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Business Taxes Law Guide—Revision 2024
Sales And Use Tax Law
Revenue and Taxation Code
Division 2. Other Taxes
Part 1. Sales and Use Taxes
Chapter 7. Overpayments and Refunds
Article 1. Claim for Refund
Section 6902.2
6902.2. Refund; offset of personal income or bank and corporation tax liability. (a) (1) In lieu of claiming the credit allowed by Section 17053.49 or 23649, a person who has paid sales tax reimbursement to a retailer or use tax on a purchase or purchases of property for which a credit may be allowed pursuant to those sections, may file a claim for refund equal to the credit amount that would otherwise be allowed pursuant to those sections. Any claim so filed shall be submitted to the board on a form prescribed by the board, shall be filed no earlier than the date a claim could have been made for a tax credit or carryover of a credit under Section 17053.49 or 23649, whichever is applicable, and shall be for an amount not in excess of the amount of the credit that could have been used to reduce the "net tax," (as defined in Section 17039), or the "tax," as defined in Section 23036. Any credit carried over pursuant to Section 17053.49 or Section 23649 may not be refunded under this section until the credit carried over could be applied to reduce the "net tax" (as defined in Section 17039) or the "tax" (as defined in Section 23036), as applicable. Under no circumstances may any claim for refund exceed the "net tax," as defined by Section 17039, or the "tax," as defined by Section 23036, after the allowance of any credits authorized by Section 17039 or 23036. A claim for refund shall, unless the sale or use of the property is otherwise exempt under this part, be accompanied by proof of payment of the tax to a retailer, including, but not limited to, a copy of an invoice or purchase contract that indicates the following:
(A) The date on which the purchase occurred.
(B) A description of the property purchased.
(C) The price paid for the property.
(D) The amount of tax paid with respect to the purchase.
(2) In the case of a person who has self-reported use tax to the board, the claim for refund shall also indicate the amount of use tax paid and the period for which that tax was remitted.
(3) Any person who claims a refund under this section shall make an irrevocable election to waive the equivalent amount of credit allowed under Section 17053.49 or 23649. Any refund claimed under this section shall be in lieu of claiming any credit under Section 17053.49 or 23649. Any person electing to file a claim for refund pursuant to this section shall provide a copy of the personal or bank and corporation tax return on which the tax liability was assessed for which the in-lieu refund is being claimed under this section.
(b) No interest shall be paid on any refund made pursuant to this section.
(c) Notwithstanding Section 6961, the board may recover any refund or part thereof that is erroneously made pursuant to this section. In recovering any erroneous refund made pursuant to this section, the board, in its discretion, may issue a deficiency determination in accordance with Article 2 (commencing with Section 6481) or Article 4 (commencing with Section 6536) of Chapter 5. Except in the case of fraud, that determination shall be made within three years from the last day of the month following the quarterly period in which the board approved the refund.
(d) The board shall provide an annual listing to the Franchise Tax Board, in a form and manner agreed upon by the board and the Franchise Tax Board, of the persons who during the year have claimed a refund of sales or use tax under this section and the amount of the refund issued to each person.
(e) Any refund approved by the board pursuant to this section shall be payable from the General Fund.
History—Added by Stats. 1994, Ch. 547, in effect September 12, 1994. Stats. 2003, Ch. 606 (SB 1064), in effect January 1, 2004, substituted "reduce the net … or 23036" for "offset personal income or bank or corporation tax liability" after "have been used to" in the second sentence of paragraph (1) of subdivision (a).
Note.—Section 2 of Stats. 2003, Ch. 606 (SB 1064) specifies that the amendments made to subdivision (a) of Section 6902.2 of the Revenue and Taxation Code by Section 1 of that act are declaratory of existing law, but are effective for any claims for refund filed with the State Board of Equalization on or after August 7, 2003.