AB 1397

Bill Subjects

Administration Of Income Taxes Electronic Remittance Penalty

Abstract

Existing law requires the Franchise Tax Board to administer and enforce the Personal Income Tax Law and the Corporation Tax Law and requires a payment required of an individual pursuant to those provisions to be electronically remitted to the Franchise Tax Board in the form and manner prescribed by the board if any of certain conditions are met, including that the total tax liability exceeds $80,000. Existing law requires a taxpayer required to electronically remit payment pursuant to that provision who makes payment by other means to pay a penalty of 1% of the amount paid, unless it is shown that the failure to make payment as required was for reasonable cause and was not the result of willful neglect. This bill would cap the amount of the 1% penalty described above at $25,000 per payment. The bill would apply that cap to a payment made on or after January 1, 2024, and to a payment made before January 1, 2024, that is, or may be, the subject of a timely filed protest or claim for refund. This bill would also make findings and declarations related to a gift of public funds.