Voluntary Disclosure of Use Tax for In - State Consumers

In-State Voluntary Disclosure

Generally, use tax applies when a person or business in California purchases tangible merchandise from a retailer outside of this state that will be used, consumed, given away, or stored in this state and the retailer does not collect California tax on their sales. As of January 1, 2009, the In-State Voluntary Disclosure Program (Revenue and Taxation Code section 6487.06) allows qualified purchasers within California, who are not otherwise required to hold a seller's permit, to report and pay their use tax liability subject to a three-year statute of limitations.


  • Limits the time the California Department of Tax and Fee Administration (CDTFA) can make an assessment for prior use tax to three years. Without this program, the applicable statutory period may be extended to eight years.
  • Allows the CDTFA to waive late filing and late payment penalties.
  • Allows applicants to describe their circumstances and obtain from the CDTFA a written opinion regarding whether the CDTFA might approve their voluntary disclosure request.

Who Qualifies for the In-State Voluntary Disclosure Program?

To qualify for In-State Voluntary Disclosure Program, all of the following conditions must be met:

  • You reside or are located within California, and not have previously registered with us;
  • You have not previously filed an Individual Use Tax Return with us;
  • You have not reported an amount for use tax on your Individual Income Tax Return filed with the Franchise Tax Board;
  • You are not engaged in business in this state as a retailer, as defined in Revenue and Taxation Code section 6015 (please see publication 107, Do You Need a California Seller's Permit?, for more information);
  • You have not been contacted by the CDTFA for failure to report the use tax imposed by section 6202 of the Revenue and Taxation Code;
  • Your failure to pay the tax or file a return was due to reasonable cause and not as a result of negligence or intentional disregard of the law;
  • Your purchase is not of a vehicle, vessel or aircraft; and
  • You voluntarily come forward to us.

To request an opinion as to whether or not the CDTFA would be inclined to approve a voluntary disclosure request or to discuss your eligibility for consideration under the Voluntary Disclosure Program, please contact the Voluntary Disclosure Specialist at the following address:

California Department of Tax and Fee Administration
Voluntary Disclosure Program
PO Box 942879 (MIC: 44)
Sacramento, CA 94279-0044
1-916-322-0187 (fax)
Voluntary Disclosure (e-mail)

Why Take Advantage of the In-State Voluntary Disclosure Program Benefits?

The CDTFA is actively pursuing use tax liabilities from consumers through a variety of programs. Consumers with use tax liabilities are encouraged to take advantage of the benefits available by participation in the In-State Voluntary Disclosure Program before being contacted directly by the CDTFA. Once a person or business is contacted by the CDTFA regarding an unreported use tax liability, that person or business is no longer eligible for participation in the In-State Voluntary Disclosure Program and will not be afforded the benefit of the three-year statute of limitations and a waiver of penalties.

Who is Liable for California Use Tax Purchases?

Use tax is imposed upon the purchaser. It generally applies to purchases from out-of-state vendors who do not collect California tax on their sales. Generally, if sales tax would apply when you buy a particular item in California, use tax applies when you make a similar purchase from a business outside the state.

For further information, please see publication 110, California Use Tax Basics. This publication is also available in Spanish (publication 110-S).

Some purchases from out-of-state vendors, however, may not be subject to use tax. The most common use tax exemptions and exclusions apply when

  • You buy the item in a transaction that would be exempt or excluded from sales tax if it occurred in California. Examples include purchases of cold food products and purchases for resale.
  • You buy prescription medicines prescribed by a licensed physician from a pharmaceutical manufacturer, pharmacist, or health facility.
  • You do not use the item in California but instead ship it to a location outside the state for exclusive use there. This is true whether you ship the item by itself or first incorporate it into another product.

How Do You Apply?

Submit the Application for In-State Voluntary Disclosure document to your nearest CDTFA office. If your application is approved, you will receive an acceptance letter. You will be notified in writing if you do not meet the requirements for the Voluntary Disclosure Program.

eReg will provide you with an eClient ID Login Code to eFile your tax returns. Payment may be made online at the time of filing or mailed with a printable voucher.

For more information, see Publication 178