18621. 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.
18621.5. (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.
18621.7. 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.
18621.9. (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.
18622. (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.
18623. (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.
18624. (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.
18625. 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.
18626. 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.
18628. (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.
18621. 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.
18621.5. (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.
18621.7. 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.
18621.9. (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.
18622. (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.
18623. (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.
18624. (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.
18625. 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.
18626. 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.
18628. (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.
18621. 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.
18621.5. (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.
18621.7. 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.
18621.9. (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.
18622. (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.
18623. (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.
18624. (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.
18625. 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.
18626. 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.
18628. (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.
