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Business Taxes Law Guide – Revision 2024
 

California Department of Tax and Fee Administration

Title 18. Public Revenues
Division 5. California Department of Tax and Fee Administration

Chapter 1. Appeals

Article 4B. Other Requests for Relief of Penalties and Interest

Rule 35050

35050. Authority to Grant Relief of Tax Due to Reasonable Reliance on Written Advice and Contents of a Request for Such Relief.

Reference: Sections 6596, 7657.1, 8879, 30284, 38454, 40104, 41098, 43159, 45157, 46158, 50112.5, 55045 and 60210, Revenue and Taxation Code.

(a) A taxpayer may be relieved from liability for the payment of a tax imposed under the laws identified in subdivision (c), including any penalties and interest added thereto, where the liabilities resulted from the taxpayer’s failure to make a timely report, return, or payment and such failure is found to be due to reasonable reliance on:

(1) Written advice given under the conditions set forth in regulation 1705, subdivision (b) or regulation 4902, subdivision (b);

(2) Written advice given in a prior audit of that taxpayer under the conditions set forth in regulation 1705, subdivision (c) or regulation 4902, subdivision (c);

(3) Written advice in the form of an annotation or legal ruling of counsel under the conditions set forth in regulation 1705, subdivision (d) or regulation 4902, subdivision (d); or

(4) Written advice requested by a trade or industry association or franchisor, on the taxpayer’s behalf, under the conditions set forth in regulation 1705, subdivision (e) or regulation 4902, subdivision (e).

(b) Written advice may only be relied upon by the person to whom it was originally issued or a legal or statutory successor to that person.

(c) This regulation applies to taxes imposed under the Sales and Use Tax Law, Motor Vehicle Fuel Tax Law, Use Fuel Tax Law, Cigarette and Tobacco Products Tax Law, Timber Yield Tax Law, Energy Resources Surcharge Law, Emergency Telephone Users Surcharge Law, Hazardous Substances Tax Law, Integrated Waste Management Fee Law, Oil Spill Response, Prevention and Administration Fee Law, Underground Storage Tank Maintenance Fee Law, Fee Collection Procedures Law, and the Diesel Fuel Tax Law.

(d) A request for relief due to reasonable reliance upon written advice must:

(1) Be in writing;

(2) Include the specific facts upon which the request for relief is based;

(3) Be signed by the taxpayer requesting relief under penalty of perjury; and

(4) Include a copy of the taxpayer’s written request for written advice and a copy of the written advice relied upon.

History—New regulation filed March 19, 2018, as an emergency; effective and operative March 19, 2018. Regulation refiled September 17, 2018, as an emergency; effective and operative September 17, 2018. Regulation refiled December 17, 2018, as an emergency; effective and operative December 17, 2018. Certificate of Compliance transmitted to OAL on February 20, 2019 and filed March 19, 2019. (The regulation incorporates provisions from regulation 5247 in division 2.1.)

Note.—Authority cited: Sections 15570.40 and 15606, Government Code; Section 25215.74, Health and Safety Code; Sections 7051, 8251, 9251, 30451, 34013, 38701, 40171, 41128, 42020, 42103, 43501, 45851, 46601, 50152, 55301 and 60601, Revenue and Taxation Code.