Looking for a California Franchise Tax Board Forms And Templates? Download it for free!

Ftb Notice 2003 - 5 2001 Legislative Changes - Informal Refund Claims Form - California Franchise Tax Board

STATE OF CALIFORNIA

STEVE WESTLY

Chair

FRANCHISE TAX BOARD - Legal Branch

PO Box 1720

CAROLE MIGDEN

Rancho Cordova CA 95741-1720

Member

(916) 845-3309 Fax (916) 845-3648

STEVE PEACE

Member

Date: May 6, 2003

FTB NOTICE 2003 – 5

SUBJECT: 2001 Legislative Changes - Informal Refund Claims

Revenue and Taxation Code section 19322.1 (added by Stats. 2001, ch. 920, §25),

provides that a claim for refund of tax that is otherwise valid, but is made before full

payment of the disputed tax has been made, shall be sufficient to toll (delay the

expiration of) the statute of limitations. This "informal" claim for refund will be

"perfected" and deemed filed on the date that full payment of tax is made. This

perfection date will be the date that the informal claim becomes a formal refund claim

for purposes of the administrative claims process. The six-month "deemed denial"

period of sections 19324 and 19385 will also begin on the date the claim is perfected.

However, no credit or refund may be made or allowed for any payment made more than

seven years before the date of full payment of tax (including penalties and interest as

explained below). The new provision applies to claims for refund filed on or after

January 1, 2002.

The amount of payment needed to perfect a claim will depend on whether any

outstanding amounts are due and payable, or are deficiency amounts that have not yet

become final at the time payment is made.

For due and payable (billable) amounts, all amounts due, including tax, penalty and

interest, must be paid to perfect the claim. Under Internal Revenue Code section

6665(a)(2), incorporated by reference into California law by Revenue and Taxation

Code section 19164(e), penalties, additions to tax and additional amounts (but not

interest) are included in the term "tax." Under Revenue and Taxation Code section

19101(c)(1), effective January 1, 2001, any reference to "tax" shall be deemed also to

refer to interest imposed on that tax, except for references relating to deficiency

assessments.

For deficiency amounts that have not become final under Revenue and Taxation Code

section 19049, the informal refund claim provisions of section 19322.1 do not apply.

See Revenue and Taxation Code section 19335.

This new informal claim procedure does not affect requests for interest abatement due

to a ministerial or managerial act, which can continue to be made before payment under

section 19104(a). See FTB Form 3701.

Ftb Notice 2003 - 5 2001 Legislative Changes - Informal Refund Claims Form - California Franchise Tax Board