Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2010
 

Diesel Fuel Tax Law

CHAPTER 6. DETERMINATIONS AND PAYMENTS.


CHAPTER 6. DETERMINATIONS AND PAYMENTS.

Article 1. Returns and Payments

60201. Return. Each supplier shall prepare and file with the board a return in the form as prescribed by the board, which may include, but not be limited to, electronic media showing the total number of gallons of diesel fuel removed, entered, or sold by him or her within this state during each calendar month, or the monthly period ended during that calendar month as the board may authorize, the amount of tax due for the month covered by the return, and any other information as the board deems necessary for the proper administration of this part. The person shall file the return on or before the last day of the calendar month following the monthly period to which it relates, together with a remittance payable to the board for the amount of tax due for that period, less whatever amounts may have been paid theretofore for the same period because of weekly returns. To facilitate the administration of this part, the board may require the filing of the returns for other than monthly periods. Returns shall be authenticated in a form or pursuant to methods as may be prescribed by the board.

History.—Stats. 2002, Ch. 459 (AB 1936), in effect January 1, 2003, deleted "on forms prescribed by the board" after "with the board" and added "in the form . . . electronic media" after "a return" in the first sentence, and added the fourth sentence.

60201.1. Return; floor stock tax. Each person subject to the tax imposed under Section 60050.1, on or before September 30, 1995, shall prepare and file with the board, on forms prescribed by the board, a return showing the total number of gallons of undyed diesel fuel owned by the person on July 1, 1995, for which a tax has not been imposed under Part 3 (commencing with Section 8601) as in effect on June 30, 1995, the amount of the tax imposed, and any other information that the board deems necessary for the proper administration of this part.

The return shall be accompanied by a remittance payable to the board in the amount of tax due.

60201.2. Purchaser's election to delay payment to supplier. A supplier who sells taxable diesel fuel shall collect from the purchaser the diesel fuel tax imposed under Section 60050. At the election of the purchaser, the payment of the diesel fuel tax owed on every gallon of diesel fuel purchased from a supplier shall be remitted to the supplier on terms agreed upon between the purchaser and the supplier or on or before five working days before the last day of the calendar month following the monthly period to which it relates. This election shall be subject to a condition that the purchaser's remittances of all amounts of tax due to the seller shall be paid by electronic funds transfer. The purchaser's election may be terminated by the seller if the purchaser does not make timely payments to the seller as required by this section. This section shall not apply where the purchaser is required by a supplier to pay cash or cash equivalent for diesel fuel purchases.

History.—Added by Stats. 1995, Ch. 34, in effect June 30, 1995, but operative July 1, 1995. Stats. 1997, Ch. 76 (SB 612), in effect July 16, 1997, deleted "(a)" at the beginning of the section and deleted subdivision (b) which read: "This section shall cease to be operative on July 1, 1997, and as of January 1, 1998, is repealed."

60201.3. Worthless accounts; supplier. (a) A supplier is relieved from liability for diesel fuel tax insofar as the sales of the diesel fuel are represented by accounts which have been found worthless and charged off for income tax purposes. If the supplier has previously paid the amount of the tax, he or she may, under the rules and regulations prescribed by the board, take a credit in that amount. If those accounts are thereafter in whole or in part collected by the supplier, the gallons of diesel fuel represented by the amounts collected shall be included in the first return filed after that collection and the amount of the tax thereon shall be paid with the return. The board may, at its option, require the supplier to submit periodic reports listing accounts delinquent for a 90-day period or more.

(b) Any customer of a supplier who has failed to pay for diesel fuel purchased and for which the supplier has been allowed a credit under subdivision (a) is liable to the state for the diesel fuel tax as an unlicensed supplier and the tax, applicable penalties, and interest become immediately due and payable under the unlicensed persons provisions contained in Article 6 (commencing with Section 60360) of Chapter 6. The notice of determination issued under Section 60361 shall be given to the customer within three years of the last day of the calendar month following the reporting period for which the supplier took a credit for the tax previously paid on the customer's account or within three years after the date a refund of the tax was paid.

History.—Added by Stats. 1995, Ch. 34. in effect June 30, 1995, but operative July 1, 1995. Stats. 1997, Ch. 76 (SB 612), in effect July 16, 1997, deleted subdivision (c) which read: "This section shall cease to be operative on July 1, 1997, and as of January 1, 1998, is repealed." Stats. 2006, Ch. 364 (AB 3076), in effect January 1, 2007, added the last sentence to subdivision (b).

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60202. Return; interstate user. (a) Each interstate user shall prepare and file with the board a return in the form as prescribed by the board, which may include, but not be limited to, electronic media showing the amount of diesel fuel used during the quarterly reporting period by the interstate user in this state, the amount of any tax due, and any other information as the board may require for the administration of this part. The return shall be filed with the board on or before the last day of the calendar month following the close of the quarterly period to which it relates, together with a remittance payable to the board of the amount of tax due. To facilitate the administration of this part, the board may require the filing of returns for other than quarterly periods. Returns shall be authenticated in a form or pursuant to methods as may be prescribed by the board. (b) An interstate user subject to the tax imposed by Section 60115 shall be allowed a credit against the amount of tax due on his or her return for an amount equal to the tax imposed by Section 60115 on diesel fuel purchased in this state in that same return period for use in the operation of a qualified motor vehicle. No credit shall be allowed unless the tax imposed by Section 60050 and the taxes imposed by Part 1 (commencing with Section 6001) and Part 1.5 (commencing with Section 7200) of Division 2 of the Revenue and Taxation Code and Section 35 of Article XIII of the California Constitution have been paid upon the purchase of the diesel fuel by the interstate user to a diesel vendor in this state. When the amount of the credit for any return period exceeds the amount of tax due for the return period, the excess shall be allowed as a credit against the amount of tax due for succeeding reporting periods or shall be refunded.

(c) Credits and refunds allowed pursuant to subdivision (b) shall be charged against the Motor Vehicle Fuel Account to the extent the total amount of credits and refunds allowed to all taxpayers for the fiscal year does not exceed the combined amounts due under subdivisions (a) and (b) of Section 60115. To the extent the total amount of credits and refunds allowed to all taxpayers for the fiscal year pursuant to subdivision (b) exceeds the combined amounts due under subdivisions (a) and (b) of Section 60115, the credits and refunds shall be charged against the Motor Vehicle Fuel Account as to the amount of the credits and refunds established under subdivision (a) of Section 60115 and shall be charged against the Retail Sales Tax Fund as to the amount of the credits and refunds established under subdivision (b) of Section 60115.

History.—Stats. 1995, Ch. 555, in effect January 1, 1996, substituted "user" for "trucker" after "Each interstate" and after "by the interstate" in subdivision (a); substituted "user" for "trucker" after "An interstate" in subdivision (b); and added subdivision (c). Stats. 1997, Ch. 618 (AB 1269), in effect October 3, 1997, substituted "subject to the . . . shall be refunded" for "who has paid diesel fuel tax to a diesel vendor in this state shall be allowed a credit on his or her return for the tax paid to the diesel vendor" after "An interstate user" in subdivision (b) and substituted "Credits and refunds . . . of Section 60115." for "If any interstate user has paid a backup tax to the state , he or she shall be allowed a credit against the amount of tax due under Section 60115 with respect to that diesel fuel on which the backup tax was paid to the state." in subdivision (c). Stats. 2002, Ch. 459 (AB 1936), in effect January 1, 2003, deleted "on forms prescribed by the board" after "with the board" and added "in the form . . . electronic media" after "a return" in the first sentence of, and added the fourth sentence to, subdivision (a).

60203. Return; throughputter. [Repealed by Stats. 2001, Ch. 429 (AB 309), in effect January 1, 2002.]

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60204. Report; terminal operator. (a) Each terminal operator shall prepare and file with the board a report in the form as prescribed by the board, which may include, but not be limited to, electronic media showing, for the calendar month, or that monthly period ended during the calendar month as the board may authorize, the following:

(1) The name and license number of each person that is a positionholder at each terminal it operates.

(2) The amount of diesel fuel received at each terminal it operates.

(3) The identity of each positionholder with respect to the rack removals of diesel fuel from each terminal it operates and the volume and dates of the removals.

(4) The amount of diesel fuel stored at each terminal it operates. (5) The destination (by state) of all diesel fuel removed at a terminal rack of each terminal it operates, to the extent that information has been provided to the terminal operator.

(6) Any other information required by the board for the proper administration of this part.

The terminal operator shall file the report on or before the last day of the month following the monthly period to which it relates. To facilitate the administration of this part, the board may require the filing of the reports for other than monthly periods. Reports shall be authenticated in a form or pursuant to methods as may be prescribed by the board.

(b) Upon written approval of the board, a terminal operator may satisfy the requirements of subdivision (a) above by executing and providing to the board a consent and authorization for the Internal Revenue Service to provide to the board under Section 6103 of the Internal Revenue Code, the return filed by the terminal operator under Section 48.4101-2 of Title 26 of the Code of Federal Regulations. The board may, in its sole discretion, rescind its approval and require a terminal operator to file reports as specified in subdivision (a).

History.—Stats. 2002, Ch. 459 (AB 1936), in effect January 1, 2003, completely revised section.

60204.5. Report; pipeline operator and vessel operator. (a) Each pipeline operator and vessel operator shall prepare and file with the board a report in the form as prescribed by the board, which may include, but not be limited to, electronic media showing, for the calendar month, or that monthly period ended during the calendar month as the board may authorize, all of the following:

(1) The amount of diesel fuel delivered to each terminal or refinery.

(2) The location of the terminal or refinery where the diesel fuel was delivered.

(3) The date of delivery.

(4) Any other information required by the board for the proper administration of this part. The pipeline operator and vessel operator shall file the report on or before the last day of the month following the monthly period to which it relates. To facilitate the administration of this part, the board may require the filing of the reports for other than monthly periods. Reports shall be authenticated in a form or pursuant to methods as may be prescribed by the board.

(b) Upon written approval of the board, a pipeline operator and vessel operator may satisfy the requirements of subdivision (a) by executing and providing to the board a consent and authorization for the Internal Revenue Service to provide to the board under Section 6103 of the Internal Revenue Code, the return filed by the pipeline operator and vessel operator under Section 48.4101-2 of Title 26 of the Code of Federal Regulations. The board may, in its sole discretion, rescind its approval and require a pipeline operator and vessel operator to file reports as specified in subdivision (a).

History.—Added by Stats. 2001, Ch. 429 (AB 309), in effect January 1, 2002.

60204.6. Report; train operator. Each train operator shall prepare and file with the board a report in the form as prescribed by the board, which may include, but not be limited to, electronic media showing, for the calendar month, or that monthly period ended during the calendar month as the board may authorize, all of the following:

(a) The amount of diesel fuel delivered into, out of, or within this state.

(b) The location where the diesel fuel was delivered.

(c) The date of delivery.

(d) Any other information required by the board for the proper administration of this part. The train operator shall file the report on or before the last day of the month following the monthly period to which it relates. To facilitate the administration of this part, the board may require the filing of the reports for other than monthly periods. Reports shall be authenticated in a form or pursuant to methods as may be prescribed by the board.

History.—Added by Stats. 2008, Ch. 306 (AB 3079), in effect January 1, 2009.

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60205. Return; exempt bus operator. Each exempt bus operator shall prepare and file with the board a return in the form as prescribed by the board, which may include, but not be limited to, electronic media showing the total number of gallons of diesel fuel used in the exempt bus operation by him or her within this state during each calendar month, or the monthly period ended during that calendar month as the board may authorize, the amount of tax pursuant to Section 60502.2 due for the month covered by the return, and any other information as the board deems necessary for the proper administration of this part. The person shall file the return on or before the last day of the calendar month following the monthly period to which it relates, together with a remittance payable to the board for the amount of tax due for that period. To facilitate the administration of this part, the board may require the filing of the returns for other than monthly periods. Returns shall be authenticated in a form or pursuant to methods as may be prescribed by the board.

History.—Stats. 2002, Ch. 459 (AB 1936), in effect January 1, 2003, deleted "on forms prescribed by the board" after "with the board" and added "in the form . . . electronic media" after "a return" in the first sentence, and added the fourth sentence.

60205.5. Return; government entity. (a) Each government entity shall prepare and file with the board a return in the form as prescribed by the board, which may include, but not be limited to, electronic media showing the total number of gallons of dyed diesel fuel and undyed diesel fuel used in a diesel-powered highway vehicle during each calendar month, or the monthly period ending during the calendar month covered by the return, and any other information as the board deems necessary for the proper administration of this part. The person shall file the return on or before the last day of the calendar month following the monthly period to which it relates, together with a remittance payable to the board for the amount of tax due for that period. To facilitate the administration of this part, the board may require the filing of the returns for other than monthly periods. Returns shall be authenticated in a form or pursuant to methods as may be prescribed by the board.

(b) A government entity that has paid diesel fuel tax to a retail vendor that sold the diesel fuel to the government entity shall be allowed a credit on its tax return for the tax paid to the retail vendor.

History.—Added by Stats. 1995, Ch. 34, in effect June 30, 1995, but operative July 1, 1995. Stats, 2002, Ch. 459 (AB 1936), in effect January 1, 2003, deleted "on forms prescribed by the board" after "with the board" and added "in the form . . . electronic media" after "a return" in the first sentence, and added the fourth sentence.

60206. Return; qualified highway vehicle operator. Each qualified highway vehicle operator shall prepare and file with the board a return in the form as prescribed by the board, which may include, but not be limited to, electronic media showing the total number of gallons of diesel fuel subject to the backup tax that was delivered into the fuel tank of a diesel-powered highway vehicle within this state during each calendar month, or the monthly period ended during that calendar month as the board may authorize, the amount of tax due for the month covered by the return, and any other information as the board deems necessary for the proper administration of this part. The person shall file the return on or before the last day of the calendar month following the monthly period to which it relates, together with a remittance payable to the board for the amount of tax due for that period. To facilitate the administration of this part, the board may require the filing of the returns for other than monthly periods. Returns shall be authenticated in a form or pursuant to methods as may be prescribed by the board.

History.—Stats. 2001, Ch. 429 (AB 309), in effect January 1, 2002, added "qualified" after "Each", deleted "and end seller" after "vehicle operator", deleted "on forms prescribed by the board" after "with the board", added "in the form as prescribed . . . , electronic media" after "a return", and deleted "or sold by him or her" after "diesel-powered highway vehicle" in the first sentence; and added the fourth sentence.

60207. Penalty. (a) Any person who fails to pay the amount of tax shown to be due by that person's return on or before the last day of the month following the reporting period to which it relates, shall pay a penalty of 10 percent of the tax, together with interest on that tax at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the date on which the tax became due and payable to the state until the date of payment.

(b) Any person who fails to file a return in accordance with the due dates set forth in Article 1 (commencing with Section 60201) shall pay a penalty of 10 percent of the amount of taxes with respect to the period for which the return is required.

(c) The penalties imposed by this section shall be limited to a maximum of 10 percent of the taxes for which the return is required for any one return.

History.—Stats. 1996, Ch. 1087, in effect January 1, 1997, deleted "file a report or return or to" after "who fails to" and deleted "or fifty dollars ($50), whichever is greater" after "of the tax". Stats. 2000, Ch. 923 (AB 2894), in effect January 1, 2001, added subdivision letter designation (a) before former sole paragraph, added subdivisions (b) and (c).

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60208. Extension of time. The board for good cause may extend for a period not to exceed one month, the time for making any report or return or paying any tax required under this part. The extension may be granted at any time provided a request therefor is filed with the board within or prior to the period for which the extension may be granted. Any person to whom an extension is granted shall pay, in addition to the tax, interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the date on which the tax would have been due without the extension to the date of payment.

60209. Excusable delay. (a) If the board finds that a person's failure to make a timely report, return, or payment 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 may be relieved of the penalty provided by Sections 60207, 60250, 60301, 60338, and 60355.

(b) Except as provided in subdivision (c), any person seeking to be relieved of the penalty shall file with the board a statement under penalty of perjury setting forth the facts upon which he or she bases the claim for relief.

(c) The board shall establish criteria that provide for efficient resolution of requests for relief pursuant to this section.

History.—Stats. 2000, Ch. 1052 (AB 2898), in effect January 1, 2001, added subdivision letter designation (a) before first paragraph, added subdivision letter designation (b) before second paragraph, substituted "Except as provided in subdivision (c), any" for "Any" in subdivision (b), and added subdivision (c).

60210. Excusable delay; reliance on Board advice. (a) If the board finds that a person's failure to make a timely return or payment is due to the person's reasonable reliance on written advice from the board, the person may be relieved of the taxes imposed by this part and any penalty or interest added thereto.

(b) For purposes of this section, a person's failure to make a timely return or payment shall be considered to be due to reasonable reliance on written advice from the board, only if the board finds that all of the following conditions are satisfied:

(1) The person requested in writing that the board advise him or her whether a particular activity or transaction is subject to tax under this part. The specific facts and circumstances of the activity or transaction shall be fully described in the request.

(2) The board responded in writing to the person regarding the written request for advice, stating whether or not the described activity or transaction is subject to tax, or stating the conditions under which the activity or transaction is subject to tax.

(3) The liability for taxes applied to a particular activity or transaction that occurred before either of the following:

(A) Before the board rescinded or modified the advice so given, by sending written notice to the person of the rescinded or modified advice.

(B) Before a change in statutory or constitutional law, a change in the board's regulations, or a final decision of a court, that renders the board's earlier written advice no longer valid. (c) Any person seeking relief under this section shall file with the board all of the following:

(1) A copy of the person's written request to the board and a copy of the board's written advice.

(2) A statement under penalty of perjury setting forth the facts on which the claim for relief is based.

(3) Any other information that the board may require.

(d) Only the person making the written request shall be entitled to rely on the board's written advice to that person.

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60210.5. Relief of spouse. (a) Under regulations prescribed by the board, if:

(1) A tax liability under this part was understated by a failure to file a return required to be filed under this part, by the omission of an amount properly includable therein, or by erroneous deductions or credits claimed on a return, and the understatement of tax liability is attributable to one spouse; or any amount of the tax reported on a return was unpaid and the nonpayment of the reported tax liability is attributable to one spouse.

(2) The other spouse establishes that he or she did not know of, and had no reason to know of, that understatement or nonpayment.

(3) Taking into account whether or not the other spouse significantly benefited directly or indirectly from the understatement or the nonpayment and taking into account all other facts and circumstances, it is inequitable to hold the other spouse liable for the deficiency in tax attributable to that understatement or nonpayment, then the other spouse shall be relieved of liability for tax (including interest, penalties, and other amounts) to the extent that the liability is attributable to that understatement or nonpayment of tax.

(b) For purposes of this section, the determination of the spouse to whom items of understatement or nonpayment are attributable shall be made without regard to community property laws.

(c) This section shall apply to all calendar months or quarters subject to the provisions of this part, but shall not apply to any calendar month or quarter that is more than five years from the final date on the board-issued determination, five years from the return due date for nonpayment on a return, or one year from the first contact with the spouse making a claim under this section; or that has been closed by res judicata, whichever is later.

(d) For purposes of paragraph (2) of subdivision (a), "reason to know" means whether or not a reasonably prudent person would have had reason to know of the understatement or nonpayment.

(e) For purposes of this section, with respect to a failure to file a return or an omission of an item from the return, "attributable to one spouse" may be determined by whether a spouse rendered substantial service as a supplier entering, removing, or selling taxable diesel fuel, an interstate user, an exempt bus operator, or a highway vehicle operator using taxable diesel fuel to which the understatement is attributable. If neither spouse rendered substantial services as a supplier, interstate user, exempt bus operator, or highway vehicle operator, then the attribution of applicable items of understatement shall be treated as community property. An erroneous deduction or credit shall be attributable to the spouse who caused that deduction or credit to be entered on the return.

(f) Under procedures prescribed by the board, if, taking into account all the facts and circumstances, it is inequitable to hold the other spouse liable for any unpaid tax or any deficiency (or any portion of either) attributable to any item for which relief is not available under subdivision (a), the board may relieve the other spouse of that liability.

(g) For purposes of this section, registered domestic partners, as defined in Section 297 of the Family Code, have the same rights, protections, and benefits as provided by this section, and are subject to the same responsibilities, obligations, and duties as imposed by this section, as are granted to and imposed upon spouses.

(h) The relief provided by this section shall apply retroactively to liabilities arising prior to the effective date of this section.

History.—Added by Stats. 2007, Ch. 342 (AB 1748), in effect January 1, 2008.

60211. Disaster. If the board finds that a person's failure to make a timely return or payment was due to a disaster, and occurred notwithstanding the exercise of ordinary care and the absence of willful neglect, the person may be relieved of the interest provided by Sections 60207, 60208, 60250, 60302, and 60339.

Any person seeking to be relieved of the interest shall file with the board a statement under penalty of perjury setting forth the facts upon which he or she bases the claim for relief.

History.—Stats. 2000, Ch. 923 (AB 2894), in effect January 1, 2001, added "60250" after "Sections 60207, 60208," in the first paragraph. Stats. 2001, Ch. 429 (AB 309), in effect January 1, 2002, deleted "and" after "60208, 60250" and added ", and 60339" after "60302" in the first paragraph.

60212. Relief of interest. (a) The board, in its discretion, may relieve all or any part of the interest imposed on a person by this part where the failure to pay tax is due in whole or in part to an unreasonable error or delay by an employee of the board acting in his or her official capacity.

(b) For purposes of this section, an error or delay shall be deemed to have occurred only if no significant aspect of the error or delay is attributable to an act of, or a failure to act by, the taxpayer.

(c) Any person seeking relief under this section shall file with the board a statement under penalty of perjury setting forth the facts on which the claim for relief is based and any other information which the board may require.

(d) The board may grant relief only for interest imposed on tax liabilities that arise during taxable periods commencing on or after January 1, 2000.

History.—Added by Stats. 1999, Ch. 929 (AB 1638), in effect January 1, 2000. Stats. 2001, Ch. 251 (AB 1123), in effect January 1, 2002, substituted "this part" for "Sections 60207 and 60302" after "imposed on a person by" in subdivision (a).

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Article 1.1 Payment by Electronic Funds Transfer1

1Article 1.1 was added by Stats. 2000, Ch. 923 (AB 2894), in effect January 1, 2001.

60250. Electronic funds transfer payments. (a) Any person whose estimated tax liability under this part averages twenty thousand dollars ($20,000) or more per month, as determined by the board pursuant to methods of calculation prescribed by the board, shall remit amounts due by an electronic funds transfer under procedures prescribed by the board.

(b) Any person whose estimated tax liability under this part averages less than twenty thousand dollars ($20,000) per month may elect to remit amounts due by electronic funds transfer with the approval of the board.

(c) Any person remitting amounts due pursuant to subdivision (a) or (b) shall perform electronic funds transfer in compliance with the due dates set forth in Article 1 (commencing with Section 60201). 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.

(d) Any person remitting taxes by electronic funds transfer shall, on or before the due date of the remittance, file a return for the preceding reporting period in the form and manner prescribed by the board. Any person who fails to timely file the required return shall pay a penalty of 10 percent of the amount of taxes with respect to the period for which the return is required.

(e) Any person required to remit taxes pursuant to this article who remits those taxes by means other than appropriate electronic funds transfer shall pay a penalty of 10 percent of the taxes incorrectly remitted.

(f) Any person who fails to pay any tax to the state or any amount of tax required to be collected and paid to the state, except amounts of determinations made by the board under Article 2 (commencing with Section 60301) or Article 3 (commencing with Section 60310), within the time required shall pay a penalty of 10 percent of the tax or amount of tax, in addition to the tax or amount of tax, plus interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the date on which the tax became due and payable to the state until the date of payment.

(g) In determining whether a person's estimated tax liability averages twenty thousand dollars ($20,000) or more per month, the board may consider tax returns filed pursuant to this part and any other information in the board's possession.

(h) The penalties imposed by subdivisions (d), (e), and (f) shall be limited to a maximum of 10 percent of the taxes due for any one return. Any person remitting taxes by electronic funds transfer shall be subject to the penalties under this section and not Section 60207.

(i) The board shall promulgate regulations pursuant to Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code for purposes of implementing this section.

History.—Stats. 2005, Ch. 519 (AB 1765), in effect October 4, 2005, but operative January 1, 2006, deleted the former last sentence of subdivision (b) which provided "The election shall be operative for a minimum of one year."

60251. Relief of penalty. If the board finds that a person's failure to make payment by an appropriate electronic funds transfer in accordance with board procedures is due to reasonable cause and circumstances beyond the person's control, and occurred notwithstanding the exercise of ordinary care and in the absence of willful neglect, that person shall be relieved of the penalty provided in subdivision (e) of Section 60250. Any person seeking to be relieved of the penalty shall file with the board a statement under penalty of perjury setting forth the facts upon which he or she bases his or her claim for relief.

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60252. Definitions. (a) "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 transfers shall be accomplished by an automated clearinghouse debit, an automated clearinghouse credit, or by Federal Reserve Wire Transfer (Fedwire).

(b) "Automated clearinghouse" means any federal reserve bank, or an organization established in agreement with the National Automated Clearing House Association, that operates as a clearinghouse for transmitting or receiving entries between banks or bank accounts and which authorizes an electronic transfer of funds between these banks or bank accounts.

(c) "Automated clearinghouse debit" means a transaction in which the state, through its designated depository bank, originates an automated clearinghouse transaction debiting the person's bank account and crediting the state's bank account for the amount of tax. Banking costs incurred for the automated clearinghouse debit transaction shall be paid by the state.

(d) "Automated clearinghouse credit" means an automated clearinghouse transaction in which the person through his or her own bank, originates an entry crediting the state's bank account and debiting his or her own bank account. Banking costs incurred for the automated clearinghouse credit transaction charged to the state shall be paid by the person originating the credit.

(e) "Fedwire transfer" means any transaction originated by a person and utilizing the national electronic payment system to transfer funds through the federal reserve banks, when that person debits his or her own bank account and credits the state's bank account. Electronic funds transfers pursuant to Section 60250 may be made by Fedwire only if payment cannot, for good cause, be made according to subdivision (a), and the use of Fedwire is preapproved by the board. Banking costs incurred for the Fedwire transaction charged to the person and to the state shall be paid by the person originating the transaction.

60253. Electronic filing. (a) Any return, report, declaration, statement, or other document required to be made under this part that is filed using electronic media shall be filed and authenticated pursuant to any method or form the board may prescribe.

(b) Notwithstanding any other law, any return, declaration, statement, or other document otherwise required to be signed that is filed by the taxpayer using electronic media in a form as required by the board shall be deemed to be a signed, valid original document, including upon reproduction to paper form by the board.

(c) Electronic media includes, but is not limited to, computer modem, magnetic media, optical disk, facsimile machine, or telephone.

(d) Upon written approval of the board, a person may satisfy the requirements of subdivision (a) by executing and providing to the board a consent and authorization for the Internal Revenue Service to provide to the board under Section 6103 of the Internal Revenue Code, the return filed by the person under Section 48.4101-2 of Title 26 of the Code of Federal Regulations. The board, in its sole discretion, may rescind its approval and require a person to file reports as specified in subdivision (a).

History.—Added by Stats. 2001, Ch. 429 (AB 309), in effect January 1, 2002.

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Article 2. Determination If No Return Made

60301. Determination; failure to file return; penalty. If any person fails, neglects, or refuses to file the return within the time prescribed by this chapter, the board shall estimate the diesel fuel removals, entries, sales, deliveries, or use for the period for which he or she made no return within the time required. Upon the basis of this estimate, the board shall determine the tax due from the person, and shall add to the tax a penalty of 10 percent thereof. The board may make a determination for more than one period and may make one or more determinations for the same period.

60302. Interest. Each determination so made, exclusive of penalties, shall bear interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the last day of the month following the reporting period for which the amount or any portion thereof should have been returned until the date of payment.

60303. Fraud penalty. If the neglect or refusal of a person to file a return is due to fraud or intent to evade the tax, a penalty of 25 percent of the tax shall be added thereto in addition to the 10-percent penalty provided in Section 60301.

60304. Notice of determination. Promptly after making its determination, the board shall give to the delinquent person written notice of the estimate, including tax, interest, and penalty. The notice shall be given in the manner prescribed in Section 60311 for giving notice of a deficiency determination.

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Article 3. Deficiency Determinations

60310. Deficiency determination. If the board is not satisfied with the return made by any person, it may make a deficiency determination of the tax required to be paid by the person based upon information contained in the return or upon any information in the possession of the board. The board may make a determination for more than one period and may make one or more determinations for the same period. When a business is discontinued, a determination may be made at any time thereafter within the period specified in Section 60315, as to liability arising out of that business, irrespective of whether the determination is issued prior to the due date of the liability as otherwise specified in this part.

60311. Notice of determination. The board shall give the person written notice of its determination. The notice shall be placed in a sealed envelope, with postage paid, addressed to the person at that person's address as it appears in the records of the board. The giving of notice shall be deemed complete at the time of the deposit of the notice in the United States Post Office, or a mailbox, sub-post office, substation, or mail chute or other facility maintained or provided by the United States Postal Service, without extension of time for any reason. In lieu of mailing, a notice may be served personally by delivering to the person to be served and service shall be deemed complete at the time of that delivery. Personal service to a corporation may be made by delivery of a notice to any person designated in the Code of Civil Procedure to be served for the corporation with summons and complaint in a civil action.

60312. Negligence. If any part of the deficiency for which a deficiency determination is made is due to negligence or intentional disregard of this part or authorized rules and regulations, a penalty of 10 percent of the amount of the determination shall be added thereto.

60313. Fraud. If any part of the deficiency for which a deficiency determination is made is due to fraud or an intent to evade the tax, a penalty of 25 percent of the amount of the determination shall be added thereto.

60314. Interest. All deficiency determinations, exclusive of penalty, shall bear interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the last day of the calendar month following the reporting period for which the amount or any portion thereof should have been returned until the date of payment.

60315. Limitations; deficiency determinations. Except in the case of fraud, intent to evade this part or authorized rules and regulations, or failure to make a return, every notice of a deficiency determination shall be given to the person within three years after the last day of the calendar month following the reporting period for which the amount is proposed to be determined or within three years after the return is filed, whichever period expires later. In the case of a failure to make a return, the notice of determination shall be mailed within eight years after the date the return was due.

60316. Limitations; deficiency determinations; decedents. In the case of a deficiency arising under this part during the lifetime of a decedent, a notice of deficiency determination shall be mailed within four months after written request therefor, in the form required by the board, by the fiduciary of the estate or trust or by any other person liable for the tax or any portion thereof.

60317. Waiver. If before the expiration of the time prescribed in Section 60315 for the mailing of a notice of deficiency determination the taxpayer has consented in writing to the mailing of the notice after that time, the notice may be mailed at any time prior to the expiration of the period agreed upon. The period so agreed upon may be extended by subsequent agreements in writing made before the expiration of the period previously agreed upon.

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Article 4. Jeopardy Determinations and Weekly Payments

60330. Jeopardy determination. If the board believes that the collection of any amount of tax imposed under this part will be jeopardized by delay, it shall thereupon make a determination of the amount of tax, noting that fact upon the determination. The amount determined is immediately due and payable.

60331. Interest and penalty. If the amount of the tax, interest, and penalty specified in the jeopardy determination is not paid within 10 days after service upon the person of notice of the determination, the determination becomes final, unless a petition for redetermination is filed within 10 days, and the delinquency penalty and interest provided in Article 5 (commencing with Section 60350) shall attach to the amount specified.

60332. Petition for redetermination; security. The person against whom a jeopardy determination is made may petition for the redetermination thereof pursuant to Article 5 (commencing with Section 60350). That person shall, however, file the petition for redetermination with the board within 10 days after the service upon that person of notice of the determination. At the time of filing the petition for redetermination, the person shall deposit with the board that security as the board may deem necessary to ensure compliance with this part.

60333. Administrative hearing. (a) In accordance with rules and regulations as the board may prescribe, the person against whom a jeopardy determination is made may apply for an administrative hearing for one or more of the following purposes:

(1) To establish that the determination is excessive.

(2) To establish that the sale of property that may be seized after issuance of the jeopardy determination or any part thereof shall be delayed pending the administrative hearing because the sale would result in irreparable injury to the person.

(3) To request the release of all or a part of the property to the person.

(4) To request a stay of collection activities.

(b) The application shall be filed within 30 days after service of the notice of jeopardy determination and shall be in writing and state the specific factual and legal grounds upon which it is founded. No security need be posted to file the application and to obtain this hearing. However, if the person does not deposit within the 10-day period prescribed in Section 60332 that security as the board may deem necessary to ensure compliance with this part, the filing of the application shall not operate as a stay of collection activities, except sale of property seized after issuance of the jeopardy determination. Upon a showing of good cause for failure to file a timely application for administrative hearing, the board may allow a filing of the application and grant the person an administrative hearing. The filing of an application pursuant to this section shall not affect provisions of Section 60331 relating to the finality date of the determination or to penalty or interest.

60334. Weekly returns. If the board deems it necessary in order to ensure payment to the state of the amount of taxes due from any supplier under this part, it may require the supplier to make returns and payments of taxes on a weekly basis. The supplier shall then file a return each Tuesday showing the total number of gallons of diesel fuel removed, entered or sold by him or her during the week ending the Saturday next preceding, the amount of tax due for that week, and any other information as the board deems necessary for the proper administration of this article. The return shall be accompanied by a remittance payable to the board for the amount of tax due for the period covered.

60335. Monthly return period. A supplier required to make weekly payments is not relieved of the duty of filing the verified monthly return required by Article 1 (commencing with Section 60201).

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60336. Revocation of license. Whenever any supplier who is required to pay tax in weekly installments as provided by Section 60334 fails to make a weekly return or to pay the full amount in accordance with the terms and conditions prescribed by the board, the supplier's license may be revoked forthwith.

60337. Immediately due and payable. If a supplier fails to make a weekly return or to pay any weekly installment of the tax, or any part thereof, pursuant to the requirement imposed upon the supplier under Section 60334, the full amount of the installment becomes immediately due and payable. The board shall thereupon make a jeopardy determination under Section 60330 and the board shall forthwith collect the tax due from the supplier in the manner prescribed by Chapter 6 (commencing with Section 60201) and Chapter 7 (commencing with Section 60401). All provisions of those chapters, where relevant, apply to collections required to be made under this article.

60338. Penalty. If any supplier fails to pay any weekly installment of tax shown to be due by the supplier's weekly return on the Tuesday when required to be paid, a penalty of 5 percent shall be added thereto. In addition, if any weekly installment of tax remains unpaid on the last day of the calendar month following the month during which the last of the removals, entries, or sales occurred on which the weekly installment was levied, a penalty of 10 percent of the installment, exclusive of penalties, shall be added thereto.

The weekly installment shall be deemed not paid or unpaid on any particular day:

(a) If not paid prior to 5 p.m. of that day, when paid in person.

(b) If the envelope in which the remittance is enclosed bears a post office cancellation mark dated later than that day, when paid by mail.

60339. Interest. All jeopardy determinations including those made under Section 60337, exclusive of penalty, shall bear interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the last day of the month following the reporting period for which the amount or any portion thereof should have been returned until the date of payment.

60340. Service of notice. Any notice required by this article may be served personally or by mail in the manner prescribed for service of notice of a deficiency determination.

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Article 5. Redeterminations

60350. Petition for redetermination. Any person against whom a determination is made by the board under Article 2 (commencing with Section 60301) and Article 3 (commencing with Section 60310) may petition for a redetermination within 30 days after the date the notice thereof is given to him or her. If a petition for redetermination is not filed within the 30-day period, the determination becomes final at the expiration of the period.

60351. Form and content. Every petition for redetermination shall be in writing and shall state the specific grounds upon which the petition is founded. The petition may be amended to state additional grounds at any time prior to the date on which the board issues its order or decision upon the petition for redetermination.

60352. Oral hearing. If a petition for redetermination is filed within the 30-day period, the board shall reconsider the determination and, if the person has so requested in his or her petition, shall grant him or her an oral hearing and shall give 10 days' notice of the time and place of the hearing. Service of notice shall be as prescribed by Section 60173. The board may continue the hearing from time to time as may be necessary.

60353. Decrease or increase of determination. The board may decrease or increase the amount of the determination before it becomes final, but the amount may be increased only if a claim for the increase is asserted by the board at or before the hearing. Unless the penalty imposed by Section 60303, 60313, or 60361 applies to the amount of the determination as originally made or as increased, the claim for increase must be asserted within eight years after the date the return for the period for which the increase is asserted was due.

60354. Finality date of order or decision. The order or decision of the board upon a petition for redetermination becomes final 30 days after the giving of notice thereof to the person as prescribed by Section 60173.

60355. Due date; penalty. All determinations made by the board under this chapter are due and payable at the time they become final. If they are not paid when due and payable, a penalty of 10 percent of the amount of the determination, exclusive of interest and penalties, shall be added thereto. Payment shall be made in the form of a remittance payable to the board and shall be filed with the board together with a copy of the notice of determination which the board shall furnish to the person for that purpose.

60356. Offsets. In making a determination, the board may offset overpayments for a period or periods, together with interest on the overpayments, against underpayments for another period or periods, against penalties, and against the interest on the underpayments. The interest on the underpayments and overpayments shall be computed in the manner set forth in Sections 60314 and 60524.

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Article 6. Payment by Unlicensed Persons

60360. Immediate liability for tax. If any person becomes a supplier, exempt bus operator, government entity, qualified highway vehicle operator, or interstate user without first securing a license, the tax, and applicable penalties and interest, if any, become immediately due and payable on account of all diesel fuel removed, entered, sold, delivered, or used by him or her.

History.—Stats. 1995, Ch. 34, in effect June 30, 1995, but operative July 1, 1995, added "government entity," after "exempt bus operator,". Stats. 1995, Ch. 555, in effect January 1, 1996, substituted "user" for "trucker" after "or interstate". Stats. 2001, Ch. 429 (AB 309), in effect January 1, 2002, added "qualified" after "government entity," and deleted "end seller," after "highway vehicle operator".

60361. Penalty. (a) The board shall forthwith ascertain as best it may the amount of the diesel fuel removed, entered, sold, delivered, or used and shall determine immediately the tax on that amount, adding to the tax a penalty of 25 percent of the amount of tax or five hundred dollars ($500), whichever is greater, and shall give the unlicensed person notice of this determination as prescribed by Section 60340. However, where the board determines that the failure to secure a license was due to reasonable cause, the penalty may be waived. Sections 60331 and 60332 shall be applicable with respect to the finality of the determination and the right of the unlicensed person to petition for a redetermination.

Any person seeking to be relieved of the penalty shall file with the board a statement under penalty of perjury setting forth the facts upon which he or she bases the claim for relief.

(b) In any case where the board does not determine an amount of tax due, the unlicensed person shall be subject to a penalty of one hundred dollars ($100), which penalty shall be immediately due and payable. Each subsequent violation shall increase the penalty amount by one hundred dollars ($100), up to a maximum penalty of five hundred dollars ($500). The board shall serve the person with a notice of penalty assessment in the manner prescribed by Section 60340 for service of notice of a deficiency determination. However, if the board finds that the failure of the person to secure a license was due to reasonable cause, the board may waive the penalty. A person seeking to be relieved of the penalty shall file with the board a statement under penalty of perjury setting forth the facts upon which the request for relief is based.

History.—Stats. 1997, Ch. 620 (SB 1102), in effect January 1, 1998, added subdivision designation "(a)", substituted "60340" for "60173" after "prescribed by Section" in the first sentence of the first paragraph of subdivision (a), and added subdivision (b).

60361.5. Immediate liability for backup tax. (a) Except in the case of a qualified highway vehicle operator, the backup tax imposed under Section 60058 and any applicable penalties and interest shall be immediately due and payable. The board shall forthwith ascertain as best it may the amount of diesel fuel sold, or delivered into the fuel tank of a diesel fuel-powered highway vehicle, or sold and delivered into the fuel tank of a diesel fuel-powered highway vehicle, and shall determine immediately the tax on the amount and shall give the highway vehicle operator/fueler notice of this determination as prescribed by Section 60340. The determination shall include interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the last day of the month following the date the backup tax applies until the date of remittance to the state. The provisions of Sections 60331 and 60332 shall be applicable with respect to the finality of the determination and the right of the highway vehicle operator/fueler to petition for a redetermination.

(b) A penalty of 25 percent of the amount of tax or five hundred dollars ($500), whichever is greater, shall be added to the tax.

(c) If more than one of the penalties specified in this section and Section 60105, 60106.3, or 60503.2 is otherwise applicable, only the penalty totaling the greatest amount shall be imposed, and, the penalty specified in this section may be imposed only if the amount of penalty exceeds any other applicable penalty.

(d) Where the board determines that the sale, delivery into the fuel tank of a diesel fuel-powered highway vehicle, or sale and delivery into the fuel tank of a diesel fuel-powered highway vehicle of untaxed diesel fuel was 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 may be relieved of the penalty. A person seeking to be relieved of the penalty shall file with the board a statement under penalty of perjury setting forth the facts upon which the request for relief is based.

(e) All administrative provisions contained in this part that apply to a supplier shall also be applicable to a highway vehicle operator/fueler.

History.—Added by Stats. 2001, Ch. 429 (AB 309), in effect January 1, 2002. Stats. 2003, Ch. 62 (SB 600), effective January 1, 2004, substituted "Sections" for "Section" after "The provisions of" in the last sentence in subdivision (a); substituted "may" for "shall" after "the penalty specified in this section" in subdivision (c).

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60362. Seizure and sale of property. The board shall forthwith collect the tax, penalty, and interest due from the unlicensed person by seizure and sale of property in the manner prescribed for the collection of a delinquent monthly tax.

60363. Attorney General action. At the request of the board, the Attorney General shall commence and prosecute to final determination an action at law to collect the tax, penalty, and interest, or any part thereof, determined against an unlicensed person.

60364. Copy of determination. In the suit, a copy of the jeopardy determination certified by the board shall be prima facie evidence that the unlicensed person is indebted to the state in the amount of the tax, penalties, and interest computed as prescribed by Section 60339.

60365. Cumulative remedies. The foregoing remedies of the state are cumulative.

60366. Applicable penal provisions. No action taken pursuant to this article relieves the unlicensed person in any way from the penal provisions of this part.

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