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Business Taxes Law Guide—Revision 2024

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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

35047 Procedures for Review of a Request for Relief
35048 Authority to Grant Relief of Penalty for Reasonable Cause and Contents of a Request for Such Relief
35049 Authority to Grant Relief of Interest Due to Unreasonable Error or Delay and Contents of a Request for Such Relief
35050 Authority to Grant Relief of Tax Due to Reasonable Reliance on Written Advice and Contents of a Request for Such Relief
35051 Authority to Grant Relief Due to Disaster and Contents of a Request for Such Relief
35052 Filing a Request for Relief
35053 Assignment for Review of a Request for Relief
35054 Acknowledgement and Review of a Request for Relief Separate from a Petition or Claim

California Department of Tax and Fee Administration

Chapter 1. Appeals

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

35047. Procedures for Review of a Request for Relief.

Reference: Sections 6074, 6592, 6593, 6593.5, 6596, 7657, 7657.1, 7658, 7658.1, 7726, 7727, 8877, 8878, 8878.5, 8879, 30282, 30283, 30283.5, 30284, 38452, 38453, 38454, 38455, 40102, 40103, 40103.5, 40104, 41096, 41097, 41097.5, 41098, 43157, 43158, 43158.5, 43159, 45155, 45156, 45156.5, 45157, 46156, 46157, 46157.5, 46158, 50112.2, 50112.3, 50112.4, 50112.5, 55044, 55045, 55046, 55046.5, 60209, 60210, 60211 and 60212, Revenue and Taxation Code.

(a) In general, a person filing a request for relief described in this article does not have a right to an appeals conference on such request. A request for an appeals conference on a request for relief may be granted or denied.

(b) If a request for relief described in this article is included in a timely filed petition for redetermination, petition for reconsideration, or claim for refund, the procedures applicable to assignment and review of such petition or claim apply to the assignment and review of the request for relief. Whether filed as part of a petition for redetermination, petition for reconsideration, or claim for refund or filed by itself, a request for relief must satisfy the requirements of this article applicable to such request.

(c) Any request for relief filed under this article may be associated with any pending petition for redetermination, petition for reconsideration, or claim for refund filed by the same person and covering the same periods as the request for relief, and if so, the procedures applicable to the assignment and review of such petition or claim apply to the assignment and review of the request for relief.

History—New article 4B (regulations 35047-35054) and regulation filed March 19, 2018, as an emergency; effective and operative March 19, 2018. Article and regulation refiled September 17, 2018, as an emergency; effective and operative September 17, 2018. Article and 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 5244 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.

35048. Authority to Grant Relief of Penalty for Reasonable Cause and Contents of a Request for Such Relief.

Reference: Sections 6074, 6592, 7657, 7726, 7727, 8877, 30282, 38452, 40102, 41096, 43157, 45155, 46156, 50112.2, 55044, 60209, 60361 and 60361.5, Revenue and Taxation Code.

(a) Authority to Grant Relief. If a taxpayer's failure to make a timely return, report, payment, or prepayment, or failure to comply with a written notice issued under Revenue and Taxation Code section 6074, subdivision (a) 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 taxpayer may be relieved of the penalties imposed under:

(1) Sales and Use Tax Law: Revenue and Taxation Code sections 6074, 6476, 6477, 6479.3, 6480.4, 6480.8, 6511, 6565, 6591, 7051.2, 7073, and 7074.

(2) Motor Vehicle Fuel Tax Law: Revenue and Taxation Code sections 7655, 7659.5, 7659.6, 7659.9, 7660, 7705, 7713, 7726, and 7727.

(3) Use Fuel Tax Law: Revenue and Taxation Code sections 8760, 8801, 8854, and 8876.

(4) Cigarette and Tobacco Products Tax Law: Revenue and Taxation Code sections 30171, 30190, 30221, 30264, and 30281.

(5) Timber Yield Tax Law: Revenue and Taxation Code sections 38421 and 38451.

(6) Energy Resources Surcharge Law: Revenue and Taxation Code sections 40067, 40081, 40096, and 40101.

(7) Emergency Telephone Users Surcharge Law: Revenue and Taxation Code sections 41060, 41080, 41090, and 41095.

(8) Hazardous Substances Tax Law: Revenue and Taxation Code sections 43155, 43170, and 43306.

(9) Integrated Waste Management Fee Law: Revenue and Taxation Code sections 45153, 45160, and 45306.

(10) Oil Spill Response, Prevention, and Administration Fees Law: Revenue and Taxation Code sections 46154, 46154.1, 46160, 46251, and 46356.

(11) Underground Storage Tank Maintenance Fee Law: Revenue and Taxation Code sections 50112, 50112.7, and 50119.

(12) Fee Collection Procedures Law: Revenue and Taxation Code sections 34013, 55042, 55050, and 55086.

(13) Diesel Fuel Tax Law: Revenue and Taxation Code sections 60207, 60250, 60301, 60338, 60355, 60361, and 60361.5.

(b) Contents of Request.

(1) A request for relief of penalty based upon reasonable cause and circumstances beyond the taxpayer's control must be in writing, identify the penalty from which relief is sought, state the specific facts upon which the request is based, and be signed by the taxpayer requesting relief under penalty of perjury.

(2) A request for relief of penalty based upon reasonable cause and circumstances beyond the taxpayer's control may also be filed online through CDTFA's website at www.cdtfa.ca.gov.

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 5245 in division 2.1.)

35049. Authority to Grant Relief of Interest Due to Unreasonable Error or Delay and Contents of a Request for Such Relief.

Reference: Sections 6593.5, 7658.1, 8878.5, 30283.5, 38455, 40103.5, 41097.5, 43158.5, 45156.5, 46157.5, 50112.4, 55046 and 60212, Revenue and Taxation Code.

(a) A taxpayer may be relieved of interest 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 Fees Law, Underground Storage Tank Maintenance Fee Law, Fee Collection Procedures Law, and Diesel Fuel Tax Law, if the taxpayer was charged interest due to an unreasonable error or delay:

(1) By CDTFA staff acting in his or her official capacity; and

(2) No significant aspect of the error or delay is attributable to an act or failure to act by the taxpayer.

(b) A taxpayer may be relieved of interest imposed under the Sales and Use Tax Law where the taxpayer's failure to pay the correct amount of use tax with respect to a vehicle or vessel registered with the Department of Motor Vehicles was the direct result of an error by an employee of the Department of Motor Vehicles in calculating the use tax due.

(1) Be in writing;

(2) Specifically identify the error or delay that caused the taxpayer requesting relief to be charged interest;

(3) Specifically identify the period for which interest relief is sought; and

(4) Be signed by the taxpayer requesting relief under penalty of perjury.

(d) A request for relief of interest may also be filed online through CDTFA's website at www.cdtfa.ca.gov.

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.

35051. Authority to Grant Relief Due to Disaster and Contents of a Request for Such Relief.

Reference: Sections 6593, 7658, 8878, 30283, 38453, 40103, 41097, 43158, 45156, 46157, 50112.3, 55046.5 and 60211, Revenue and Taxation Code.

(a) If a taxpayer'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 taxpayer may be relieved of interest imposed under:

(1) Sales and Use Tax Law: Revenue and Taxation Code sections 6459, 6480.4, 6513, 6591, and 6592.5.

(2) Motor Vehicle Fuel Tax Law: Revenue and Taxation Code sections 7655, 7656, 7659.9, 7661, and 7706.

(3) Use Fuel Tax Law: Revenue and Taxation Code sections 8754, 8760, 8803, and 8876.

(4) Cigarette and Tobacco Products Tax Law: Revenue and Taxation Code sections 30171, 30185, 30190, 30223, and 30281.

(5) Timber Yield Tax Law: Revenue and Taxation Code sections 38405, 38423, and 38451.

(6) Energy Resources Surcharge Law: Revenue and Taxation Code sections 40065, 40067, 40083, and 40101.

(7) Emergency Telephone Users Surcharge Law: Revenue and Taxation Code sections 41054, 41060, 41082, and 41095.

(8) Hazardous Substances Tax Law: Revenue and Taxation Code sections 43154, 43155, 43170, and 43201.

(9) Integrated Waste Management Fee Law: Revenue and Taxation Code sections 45152, 45153, 45160, and 45201.

(10) Oil Spill Response, Prevention, and Administration Fees Law: Revenue and Taxation Code sections 46153, 46154, 46160, and 46253.

(11) Underground Storage Tank Maintenance Fee Law: Revenue and Taxation Code sections 50111, 50112, and 50112.7.

(12) Fee Collection Procedures Law: Revenue and Taxation Code sections 55041, 55042, 55050, and 55061.

(13) Diesel Fuel Tax Law: Revenue and Taxation Code sections 60207, 60208, 60250, 60302, and 60339.

(b) A request for relief of interest due to a disaster must:

(1) Be in writing;

(2) Identify the disaster due to which relief is sought;

(3) Identify the period for which relief is sought; and

(4) Be signed by the taxpayer requesting such relief under penalty of perjury.

35052. Filing a Request for Relief.

(a) A request for relief of an unpaid amount may be filed in the manner provided in regulation 35015 for the filing of a petition for redetermination concerning the same tax law at issue in the request for relief.

(b) A request for relief of a previously paid amount may be filed in the manner provided in regulation 35039 for the filing of a claim for refund concerning the same tax law at issue in the request for relief.

35053. Assignment for Review of a Request for Relief.

(a) A request for relief included in or associated with a petition for redetermination, petition for reconsideration, or claim for refund will be assigned, acknowledged, and reviewed as part of that petition or claim in accordance with the procedures applicable to such petition or claim.

(b) A request for relief that is not included in or associated with a petition for redetermination, petition for reconsideration, or claim for refund will be assigned for review as follows:

(1) Sales and Use Tax.

(A) A request for relief of an amount included in a return will be assigned for review by the Return Analysis Section, whether the amount has been paid or not.

(B) A request for relief of an unpaid amount that was not included in a return will be assigned for review by the Petitions Section.

(C) A request for relief of an amount that was not included in a return that is paid at the time the request is filed will be treated as a claim for refund, and assigned for review by the Audit Determination and Refund Section under the procedures contained in article 3 of this chapter.

(2) Special Taxes. A request for relief filed under subdivision (a)(2) through subdivision (a)(13) of regulation 35048 or regulation 35051 will be assigned for review as follows:

(A) A request for relief of an amount included in a return will be assigned for review by the Return Processing Branch.

(B) A request for relief of an amount assessed in a determination will be assigned for review by the Appeals and Data Analysis Branch.

35054. Acknowledgement and Review of a Request for Relief Separate from a Petition or Claim.

(a) A request for relief that has been assigned pursuant to regulation 35053, subdivision (b), will be reviewed as provided in this regulation.

(b) The assigned section will review the request for relief, and may request additional information from the taxpayer. When the assigned section completes its review and determines whether the request should be granted, denied, or granted in part and denied in part, the assigned section will mail its findings to the taxpayer. Where the assigned section denies the request, in whole or in part, the letter will explain that the taxpayer may request reconsideration by the Deputy Director if the taxpayer mails a request for reconsideration to the assigned section within 30 days of the date of the letter. If the taxpayer does not submit a timely written request for reconsideration, the assigned section’s findings as stated in the letter become final.

(c) If the taxpayer mails a timely request for reconsideration, the Deputy Director will reconsider the findings of the assigned section, and will mail the taxpayer a letter containing his or her decision. If the Deputy Director’s decision is to deny the requested relief, in whole or in part, the Deputy Director’s letter will state that the taxpayer may appeal the Deputy Director’s decision by mailing a request for appeals conference to the assigned section within 30 days of the date of the Deputy Director’s letter. The letter will also explain that a request for an appeals conference may be granted or may be denied. If the taxpayer does not submit a timely written request for appeals conference, the Deputy Director’s decision becomes final.

(d) If the taxpayer requests an appeals conference, the assigned section will notify the taxpayer whether an appeals conference is granted or denied. If the request for an appeals conference is granted, the request for relief will be forwarded to the Appeals Bureau for the scheduling of an appeals conference. If the request for an appeals conference is denied, the Deputy Director’s decision becomes final.

Laws, Regulations and Annotations

Search

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

California Department of Tax and Fee Administration

Chapter 1. Appeals

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

35047. Procedures for Review of a Request for Relief.

35048. Authority to Grant Relief of Penalty for Reasonable Cause and Contents of a Request for Such Relief.

35049. Authority to Grant Relief of Interest Due to Unreasonable Error or Delay and Contents of a Request for Such Relief.

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

35051. Authority to Grant Relief Due to Disaster and Contents of a Request for Such Relief.

35052. Filing a Request for Relief.

35053. Assignment for Review of a Request for Relief.

35054. Acknowledgement and Review of a Request for Relief Separate from a Petition or Claim.

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