California Tax Administration, Procedure, and Appeals
Administrative process
Candidates must understand the lifecycle of a California tax matter: assessment, notice, protest, appeal, and collection. Know the roles of the Franchise Tax Board (income taxes) and the California Department of Tax and Fee Administration (sales and use taxes), and the Board of Equalization's limited role.
Key concepts
Understand the protest deadlines, the difference between an appeal to the Office of Tax Appeals and a court action, and the statute of limitations on assessments and refunds. Know the rules for innocent spouse relief, offers in compromise, and installment agreements. Familiarize yourself with penalties and interest, and the procedures for requesting a collection due process hearing.
Traps
Frequently tested: missing the protest deadline forfeits the appeal, and the statute of limitations differs for fraud versus ordinary assessments. Questions may confuse the Office of Tax Appeals with the Board of Equalization.
Rule of thumb
File a protest within the deadline stated on the notice, or the assessment becomes final.
Worked example
A taxpayer receives a notice of proposed assessment with a 30-day protest window. If the taxpayer does not protest within 30 days, the assessment becomes final and the taxpayer must pay or pursue collection alternatives.