California Department of Tax and Fee Administration Audit

On: May 31, 2023

What do I need to respond to an audit notice?  You will need to review what tax year is involved in the audit, what issue is the focus, and what additional information you made need to provide to substantiate the entry on the tax return. Taxpayers will be notified how to contact the California Department of Tax and Fee Administration audit office. You can schedule appointments, review deadlines, review tax documents to support your position, and respond to resolve the audit issue.

Do I have taxpayer rights to protest the audit?  Yes, in California you have a Taxpayer’s Bill of Rights which is a protection of the rights, privacy, and property of all California taxpayers which gives you the right to protest, to appeal, to have a judicial review, to be represented by others, and pay no more than the correct amount you owe. A similar taxpayer bill of rights is used in all states and at the IRS.

What if I disagree with the notice sent to me?  Once you carefully review the letter or notice the Franchise Tax Board has sent to you, if you do not agree, respond directly to the office that tsent you the notice or letter stating the information you disagree with.  You must submit your response in the time frame given in the notice in order for the response to be received timely and allow for further review. You can mail or fax in your response, reply online, call to the office telephone number in the notice, or settle for making an appointment for an in-person meeting.

How do I submit an appeal?  To submit an appeal, you submit your letter to the Office of Tax Appeals and be sure to reply on or before the deadline date on your notice. Submit with your letter a copy of the notice that you are appealing. You can also use the Franchise Tax Board Form 1037 which is available from their website, to explain on what grounds you disagree with the determination.  Attach all substantiating documents with your letter in support of your appeal request. There is a specific office address where to mail your appeal, it is to Office of Tax Appeals, PO Box 989880, West Sacramento, CA 95798-9880. You can also fax your’ appeal request to 916-492-2089 or send an email to appeals@ota.ca.gov .

Where can I find an office? The California Tax and Fee Administration audit is done at a separate office from the central point for taxpayers in California where they file their individual state income tax returns, make payments for state income taxes due, or setup payment plans at the state level. California Department of Tax and Fee Administration does not accept California state income tax returns for individuals or businesses.  The California Tax and Fee Administration does have 21 locations where throughout the state taxpayers can receive help.

What is the Sales Tax Rate in California?  The California statewide tax rate is 7.25%. In most areas around California, local jurisdictions have added district taxes that increase the tax owed by a seller. Some of the external resources available in their website are the California Board of Equalization, The Employee Development Department, the Franchise Tax Board.  In this department website you can register for several different issues or exemptions. You can register for a permit, license, or account, apply for a fuel tax exemption, cigarette and tobacco distributors, wholesalers, manufacturers, and importers can register to do business in California. Beer and wine importers can also register, or you can do a search for a carrier or importer listing. For taxpayers, they can file a tax return, make a payment, prepay their tax bills, respond to a tax notice or letter online, request a sales tax clearance letter.