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Article 6. Interest And Penalties of California Revenue And Taxation Code >> Division 2. >> Part 1. >> Chapter 5. >> Article 6.
(a) Any person who fails to pay any tax to the state or any
amount of tax required to be collected and paid to the state, except
amounts of determinations made by the board under Article 2
(commencing with Section 6481) or Article 3 (commencing with Section
6511) of this chapter, within the time required shall pay a penalty
of 10 percent of the tax or amount of the tax, in addition to the tax
or amount of tax, plus interest at the modified adjusted rate per
month, or fraction thereof, established pursuant to Section 6591.5,
from the date on which the tax or the amount of tax required to be
collected became due and payable to the state until the date of
payment.
(b) Any person who fails to file a return in accordance with the due date set forth in Section 6451 or the due date established by the board in accordance with Section 6455, shall pay a penalty of 10 percent of the amount of taxes, exclusive of prepayments, with respect to the period for which the return is required.
(c) The penalties imposed by this section shall be limited to a maximum of 10 percent of the taxes for which the return is required, exclusive of any prepayments, for any one return.
(b) Any person who fails to file a return in accordance with the due date set forth in Section 6451 or the due date established by the board in accordance with Section 6455, shall pay a penalty of 10 percent of the amount of taxes, exclusive of prepayments, with respect to the period for which the return is required.
(c) The penalties imposed by this section shall be limited to a maximum of 10 percent of the taxes for which the return is required, exclusive of any prepayments, for any one return.
(a) (1) For interest required to be paid to the state upon
underpayments of tax to the state, " modified adjusted rate per annum"
means the adjusted annual rate established pursuant to subdivision
(c), plus three percentage points.
(2) For interest required to be paid by the state upon overpayments of tax, "modified adjusted rate per annum" means the adjusted annual rate established pursuant to subdivision (d).
(b) "Modified adjusted rate per month, or fraction thereof" means the modified adjusted rate per annum divided by 12.
(c) The rate established for interest to be paid upon underpayments of tax shall be determined in accordance with the provisions of Section 6621 of the Internal Revenue Code which establish the underpayment rate, except that the determination specified in Section 6621(b) of the Internal Revenue Code shall be modified to be determined semiannually as follows:
(1) The rate for January shall apply for the following July 1 to December 31, inclusive.
(2) The rate for July shall apply for the following January 1 to June 30, inclusive.
(d) (1) Except as provided in paragraph (2), the rate established for interest to be paid by the state upon overpayments of tax shall be equal to the bond equivalent rate of 13-week treasury bills auctioned, rounded to the nearest full percent (or if a multiple of one-half of 1 percent, the rate shall be increased to the next highest full percent), as follows:
(A) The bond equivalent rate of 13-week treasury bills established at the first auction held during the month of January shall apply for the following July 1 to December 31, inclusive.
(B) The bond equivalent rate of 13-week treasury bills established at the first auction held during the month of July shall apply for the following January 1 to June 30, inclusive.
(2) For the period July 1, 1991, through June 30, 1992, the rate to be paid by the state upon overpayments of tax shall be equal to the bond equivalent rate of 13-week treasury bills established at the auction held on July 1, 1991, rounded to the nearest full percent (or if a multiple of one-half of 1 percent, the rate shall be increased to the next highest full percent).
(e) For purposes of this part, and any other provision of law referencing this method of computation, in computing the amount of any interest required to be paid by the state or by the taxpayer, or any other amount determined by reference to that amount of interest, that interest and that amount shall be computed as simple interest, not compound interest.
(2) For interest required to be paid by the state upon overpayments of tax, "modified adjusted rate per annum" means the adjusted annual rate established pursuant to subdivision (d).
(b) "Modified adjusted rate per month, or fraction thereof" means the modified adjusted rate per annum divided by 12.
(c) The rate established for interest to be paid upon underpayments of tax shall be determined in accordance with the provisions of Section 6621 of the Internal Revenue Code which establish the underpayment rate, except that the determination specified in Section 6621(b) of the Internal Revenue Code shall be modified to be determined semiannually as follows:
(1) The rate for January shall apply for the following July 1 to December 31, inclusive.
(2) The rate for July shall apply for the following January 1 to June 30, inclusive.
(d) (1) Except as provided in paragraph (2), the rate established for interest to be paid by the state upon overpayments of tax shall be equal to the bond equivalent rate of 13-week treasury bills auctioned, rounded to the nearest full percent (or if a multiple of one-half of 1 percent, the rate shall be increased to the next highest full percent), as follows:
(A) The bond equivalent rate of 13-week treasury bills established at the first auction held during the month of January shall apply for the following July 1 to December 31, inclusive.
(B) The bond equivalent rate of 13-week treasury bills established at the first auction held during the month of July shall apply for the following January 1 to June 30, inclusive.
(2) For the period July 1, 1991, through June 30, 1992, the rate to be paid by the state upon overpayments of tax shall be equal to the bond equivalent rate of 13-week treasury bills established at the auction held on July 1, 1991, rounded to the nearest full percent (or if a multiple of one-half of 1 percent, the rate shall be increased to the next highest full percent).
(e) For purposes of this part, and any other provision of law referencing this method of computation, in computing the amount of any interest required to be paid by the state or by the taxpayer, or any other amount determined by reference to that amount of interest, that interest and that amount shall be computed as simple interest, not compound interest.
(a) If the board finds, taking into account all facts and
circumstances, that it is inequitable to compute interest at the
modified adjusted rate per month or fraction thereof, as defined in
subdivision (b) of Section 6591.5, interest shall be computed at the
modified adjusted daily rate from the date on which the tax or
prepayment was due until the date of payment, if all of the following
occur:
(1) The payment of tax or the prepayment was made one business day after the date the tax or prepayment was due.
(2) The person was granted relief from all penalties that applied to that payment of tax or prepayment.
(3) The person files a request for an oral hearing before the board.
(b) For purposes of this section, "modified adjusted daily rate" means the modified adjusted rate per annum as defined in subdivision (a) of Section 6591.5 determined on a daily basis by dividing the modified adjusted rate per annum by 365.
(c) For purposes of this section, "board" means the members of the State Board of Equalization meeting as a public body.
(d) For purposes of this section, "business day" means any day other than a Saturday, Sunday, or any day designated as a state holiday.
(e) This section shall not apply to any payment made pursuant to a deficiency determination, a determination where no return has been filed, or a jeopardy determination issued by the board.
(f) This section shall only apply to electronic payments or prepayments of taxes.
(g) This section shall be operative only until January 1, 2016.
(1) The payment of tax or the prepayment was made one business day after the date the tax or prepayment was due.
(2) The person was granted relief from all penalties that applied to that payment of tax or prepayment.
(3) The person files a request for an oral hearing before the board.
(b) For purposes of this section, "modified adjusted daily rate" means the modified adjusted rate per annum as defined in subdivision (a) of Section 6591.5 determined on a daily basis by dividing the modified adjusted rate per annum by 365.
(c) For purposes of this section, "board" means the members of the State Board of Equalization meeting as a public body.
(d) For purposes of this section, "business day" means any day other than a Saturday, Sunday, or any day designated as a state holiday.
(e) This section shall not apply to any payment made pursuant to a deficiency determination, a determination where no return has been filed, or a jeopardy determination issued by the board.
(f) This section shall only apply to electronic payments or prepayments of taxes.
(g) This section shall be operative only until January 1, 2016.
(a) If the board finds that a person's failure to make a
timely return or payment 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
person shall be relieved of the penalties provided by Sections 6476,
6477, 6479.3, 6480.4, 6480.8, 6511, 6565, 6591, 7051.2, 7073, and
7074.
(b) Except as provided in subdivision (c) any person seeking to be relieved of the penalty shall file with the board a statement under penalty of perjury setting forth the facts upon which he or she bases his or her claim for relief.
(c) The board shall establish criteria that provides for efficient resolution of requests for relief pursuant to this section.
(b) Except as provided in subdivision (c) any person seeking to be relieved of the penalty shall file with the board a statement under penalty of perjury setting forth the facts upon which he or she bases his or her claim for relief.
(c) The board shall establish criteria that provides for efficient resolution of requests for relief pursuant to this section.
Any person who is granted relief from the penalty imposed
by Section 6476 or 6477 shall pay, in addition to any prepayment,
interest at the "modified adjusted rate per month, or fraction
thereof" established pursuant to subdivision (b) of Section 6591.5,
from the date on which the prepayment would have been due until the
date of payment.
If the board finds that a person'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 person may be relieved of the interest provided by Sections 6459,
6480.4, 6480.8, 6513, 6591, and 6592.5.
Any person seeking to be relieved of the interest shall file with
the board a statement under penalty of perjury setting forth the
facts upon which he or she bases his or her claim for relief.
(a) The board, in its discretion, may relieve all or any
part of the interest imposed on a person by this part under the
following circumstances:
(1) Where the failure to pay tax is due in whole or in part to an unreasonable error or delay by an employee of the board acting in his or her official capacity.
(2) Where failure to pay use tax on a vehicle or vessel registered with the Department of Motor Vehicles was the direct result of an error by the Department of Motor Vehicles in calculating the use tax.
(b) For purposes of this section, an error or delay shall be deemed to have occurred only if no significant aspect of the error or delay is attributable to an act of, or a failure to act by, the taxpayer.
(c) Any person seeking relief under this section shall file with the board a statement under penalty of perjury setting forth the facts on which the claim for relief is based and any other information which the board may require.
(d) The board may grant relief only for interest imposed on tax liabilities that arise during taxable periods commencing on or after July 1, 1999.
(1) Where the failure to pay tax is due in whole or in part to an unreasonable error or delay by an employee of the board acting in his or her official capacity.
(2) Where failure to pay use tax on a vehicle or vessel registered with the Department of Motor Vehicles was the direct result of an error by the Department of Motor Vehicles in calculating the use tax.
(b) For purposes of this section, an error or delay shall be deemed to have occurred only if no significant aspect of the error or delay is attributable to an act of, or a failure to act by, the taxpayer.
(c) Any person seeking relief under this section shall file with the board a statement under penalty of perjury setting forth the facts on which the claim for relief is based and any other information which the board may require.
(d) The board may grant relief only for interest imposed on tax liabilities that arise during taxable periods commencing on or after July 1, 1999.
Notwithstanding any other provision of this part, no interest
or penalties shall be assessed against any person for failure to
make payments of any taxes on leases of personal property to the
United States government while the board is enjoined from collecting
such taxes by order of the United States District Court for the
Central District of California in the case of United States of
America v. California State Board of Equalization, No. CV 79-03359-R,
provided that payment of any applicable taxes is made within 60 days
after the board is no longer enjoined from collecting such taxes.
(a) If the board finds that a person's failure to make a
timely return or payment is due to the person's reasonable reliance
on written advice from the board, the person may be relieved of the
taxes imposed by Sections 6051 and 6201 and any penalty or interest
added thereto.
(b) For the purpose of this section, a person's failure to make a timely return or payment shall be considered to be due to reasonable reliance on written advice from the board, only if the board finds that all of the following conditions are satisfied:
(1) The person requested in writing that the board advise him or her whether a particular activity or transaction is subject to tax under this part. The specific facts and circumstances of the activity or transaction shall be fully described in the request.
(2) The board responded in writing to the person regarding the written request for advice, stating whether or not the described activity or transaction is subject to tax, or stating the conditions under which the activity or transaction is subject to tax.
(3) In reasonable reliance on the board's written advice, the person did not do either of the following:
(A) Charge or collect from his or her customers amounts designated as sales tax reimbursement or use tax for the described activity or transaction.
(B) Pay a use tax on the storage, use, or other consumption in this state of tangible personal property.
(4) The liability for taxes applied to a particular activity or transaction which occurred before either of the following:
(A) Before the board rescinded or modified the advice so given, by sending written notice to the person of the rescinded or modified advice.
(B) Before a change in statutory or constitutional law, a change in the board's regulations, or a final decision of a court, which renders the board's earlier written advice no longer valid.
(c) Any person seeking relief under this section shall file with the board:
(1) A copy of the person's written request to the board and a copy of the board's written advice.
(2) A statement under penalty of perjury setting forth the facts on which the claim for relief is based.
(3) Any other information which the board may require.
(d) Only the person making the written request shall be entitled to rely on the board's written advice to that person.
(b) For the purpose of this section, a person's failure to make a timely return or payment shall be considered to be due to reasonable reliance on written advice from the board, only if the board finds that all of the following conditions are satisfied:
(1) The person requested in writing that the board advise him or her whether a particular activity or transaction is subject to tax under this part. The specific facts and circumstances of the activity or transaction shall be fully described in the request.
(2) The board responded in writing to the person regarding the written request for advice, stating whether or not the described activity or transaction is subject to tax, or stating the conditions under which the activity or transaction is subject to tax.
(3) In reasonable reliance on the board's written advice, the person did not do either of the following:
(A) Charge or collect from his or her customers amounts designated as sales tax reimbursement or use tax for the described activity or transaction.
(B) Pay a use tax on the storage, use, or other consumption in this state of tangible personal property.
(4) The liability for taxes applied to a particular activity or transaction which occurred before either of the following:
(A) Before the board rescinded or modified the advice so given, by sending written notice to the person of the rescinded or modified advice.
(B) Before a change in statutory or constitutional law, a change in the board's regulations, or a final decision of a court, which renders the board's earlier written advice no longer valid.
(c) Any person seeking relief under this section shall file with the board:
(1) A copy of the person's written request to the board and a copy of the board's written advice.
(2) A statement under penalty of perjury setting forth the facts on which the claim for relief is based.
(3) Any other information which the board may require.
(d) Only the person making the written request shall be entitled to rely on the board's written advice to that person.
(a) (1) Any person who knowingly collects sales tax
reimbursement, as defined in Section 1656.1 of the Civil Code, or who
knowingly collects use tax pursuant to Chapter 3 (commencing with
Section 6201), and who fails to timely remit that sales tax
reimbursement or use tax to the board, shall be liable for a penalty
of 40 percent of the amount not timely remitted.
(2) (A) This subdivision shall not apply to any person whose liability for the unremitted sales tax reimbursement or use tax described in paragraph (1) averages one thousand dollars ($1,000) or less per month or does not exceed 5 percent of the total amount of tax liability for which the tax reimbursement was collected for the period in which tax was due, whichever is greater.
(B) If a person's failure to make a timely remittance of sales tax reimbursement or use tax is due to a reasonable cause or circumstances beyond the person's control, and occurred notwithstanding the exercise of ordinary care and the absence of willful neglect, the person shall be relieved of the penalty imposed by this subdivision.
(b) For purposes of this section:
(1) "Reasonable cause or circumstances beyond the person's control" includes, but is not limited to, any of the following:
(A) The occurrence of a death or serious illness of the person or the person's next of kin that caused the person's failure to make a timely remittance.
(B) The occurrence of an emergency, as defined in Section 8558 of the Government Code that caused the person's failure to make a timely remittance.
(C) A natural disaster or other catastrophe directly affecting the business operations of the person that caused the person's failure to make a timely remittance.
(D) The board failed to send returns or other information to the correct address of record, that caused the person's failure to make a timely remittance.
(E) The person's failure to make a timely remittance occurred only once over a three-year period, or once during the period in which the person was engaged in business, whichever time period is shorter.
(F) The person voluntarily corrected errors in remitting sales tax reimbursement or use tax collected that were made in previous reporting periods and remitted payment of the liability owed as a result of those errors prior to being contacted by the board regarding possible errors or discrepancies.
(2) "Sales tax reimbursement" shall also include any sales tax that is advertised, held out, or stated to the public or to any customer, directly or indirectly, that the tax or any part thereof will be assumed or absorbed by the retailer.
(c) This section shall apply to any determination made by the board pursuant to Article 2 (commencing with Section 6481), Article 3 (commencing with Section 6511), and Article 4 (commencing with Section 6536).
(2) (A) This subdivision shall not apply to any person whose liability for the unremitted sales tax reimbursement or use tax described in paragraph (1) averages one thousand dollars ($1,000) or less per month or does not exceed 5 percent of the total amount of tax liability for which the tax reimbursement was collected for the period in which tax was due, whichever is greater.
(B) If a person's failure to make a timely remittance of sales tax reimbursement or use tax is due to a reasonable cause or circumstances beyond the person's control, and occurred notwithstanding the exercise of ordinary care and the absence of willful neglect, the person shall be relieved of the penalty imposed by this subdivision.
(b) For purposes of this section:
(1) "Reasonable cause or circumstances beyond the person's control" includes, but is not limited to, any of the following:
(A) The occurrence of a death or serious illness of the person or the person's next of kin that caused the person's failure to make a timely remittance.
(B) The occurrence of an emergency, as defined in Section 8558 of the Government Code that caused the person's failure to make a timely remittance.
(C) A natural disaster or other catastrophe directly affecting the business operations of the person that caused the person's failure to make a timely remittance.
(D) The board failed to send returns or other information to the correct address of record, that caused the person's failure to make a timely remittance.
(E) The person's failure to make a timely remittance occurred only once over a three-year period, or once during the period in which the person was engaged in business, whichever time period is shorter.
(F) The person voluntarily corrected errors in remitting sales tax reimbursement or use tax collected that were made in previous reporting periods and remitted payment of the liability owed as a result of those errors prior to being contacted by the board regarding possible errors or discrepancies.
(2) "Sales tax reimbursement" shall also include any sales tax that is advertised, held out, or stated to the public or to any customer, directly or indirectly, that the tax or any part thereof will be assumed or absorbed by the retailer.
(c) This section shall apply to any determination made by the board pursuant to Article 2 (commencing with Section 6481), Article 3 (commencing with Section 6511), and Article 4 (commencing with Section 6536).
