AB 1412, as amended, Committee on Revenue and Taxation. Sales and use taxes: claim for refund: customer refunds.
Under the Sales and Use Tax Law, any amount collected or paid in excess of what is due under that law is required to be credited by the State Board of Equalization against any other amounts due and payable from the person from whom the excess amount was collected or by whom it was paid, and the balance refunded to the person, as provided. Under existing law, when an amount represented by a person to a customer as constituting reimbursement for taxes due under the Sales and Use Tax Law is computed upon an amount that is not taxable or is in excess of the taxable amount and is actually paid by the customer to the person, the amount paid is required to be returned by the person to the customer upon notification by the board or by the customer that this excess has been ascertained.
This bill would authorize a person to make an irrevocable election to assign to the customer the right to receive the amount that would be refunded to the person, provided specified conditions are met, and would authorize the board to make that payment to the customer.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 6901 of the Revenue and Taxation Code
2 is amended to read:
(a) If the board determines that any amount, penalty, or
4interest has been paid more than once or has been erroneously or
5illegally collected or computed, the board shall set forth that fact
6in the records of the board and shall certify the amount collected
7in excess of the amount legally due and the person from whom it
8was collected or by whom paid. The excess amount collected or
9paid shall be credited by the board on any amounts then due and
10payable from the person from whom the excess amount was
11collected or by whom it was paid under this part, and the balance
12shall be refunded to the person, or his or her successors,
13administrators, or executors, or customer as provided in subdivision
14(b), if a determination
by the board is made in any of the following
15cases:
16(1) Any amount of tax, interest, or penalty was not required to
17be paid.
18(2) Any amount of prepayment of sales tax, interest, or penalty
19paid pursuant to Article 1.5 (commencing with Section 6480) of
20Chapter 5 was not required to be paid.
21(3) Any amount that is approved as a settlement pursuant to
22Section 7093.5.
23(b) A person may make an irrevocable election to assign to the
24customer the right to receive the amount refunded if all of the
25following conditions are met:
26(1) Thebegin insert
entireend insert amount represents excess tax reimbursement that
27is required to be paid by the person tobegin delete theend deletebegin insert a singleend insert customer under
28Section 6901.5.
29(2) The amount to be refunded is fifty thousand dollars ($50,000)
30or greater.
31(2)
end delete
32begin insert(3)end insert The irrevocable
election to assign to the customer the amount
33refunded is evidenced by a statement signed by the person and the
34customer authorizing the named customer to receive the amount
35refunded.
P3 1(3)
end delete
2begin insert(4)end insert The signed statement is submitted to the board in conjunction
3with the person’s claim for refund.
4(c) Any overpayment of the use tax by a purchaser to a retailer
5who is required to collect the tax and who gives the purchaser a
6receipt therefor pursuant to Article 1 (commencing with Section
76201) of Chapter 3 shall be credited or refunded by
the state to the
8purchaser.
9(d) Any proposed determination by the board pursuant to this
10section with respect to an amount in excess of fifty thousand dollars
11($50,000) shall be available as a public record for at least 10 days
12prior to the effective date of that determination.
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