19001. Except as provided by Article 2 (commencing with Section
19021), the tax imposed under Part 10 (commencing with Section 17001)
and Part 11 (commencing with Section 23001) shall be paid at the
time and place fixed for filing the return (determined without regard
to any extension of time for filing the return).
19002. (a) The amount withheld under Article 5 (commencing with
Section 18661) of Chapter 2 or Section 13020 of the Unemployment
Insurance Code during any calendar year shall be allowed to the
recipient of the income as a credit against the tax for the taxable
year with respect to which the amount was withheld.
(b) In the case of a partnership, limited liability company
classified as a partnership for California income tax purposes, or S
corporation filing a group return as agent for electing nonresident
partners or shareholders in accordance with Section 18535, for
purposes of this part, the amount withheld under Article 5
(commencing with Section 18661) of Chapter 2 during any taxable year
shall be allowed as a credit attributable to the partnership, limited
liability company, or S corporation on the group return for the
taxable year with respect to which that amount was withheld.
(c) (1) For purposes of Section 19306, any tax actually deducted
and withheld during any calendar year under Article 5 (commencing
with Section 18661) of Chapter 2 or Section 13020 of the Unemployment
Insurance Code shall, in respect of the recipient of the income, be
deemed to have been paid on the last day prescribed for filing the
return under Article 1 (commencing with Section 18501) or Article 2
(commencing with Section 18601) of Chapter 2 (without regard to any
extension of time for filing the return), with respect to which the
tax is allowable as a credit under subdivision (a) or (b).
(2) For purposes of Sections 19306 and 19340, any amount paid as
estimated tax under Section 19025 or 19136 of this code or Section
13043 of the Unemployment Insurance Code for any taxable year shall
be deemed to have been paid on the last day prescribed for filing the
return under Article 1 (commencing with Section 18501) or Article 2
(commencing with Section 18601) of Chapter 2 (without regard to any
extension of time for filing the return).
(d) Notwithstanding subdivision (b) or (c), for purposes of
Section 19306 with respect to any tax deducted and withheld under
Article 5 (commencing with Section 18661) of Chapter 2 or Section
13020 of the Unemployment Insurance Code both of the following shall
apply:
(1) If a return is filed before the due date for that return, the
return shall be considered filed on the due date.
(2) If a tax with respect to an amount paid is paid before the due
date for that return, the tax shall be considered paid on the due
date.
(e) If any overpayment of income tax is claimed as a credit
against estimated tax for the succeeding taxable year, that amount
shall be considered as a payment of estimated tax in accordance with
Section 19007, for the succeeding taxable year, and no claim for
credit or refund of the overpayment shall be allowed for the taxable
year in which the overpayment arises.
19004. A taxpayer may elect to pay the tax prior to the date
prescribed for its payment.
19005. The tax, and any interest and penalties, shall be paid to
the Franchise Tax Board. Except as provided in Section 19011 with
respect to an electronic funds transfer, remittances may be in the
form of a check, payable in United States funds to the Franchise Tax
Board, at the time and in the manner as the Franchise Tax Board may
prescribe or, notwithstanding Title 1.3 (commencing with Section
1747) of Part 4 of Title 3 of the Civil Code, in the form of a credit
card or other payment device as defined in Chapter 2.6 (commencing
with Section 6160) of the Government Code, at the time and in the
manner that the Franchise Tax Board may prescribe. If a check or
credit card remittance is not paid by the bank on which it is drawn,
the taxpayer tendering the check or credit card remittance remains
liable for the payment of the tax, and all interest and penalties, as
if the check or credit card remittance had not been tendered.
19006. (a) The spouse who controls the disposition of or who
receives or spends community income as well as the spouse who is
taxable on the income is liable for the payment of the taxes imposed
by Part 10 (commencing with Section 17001) on that income.
(b) Whenever a joint return is filed by a husband and wife, the
liability for the tax on the aggregate income is joint and several.
The liability may be revised by a court in a proceeding for
dissolution of the marriage of the husband and wife, provided:
(1) The order revising tax liability may not relieve a spouse of
tax liability on income earned by or subject to the exclusive
management and control of the spouse. The liability of the spouse for
the tax, penalties, and interest due for the taxable year shall be
in the same ratio to total tax, penalties, and interest due for the
taxable year as the income earned by or subject to the management and
control of the spouse is to total gross income reportable on the
return.
(2) The order revising tax liability:
(A) Must separately state the income tax liabilities for the
taxable years for which revision of tax liability is granted.
(B) Shall not revise a tax liability that has been fully paid
prior to the effective date of the order; however, any unpaid amount
may be revised.
(C) Shall become effective when the Franchise Tax Board is served
with or acknowledges receipt of the order.
(D) Shall not be effective if the gross income reportable on the
return exceeds one hundred fifty thousand dollars ($150,000) or the
amount of tax liability the spouse is relieved of exceeds seven
thousand five hundred dollars ($7,500), unless a tax revision
clearance certificate is obtained from the Franchise Tax Board and
filed with the court.
(c) Notwithstanding subdivisions (a) and (b), whenever a joint
return is filed by a husband and wife and the tax liability is not
fully paid, that liability, including interest and penalties, may be
revised by the Franchise Tax Board as to one spouse.
(1) However, the liability shall not be revised:
(A) To relieve a spouse of tax liability on income earned by or
subject to the exclusive management and control of the spouse. The
liability of the spouse for the tax, penalties, and interest due for
the taxable year shall be in the same ratio to total tax, penalties,
and interest due for the taxable year as the income earned by or
subject to the management and control of the spouse is to total gross
income reportable on the return.
(B) To relieve a spouse of liability below the amount actually
paid on the liability prior to the granting of relief, including
credit from any other taxable year available for application to the
liability.
(2) The liability may be revised only if the spouse whose
liability is to be revised establishes that he or she did not know
of, and had no reason to know of, the nonpayment at the time the
return was filed. For purposes of this paragraph, "reason to know"
means whether or not a reasonably prudent person would have had
reason to know of the nonpayment.
(3) For purposes of this section, the determination of the spouse
to whom items of gross income are attributable shall be made without
regard to community property laws.
(4) The determination of the Franchise Tax Board as to whether the
liability is to be revised as to one spouse shall be made not less
than 30 days after notification of the other spouse and shall be
based upon whether, under all of the facts and circumstances
surrounding the nonpayment, it would be inequitable to hold the
spouse requesting revision liable for the nonpayment. Any action
taken under this section shall be treated as though it were action on
a protest taken under Section 19044 and shall become final upon the
expiration of 30 days from the date that notice of the action is
mailed to both spouses, unless, within that 30-day period, one or
both spouses appeal the determination to the board as provided in
Section 19045.
(5) This subdivision shall apply to all taxable years subject to
the provisions of this part, but shall not apply to any taxable year
which has been closed by a statute of limitations, res judicata, or
otherwise.
19007. Payment of the estimated tax, or any installment thereof,
shall be considered payment on account of the taxes imposed under
Part 10 (commencing with Section 17001) or Part 11 (commencing with
Section 23001) for the taxable year.
19008. (a) The Franchise Tax Board may, in cases of financial
hardship, as determined by the Franchise Tax Board, allow a taxpayer
to enter into installment payment agreements with the Franchise Tax
Board to make full or partial payment of taxes due, plus applicable
interest and penalties over the life of the installment period.
Failure by a taxpayer to comply fully with the terms of the
installment payment agreement shall render the agreement null and
void, unless the Franchise Tax Board determines that the failure was
due to a reasonable cause, and the total amount of tax, interest, and
all penalties shall be immediately due and payable.
(b) In the case of a liability for tax of an individual under Part
10 (commencing with Section 17001) or this part, the Franchise Tax
Board shall enter into an agreement to accept the full payment of the
tax in installments if, as of the date the individual offers to
enter into the agreement, all of the following apply:
(1) The aggregate amount of the liability (determined without
regard to interest, penalties, additions to the tax and additional
amounts) does not exceed ten thousand dollars ($10,000).
(2) The taxpayer (and, if the liability relates to a joint return,
the taxpayer's spouse) has not during any of the preceding five
taxable years done any of the following:
(A) Failed to file any return of tax imposed under Part 10
(commencing with Section 17001) or this part.
(B) Failed to pay any tax required to be shown on the return.
(C) Entered into an installment agreement under this section for
payment of any tax imposed by Part 10 (commencing with Section 17001)
or this part.
(3) The Franchise Tax Board determines that the taxpayer is
financially unable to pay the liability in full when due, and the
taxpayer submits any information as the Franchise Tax Board may
require to make this determination.
(4) The agreement requires full payment of the liability within
three years.
(5) The taxpayer agrees to comply with the provisions of this part
and Part 10 (commencing with Section 17001) for the period the
agreement is in effect.
(c) Except in any case where the Franchise Tax Board finds
collection of the tax to which an installment payment agreement
relates to be in jeopardy, or there is a mutual consent to terminate,
alter, or modify the agreement, the agreement shall not be
considered null and void, or otherwise terminated, unless both of the
following occur:
(1) A notice of termination is provided to the taxpayer not later
than 30 days before the date of termination.
(2) The notice includes an explanation of why the Franchise Tax
Board intends to terminate the agreement.
(d) No levy may be issued on the property or rights to property of
any person with respect to any unpaid tax:
(1) During the period that an offer by the taxpayer for an
installment agreement under this section for payment of the unpaid
tax is pending with the Franchise Tax Board.
(2) If the offer is rejected by the Franchise Tax Board, during
the 30 days thereafter and, if a request for review of the rejection
is filed within the 30 days, during the period that the review is
pending.
(3) During the period that the installment agreement for payment
of the unpaid tax is in effect.
(4) If the agreement is terminated by the Franchise Tax Board,
during the 30 days thereafter (and, if a request for review of the
termination is filed within the 30 days, during the period that the
review is pending).
(5) This subdivision shall not apply with respect to any of the
following:
(A) Any unpaid tax if either of the following occurs:
(i) The taxpayer files a written notice with the Franchise Tax
Board that waives the restriction imposed by this subdivision on levy
with respect to the tax.
(ii) The Franchise Tax Board finds that the collection of that tax
is in jeopardy.
(B) Any levy that was first issued before the date that the
applicable proceeding under this subdivision commenced.
(C) At the discretion of the Franchise Tax Board, any unpaid tax
for which the taxpayer makes an offer of an installment agreement
subsequent to a rejection of an offer of an installment agreement
with respect to that unpaid tax (or to any review thereof).
(D) The period of limitation under Section 19371 shall be
suspended for the period during which the Franchise Tax Board is
prohibited under this subdivision from making a levy.
(e) The Taxpayers' Rights Advocate shall establish procedures for
an independent departmental administrative review for the rejection
of the offer of an installment payment and for installment payment
agreements that are rendered null and void, or otherwise terminated
under this section, for taxpayers that request that review. This
administrative review shall not be subject to Chapter 4.5 (commencing
with Section 11400) of Part 1 of Division 3 of the Government Code.
Unless review is requested by the taxpayer within 30 days of the date
of rejection of the offer of an installment agreement or termination
of the installment agreement, this administrative review shall not
stay collection of the tax to which the installment payment agreement
relates.
(f) In the case of an agreement entered into by the Franchise Tax
Board under subdivision (a) for partial payment of a tax liability,
the Franchise Tax Board shall review the agreement at least once
every two years.
(g) (1) In the case of any taxpayer that is making payments to the
Franchise Tax Board under an informal payment arrangement that was
in existence prior to the effective date of the act adding this
subdivision, that informal payment arrangement, for purposes of this
section, shall be treated as an installment payment agreement that
was entered into on the later of the following:
(A) January 1, 2005.
(B) The date on which the arrangement was established by the
Franchise Tax Board.
(2) In any case where the date determined under the rules of
paragraph (1) is a date prior to February 1, 2005, the amount due
under the informal payment arrangement as of February 1, 2005, shall
be treated as an installment payment agreement amount as of the start
of the amnesty program within the meaning of Section 19738.
(3) Section 19591 does not apply to either of the following:
(A) Informal payment arrangements treated as installment payment
agreements under paragraph (1).
(B) Installment payment agreements authorized by the amendments
made by the act adding this subdivision that were entered into prior
to July 1, 2005, or the effective date of the act adding this
subdivision, whichever occurs later.
19009. (a) Whenever any person or employer who is required to
collect, account for, and pay over any tax--
(1) At the time and in the manner prescribed by law or regulations
(A) fails to collect, truthfully account for, or pay over the tax,
or (B) fails to make deposits, payments, or returns of the tax, and
(2) Is notified, by notice delivered in hand or by registered mail
of the failure, then all the requirements of subdivision (b) shall
be complied with. In the case of a corporation, partnership, limited
liability company, or trust, notice to an officer, partner, manager,
member, or trustee, shall, for purposes of this section, be deemed to
be sufficient notice to the corporation, partnership, limited
liability company, or trust and to all officers, partners, managers,
members, trustees, and employees thereof.
(b) Any person or employer who is required to collect, account
for, and pay over any tax imposed by Part 10 (commencing with Section
17001) or Part 11 (commencing with Section 23001), if notice has
been delivered to that person or employer in accordance with
subdivision (a), shall collect the taxes, which become collectible
after delivery of the notice, shall (not later than the end of the
second banking day after any amount of the taxes is collected)
deposit that amount in a separate account in a bank located within
the limits of this state, and shall keep the amount of those taxes in
that account until payment over to the Franchise Tax Board. The
account shall be designated as a special fund in trust for the
Franchise Tax Board, payable to the Franchise Tax Board by that
person or employer as trustee.
(c) Whenever the Franchise Tax Board is satisfied, with respect to
any notification made under subdivision (a), that all requirements
of law and regulations with respect to the taxes, will henceforth be
complied with, it may cancel the notification. The cancellation shall
take effect at the time as is specified in the notice of the
cancellation.
19010. Unless otherwise provided, any provision of this part that
relates to the assessment and collection of tax shall also apply to
the assessment and collection of estimated tax.
19011. (a) All payments required under this part, regardless of the
taxable year to which the payments apply shall be remitted to the
Franchise Tax Board by electronic funds transfer pursuant to Division
11 (commencing with Section 11101) of the Commercial Code, once any
of the following conditions are met:
(1) With respect to any corporation, any installment payment of
estimated tax made pursuant to Section 19025 or the payment made
pursuant to Section 18604 with regard to an extension of time to file
exceeds fifty thousand dollars ($50,000) in any taxable year
beginning on or after January 1, 1991, or exceeds twenty thousand
dollars ($20,000) in any taxable year beginning on or after January
1, 1995.
(2) With respect to any corporation, the total tax liability
exceeds two hundred thousand dollars ($200,000) in any taxable year
beginning on or after January 1, 1991, or exceeds eighty thousand
dollars ($80,000) in any taxable year beginning on or after January
1, 1995. For purposes of this section, total tax liability shall be
the total tax liability as shown on the original return, after any
adjustment made pursuant to Section 19051.
(3) A taxpayer submits a request to the Franchise Tax Board and is
granted permission to make electronic funds transfers.
(b) A taxpayer required to remit payments to the Franchise Tax
Board by electronic funds transfer may elect to discontinue making
payments where the threshold requirements set forth in paragraphs (1)
and (2) of subdivision (a) were not met for the preceding taxable
year. The election shall be made in a form and manner prescribed by
the Franchise Tax Board.
(c) Any taxpayer required to remit payment by electronic funds
transfer pursuant to this section who makes payment by other means
shall pay a penalty of 10 percent of the amount paid, unless it is
shown that the failure to make payment as required was for reasonable
cause and was not the result of willful neglect.
(d) Any taxpayer required to remit payments by electronic funds
transfer pursuant to this section may request a waiver of those
requirements from the Franchise Tax Board. The Franchise Tax Board
may grant a waiver only if it determines that the particular amounts
paid in excess of the threshold amounts established in this section
were not representative of the taxpayer's tax liability. If a
taxpayer is granted a waiver, subsequent remittances by electronic
funds transfer shall be required only on those terms set forth in the
waiver.
(e) The Franchise Tax Board shall accept remittances by electronic
funds transfer pursuant to this section no later than January 1,
1993. Electronic funds transfer procedures, in addition to those
described in subdivision (f), shall be as prescribed by the Franchise
Tax Board. Payment is deemed complete on the date the electronic
funds transfer is initiated, if settlement to the state's demand
account occurs on or before the banking day following the date the
transfer is initiated. If settlement to the state's demand account
does not occur on or before the banking day following the date the
transfer is initiated, payment is deemed to occur on the date
settlement occurs.
(f) For purposes of this section:
(1) "Electronic funds transfer" means any transfer of funds, other
than a transaction originated by check, draft, or similar paper
instrument, that is initiated through an electronic terminal,
telephonic instrument, or computer or magnetic tape, so as to order,
instruct, or authorize a financial institution to debit or credit an
account. Electronic funds transfer shall be accomplished by an
automated clearinghouse debit, automated clearinghouse credit, a
Federal Reserve Wire Transfer (Fedwire), or by an international funds
transfer.
(2) "Automated clearinghouse" means any federal reserve bank, or
an organization established by agreement with the National Automated
Clearing House Association, that operates as a clearinghouse for
transmitting or receiving entries between banks or bank accounts and
that authorizes an electronic transfer of funds between those banks
or bank accounts.
(3) "Automated clearinghouse debit" means a transaction in which
any department of the state, through its designated depository bank,
originates an automated clearinghouse transaction debiting the
taxpayer's bank account and crediting the state's bank account for
the amount of tax. Banking costs incurred for the automated
clearinghouse debit transaction by the taxpayer shall be paid by the
state.
(4) "Automated clearinghouse credit" means an automated
clearinghouse transaction in which the taxpayer, through its own
bank, originates an entry crediting the state's bank account and
debiting its own bank account. Banking costs incurred by the state
for the automated clearinghouse credit transaction may be charged to
the taxpayer.
(5) "Fedwire" means any transaction originated by the taxpayer and
utilizing the national electronic payment system to transfer funds
through federal reserve banks, pursuant to which the taxpayer debits
its own bank account and credits the state's bank account. Electronic
funds transfers may be made by Fedwire only if prior approval is
obtained from the Franchise Tax Board and the taxpayer is unable, for
reasonable cause, to make payments pursuant to paragraph (3) or (4).
Banking costs charged to the taxpayer and to the state may be
charged to the taxpayer.
(6) "International funds transfer" means any transaction
originated by the taxpayer and utilizing the international electronic
payment system to transfer funds, pursuant to which the taxpayer
debits its own bank account and credits the state's bank account.
(7) In determining whether a payment or total tax liability
exceeds the amounts established in subdivision (a), the income of all
taxpayers whose income derived from, or attributable to, sources
within this state is required to be determined by a combined report
shall be aggregated and the total aggregate amount shall be
considered to be the income of a single taxpayer for purposes of
determining the payment or total tax liability of a single taxpayer.
19011.5. (a) All payments required by an individual under this
part, regardless of the taxable year to which the payments apply,
made on or after January 1, 2009, shall be electronically remitted to
the Franchise Tax Board in the form and manner prescribed by the
Franchise Tax Board, once any of the following conditions are met by
an individual:
(1) Any installment payment of estimated tax made pursuant to this
part in excess of twenty thousand dollars ($20,000), or any payment
made pursuant to Section 18567 with regard to an extension of time to
file that exceeds twenty thousand dollars ($20,000), for any taxable
year beginning on or after January 1, 2009.
(2) The total tax liability exceeds eighty thousand dollars
($80,000) in any taxable year beginning on or after January 1, 2009.
For purposes of this section, total tax liability shall be the total
tax liability as shown on the original return, after any adjustment
made pursuant to Section 19051.
(b) A taxpayer required to electronically remit payment to the
Franchise Tax Board pursuant to this section may elect to discontinue
making payments electronically where the threshold requirements set
forth in paragraphs (1) and (2) of subdivision (a) were not met for
the preceding taxable year. The election shall be made in a form and
manner prescribed by the Franchise Tax Board.
(c) Any taxpayer required to electronically remit payment pursuant
to this section who makes payment by other means shall pay a penalty
of 1 percent of the amount paid, unless it is shown that the failure
to make payment as required was for reasonable cause and was not the
result of willful neglect.
(d) Any taxpayer required to electronically remit payments
pursuant to this section may request a waiver of those requirements
from the Franchise Tax Board. The Franchise Tax Board may grant a
waiver only if it determines that the particular amounts paid in
excess of the threshold amounts established in this section were not
representative of the taxpayer's tax liability. If the Franchise Tax
Board grants a waiver to a taxpayer, the waiver shall be in writing,
and subsequent electronic remittances shall be required only on those
terms set forth in the written waiver.
(e) 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 shall not apply to any standard, criterion, procedure,
determination, rule, notice, or guideline established or issued by
the Franchise Tax Board pursuant to subdivision (a).
(f) For purposes of this section, both of the following shall
apply:
(1) "Electronically remit" means to send payment through use of
any of the electronic payment applications provided by the Franchise
Tax Board, including, but not limited to, a pay by phone option, when
made available by the Franchise Tax Board.
(2) "Pay by phone" means a method that allows a taxpayer to
authorize a transfer of funds from a financial institution using
telephonic technology.
19001. Except as provided by Article 2 (commencing with Section
19021), the tax imposed under Part 10 (commencing with Section 17001)
and Part 11 (commencing with Section 23001) shall be paid at the
time and place fixed for filing the return (determined without regard
to any extension of time for filing the return).
19002. (a) The amount withheld under Article 5 (commencing with
Section 18661) of Chapter 2 or Section 13020 of the Unemployment
Insurance Code during any calendar year shall be allowed to the
recipient of the income as a credit against the tax for the taxable
year with respect to which the amount was withheld.
(b) In the case of a partnership, limited liability company
classified as a partnership for California income tax purposes, or S
corporation filing a group return as agent for electing nonresident
partners or shareholders in accordance with Section 18535, for
purposes of this part, the amount withheld under Article 5
(commencing with Section 18661) of Chapter 2 during any taxable year
shall be allowed as a credit attributable to the partnership, limited
liability company, or S corporation on the group return for the
taxable year with respect to which that amount was withheld.
(c) (1) For purposes of Section 19306, any tax actually deducted
and withheld during any calendar year under Article 5 (commencing
with Section 18661) of Chapter 2 or Section 13020 of the Unemployment
Insurance Code shall, in respect of the recipient of the income, be
deemed to have been paid on the last day prescribed for filing the
return under Article 1 (commencing with Section 18501) or Article 2
(commencing with Section 18601) of Chapter 2 (without regard to any
extension of time for filing the return), with respect to which the
tax is allowable as a credit under subdivision (a) or (b).
(2) For purposes of Sections 19306 and 19340, any amount paid as
estimated tax under Section 19025 or 19136 of this code or Section
13043 of the Unemployment Insurance Code for any taxable year shall
be deemed to have been paid on the last day prescribed for filing the
return under Article 1 (commencing with Section 18501) or Article 2
(commencing with Section 18601) of Chapter 2 (without regard to any
extension of time for filing the return).
(d) Notwithstanding subdivision (b) or (c), for purposes of
Section 19306 with respect to any tax deducted and withheld under
Article 5 (commencing with Section 18661) of Chapter 2 or Section
13020 of the Unemployment Insurance Code both of the following shall
apply:
(1) If a return is filed before the due date for that return, the
return shall be considered filed on the due date.
(2) If a tax with respect to an amount paid is paid before the due
date for that return, the tax shall be considered paid on the due
date.
(e) If any overpayment of income tax is claimed as a credit
against estimated tax for the succeeding taxable year, that amount
shall be considered as a payment of estimated tax in accordance with
Section 19007, for the succeeding taxable year, and no claim for
credit or refund of the overpayment shall be allowed for the taxable
year in which the overpayment arises.
19004. A taxpayer may elect to pay the tax prior to the date
prescribed for its payment.
19005. The tax, and any interest and penalties, shall be paid to
the Franchise Tax Board. Except as provided in Section 19011 with
respect to an electronic funds transfer, remittances may be in the
form of a check, payable in United States funds to the Franchise Tax
Board, at the time and in the manner as the Franchise Tax Board may
prescribe or, notwithstanding Title 1.3 (commencing with Section
1747) of Part 4 of Title 3 of the Civil Code, in the form of a credit
card or other payment device as defined in Chapter 2.6 (commencing
with Section 6160) of the Government Code, at the time and in the
manner that the Franchise Tax Board may prescribe. If a check or
credit card remittance is not paid by the bank on which it is drawn,
the taxpayer tendering the check or credit card remittance remains
liable for the payment of the tax, and all interest and penalties, as
if the check or credit card remittance had not been tendered.
19006. (a) The spouse who controls the disposition of or who
receives or spends community income as well as the spouse who is
taxable on the income is liable for the payment of the taxes imposed
by Part 10 (commencing with Section 17001) on that income.
(b) Whenever a joint return is filed by a husband and wife, the
liability for the tax on the aggregate income is joint and several.
The liability may be revised by a court in a proceeding for
dissolution of the marriage of the husband and wife, provided:
(1) The order revising tax liability may not relieve a spouse of
tax liability on income earned by or subject to the exclusive
management and control of the spouse. The liability of the spouse for
the tax, penalties, and interest due for the taxable year shall be
in the same ratio to total tax, penalties, and interest due for the
taxable year as the income earned by or subject to the management and
control of the spouse is to total gross income reportable on the
return.
(2) The order revising tax liability:
(A) Must separately state the income tax liabilities for the
taxable years for which revision of tax liability is granted.
(B) Shall not revise a tax liability that has been fully paid
prior to the effective date of the order; however, any unpaid amount
may be revised.
(C) Shall become effective when the Franchise Tax Board is served
with or acknowledges receipt of the order.
(D) Shall not be effective if the gross income reportable on the
return exceeds one hundred fifty thousand dollars ($150,000) or the
amount of tax liability the spouse is relieved of exceeds seven
thousand five hundred dollars ($7,500), unless a tax revision
clearance certificate is obtained from the Franchise Tax Board and
filed with the court.
(c) Notwithstanding subdivisions (a) and (b), whenever a joint
return is filed by a husband and wife and the tax liability is not
fully paid, that liability, including interest and penalties, may be
revised by the Franchise Tax Board as to one spouse.
(1) However, the liability shall not be revised:
(A) To relieve a spouse of tax liability on income earned by or
subject to the exclusive management and control of the spouse. The
liability of the spouse for the tax, penalties, and interest due for
the taxable year shall be in the same ratio to total tax, penalties,
and interest due for the taxable year as the income earned by or
subject to the management and control of the spouse is to total gross
income reportable on the return.
(B) To relieve a spouse of liability below the amount actually
paid on the liability prior to the granting of relief, including
credit from any other taxable year available for application to the
liability.
(2) The liability may be revised only if the spouse whose
liability is to be revised establishes that he or she did not know
of, and had no reason to know of, the nonpayment at the time the
return was filed. For purposes of this paragraph, "reason to know"
means whether or not a reasonably prudent person would have had
reason to know of the nonpayment.
(3) For purposes of this section, the determination of the spouse
to whom items of gross income are attributable shall be made without
regard to community property laws.
(4) The determination of the Franchise Tax Board as to whether the
liability is to be revised as to one spouse shall be made not less
than 30 days after notification of the other spouse and shall be
based upon whether, under all of the facts and circumstances
surrounding the nonpayment, it would be inequitable to hold the
spouse requesting revision liable for the nonpayment. Any action
taken under this section shall be treated as though it were action on
a protest taken under Section 19044 and shall become final upon the
expiration of 30 days from the date that notice of the action is
mailed to both spouses, unless, within that 30-day period, one or
both spouses appeal the determination to the board as provided in
Section 19045.
(5) This subdivision shall apply to all taxable years subject to
the provisions of this part, but shall not apply to any taxable year
which has been closed by a statute of limitations, res judicata, or
otherwise.
19007. Payment of the estimated tax, or any installment thereof,
shall be considered payment on account of the taxes imposed under
Part 10 (commencing with Section 17001) or Part 11 (commencing with
Section 23001) for the taxable year.
19008. (a) The Franchise Tax Board may, in cases of financial
hardship, as determined by the Franchise Tax Board, allow a taxpayer
to enter into installment payment agreements with the Franchise Tax
Board to make full or partial payment of taxes due, plus applicable
interest and penalties over the life of the installment period.
Failure by a taxpayer to comply fully with the terms of the
installment payment agreement shall render the agreement null and
void, unless the Franchise Tax Board determines that the failure was
due to a reasonable cause, and the total amount of tax, interest, and
all penalties shall be immediately due and payable.
(b) In the case of a liability for tax of an individual under Part
10 (commencing with Section 17001) or this part, the Franchise Tax
Board shall enter into an agreement to accept the full payment of the
tax in installments if, as of the date the individual offers to
enter into the agreement, all of the following apply:
(1) The aggregate amount of the liability (determined without
regard to interest, penalties, additions to the tax and additional
amounts) does not exceed ten thousand dollars ($10,000).
(2) The taxpayer (and, if the liability relates to a joint return,
the taxpayer's spouse) has not during any of the preceding five
taxable years done any of the following:
(A) Failed to file any return of tax imposed under Part 10
(commencing with Section 17001) or this part.
(B) Failed to pay any tax required to be shown on the return.
(C) Entered into an installment agreement under this section for
payment of any tax imposed by Part 10 (commencing with Section 17001)
or this part.
(3) The Franchise Tax Board determines that the taxpayer is
financially unable to pay the liability in full when due, and the
taxpayer submits any information as the Franchise Tax Board may
require to make this determination.
(4) The agreement requires full payment of the liability within
three years.
(5) The taxpayer agrees to comply with the provisions of this part
and Part 10 (commencing with Section 17001) for the period the
agreement is in effect.
(c) Except in any case where the Franchise Tax Board finds
collection of the tax to which an installment payment agreement
relates to be in jeopardy, or there is a mutual consent to terminate,
alter, or modify the agreement, the agreement shall not be
considered null and void, or otherwise terminated, unless both of the
following occur:
(1) A notice of termination is provided to the taxpayer not later
than 30 days before the date of termination.
(2) The notice includes an explanation of why the Franchise Tax
Board intends to terminate the agreement.
(d) No levy may be issued on the property or rights to property of
any person with respect to any unpaid tax:
(1) During the period that an offer by the taxpayer for an
installment agreement under this section for payment of the unpaid
tax is pending with the Franchise Tax Board.
(2) If the offer is rejected by the Franchise Tax Board, during
the 30 days thereafter and, if a request for review of the rejection
is filed within the 30 days, during the period that the review is
pending.
(3) During the period that the installment agreement for payment
of the unpaid tax is in effect.
(4) If the agreement is terminated by the Franchise Tax Board,
during the 30 days thereafter (and, if a request for review of the
termination is filed within the 30 days, during the period that the
review is pending).
(5) This subdivision shall not apply with respect to any of the
following:
(A) Any unpaid tax if either of the following occurs:
(i) The taxpayer files a written notice with the Franchise Tax
Board that waives the restriction imposed by this subdivision on levy
with respect to the tax.
(ii) The Franchise Tax Board finds that the collection of that tax
is in jeopardy.
(B) Any levy that was first issued before the date that the
applicable proceeding under this subdivision commenced.
(C) At the discretion of the Franchise Tax Board, any unpaid tax
for which the taxpayer makes an offer of an installment agreement
subsequent to a rejection of an offer of an installment agreement
with respect to that unpaid tax (or to any review thereof).
(D) The period of limitation under Section 19371 shall be
suspended for the period during which the Franchise Tax Board is
prohibited under this subdivision from making a levy.
(e) The Taxpayers' Rights Advocate shall establish procedures for
an independent departmental administrative review for the rejection
of the offer of an installment payment and for installment payment
agreements that are rendered null and void, or otherwise terminated
under this section, for taxpayers that request that review. This
administrative review shall not be subject to Chapter 4.5 (commencing
with Section 11400) of Part 1 of Division 3 of the Government Code.
Unless review is requested by the taxpayer within 30 days of the date
of rejection of the offer of an installment agreement or termination
of the installment agreement, this administrative review shall not
stay collection of the tax to which the installment payment agreement
relates.
(f) In the case of an agreement entered into by the Franchise Tax
Board under subdivision (a) for partial payment of a tax liability,
the Franchise Tax Board shall review the agreement at least once
every two years.
(g) (1) In the case of any taxpayer that is making payments to the
Franchise Tax Board under an informal payment arrangement that was
in existence prior to the effective date of the act adding this
subdivision, that informal payment arrangement, for purposes of this
section, shall be treated as an installment payment agreement that
was entered into on the later of the following:
(A) January 1, 2005.
(B) The date on which the arrangement was established by the
Franchise Tax Board.
(2) In any case where the date determined under the rules of
paragraph (1) is a date prior to February 1, 2005, the amount due
under the informal payment arrangement as of February 1, 2005, shall
be treated as an installment payment agreement amount as of the start
of the amnesty program within the meaning of Section 19738.
(3) Section 19591 does not apply to either of the following:
(A) Informal payment arrangements treated as installment payment
agreements under paragraph (1).
(B) Installment payment agreements authorized by the amendments
made by the act adding this subdivision that were entered into prior
to July 1, 2005, or the effective date of the act adding this
subdivision, whichever occurs later.
19009. (a) Whenever any person or employer who is required to
collect, account for, and pay over any tax--
(1) At the time and in the manner prescribed by law or regulations
(A) fails to collect, truthfully account for, or pay over the tax,
or (B) fails to make deposits, payments, or returns of the tax, and
(2) Is notified, by notice delivered in hand or by registered mail
of the failure, then all the requirements of subdivision (b) shall
be complied with. In the case of a corporation, partnership, limited
liability company, or trust, notice to an officer, partner, manager,
member, or trustee, shall, for purposes of this section, be deemed to
be sufficient notice to the corporation, partnership, limited
liability company, or trust and to all officers, partners, managers,
members, trustees, and employees thereof.
(b) Any person or employer who is required to collect, account
for, and pay over any tax imposed by Part 10 (commencing with Section
17001) or Part 11 (commencing with Section 23001), if notice has
been delivered to that person or employer in accordance with
subdivision (a), shall collect the taxes, which become collectible
after delivery of the notice, shall (not later than the end of the
second banking day after any amount of the taxes is collected)
deposit that amount in a separate account in a bank located within
the limits of this state, and shall keep the amount of those taxes in
that account until payment over to the Franchise Tax Board. The
account shall be designated as a special fund in trust for the
Franchise Tax Board, payable to the Franchise Tax Board by that
person or employer as trustee.
(c) Whenever the Franchise Tax Board is satisfied, with respect to
any notification made under subdivision (a), that all requirements
of law and regulations with respect to the taxes, will henceforth be
complied with, it may cancel the notification. The cancellation shall
take effect at the time as is specified in the notice of the
cancellation.
19010. Unless otherwise provided, any provision of this part that
relates to the assessment and collection of tax shall also apply to
the assessment and collection of estimated tax.
19011. (a) All payments required under this part, regardless of the
taxable year to which the payments apply shall be remitted to the
Franchise Tax Board by electronic funds transfer pursuant to Division
11 (commencing with Section 11101) of the Commercial Code, once any
of the following conditions are met:
(1) With respect to any corporation, any installment payment of
estimated tax made pursuant to Section 19025 or the payment made
pursuant to Section 18604 with regard to an extension of time to file
exceeds fifty thousand dollars ($50,000) in any taxable year
beginning on or after January 1, 1991, or exceeds twenty thousand
dollars ($20,000) in any taxable year beginning on or after January
1, 1995.
(2) With respect to any corporation, the total tax liability
exceeds two hundred thousand dollars ($200,000) in any taxable year
beginning on or after January 1, 1991, or exceeds eighty thousand
dollars ($80,000) in any taxable year beginning on or after January
1, 1995. For purposes of this section, total tax liability shall be
the total tax liability as shown on the original return, after any
adjustment made pursuant to Section 19051.
(3) A taxpayer submits a request to the Franchise Tax Board and is
granted permission to make electronic funds transfers.
(b) A taxpayer required to remit payments to the Franchise Tax
Board by electronic funds transfer may elect to discontinue making
payments where the threshold requirements set forth in paragraphs (1)
and (2) of subdivision (a) were not met for the preceding taxable
year. The election shall be made in a form and manner prescribed by
the Franchise Tax Board.
(c) Any taxpayer required to remit payment by electronic funds
transfer pursuant to this section who makes payment by other means
shall pay a penalty of 10 percent of the amount paid, unless it is
shown that the failure to make payment as required was for reasonable
cause and was not the result of willful neglect.
(d) Any taxpayer required to remit payments by electronic funds
transfer pursuant to this section may request a waiver of those
requirements from the Franchise Tax Board. The Franchise Tax Board
may grant a waiver only if it determines that the particular amounts
paid in excess of the threshold amounts established in this section
were not representative of the taxpayer's tax liability. If a
taxpayer is granted a waiver, subsequent remittances by electronic
funds transfer shall be required only on those terms set forth in the
waiver.
(e) The Franchise Tax Board shall accept remittances by electronic
funds transfer pursuant to this section no later than January 1,
1993. Electronic funds transfer procedures, in addition to those
described in subdivision (f), shall be as prescribed by the Franchise
Tax Board. Payment is deemed complete on the date the electronic
funds transfer is initiated, if settlement to the state's demand
account occurs on or before the banking day following the date the
transfer is initiated. If settlement to the state's demand account
does not occur on or before the banking day following the date the
transfer is initiated, payment is deemed to occur on the date
settlement occurs.
(f) For purposes of this section:
(1) "Electronic funds transfer" means any transfer of funds, other
than a transaction originated by check, draft, or similar paper
instrument, that is initiated through an electronic terminal,
telephonic instrument, or computer or magnetic tape, so as to order,
instruct, or authorize a financial institution to debit or credit an
account. Electronic funds transfer shall be accomplished by an
automated clearinghouse debit, automated clearinghouse credit, a
Federal Reserve Wire Transfer (Fedwire), or by an international funds
transfer.
(2) "Automated clearinghouse" means any federal reserve bank, or
an organization established by agreement with the National Automated
Clearing House Association, that operates as a clearinghouse for
transmitting or receiving entries between banks or bank accounts and
that authorizes an electronic transfer of funds between those banks
or bank accounts.
(3) "Automated clearinghouse debit" means a transaction in which
any department of the state, through its designated depository bank,
originates an automated clearinghouse transaction debiting the
taxpayer's bank account and crediting the state's bank account for
the amount of tax. Banking costs incurred for the automated
clearinghouse debit transaction by the taxpayer shall be paid by the
state.
(4) "Automated clearinghouse credit" means an automated
clearinghouse transaction in which the taxpayer, through its own
bank, originates an entry crediting the state's bank account and
debiting its own bank account. Banking costs incurred by the state
for the automated clearinghouse credit transaction may be charged to
the taxpayer.
(5) "Fedwire" means any transaction originated by the taxpayer and
utilizing the national electronic payment system to transfer funds
through federal reserve banks, pursuant to which the taxpayer debits
its own bank account and credits the state's bank account. Electronic
funds transfers may be made by Fedwire only if prior approval is
obtained from the Franchise Tax Board and the taxpayer is unable, for
reasonable cause, to make payments pursuant to paragraph (3) or (4).
Banking costs charged to the taxpayer and to the state may be
charged to the taxpayer.
(6) "International funds transfer" means any transaction
originated by the taxpayer and utilizing the international electronic
payment system to transfer funds, pursuant to which the taxpayer
debits its own bank account and credits the state's bank account.
(7) In determining whether a payment or total tax liability
exceeds the amounts established in subdivision (a), the income of all
taxpayers whose income derived from, or attributable to, sources
within this state is required to be determined by a combined report
shall be aggregated and the total aggregate amount shall be
considered to be the income of a single taxpayer for purposes of
determining the payment or total tax liability of a single taxpayer.
19011.5. (a) All payments required by an individual under this
part, regardless of the taxable year to which the payments apply,
made on or after January 1, 2009, shall be electronically remitted to
the Franchise Tax Board in the form and manner prescribed by the
Franchise Tax Board, once any of the following conditions are met by
an individual:
(1) Any installment payment of estimated tax made pursuant to this
part in excess of twenty thousand dollars ($20,000), or any payment
made pursuant to Section 18567 with regard to an extension of time to
file that exceeds twenty thousand dollars ($20,000), for any taxable
year beginning on or after January 1, 2009.
(2) The total tax liability exceeds eighty thousand dollars
($80,000) in any taxable year beginning on or after January 1, 2009.
For purposes of this section, total tax liability shall be the total
tax liability as shown on the original return, after any adjustment
made pursuant to Section 19051.
(b) A taxpayer required to electronically remit payment to the
Franchise Tax Board pursuant to this section may elect to discontinue
making payments electronically where the threshold requirements set
forth in paragraphs (1) and (2) of subdivision (a) were not met for
the preceding taxable year. The election shall be made in a form and
manner prescribed by the Franchise Tax Board.
(c) Any taxpayer required to electronically remit payment pursuant
to this section who makes payment by other means shall pay a penalty
of 1 percent of the amount paid, unless it is shown that the failure
to make payment as required was for reasonable cause and was not the
result of willful neglect.
(d) Any taxpayer required to electronically remit payments
pursuant to this section may request a waiver of those requirements
from the Franchise Tax Board. The Franchise Tax Board may grant a
waiver only if it determines that the particular amounts paid in
excess of the threshold amounts established in this section were not
representative of the taxpayer's tax liability. If the Franchise Tax
Board grants a waiver to a taxpayer, the waiver shall be in writing,
and subsequent electronic remittances shall be required only on those
terms set forth in the written waiver.
(e) 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 shall not apply to any standard, criterion, procedure,
determination, rule, notice, or guideline established or issued by
the Franchise Tax Board pursuant to subdivision (a).
(f) For purposes of this section, both of the following shall
apply:
(1) "Electronically remit" means to send payment through use of
any of the electronic payment applications provided by the Franchise
Tax Board, including, but not limited to, a pay by phone option, when
made available by the Franchise Tax Board.
(2) "Pay by phone" means a method that allows a taxpayer to
authorize a transfer of funds from a financial institution using
telephonic technology.
19001. Except as provided by Article 2 (commencing with Section
19021), the tax imposed under Part 10 (commencing with Section 17001)
and Part 11 (commencing with Section 23001) shall be paid at the
time and place fixed for filing the return (determined without regard
to any extension of time for filing the return).
19002. (a) The amount withheld under Article 5 (commencing with
Section 18661) of Chapter 2 or Section 13020 of the Unemployment
Insurance Code during any calendar year shall be allowed to the
recipient of the income as a credit against the tax for the taxable
year with respect to which the amount was withheld.
(b) In the case of a partnership, limited liability company
classified as a partnership for California income tax purposes, or S
corporation filing a group return as agent for electing nonresident
partners or shareholders in accordance with Section 18535, for
purposes of this part, the amount withheld under Article 5
(commencing with Section 18661) of Chapter 2 during any taxable year
shall be allowed as a credit attributable to the partnership, limited
liability company, or S corporation on the group return for the
taxable year with respect to which that amount was withheld.
(c) (1) For purposes of Section 19306, any tax actually deducted
and withheld during any calendar year under Article 5 (commencing
with Section 18661) of Chapter 2 or Section 13020 of the Unemployment
Insurance Code shall, in respect of the recipient of the income, be
deemed to have been paid on the last day prescribed for filing the
return under Article 1 (commencing with Section 18501) or Article 2
(commencing with Section 18601) of Chapter 2 (without regard to any
extension of time for filing the return), with respect to which the
tax is allowable as a credit under subdivision (a) or (b).
(2) For purposes of Sections 19306 and 19340, any amount paid as
estimated tax under Section 19025 or 19136 of this code or Section
13043 of the Unemployment Insurance Code for any taxable year shall
be deemed to have been paid on the last day prescribed for filing the
return under Article 1 (commencing with Section 18501) or Article 2
(commencing with Section 18601) of Chapter 2 (without regard to any
extension of time for filing the return).
(d) Notwithstanding subdivision (b) or (c), for purposes of
Section 19306 with respect to any tax deducted and withheld under
Article 5 (commencing with Section 18661) of Chapter 2 or Section
13020 of the Unemployment Insurance Code both of the following shall
apply:
(1) If a return is filed before the due date for that return, the
return shall be considered filed on the due date.
(2) If a tax with respect to an amount paid is paid before the due
date for that return, the tax shall be considered paid on the due
date.
(e) If any overpayment of income tax is claimed as a credit
against estimated tax for the succeeding taxable year, that amount
shall be considered as a payment of estimated tax in accordance with
Section 19007, for the succeeding taxable year, and no claim for
credit or refund of the overpayment shall be allowed for the taxable
year in which the overpayment arises.
19004. A taxpayer may elect to pay the tax prior to the date
prescribed for its payment.
19005. The tax, and any interest and penalties, shall be paid to
the Franchise Tax Board. Except as provided in Section 19011 with
respect to an electronic funds transfer, remittances may be in the
form of a check, payable in United States funds to the Franchise Tax
Board, at the time and in the manner as the Franchise Tax Board may
prescribe or, notwithstanding Title 1.3 (commencing with Section
1747) of Part 4 of Title 3 of the Civil Code, in the form of a credit
card or other payment device as defined in Chapter 2.6 (commencing
with Section 6160) of the Government Code, at the time and in the
manner that the Franchise Tax Board may prescribe. If a check or
credit card remittance is not paid by the bank on which it is drawn,
the taxpayer tendering the check or credit card remittance remains
liable for the payment of the tax, and all interest and penalties, as
if the check or credit card remittance had not been tendered.
19006. (a) The spouse who controls the disposition of or who
receives or spends community income as well as the spouse who is
taxable on the income is liable for the payment of the taxes imposed
by Part 10 (commencing with Section 17001) on that income.
(b) Whenever a joint return is filed by a husband and wife, the
liability for the tax on the aggregate income is joint and several.
The liability may be revised by a court in a proceeding for
dissolution of the marriage of the husband and wife, provided:
(1) The order revising tax liability may not relieve a spouse of
tax liability on income earned by or subject to the exclusive
management and control of the spouse. The liability of the spouse for
the tax, penalties, and interest due for the taxable year shall be
in the same ratio to total tax, penalties, and interest due for the
taxable year as the income earned by or subject to the management and
control of the spouse is to total gross income reportable on the
return.
(2) The order revising tax liability:
(A) Must separately state the income tax liabilities for the
taxable years for which revision of tax liability is granted.
(B) Shall not revise a tax liability that has been fully paid
prior to the effective date of the order; however, any unpaid amount
may be revised.
(C) Shall become effective when the Franchise Tax Board is served
with or acknowledges receipt of the order.
(D) Shall not be effective if the gross income reportable on the
return exceeds one hundred fifty thousand dollars ($150,000) or the
amount of tax liability the spouse is relieved of exceeds seven
thousand five hundred dollars ($7,500), unless a tax revision
clearance certificate is obtained from the Franchise Tax Board and
filed with the court.
(c) Notwithstanding subdivisions (a) and (b), whenever a joint
return is filed by a husband and wife and the tax liability is not
fully paid, that liability, including interest and penalties, may be
revised by the Franchise Tax Board as to one spouse.
(1) However, the liability shall not be revised:
(A) To relieve a spouse of tax liability on income earned by or
subject to the exclusive management and control of the spouse. The
liability of the spouse for the tax, penalties, and interest due for
the taxable year shall be in the same ratio to total tax, penalties,
and interest due for the taxable year as the income earned by or
subject to the management and control of the spouse is to total gross
income reportable on the return.
(B) To relieve a spouse of liability below the amount actually
paid on the liability prior to the granting of relief, including
credit from any other taxable year available for application to the
liability.
(2) The liability may be revised only if the spouse whose
liability is to be revised establishes that he or she did not know
of, and had no reason to know of, the nonpayment at the time the
return was filed. For purposes of this paragraph, "reason to know"
means whether or not a reasonably prudent person would have had
reason to know of the nonpayment.
(3) For purposes of this section, the determination of the spouse
to whom items of gross income are attributable shall be made without
regard to community property laws.
(4) The determination of the Franchise Tax Board as to whether the
liability is to be revised as to one spouse shall be made not less
than 30 days after notification of the other spouse and shall be
based upon whether, under all of the facts and circumstances
surrounding the nonpayment, it would be inequitable to hold the
spouse requesting revision liable for the nonpayment. Any action
taken under this section shall be treated as though it were action on
a protest taken under Section 19044 and shall become final upon the
expiration of 30 days from the date that notice of the action is
mailed to both spouses, unless, within that 30-day period, one or
both spouses appeal the determination to the board as provided in
Section 19045.
(5) This subdivision shall apply to all taxable years subject to
the provisions of this part, but shall not apply to any taxable year
which has been closed by a statute of limitations, res judicata, or
otherwise.
19007. Payment of the estimated tax, or any installment thereof,
shall be considered payment on account of the taxes imposed under
Part 10 (commencing with Section 17001) or Part 11 (commencing with
Section 23001) for the taxable year.
19008. (a) The Franchise Tax Board may, in cases of financial
hardship, as determined by the Franchise Tax Board, allow a taxpayer
to enter into installment payment agreements with the Franchise Tax
Board to make full or partial payment of taxes due, plus applicable
interest and penalties over the life of the installment period.
Failure by a taxpayer to comply fully with the terms of the
installment payment agreement shall render the agreement null and
void, unless the Franchise Tax Board determines that the failure was
due to a reasonable cause, and the total amount of tax, interest, and
all penalties shall be immediately due and payable.
(b) In the case of a liability for tax of an individual under Part
10 (commencing with Section 17001) or this part, the Franchise Tax
Board shall enter into an agreement to accept the full payment of the
tax in installments if, as of the date the individual offers to
enter into the agreement, all of the following apply:
(1) The aggregate amount of the liability (determined without
regard to interest, penalties, additions to the tax and additional
amounts) does not exceed ten thousand dollars ($10,000).
(2) The taxpayer (and, if the liability relates to a joint return,
the taxpayer's spouse) has not during any of the preceding five
taxable years done any of the following:
(A) Failed to file any return of tax imposed under Part 10
(commencing with Section 17001) or this part.
(B) Failed to pay any tax required to be shown on the return.
(C) Entered into an installment agreement under this section for
payment of any tax imposed by Part 10 (commencing with Section 17001)
or this part.
(3) The Franchise Tax Board determines that the taxpayer is
financially unable to pay the liability in full when due, and the
taxpayer submits any information as the Franchise Tax Board may
require to make this determination.
(4) The agreement requires full payment of the liability within
three years.
(5) The taxpayer agrees to comply with the provisions of this part
and Part 10 (commencing with Section 17001) for the period the
agreement is in effect.
(c) Except in any case where the Franchise Tax Board finds
collection of the tax to which an installment payment agreement
relates to be in jeopardy, or there is a mutual consent to terminate,
alter, or modify the agreement, the agreement shall not be
considered null and void, or otherwise terminated, unless both of the
following occur:
(1) A notice of termination is provided to the taxpayer not later
than 30 days before the date of termination.
(2) The notice includes an explanation of why the Franchise Tax
Board intends to terminate the agreement.
(d) No levy may be issued on the property or rights to property of
any person with respect to any unpaid tax:
(1) During the period that an offer by the taxpayer for an
installment agreement under this section for payment of the unpaid
tax is pending with the Franchise Tax Board.
(2) If the offer is rejected by the Franchise Tax Board, during
the 30 days thereafter and, if a request for review of the rejection
is filed within the 30 days, during the period that the review is
pending.
(3) During the period that the installment agreement for payment
of the unpaid tax is in effect.
(4) If the agreement is terminated by the Franchise Tax Board,
during the 30 days thereafter (and, if a request for review of the
termination is filed within the 30 days, during the period that the
review is pending).
(5) This subdivision shall not apply with respect to any of the
following:
(A) Any unpaid tax if either of the following occurs:
(i) The taxpayer files a written notice with the Franchise Tax
Board that waives the restriction imposed by this subdivision on levy
with respect to the tax.
(ii) The Franchise Tax Board finds that the collection of that tax
is in jeopardy.
(B) Any levy that was first issued before the date that the
applicable proceeding under this subdivision commenced.
(C) At the discretion of the Franchise Tax Board, any unpaid tax
for which the taxpayer makes an offer of an installment agreement
subsequent to a rejection of an offer of an installment agreement
with respect to that unpaid tax (or to any review thereof).
(D) The period of limitation under Section 19371 shall be
suspended for the period during which the Franchise Tax Board is
prohibited under this subdivision from making a levy.
(e) The Taxpayers' Rights Advocate shall establish procedures for
an independent departmental administrative review for the rejection
of the offer of an installment payment and for installment payment
agreements that are rendered null and void, or otherwise terminated
under this section, for taxpayers that request that review. This
administrative review shall not be subject to Chapter 4.5 (commencing
with Section 11400) of Part 1 of Division 3 of the Government Code.
Unless review is requested by the taxpayer within 30 days of the date
of rejection of the offer of an installment agreement or termination
of the installment agreement, this administrative review shall not
stay collection of the tax to which the installment payment agreement
relates.
(f) In the case of an agreement entered into by the Franchise Tax
Board under subdivision (a) for partial payment of a tax liability,
the Franchise Tax Board shall review the agreement at least once
every two years.
(g) (1) In the case of any taxpayer that is making payments to the
Franchise Tax Board under an informal payment arrangement that was
in existence prior to the effective date of the act adding this
subdivision, that informal payment arrangement, for purposes of this
section, shall be treated as an installment payment agreement that
was entered into on the later of the following:
(A) January 1, 2005.
(B) The date on which the arrangement was established by the
Franchise Tax Board.
(2) In any case where the date determined under the rules of
paragraph (1) is a date prior to February 1, 2005, the amount due
under the informal payment arrangement as of February 1, 2005, shall
be treated as an installment payment agreement amount as of the start
of the amnesty program within the meaning of Section 19738.
(3) Section 19591 does not apply to either of the following:
(A) Informal payment arrangements treated as installment payment
agreements under paragraph (1).
(B) Installment payment agreements authorized by the amendments
made by the act adding this subdivision that were entered into prior
to July 1, 2005, or the effective date of the act adding this
subdivision, whichever occurs later.
19009. (a) Whenever any person or employer who is required to
collect, account for, and pay over any tax--
(1) At the time and in the manner prescribed by law or regulations
(A) fails to collect, truthfully account for, or pay over the tax,
or (B) fails to make deposits, payments, or returns of the tax, and
(2) Is notified, by notice delivered in hand or by registered mail
of the failure, then all the requirements of subdivision (b) shall
be complied with. In the case of a corporation, partnership, limited
liability company, or trust, notice to an officer, partner, manager,
member, or trustee, shall, for purposes of this section, be deemed to
be sufficient notice to the corporation, partnership, limited
liability company, or trust and to all officers, partners, managers,
members, trustees, and employees thereof.
(b) Any person or employer who is required to collect, account
for, and pay over any tax imposed by Part 10 (commencing with Section
17001) or Part 11 (commencing with Section 23001), if notice has
been delivered to that person or employer in accordance with
subdivision (a), shall collect the taxes, which become collectible
after delivery of the notice, shall (not later than the end of the
second banking day after any amount of the taxes is collected)
deposit that amount in a separate account in a bank located within
the limits of this state, and shall keep the amount of those taxes in
that account until payment over to the Franchise Tax Board. The
account shall be designated as a special fund in trust for the
Franchise Tax Board, payable to the Franchise Tax Board by that
person or employer as trustee.
(c) Whenever the Franchise Tax Board is satisfied, with respect to
any notification made under subdivision (a), that all requirements
of law and regulations with respect to the taxes, will henceforth be
complied with, it may cancel the notification. The cancellation shall
take effect at the time as is specified in the notice of the
cancellation.
19010. Unless otherwise provided, any provision of this part that
relates to the assessment and collection of tax shall also apply to
the assessment and collection of estimated tax.
19011. (a) All payments required under this part, regardless of the
taxable year to which the payments apply shall be remitted to the
Franchise Tax Board by electronic funds transfer pursuant to Division
11 (commencing with Section 11101) of the Commercial Code, once any
of the following conditions are met:
(1) With respect to any corporation, any installment payment of
estimated tax made pursuant to Section 19025 or the payment made
pursuant to Section 18604 with regard to an extension of time to file
exceeds fifty thousand dollars ($50,000) in any taxable year
beginning on or after January 1, 1991, or exceeds twenty thousand
dollars ($20,000) in any taxable year beginning on or after January
1, 1995.
(2) With respect to any corporation, the total tax liability
exceeds two hundred thousand dollars ($200,000) in any taxable year
beginning on or after January 1, 1991, or exceeds eighty thousand
dollars ($80,000) in any taxable year beginning on or after January
1, 1995. For purposes of this section, total tax liability shall be
the total tax liability as shown on the original return, after any
adjustment made pursuant to Section 19051.
(3) A taxpayer submits a request to the Franchise Tax Board and is
granted permission to make electronic funds transfers.
(b) A taxpayer required to remit payments to the Franchise Tax
Board by electronic funds transfer may elect to discontinue making
payments where the threshold requirements set forth in paragraphs (1)
and (2) of subdivision (a) were not met for the preceding taxable
year. The election shall be made in a form and manner prescribed by
the Franchise Tax Board.
(c) Any taxpayer required to remit payment by electronic funds
transfer pursuant to this section who makes payment by other means
shall pay a penalty of 10 percent of the amount paid, unless it is
shown that the failure to make payment as required was for reasonable
cause and was not the result of willful neglect.
(d) Any taxpayer required to remit payments by electronic funds
transfer pursuant to this section may request a waiver of those
requirements from the Franchise Tax Board. The Franchise Tax Board
may grant a waiver only if it determines that the particular amounts
paid in excess of the threshold amounts established in this section
were not representative of the taxpayer's tax liability. If a
taxpayer is granted a waiver, subsequent remittances by electronic
funds transfer shall be required only on those terms set forth in the
waiver.
(e) The Franchise Tax Board shall accept remittances by electronic
funds transfer pursuant to this section no later than January 1,
1993. Electronic funds transfer procedures, in addition to those
described in subdivision (f), shall be as prescribed by the Franchise
Tax Board. Payment is deemed complete on the date the electronic
funds transfer is initiated, if settlement to the state's demand
account occurs on or before the banking day following the date the
transfer is initiated. If settlement to the state's demand account
does not occur on or before the banking day following the date the
transfer is initiated, payment is deemed to occur on the date
settlement occurs.
(f) For purposes of this section:
(1) "Electronic funds transfer" means any transfer of funds, other
than a transaction originated by check, draft, or similar paper
instrument, that is initiated through an electronic terminal,
telephonic instrument, or computer or magnetic tape, so as to order,
instruct, or authorize a financial institution to debit or credit an
account. Electronic funds transfer shall be accomplished by an
automated clearinghouse debit, automated clearinghouse credit, a
Federal Reserve Wire Transfer (Fedwire), or by an international funds
transfer.
(2) "Automated clearinghouse" means any federal reserve bank, or
an organization established by agreement with the National Automated
Clearing House Association, that operates as a clearinghouse for
transmitting or receiving entries between banks or bank accounts and
that authorizes an electronic transfer of funds between those banks
or bank accounts.
(3) "Automated clearinghouse debit" means a transaction in which
any department of the state, through its designated depository bank,
originates an automated clearinghouse transaction debiting the
taxpayer's bank account and crediting the state's bank account for
the amount of tax. Banking costs incurred for the automated
clearinghouse debit transaction by the taxpayer shall be paid by the
state.
(4) "Automated clearinghouse credit" means an automated
clearinghouse transaction in which the taxpayer, through its own
bank, originates an entry crediting the state's bank account and
debiting its own bank account. Banking costs incurred by the state
for the automated clearinghouse credit transaction may be charged to
the taxpayer.
(5) "Fedwire" means any transaction originated by the taxpayer and
utilizing the national electronic payment system to transfer funds
through federal reserve banks, pursuant to which the taxpayer debits
its own bank account and credits the state's bank account. Electronic
funds transfers may be made by Fedwire only if prior approval is
obtained from the Franchise Tax Board and the taxpayer is unable, for
reasonable cause, to make payments pursuant to paragraph (3) or (4).
Banking costs charged to the taxpayer and to the state may be
charged to the taxpayer.
(6) "International funds transfer" means any transaction
originated by the taxpayer and utilizing the international electronic
payment system to transfer funds, pursuant to which the taxpayer
debits its own bank account and credits the state's bank account.
(7) In determining whether a payment or total tax liability
exceeds the amounts established in subdivision (a), the income of all
taxpayers whose income derived from, or attributable to, sources
within this state is required to be determined by a combined report
shall be aggregated and the total aggregate amount shall be
considered to be the income of a single taxpayer for purposes of
determining the payment or total tax liability of a single taxpayer.
19011.5. (a) All payments required by an individual under this
part, regardless of the taxable year to which the payments apply,
made on or after January 1, 2009, shall be electronically remitted to
the Franchise Tax Board in the form and manner prescribed by the
Franchise Tax Board, once any of the following conditions are met by
an individual:
(1) Any installment payment of estimated tax made pursuant to this
part in excess of twenty thousand dollars ($20,000), or any payment
made pursuant to Section 18567 with regard to an extension of time to
file that exceeds twenty thousand dollars ($20,000), for any taxable
year beginning on or after January 1, 2009.
(2) The total tax liability exceeds eighty thousand dollars
($80,000) in any taxable year beginning on or after January 1, 2009.
For purposes of this section, total tax liability shall be the total
tax liability as shown on the original return, after any adjustment
made pursuant to Section 19051.
(b) A taxpayer required to electronically remit payment to the
Franchise Tax Board pursuant to this section may elect to discontinue
making payments electronically where the threshold requirements set
forth in paragraphs (1) and (2) of subdivision (a) were not met for
the preceding taxable year. The election shall be made in a form and
manner prescribed by the Franchise Tax Board.
(c) Any taxpayer required to electronically remit payment pursuant
to this section who makes payment by other means shall pay a penalty
of 1 percent of the amount paid, unless it is shown that the failure
to make payment as required was for reasonable cause and was not the
result of willful neglect.
(d) Any taxpayer required to electronically remit payments
pursuant to this section may request a waiver of those requirements
from the Franchise Tax Board. The Franchise Tax Board may grant a
waiver only if it determines that the particular amounts paid in
excess of the threshold amounts established in this section were not
representative of the taxpayer's tax liability. If the Franchise Tax
Board grants a waiver to a taxpayer, the waiver shall be in writing,
and subsequent electronic remittances shall be required only on those
terms set forth in the written waiver.
(e) 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 shall not apply to any standard, criterion, procedure,
determination, rule, notice, or guideline established or issued by
the Franchise Tax Board pursuant to subdivision (a).
(f) For purposes of this section, both of the following shall
apply:
(1) "Electronically remit" means to send payment through use of
any of the electronic payment applications provided by the Franchise
Tax Board, including, but not limited to, a pay by phone option, when
made available by the Franchise Tax Board.
(2) "Pay by phone" means a method that allows a taxpayer to
authorize a transfer of funds from a financial institution using
telephonic technology.
