Article 3. Deficiency Determination of California Revenue And Taxation Code >> Division 2. >> Part 9.5. >> Chapter 2. >> Article 3.

In a case not involving a false or fraudulent return or failure to file a return, if the Controller determines at any time after the tax is due, but not later than four years after the return is filed, that the tax disclosed in any return required to be filed by this part is less than the tax disclosed by his examination, a deficiency shall be determined; provided that in a case where the federal generation skipping transfer tax has been increased upon audit of the federal return, the determination may be made at any time within one year after the federal generation skipping transfer tax becomes final. For the purposes of this section, a return filed before the last day prescribed by law for filing such return shall be considered as filed on such last day.

In the case of a false or fraudulent return or failure to file a return, the Controller may determine the tax at any time.

In any case in which a deficiency has been determined in an erroneous amount, the Controller may, within three years after the erroneous determination was made, set aside the determination or issue an amended determination in the correct amount.

The Controller shall give notice of the deficiency determined, together with any penalty for failure to file a return or to show any transfer in the return filed, by personal service or by mail to the person filing the return at the address stated in the return, or, if no return is filed, to the person liable for the tax. Copies of the notice of deficiency may in like manner be given to such other persons as the Controller deems advisable.

In any case in which it is claimed that a deficiency has been determined in an erroneous amount, any person who is liable for the tax may, within three years after the determination was made, bring an action against the state in the superior court having jurisdiction to have the tax modified in whole or in part.