California Code of Regulations
Title 18 - Public Revenues
Division 5 - California Department of Tax and Fee Administration
Chapter 1 - Appeals
Article 2a - Petitioning Notices of Determination
Section 35017 - Review of a Petition by the Assigned Section

(a) The assigned section must review the petition, notice of determination, and all other relevant information available to it in reaching findings on behalf of BTFD, subject to the oversight of the Deputy Director.

(b) The assigned section may refer the petition to the CDTFA office or section that issued the notice being petitioned for further investigation and comment, but any findings resulting from such referral are tentative and subject to review by the assigned section. The assigned section will promptly notify the taxpayer of such a referral, provide assistance needed to complete the investigation, monitor the progress of the CDTFA office or other section to which the petition is referred, and respond to the taxpayer's requests for updates regarding such progress.

(c) Where the assigned section, or the CDTFA office or other section to whom the petition is referred, believes additional documentary evidence is needed as support for the petition for redetermination, it will contact the petitioner and request such information. The failure to provide such information upon request may result in the assigned section's conclusion that the petition for redetermination should be denied.

(d) The assigned section must look for consistency, adequacy of procedures, proper application of law, and consideration of any recent law or regulatory changes or precedential opinions from the Office of Tax Appeals that may affect the audit or investigation findings, where appropriate.

(e) Upon completion of the review, the assigned section will mail the taxpayer a letter to advise the taxpayer of its findings.

(f) Where the findings of the assigned section are that all matters put into dispute by the petition should be resolved in the taxpayer's favor, the assigned section will mail the taxpayer a letter notifying the taxpayer of the assigned section's findings and advising that, except as provided in subdivision (j), the appeal will be resolved in accordance with those findings unless, within 30 days of the date of the letter, the taxpayer advises the assigned section that its findings do not resolve all matters and that some matter remains in dispute.

(g) If, within 30 days of a letter issued pursuant to subdivision (f), the taxpayer responds advising the assigned section that some matter remains in dispute, the assigned section will consider the remaining dispute. If the assigned section's findings are that the dispute should be resolved in the taxpayer's favor, the assigned section will mail a letter notifying the taxpayer of those findings and advising that, except as provided in subdivision (j), the appeal will be resolved in accordance with those findings. Otherwise, the provisions of subdivision (h) are applicable.

(h) Where the findings of the assigned section are that some or all of the matters put into dispute by the petition should not be resolved in the taxpayer's favor and the taxpayer has not previously requested an appeals conference, the assigned section will mail the taxpayer a letter notifying the taxpayer of the assigned section's findings and advising that, except as provided in subdivision (j), the appeal will be resolved in accordance with those findings unless, within 30 days of the date of that letter, the taxpayer makes a written request to the assigned section for an appeals conference. If the taxpayer submits a written request within 30 days for an appeals conference, the appeal will be forwarded to the Appeals Bureau for the scheduling of an appeals conference; otherwise, unless an appeals conference is requested by another party as provided in subdivision (j), the appeal will be resolved in accordance with the assigned section's findings as stated in its letter to the taxpayer. However, the Deputy Director may, in the Deputy Director's sole discretion, reinstate an appeal if, before the taxpayer's Notice of Redetermination is issued, the taxpayer submits a written request for an appeals conference and documentation that establishes that the taxpayer was unavailable (e.g., out of town, hospitalized, or incarcerated) to reply to the assigned section's letter within the 30 days allowed and the taxpayer submitted the request for an appeals conference within 30 days of the date the taxpayer became available.

(i) Where the findings of the assigned section are that some or all of the matters put into dispute by the petition should not be resolved in the taxpayer's favor and the taxpayer had previously requested an appeals conference, the assigned section will mail a letter to the taxpayer either advising the taxpayer that the appeal will be forwarded to the Appeals Bureau for the scheduling of an appeals conference, or requesting the taxpayer to confirm its prior request for an appeals conference.

(j) Where a state agency other than CDTFA is a party to the appeal and the findings of the assigned section are in favor of the taxpayer and adverse to the state agency, in whole or in part, the state agency may request an appeals conference. The state agency must submit its written request for appeals conference to the assigned section within 30 days of any letter mailed pursuant to this regulation notifying the taxpayer of the assigned section's findings that the taxpayer's appeal should be granted, in whole or in part. Where a state agency makes such a timely written request for an appeals conference, the assigned section will forward the appeal to the Appeals Bureau for the scheduling of an appeals conference.

(k) If the assigned section determines that a cancellation, including an adjustment, in excess of $50,000 should be granted, the fact that CDTFA will cancel or adjust such amount must be available as a public record for at least 10 days after the effective date of the determination.