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Business Taxes Law Guide—Revision 2024
Alcoholic Beverage Tax Law
Revenue and Taxation Code
Division 2. Other Taxes
Part 14. Alcoholic Beverage Tax
Chapter 7. Collection of Tax
Article 1. Suit for Tax
Article 2. Judgment for Tax
- 32361 Summary judgment
- 32362 Abstract of judgment; lien
- 32363 Liens; perfection and enforceability of
- 32364 Release of liens
Article 2.5. Warrant for Collection
Article 3. Seizure and Sale
Article 4. Miscellaneous
- 32381 Notice to withhold payments
- 32382 No transfer after notice
- 32383 Advise board after notice
- 32384 Liability for transfer after notice
- 32385 Remedies cumulative
- 32386 Priority of taxes [Repealed.]
- 32386 Priority of taxes
- 32387 Notice of levy
- 32387.1 Electronic earnings withholding orders
- 32387.5 Employer withheld earnings
- 32388 Furnishing of partnership agreement
- 32389 Installment payment agreement
- 32389.5 Installment payment annual statement
- 32390 Collection cost recovery fee
Article 1. Suit for Tax
32351. Action to collect tax. The board may bring such legal actions as are necessary to collect any deficiency in the tax required to be paid, and, upon the board's request, the Attorney General shall bring the actions.
32352. Certificate of delinquency. In any suit brought to enforce the rights of the state with respect to taxes, a certificate by the board showing the delinquency shall be prima facie evidence of the levy of the tax, of the delinquency of the amount of tax, interest, and penalty set forth therein, and of compliance by the board with all provisions of this part in relation to the computation and levy of the tax. In the action a writ of attachment may be issued in the manner provided by Chapter 5 (commencing with Section 485.010) of Title 6.5 of Part 2 of the Code of Civil Procedure without the showing required by Section 485.010 of the Code of Civil Procedure.
History—Stats. 1974, Ch. 1516, effective January 1, 1975, deleted the statement that no bond or affidavit was required previous to the issuing of the attachment, and added the proviso that the writ of attachment may be issued in the described manner.
Article 2. Judgment for Tax
32361. Summary judgment. Whenever any tax, interest, or penalty is not paid when due, the board may file in the office of the County Clerk of Sacramento County or any other county a certificate specifying the amount of the tax, interest, and penalty due, the name and last known address of the taxpayer liable for it, that the board has complied with all the provisions of this part in relation to the computation and levy of the tax, and requesting that judgment be entered against the taxpayer in the amount of the tax, interest, and penalty set forth in the certificate. The county clerk immediately upon the filing of the certificate shall enter a judgment for the people of the State of California against the taxpayer in the amount of the tax, interest, and penalty set forth in the certificate. The judgment may be filed by the county clerk in a loose-leaf book entitled "Special Judgment for State Excise Tax."
32362. Abstract of judgment; lien. An abstract or copy of the judgment entered under Section 32361 may be recorded with the county recorder of any county, and from the time of such recording, the amount of the taxes, interest, and penalty set forth in the judgment shall constitute a lien upon all the real property owned by the taxpayer in the county or which he may acquire afterwards and before the lien expires, which lien shall have the force, effect, and priority of a judgment lien and shall continue for 10 years from the time of the recording of the abstract unless sooner released or otherwise discharged. The lien may, within 10 years from the date of the recording of the abstract or within 10 years from the date of the last extension of the lien, be extended by recording a new abstract in the office of the county recorder of any county and from the time of such recording, the lien shall be extended to the real property in such county for 10 years unless sooner released or otherwise discharged. Execution shall issue upon such a judgment upon the request of the board in the same manner as execution may issue upon other judgments, and sales shall be held under the execution as prescribed in the Code of Civil Procedure. In all proceedings under this section the board shall act on behalf of the people of the State of California.
History—Stats. 1957, p. 2220, in effect September 11, 1957, added clause beginning with "and shall continue" to end of first sentence and added the second sentence. Stats. 1965, p. 2072, in effect September 17, 1965, substituted "10" years for "five" years in the first two sentences.
32363. Liens; perfection and enforceability of. (a) If any person fails to pay any amount imposed under this part at the time that it becomes due and payable, the amount thereof, including penalties and interest, together with any costs in addition thereto, shall thereupon be a perfected and enforceable state tax lien. Such a lien is subject to Chapter 14 (commencing with Section 7150) of Division 7 of Title 1 of the Government Code.
(b) For the purpose of this section, amounts are "due and payable" on the following dates:
(1) For amounts disclosed on a return received by the board before the date the return is delinquent, the date the return would have been delinquent;
(2) For amounts disclosed on a return filed on or after the date the return is delinquent, the date the return is received by the board;
(3) For amounts determined under Section 32311 (pertaining to jeopardy assessments), the date the notice of the board's finding is mailed or issued;
(4) For all other amounts, the date the assessment is final.
History—Added by Stats. 1977, Ch. 481, operative July 1, 1978. Stats. 1979, Ch. 322, effective January 1, 1980, changed wording of second paragraph of (a), deleted reference to judgment creditors in second paragraph of (f). Stats. 1980, Ch. 600, operative January 1, 1981, deleted part of first sentence following "lien"; substituted present second sentence for former second sentence in (a); renumbered second paragraph of (a) to (b); deleted former (b), (c), (d), (e), (f).
32364. Release of liens. (a) If the board determines that the amount of tax, interest, and penalties are sufficiently secured by a lien on other property or that the release or subordination of the lien imposed under this article will not jeopardize the collection of the amount of the tax, interest, and penalties, the board may at any time release all or any portion of the property subject to the lien from the lien or may subordinate the lien to other liens and encumbrances.
(b) If the board finds that the liability represented by the lien imposed under this article, including any interest accrued thereon, is legally unenforceable, the board may release the lien.
(c) A certificate by the board to the effect that any property has been released from a lien or that the lien has been subordinated to other liens and encumbrances is conclusive evidence that the property has been released or that the lien has been subordinated as provided in the certificate.
History—Added by Stats. 1980, Ch. 600, operative January 1, 1981. Stats. 2006, Ch. 538 (SB 1852), in effect January 1, 2007, substituted "the" for "such" after "conclusive evidence that" in subdivision (c).
Article 2.5. Warrant for Collection
32365. Warrant; time of issuing. At any time within three years after any person is delinquent in the payment of any amount herein required to be paid, or within 10 years after the last recording of an abstract under Section 32362 or the last recording or filing of a notice of state tax lien under Section 7171 of the Government Code, the board or its authorized representative may issue a warrant for the enforcement of any liens and for the collection of any amount required to be paid to the state under this part. The warrant shall be directed to any sheriff or marshal and shall have the same effect as a writ of execution. The warrant shall be levied and sale made pursuant to it in the same manner and with the same effect as a levy of and a sale pursuant to a writ of execution.
History—Added by Stats. 1957, p. 2024, in effect September 11, 1957. Stats. 1965, p. 2047, in effect September 17, 1965, substituted "10" years for "three" years in the first sentence. Stats. 1977, Ch. 481, operative July 1, 1978, added a comma following "paid" on the third line, removed a comma following "32362" on the fourth line and added "or the recording or filing of a notice of state tax lien under Section 32363,". Stats. 1980, Ch. 600 operative January 1, 1981, added "last" following "32362 or the " and substituted "Section 7171 of the Government Code" for "Section 32363". Stats. 1996, Ch. 872, in effect January 1, 1997, substituted "or marshal" for ", marshal or constable" after "to any sheriff" in the second sentence.
32366. Fees and expenses. The board may pay or advance to the sheriff or marshal, the same fees, commissions, and expenses for his or her services as are provided by law for similar services pursuant to a writ of execution. The board, and not the court, shall approve the fees for publication in a newspaper.
History—Added by Stats. 1957, p. 2025, in effect September 11, 1957. Stats. 1996, Ch. 872, in effect January 1, 1997, substituted "or marshal" for ", marshal or constable" after "to the sheriff" and added "or her" after "expenses for his" in the first sentence.
32367. Collection of fees. The fees, commissions, and expenses are the obligation of the person required to pay any amount under this part and may be collected from him by virtue of the warrant or in any other manner provided in this part for the collection of the tax.
History—Added by Stats. 1957, p. 2025, in effect September 11, 1957.
Article 3. Seizure and Sale
32371. Seizure and sale. Whenever any taxpayer is delinquent in the payment of the tax, the board or its authorized representative may seize any property, real or personal, of the taxpayer, and sell at public auction the property seized, or a sufficient portion thereof, to pay the tax due, together with any penalties imposed for the delinquency and all costs that have been incurred on account of the seizure and sale.
32372. Notice of sale. Notice of the sale, and the time and place thereof, shall be given to the delinquent taxpayer and to all persons who have an interest of record in the property at least 20 days before the date set for the sale in the following manner:
The notice shall be personally served or enclosed in an envelope addressed to the taxpayer or other person at his or her last known residence or place of business in this state. The notice shall be published pursuant to Section 6063 of the Government Code in a newspaper of general circulation published in the city in which the property or a part thereof is situated if any part thereof is situated in a city or, if not, in a newspaper of general circulation published in the county in which the property or a part thereof is located. Notice shall also be posted in both of the following manners:
(a) One public place in the city in which the interest in property is to be sold if it is to be sold in a city or, if not to be sold in a city, one public place in the county in which the interest in the property is to be sold.
(b) One conspicuous place on the property.
The notice shall contain a description of the property to be sold, a statement of the amount due, including taxes, interest, penalties, and costs, the name of the taxpayer, and the further statement that unless the amount due is paid on or before the time fixed in the notice for the sale, the property, or so much thereof as may be necessary, will be sold in accordance with law and the notice.
History—Stats. 1957, p. 1047, in effect September 11, 1957, substituted "pursuant to Section 6062 of the Government Code" for "for at least 10 days before the date set for the sale in a newspaper of general circulation published" in second sentence. Stats. 1990, Ch. 1528, in effect January 1, 1991, deleted "Written" before "Notice", "intended" before "sale, and", substituted "who" for "appearing of record to", added "of record" after "interest", substituted "20" for "10" and "in the following manner: The notice shall be personally served or enclosed" for "by enclosing the notice", added "or other person" and "or her", and deleted "as appears upon the records of the board, if any, and depositing it in the United States registered mail, postage prepaid." after "state" in the first sentence; deleted "also" before "be published", substituted "6063" for "6062", substituted "a newspaper of general circulation published in the city" for "the county" deleted "seized is to be sold" before "a newspaper", and added "or a part thereof is situated if any part thereof is situated in a city or, if not", substituted "a" for "If there is no" combining sentence two with former sentence three, added "published" after circulation", added "in which the property or a part thereof is located. Notice shall also be posted in both of the following manners:", added subdivisions (a) and (b), created new paragraph with the former last sentence; substituted "due, including" for "of the" after "amount", added "interest" after "taxes"; substituted "amount due is" for "taxes, penalties, and costs are" in the former last sentence.
32373. Bill of sale; deed. At the sale the property shall be sold by the board or by its authorized agent in accordance with law and the notice, and the board shall deliver to the purchaser a bill of sale for the personal property and a deed for any real property sold. The bill of sale or deed vests title in the purchaser. The unsold portion of any property seized may be left at the place of sale at the risk of the taxpayer.
History—Stats. 1982, Ch. 497, in effect January 1, 1983, operative July 1, 1983, deleted "subject … execution" after "purchaser" in the second sentence.
32374. Disposition of proceeds. If upon the sale the moneys received exceed the amount of all license taxes, penalties, and costs due the state from the taxpayer, the board shall return the excess to him or her and obtain his or her receipt. If any person having an interest in or lien upon the property files with the board prior to the sale notice of his or her interest, the board shall withhold any excess pending a determination of the rights of the respective parties to the property by a court of competent jurisdiction. If for any reason the receipt of the taxpayer is not available, the board shall deposit the excess moneys with the Controller, as trustee for the owner, subject to the order of the taxpayer, his or her heirs, successors, or assigns.
History—Stats. 1996, Ch. 860, in effect January 1, 1997, substituted "state" for "State" after "costs due the", and added "or her" after "excess to him" and after "and obtain his", in the first sentence, added "or her" after "notice of his", and substituted "to the property" for "thereto" after "the respective parties", in the second sentence, substituted "Controller" for "State Treasurer" after "moneys with the", and added "or her" after "the taxpayer, his", in the last sentence.
Article 4. Miscellaneous
32381. Notice to withhold payments. If any taxpayer is delinquent in the payment of any obligations imposed by this part, or in the event a determination has been made against such a taxpayer which remains unpaid, the board may, not later than three years after the payment becomes delinquent, or within 10 years after the last recording of an abstract or copy of judgment under Section 32362 or the last recording or filing of a notice of state tax lien under Section 7171 of the Government Code, give notice thereof, personally or by first-class mail to all persons, including any officer or department of the state or any political subdivision or agency of the state, having in their possession or under their control any credits or other personal property belonging to the taxpayer, or owing any debts to the taxpayer. In the case of any state officer, department, or agency, the notice shall be given to such officer, department, or agency prior to the time it presents the claim of the delinquent taxpayer to the State Controller.
History—Stats. 1957, p. 2025, in effect September 11, 1957, amended the original section. Stats. 1963, p. 2936, in effect September 20, 1963, completely revised the original section. Stats. 1971, Ch. 1634, operative on and after January 1, 1972, and shall be applicable only with respect to certificates of lien or abstracts of judgment filed on or after that date. Substitutes "within 10 years after payment" for "within 3 years after payment". Stats. 1977, Ch. 481, operative July 1, 1978, deleted a comma following "32362" in the sixth line and added "or the recording or filing of a notice of state tax lien under Section 32363,". Stats. 1978, Ch. 827, effective January 1, 1979, substituted "first-class" for "registered". Stats. 1980, Ch. 600, operative January 1, 1981, added "last" following "32362 or the" and substituted "Section 7171 of the Government Code" for "Section 32363".
32382. No transfer after notice. After receiving the notice the person so notified shall neither transfer nor make any other disposition of the credits, other personal property, or debts in their possession or under their control at the time they receive the notice until the board consents to a transfer or disposition or until 60 days elapse after the receipt of the notice, whichever period expires the earlier.
History—Added by Stats. 1963, p. 2936, in effect September 20, 1963, which also renumbered the original section as 32385.
32383. Advise board after notice. All persons so notified shall forthwith after receipt of the notice advise the board of all credits, other personal property, or debts in their possession, under their control, or owing by them. If such notice seeks to prevent the transfer or other disposition of a deposit in a bank or other credits or personal property in the possession or under the control of a bank, the notice to be effective shall state the amount, interest and penalty due from the person and shall be delivered or mailed to the branch or office of such bank at which such deposit is carried or at which such credits or personal property is held. Notwithstanding any other provision, with respect to a deposit in a bank or other credits or personal property in the possession or under the control of a bank, the notice shall only be effective with respect to an amount not in excess of two times the amount, interest and penalty due from the person.
History—Added by Stats. 1963, p. 2937, in effect September 20, 1963, which also renumbered the original section as 32386. Amended by Stats. 1972, Ch. 103, operative July 1, 1973, which added "shall state the amount, interest and penalty due from the person and" and the third sentence.
32384. Liability for transfer after notice. If, during the effective period of the notice to withhold, any person so notified makes any transfer or disposition of the property or debts required to be withheld, to the extent of the value of the property or the amount of the debts thus transferred or paid he shall be liable to the State for any indebtedness due under this part from the person with respect to whose obligation the notice was given if solely by reason of such transfer or disposition the State is unable to recover the indebtedness of the person with respect to whose obligation the notice was given.
History—Added by Stats. 1963, p. 2937, in effect September 20, 1963.
32385. Remedies cumulative. The remedies of the State provided for in this chapter are cumulative, and no action taken by the board or Attorney General constitutes an election by the State or any of its officers to pursue any remedy to the exclusion of any other remedy for which provision is made in this part.
History—Formerly Section 32382, this section was renumbered by Stats. 1963, p. 2936, in effect September 20, 1963.
32386. Priority of taxes. [Repealed by Stats. 1977, Ch. 481, operative July 1, 1978.]
32386. Priority of taxes. The amounts required to be paid by any person under this part together with interest and penalties shall be satisfied first in any of the following cases:
(a) Whenever the person is insolvent.
(b) Whenever the person makes a voluntary assignment of his assets.
(c) Whenever the estate of the person in the hands of executors, administrators, or heirs is insufficient to pay all the debts due from the deceased.
(d) Whenever the estate and effects of an absconding, concealed, or absent person required to pay any amount under this part are levied upon by process of law.
This section does not give the state a preference over a lien or security interest which was recorded or perfected prior to the time when the state records or files its lien as provided in Section 7171 of the Government Code.
The preference given to the state by this section is subordinate to the preferences given to claims for personal services by Sections 1204 and 1206 of the Code of Civil Procedure.
History—Added by Stats. 1977, Ch. 481, operative July 1, 1978. Stats. 1980, Ch. 600, operative January 1, 1981, substituted "a lien" for "any lien" and "as provided in Section 7171 of the Government Code" for "pursuant to subdivision (b) or (c) of Section 32363" in the second paragraph and added third paragraph.
Text of Section Operative Through June 30, 2001
32387. Notice of levy. (a) The board may, by notice of levy served personally or by first-class mail, require all persons having in their possession, or under their control, any payments, credits other than payments, or other personal property belonging to a taxpayer or other person liable for any amount under this part to withhold from these credits or other personal property the amount of any tax, interest, or penalties due from the taxpayer or other person, or the amount of any liability incurred by them under this part, and to transmit the amount withheld to the board at the time it may designate. The notice of levy shall have the same effect as a levy pursuant to a writ of execution except for the continuing effect of the levy, as provided in subdivision (b).
(b) The person served shall continue to withhold pursuant to the notice of levy until the amount specified in the notice, including accrued interest, has been paid in full, until the notice is withdrawn, or until one year from the date the notice is received, whichever occurs first.
(c) The amount required to be withheld is the lesser of the following:
(1) The amount due stated on the notice.
(2) The sum of both of the following:
(A) The amount of the payments, credits other than payments, or personal property described above and under the person's possession or control when the notice of levy is served on the person.
(B) The amount of each payment that becomes due following service of the notice of levy on the person and prior to the expiration of the levy.
(d) For the purposes of this section, the term "payments" does not include earnings as that term is defined in subdivision (a) of Section 706.011 of the Code of Civil Procedure or funds in a deposit account as defined in Section 9105 of the Commercial Code. The term "payments" does include any of the following:
(1) Payments due for services of independent contractors, dividends, rents, royalties, residuals, patent rights, or mineral or other natural rights.
(2) Payments or credits due or becoming due periodically as a result of an enforceable obligation to the distributor, dealer, or other person liable for the tax.
(3) Any other payments or credits due or becoming due the distributor, dealer, or other person liable as the result of written or oral contracts for services or sales whether denominated as wages, salary, commission, bonus, or otherwise.
(e) In the case of a financial institution, to be effective, the notice shall state the amount due from the consumer and shall be delivered or mailed to the branch or office of the financial institution where the credits or other property is held, unless another branch or office is designated by the financial institution to receive the notice.
History—Added by Stats. 1982, Ch. 1589, in effect January 1, 1983. Stats. 1993, Ch. 1113, in effect January 1, 1994, added "(a)", added a comma following "The board may", deleted a comma following "notice of levy", substituted "these" for "such" after "withhold from", substituted "the" for "such" after "due from", and substituted "the" for "such" after "board at" in the first paragraph; added "(b)"; and added subdivision (c). Stats. 1998, Ch. 609 (SB 2232), in effect January 1, 1999, substituted "payments, credits, or other payments," for "credits" after "their control, any", substituted "time" for "times as" after "board at the" in the first sentence, and added "The notice of … in subdivision (b)." as the second sentence to subdivision (a); relettered subdivision (b) as (e); relettered subdivision (c) as (b); and added subdivisions (c) and (d).
Text of Section Operative July 1, 2001
32387. Notice of levy. (a) The board may, by notice of levy served personally, by first-class mail, or by electronic transmission or other electronic technology, require all persons having in their possession, or under their control, any payments, credits other than payments, or other personal property belonging to a taxpayer or other person liable for any amount under this part to withhold from these credits or other personal property the amount of any tax, interest, or penalties due from the taxpayer or other person, or the amount of any liability incurred by them under this part, and to transmit the amount withheld to the board at the time it may designate. The notice of levy shall have the same effect as a levy pursuant to a writ of execution except for the continuing effect of the levy, as provided in subdivision (b).
(b) The person served shall continue to withhold pursuant to the notice of levy until the amount specified in the notice, including accrued interest, has been paid in full, until the notice is withdrawn, or until one year from the date the notice is received, whichever occurs first.
(c) The amount required to be withheld is the lesser of the following:
(1) The amount due stated on the notice.
(2) The sum of both of the following:
(A) The amount of the payments, credits other than payments, or personal property described above and under the person’s possession or control when the notice of levy is served on the person.
(B) The amount of each payment that becomes due following service of the notice of levy on the person and prior to the expiration of the levy.
(d) For the purposes of this section, the term "payments" does not include earnings as that term is defined in subdivision (a) of Section 706.011 of the Code of Civil Procedure or funds in a deposit account as defined in paragraph (29) of subdivision (a) of Section 9102 of the Commercial Code. The term "payments" does include any of the following:
(1) Payments due for services of independent contractors, dividends, rents, royalties, residuals, patent rights, or mineral or other natural rights.
(2) Payments or credits due or becoming due periodically as a result of an enforceable obligation to the distributor, dealer, or other person liable for the tax.
(3) Any other payments or credits due or becoming due the distributor, dealer, or other person liable as the result of written or oral contracts for services or sales whether denominated as wages, salary, commission, bonus, or otherwise.
(e) In the case of a financial institution, to be effective, the notice shall state the amount due from the consumer and shall be delivered, mailed, or served by electronic transmission or other electronic technology, to the branch or office of the financial institution where the credits or other property is held, unless another branch or office is designated by the financial institution to receive the notice.
History—Added by Stats. 1982, Ch. 1589, in effect January 1, 1983. Stats. 1993, Ch. 1113, in effect January 1, 1994, added "(a)", added a comma following "The board may", deleted a comma following "notice of levy", substituted "these" for "such" after "withhold from", substituted "the" for "such" after "due from", and substituted "the" for "such" after "board at" in the first paragraph; added "(b)"; and added subdivision (c). Stats. 1998, Ch. 609 (SB 2232), in effect January 1, 1999, substituted "payments, credits, or other payments," for "credits" after "their control, any", substituted "time" for "times as" after "board at the" in the first sentence, and added "The notice of … in subdivision (b)." as the second sentence to subdivision (a); relettered subdivision (b) as (e); relettered subdivision (c) as (b); and added subdivisions (c) and (d). Stats. 1999, Ch. 991 (SB 45), in effect January 1, 2000, but operative July 1, 2001, substituted "paragraph (29) of subdivision (a) of Section 9102" for "Section 9105" after "as defined in" in subdivision (d). Stats. 2024, Ch. 499 (SB 1528), in effect January 1, 2025, substituted "personally," for "personally or" after "levy served" and added "or by electronic … electronic technology," after "by first-class mail," in the first sentence of subdivision (a); and substituted "delivered, … electronic technology" for "delivered or mailed" after "shall be" in subdivision (e).
32387.1. Electronic earnings withholding orders. (a) Notwithstanding Sections 706.071, 706.073, 706.080, 706.101, and 706.105 of the Code of Civil Procedure, the board may serve earnings withholding orders for taxes and any other notice or document required to be served or provided in connection with an earnings withholding order for taxes according to Article 4 (commencing with Section 706.070) of Chapter 5 of Division 2 of Title 9 of Part 2 of the Code of Civil Procedure to government and private employers by electronic transmission or other electronic technology.
(b) Upon consent of the employer, the board may provide service by electronic transmission or other electronic technology under this section.
(c) Notwithstanding Sections 706.071, 706.073, 706.080, 706.101, 706.125, and 706.126 of the Code of Civil Procedure, the board may receive the employer’s return, as described in Section 706.126 of the Code of Civil Procedure, by electronic transmission or other electronic technology.
(d) This section shall apply in the same manner and with the same force and effect and to the full extent as if this section had been incorporated in full into Article 4 (commencing with Section 706.070) of Chapter 5 of Division 2 of Title 9 of Part 2 of the Code of Civil Procedure.
(e) This section shall apply to notices served or provided on or after the effective date of the act adding this section.
History—Added by Stats. 2023, ch. 511 (SB 889), effective January 1, 2024.
32387.5. Employer withheld earnings. (a) Notwithstanding Article 7 (commencing with Section 706.151) of Chapter 5 of Title 9 of Part 2 of the Code of Civil Procedure, if the board determines upon receiving information from a manufacturer or other person liable for any amount under this part that the person's employer withheld earnings for taxes pursuant to Section 32387 and failed to remit the withheld earnings to the board, the employer shall be liable for the amount not remitted. The board's determination shall be based on payroll documents or other substantiating evidence furnished by the person liable for the tax.
(b) Upon its determination, the board shall mail notice to the employer at its last known address that upon failure to remit the withheld earnings to the board within 15 days of the date of its notice to the employer, the employer shall be liable for that amount which was withheld and not remitted.
(c) If the employer fails to remit the amount withheld to the board upon notice, that amount for which the employer is liable shall be determined, collected, and paid as though it were a tax deficiency. The amount may be assessed at any time prior to seven years from the first day that the unremitted amount, in the aggregate, was first withheld. Interest shall accrue on that amount from the first day that the unremitted amount, in the aggregate, was first withheld.
(d) When the determination against the employer is final and due and payable, the person's account shall be immediately credited with an amount equal to that determined amount as though it were a payment received by the board on the first date that the unremitted amount, in the aggregate, was first withheld by the employer.
(e) Collection against the person liable for the tax is stayed for both the following amount and period:
(1) An amount equal to the amount determined by the board under subdivision (a).
(2) The earlier of the time the credit is applied to the person's account pursuant to subdivision (d) or the determination against the employer is withdrawn or revised and the person is notified by the board thereof.
(f) If under this section an amount that was withheld and not remitted to the board is final and due and payable by the employer and credited to the person's account, this remedy shall be the exclusive remedy for the person to recover that amount from the employer.
(g) This section shall apply to determinations made by the board on or after the effective date of the act adding this section.
History—Added by Stats. 2000, Ch. 1052 (AB 2898), in effect January 1, 2001.
32388. Furnishing of partnership agreement. The board shall not be subject to subdivisions (c) and (d) of Section 16307 of the Corporations Code unless, at the time of application for or issuance of a permit, license, or registration number under this part, the applicant furnishes to the board a written partnership agreement that provides that all business assets shall be held in the name of the partnership.
History—Added by Stats. 1996, Ch. 1003, in effect January 1, 1997.
32389. Installment payment agreement. (a) The board may, in its discretion, enter into a written installment payment agreement with a person for the payment of any taxes due, together with interest thereon and any applicable penalties, in installments over an agreed period. With mutual consent, the board and the taxpayer may alter or modify the agreement.
(b) Upon failure of a person to fully comply with the terms of an installment payment agreement with the board, the board may terminate the agreement by mailing a notice of termination to the person. The notice shall include an explanation of the basis for the termination and inform the person of his or her right to request an administrative review of the termination. Fifteen days after the mailing of the notice, the installment payment agreement shall be void, and the total amount of the tax, interest, and penalties due shall be immediately payable.
(c) The board shall establish procedures for an administrative review for persons requesting that review whose installment payment agreements are terminated under subdivision (b). The collection of taxes, interest, and penalties that are the subject of the terminated installment payment agreement may not be stayed during this administrative review process.
(d) Subdivision (b) shall not apply to any case where the board finds collection of the tax to be in jeopardy.
(e) Except in the case of fraud, if an installment payment agreement is entered into within 45 days from the date on which the board's notice of determination or redetermination becomes final, and the person complies with the terms of the installment payment agreement, the board shall relieve the penalty imposed pursuant to Section 32305.
History—Added by Stats. 1999, Ch. 929 (AB 1638), in effect January 1, 2000. Stats. 2000, Ch. 1052 (AB 2898), added subdivision (e).
32389.5. Installment payment annual statement. The board, beginning no later than July 1, 2000, shall provide each taxpayer who has an installment payment agreement in effect under Section 32389 an annual statement setting forth the initial balance at the beginning of the year, the payments made during the year, and the remaining balance as of the end of the year.
History—Added by Stats. 2000, Ch. 1052 (AB 2898), in effect January 1, 2001.
32390. Collection cost recovery fee. (a) A collection cost recovery fee shall be imposed on any person that fails to pay an amount of tax, interest, penalty, or other amount due and payable under this part. The collection cost recovery fee shall be in an amount less than or equal to the board's costs for collection, as reasonably determined by the California Department of Tax and Fee Administration’s. The collection cost recovery fee shall be imposed only if the California Department of Tax and Fee Administration has mailed its demand notice, to that person for payment, that advises that continued failure to pay the amount due may result in collection action, including the imposition of a collection cost recovery fee.
(b) Interest shall not accrue with respect to the collection cost recovery fee provided by this section.
(c) The collection cost recovery fee imposed pursuant to this section shall be collected in the same manner as the collection of any other tax imposed by this part.
(d) (1) If the California Department of Tax and Fee Administration finds that a person's failure to pay any amount under this part is due to reasonable cause and circumstances beyond the person's control, and occurred notwithstanding the exercise of ordinary care and the absence of willful neglect, the person shall be relieved of the collection cost recovery fee provided by this section.
(2) Any person seeking to be relieved of the collection cost recovery fee shall file with the California Department of Tax and Fee Administration a statement under penalty of perjury setting forth the facts upon which the person bases the claim for relief.
(e) Subdivision (a) shall be operative with respect to a demand notice for payment which is mailed on or after January 1, 2011.
(f) Collection cost recovery fee revenues shall be deposited in the same manner as revenues derived from any other tax imposed by this part.
History—Added by Stats. 2010, Ch. 721 (SB 858), in effect October 19, 2010, operative January 1, 2011. Stats. 2021, Ch. 432 (SB 824), effective January 1, 2022, added "less than or" after "shall be in an amount" in subdivision (a); and substituted "California Department of Tax and Fee Administration" for "board" throughout.