did not do either of the following:

(A) Charge or collect from his or her customers amounts designated as sales tax reimbursement or use tax for the described activity or transaction.

(B) Pay a use tax on the storage, use, or other consumption in this state of tangible personal property.

(4) The liability for taxes applied to a particular activity or transaction which occurred before either of the following:

(A) Before the board rescinded or modified the advice so given, by sending written notice to the person of the rescinded or modified advice.

(B) Before a change in statutory or constitutional law, a change in the board’s regulations, or a final decision of a court, which renders the board’s earlier written advice no longer valid.

(c) Any person seeking relief under this section shall file with the board:

(1) A copy of the person’s written request to the board and a copy of the board’s written advice.

(2) A statement under penalty of perjury setting forth the facts on which the claim for relief is based.

(3) Any other information which the board may require.

(d) Only the person making the written request shall be entitled to rely on the board’s written advice to that person.

history: (History: Amended by Stats. 1991, Ch. 402, Sec. 1.)

article: 6. Interest and Penalties


citation: RTC § 6597

text:
(a) (1) Any person who knowingly collects sales tax reimbursement, as defined in Section 1656.1 of the Civil Code, or who knowingly collects use tax pursuant to Chapter 3 (commencing with Section 6201), and who fails to timely remit that sales tax reimbursement or use tax to the California Department of Tax and Fee Administration, shall be liable for a penalty of 40 percent of the amount not timely remitted.

(2) (A) This subdivision shall not apply to any person whose liability for the unremitted sales tax reimbursement or use tax described in paragraph (1) averages one thousand five hundred dollars ($1,500) or less per month or does not exceed 25 percent of the total amount of tax liability for which the sales tax reimbursement or use tax was collected for the period in which tax was due, whichever is greater.

(B) If a person’s failure to make a timely remittance of sales tax reimbursement or use tax is due to a reasonable cause or circumstances beyond the person’s control, and occurred notwithstanding the exercise of ordinary care and the absence of willful neglect, the person shall be relieved of the penalty imposed by this subdivision.

(b) For purposes of this section:

(1) “Reasonable cause or circumstances beyond the person’s control” includes, but is not limited to, any of the following:

(A) The occurrence of a death or serious illness of the person or the person’s next of kin that caused the person’s failure to make a timely remittance.

(B) The occurrence of an emergency, as defined in Section 8558 of the Government Code that caused the person’s failure to make a timely remittance.

(C) A natural disaster or other catastrophe directly affecting the business operations of the person that caused the person’s failure to make a timely remittance.

(D) The California Department of Tax and Fee Administration failed to send returns or other information to the correct address of record, that caused the person’s failure to make a timely remittance.

(E) The person’s failure to make a timely remittance occurred only once over a three-year period, or once during the period in which the person was engaged in business, whichever time period is shorter.

(F) The person voluntarily corrected errors in remitting sales tax reimbursement or use tax collected that were made in previous reporting periods and remitted payment of the liability owed as a result of those errors prior to being contacted by the California Department of Tax and Fee Administration regarding possible errors or discrepancies.

(2) “Sales tax reimbursement” shall also include any sales tax that is advertised, held out, or stated to the public or to any customer, directly or indirectly, that the tax or any part thereof will be assumed or absorbed by the retailer.

(c) This section shall apply to any determination made by the California Department of Tax and Fee Administration pursuant to Article 2 (commencing with Section 6481), Article 3 (commencing with Section 6511), and Article 4 (commencing with Section 6536).

(d) The amendments made by the act adding this subdivision shall apply to determinations made on or after January 1, 2025.

history: (History: Amended by Stats. 2024, Ch. 499, Sec. 13. (SB 1528) Effective January 1, 2025.)

article: 6. Interest and Penalties


citation: RTC § 6701

text: The department, whenever it deems it necessary to ensure compliance with this part, may require any person subject thereto, to place with it any security that the department may determine. Any security in the form of cash, government bonds, or insured deposits in banks or savings and loan institutions shall be held by the department in trust to be used solely in the manner provided by this section and Section 6815. The amount of the security shall be fixed by the department but, except as noted below, shall not be greater than twice the estimated average liability of persons filing returns for quarterly periods or three times the estimated average liability of persons required to file returns for monthly periods, determined in the manner that the department deems proper, or fifty thousand dollars ($50,000), whichever amount is the lesser. In case of a person who, pursuant to Section 6070 of this part, has been given notice of hearing to show cause why their permit or permits should not be revoked, or a person whose permit or permits has been revoked or suspended, the amount of the security shall not be greater than three times the average liability of persons filing returns for quarterly periods or five times the average liability of persons required to file returns for monthly periods, or fifty thousand dollars ($50,000), whichever amount is the lesser. The limitations herein provided apply regardless of the type of security placed with the department. The amount of the security may be increased or decreased by the department subject to the limitations herein provided. Security held by the department shall be released after a three-year period in which the person has filed all returns and paid all tax to the state or any amount of tax required to be collected and paid to the state within the time required. The department may sell the security at public auction if it becomes necessary to do so in order to recover any tax or any amount required to be collected, interest, or penalty due. Notice of the sale may be served upon the person who placed the security in the manner prescribed for service of a notice of a deficiency determination. Upon any sale, any surplus above the amounts due shall be returned to the person who placed the security.

history: (History: Amended by Stats. 2024, Ch. 499, Sec. 14. (SB 1528) Effective January 1, 2025.)

chapter: 6. Collection of Tax

article: 1. Security for Tax

path: 2. OTHER TAXES > 1. SALES AND USE TAXES > 6. Collection of Tax > 1. Security for Tax


citation: RTC § 6702

text:
(a) If any person is delinquent in the payment of the amount required to be paid by him or her or in the event a determination has been made against him or her which remains unpaid, the board may, not later than three years after the payment became delinquent, or within 10 years after the last recording of an abstract under Section 6738 or the last recording or filing of a notice of state tax lien under Section 7171 of the Government Code, give notice thereof personally or by first-class mail to all persons, including any officer or department of the state or any political subdivision or agency of the state, having in their possession or under their control any credits or other personal property belonging to the delinquent, or person against whom a determination has been made which remains unpaid, or owing any debts to the delinquent or that person. In the case of any state officer, department, or agency, the notice shall be given to the officer, department, or agency prior to the time it presents the claim of the delinquent taxpayer to the Controller. After receiving the notice the persons so notified shall neither transfer nor make any other disposition of the credits, other personal property, or debts in their possession or under their control at the time they receive the notice until the board consents to a transfer or disposition or until 60 days elapse after the receipt of the notice, whichever period expires the earlier. All persons so notified shall forthwith after receipt of the notice advise the board of all those credits, other personal property, or debts in their possession, under their control, or owing by them.

(b) If the notice seeks to prevent the transfer or other disposition of a deposit in a bank or a state or federal savings and loan association or other credits or personal property in the possession or under the control of a bank or a state or federal savings and loan association, the notice to be effective shall state the amount, interest, and penalty due from the person, and shall be delivered or mailed to the branch or office of the bank or a state or federal savings and loan association at which the deposit is carried or at which the credits or personal property is held. A bank, state or federal savings and loan association, or a state or federal credit union withholding any deposit or other credits or personal property required to be withheld in which the delinquent taxpayer and another person or persons have an interest, or held in the name of a third party or parties in which the delinquent taxpayer is ultimately determined to have no interest, is not liable therefor to any of the persons who have an interest in the deposit or other credits or personal property unless the deposit or other credits or personal property is released or transferred to the delinquent taxpayer.

(c) In the case of a deposit or other credits or personal property for which the transfer or other disposition is prevented, the depository institution required to prevent transfer or other disposition shall send a notice by first-class mail to each person named on a deposit, other credits, or personal property included in the notice from the board, provided a current address for each person is available to the institution. This notice shall inform each person as to the reason for preventing transfer or disposition of the deposit or other credits or personal property, the amount thereof which is prevented from transfer or other disposition, and the date by which that amount is to be remitted to the board. An institution may assess the deposit or other credits or personal property of each person receiving this notice a reasonable service charge not to exceed three dollars ($3).

(d) Notwithstanding any other provision, with respect to a deposit in a bank or other credits or personal property in the possession or under the control of a bank or a state or federal savings and loan association, the aggregate amount of deposits, credits, or personal property to be withheld shall be an amount equal to two times the amount of the tax, interest, or penalty due from the person. If, during the effective period of the notice to withhold, any person so notified makes any transfer or disposition of the property or debts required to be withheld, to the extent of the value of the property or the amount of the debts thus transferred or paid he or she shall be liable to the state for any indebtedness due under this part from the person with respect to whose obligation the notice was given if solely by reason of that transfer or disposition the state is unable to recover the indebtedness of the person with respect to whose obligation the notice was given.

history: (History: Amended by Stats. 1984, Ch. 562, Sec. 1.)

article: 1. Security for Tax