Article 3. General Provisions Applicable To All Persons of California Revenue And Taxation Code >> Division 2. >> Part 10.2. >> Chapter 2. >> Article 3.

Except as otherwise provided by the Franchise Tax Board and in Section 18621.5, any return, declaration, statement, or other document required to be made under any provision of Part 10 (commencing with Section 17001), Part 11 (commencing with Section 23001), this part, or any applicable regulation shall contain, or be verified by, a written declaration that it is made under the penalties of perjury. Those returns, and all other returns, declarations, statements, or other documents or copies thereof required, shall be in any form as the Franchise Tax Board may from time to time prescribe, including, but not limited to, on paper, on magnetic media pursuant to Section 19524, or by electronic technology or electronic imaging technology pursuant to Section 18621.5, and shall be filed with the Franchise Tax Board. The Franchise Tax Board shall prepare blank forms for the returns, declarations, statements, or other documents and shall distribute them throughout the state and furnish them upon application. Failure to receive or secure the form does not relieve any taxpayer from making any return, declaration, statement, or other document required.

(a) Any return, declaration, statement, or other document required to be made under this part that is filed using electronic technology shall be in a form as the Franchise Tax Board may prescribe and is not complete, and therefore not filed, unless an electronic filing declaration is signed by the taxpayer, in accordance with Section 18621 in the case of individuals, subdivision (a) of Section 18505 in the case of estates or trusts, corporations, or limited liability companies classified as corporations for California income tax purposes, subdivision (a) of Section 18633 in the case of a partnership, or Section 18633.5 in the case of limited liability companies classified as partnerships for California income tax purposes. The Franchise Tax Board may prescribe forms and instructions for requiring the electronic filing declaration to be retained by the preparer or taxpayer and may require the declaration to be furnished to the Franchise Tax Board upon request.
  (b) Notwithstanding any other provision of law, any return, declaration, statement, or other document otherwise required to be signed that is filed in a traditional medium and captured using electronic imaging technology shall be deemed to be a valid original document upon reproduction to paper form by the Franchise Tax Board.
  (c) Notwithstanding any other law, any return, declaration, statement, or other document otherwise required to be signed that is filed by the taxpayer using electronic technology in a form as required by the Franchise Tax Board shall be deemed to be a signed, valid original document, including upon reproduction to paper form by the Franchise Tax Board.
  (d) "Electronic imaging technology" means a system of microphotography, optical disk, or reproduction by other technique that does not permit additions, deletions, or changes to the original document. The system may include, but is not limited to, any magnetic media or other machine readable form.
  (e) "Traditional medium" means any return, declaration, statement, or other document required to be made pursuant to this article other than those made using electronic imaging technology.
  (f) "Electronic technology" includes, but is not limited to, computer modem, magnetic media, optical disk, facsimile machine, or telephone.

The Franchise Tax Board shall not approve for electronic filing any proprietary filing software or electronic tax preparation forms that require a taxpayer to consent to the disclosure of any information for which a consent to disclose is required by Section 17530.5 of the Business and Professions Code as a condition of access to that software or to those electronic tax preparation forms.

(a) If an income tax return preparer prepared more than 100 timely original individual income tax returns that were filed during any calendar year that began on and after January 1, 2003, and if in the current calendar year that income tax preparer prepares one or more acceptable individual income tax returns using tax preparation software, then, for that calendar year and for each subsequent calendar year thereafter, all acceptable individual income tax returns prepared by that income tax preparer shall be filed using electronic technology, as defined in Section 18621.5.
  (b) For purposes of this section:
  (1) "Income tax preparer" means a person that meets both of the following:
  (A) Any person that prepares, in exchange for compensation, or who employs another person to prepare, in exchange for compensation, any return for the tax imposed by Part 10 (commencing with Section 17001) (hereafter Part 10). A person that only performs those acts described in clauses (i) through (iv) of Section 7701(a)(36)(B) of the Internal Revenue Code, with respect to the preparation of a return for the tax imposed by Part 10, is not an income tax preparer for purposes of this section or for purposes of Section 19170.
  (B) Any person that prepares returns for the tax imposed by Part 10 that is also required, by this article, to include an identification number on any return prepared by that tax preparer for the tax imposed by Part 10.
  (2) "Original individual income tax return" means any return that is required, by Section 18501, to be made with respect to the tax imposed by Part 10. For purposes of subdivision (a), a "timely" original individual tax return means any original individual tax return that is filed, without regard to extensions, during the calendar year for which that tax return is required to be filed.
  (3) "Acceptable individual income tax return" means any original individual tax return that is authorized by the Franchise Tax Board to be filed using electronic technology, as defined in Section 18621.5. For purposes of this section, Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code does not apply to any rule, notice, or guideline issued by the Franchise Tax Board that identifies a tax return as an acceptable individual income tax return.
  (4) "Tax preparation software" means any computer software program intended for accounting, tax return preparation, or tax compliance.
  (c) Subdivision (a) shall cease to apply to an income tax preparer if, during the previous calendar year, that income tax preparer prepared no more than 25 original individual income tax returns.
  (d) (1) This section applies to acceptable individual income tax returns required to be filed on and after January 1, 2004.
  (2) This section may not be interpreted to require electronic filing of acceptable individual income tax returns that are required to be filed before January 1, 2004.

(a) For taxable years beginning on or after January 1, 2014, if an acceptable return of a business entity was prepared using a tax preparation software, that return shall be filed using electronic technology in a form and manner prescribed by the Franchise Tax Board.
  (b) For purposes of this section:
  (1) "Acceptable return" means any original or amended return that is required to be filed pursuant to Article 2 (commencing with Section 18601), Section 18633, Section 18633.5, or Article 3 (commencing with Section 23771) of Chapter 4 of Part 11, other than the return for unrelated business taxable income required by Section 23771.
  (2) "Business entity" means a corporation, including an "S" corporation, an organization exempt from tax pursuant to Chapter 4 (commencing with Section 23701) of Part 11, a partnership, or a limited liability company.
  (3) "Tax preparation software" means any computer software program used to prepare an acceptable return or for use in tax compliance.
  (4) "Electronic technology" includes, but is not limited to, the Internet, cloud computing, or an electronic information delivery system.
  (5) "Technology constraints" means an inability of the tax preparation software used by a business entity to electronically file the acceptable return as required by this section as a result of the complex nature of the return or inadequacy of the software.
  (c) Any business entity required to file a return electronically under this section may annually request a waiver of the requirements of this section from the Franchise Tax Board with respect to an acceptable return filed for a taxable year. The Franchise Tax Board may grant a waiver if it determines the business entity is unable to comply with the requirements of this section due to, but not limited to, technology constraints, where compliance would result in undue financial burden, or due to circumstances that constitute reasonable cause, and not willful neglect, as applicable with respect to the penalty imposed under Section 19171.
  (d) This section applies to an acceptable return required to be filed on or after January 1, 2015.

(a) If any item required to be shown on a federal tax return, including any gross income, deduction, penalty, credit, or tax for any year of any taxpayer is changed or corrected by the Commissioner of Internal Revenue or other officer of the United States or other competent authority, or where a renegotiation of a contract or subcontract with the United States results in a change in gross income or deductions, that taxpayer shall report each change or correction, or the results of the renegotiation, within six months after the date of each final federal determination of the change or correction or renegotiation, or as required by the Franchise Tax Board, and shall concede the accuracy of the determination or state wherein it is erroneous. For any individual subject to tax under Part 10 (commencing with Section 17001), changes or corrections need not be reported unless they increase the amount of tax payable under Part 10 (commencing with Section 17001) for any year.
  (b) Any taxpayer filing an amended return with the Commissioner of Internal Revenue shall also file within six months thereafter an amended return with the Franchise Tax Board which shall contain any information as it shall require. For any individual subject to tax under Part 10 (commencing with Section 17001), an amended return need not be filed unless the change therein would increase the amount of tax payable under Part 10 (commencing with Section 17001) for any year.
  (c) Notification of a change or correction by the Commissioner of Internal Revenue or other officer of the United States or other competent authority, or renegotiation of a contract or subcontract with the United States that results in a change in any item or the filing of an amended return must be sufficiently detailed to allow computation of the resulting California tax change and shall be reported in the form and manner as prescribed by the Franchise Tax Board.
  (d) For purposes of this part, the date of each final federal determination shall be the date on which each adjustment or resolution resulting from an Internal Revenue Service examination is assessed pursuant to Section 6203 of the Internal Revenue Code.

(a) The Franchise Tax Board is authorized to provide, with respect to any amount required to be shown on any return, form, statement, or other document required to be filed with the Franchise Tax Board, that if the amount of the item is other than a whole dollar amount, either of the following shall apply:
  (1) The fractional part of a dollar shall be disregarded.
  (2) The fractional part of a dollar shall be disregarded unless it amounts to one-half dollar ($0.50) or more, in which case the amount (determined without regard to the fractional part of a dollar) shall be increased by one dollar ($1).
  (b) Any person making a return, statement, or other document shall be allowed, under regulations prescribed by the Franchise Tax Board, to make the return, statement, or other document without regard to subdivision (a).
  (c) Subdivisions (a) and (b) shall not be applicable to items which must be taken into account in making the computations necessary to determine the amount required to be shown on a form, but shall be applicable only to the final amount.

(a) Section 6109 of the Internal Revenue Code, relating to identifying numbers, shall apply, except as otherwise provided.
  (b) Identifying numbers shall be required on state tax returns, statements, or other documents in the form and manner as the Franchise Tax Board may require.
  (c) Section 6109(h) of the Internal Revenue Code, relating to identifying information required with respect to certain seller-provided financing, shall not apply.
  (d) The amendments made to Section 6109(a) of the Internal Revenue Code, relating to identifying number of income tax return preparer, by Public Law 105-206 shall apply.
  (e) The amendments made by the act adding this subdivision shall be operative on the effective date of the act adding this subdivision.

An income tax return preparer shall furnish a copy of any state tax return to a taxpayer and retain information in accordance with Section 6107 of the Internal Revenue Code.

For purposes of Chapter 9 (commencing with Section 19701), which relates to criminal penalties in the case of fraudulent returns, the term "return" includes any return filed under this part using electronic technology pursuant to Section 18621.5.

(a) Section 6111 of the Internal Revenue Code, relating to disclosure of reportable transactions, applies, except as otherwise provided.
  (b) (1) Except as provided in subdivision (e), a material advisor is required to send a duplicate of the federal return, if applicable, or the same information required to be provided on the federal reportable transactions return for California reportable transactions to the Franchise Tax Board not later than the date specified by the Franchise Tax Board or the Secretary of the Treasury.
  (2) (A) The information provided to the Franchise Tax Board pursuant to paragraph (1) shall also include any other information required by a Franchise Tax Board Notice.
  (B) Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code does not apply to any additional information requested under this section.
  (c) Section 6111 of the Internal Revenue Code is modified by substituting the phrase "Secretary or the Franchise Tax Board" for the word "Secretary" in each place it appears.
  (d) The reportable transactions return requirements of this section shall apply to any material advisor with respect to any reportable transaction, as defined in Section 6707A(c) of the Internal Revenue Code with respect to a material advisor that satisfies any of the following conditions:
  (1) Is organized in this state.
  (2) Is doing business in this state.
  (3) Derives income from sources in this state.
  (4) Provides any material aid, assistance, or advice with respect to organizing, managing, promoting, selling, implementing, insuring, or carrying out any reportable transaction with respect to a taxpayer that meets any of the following requirements:
  (A) Is organized in this state.
  (B) Does business in this state.
  (C) Derives income from sources in this state.
  (e) In addition to the requirements set forth in subdivision (a), for any transactions entered into on or after February 28, 2000, that become listed transactions (as defined under Section 6707A(c)(2) of the Internal Revenue Code) at any time, a return for those transactions shall be required to be filed with the Franchise Tax Board by the later of:
  (1) Sixty days after entering into the transaction.
  (2) Sixty days after the transaction becomes a listed transaction.
  (3) Sixty days after the effective date of the act amending this section.
  (f) In addition to the requirements set forth in subdivisions (a) and (e), for any transactions entered into on or after September 2, 2003, that are specifically identified by the Franchise Tax Board for California income or franchise tax purposes (under the authority of paragraph (4) of subdivision (a) of Section 18407) as a "listed transaction" at any time, a return for those transactions shall be required to be filed with the Franchise Tax Board by the later of:
  (1) Sixty days after entering into the transaction.
  (2) Sixty days after the transaction becomes a listed transaction.
  (3) Sixty days after the effective date of the act amending this section.