California Revenue and Taxation Code

§ 19777

RTC § 19777 Effective Jan 1, 2023Div. 2 · Part 10.2 · Ch. 9.5 · Art. 4

Statute text

(a)If a taxpayer has been contacted by the Franchise Tax Board regarding an abusive tax avoidance transaction, and has a deficiency attributable to an abusive tax avoidance transaction, there shall be added to the tax an amount equal to 100 percent of the interest payable under Section 19101 for the period beginning on the last date prescribed by law for the payment of that tax, determined without regard to extensions, and ending on the date the notice of proposed assessment is mailed.

(b)For purposes of this section, “abusive tax avoidance transaction” means any of the following:

(1)A tax shelter as defined in Section 6662(d)(2)(C) of the Internal Revenue Code, relating to reduction not to apply to tax shelters. For purposes of this chapter, Section 6662(d)(2)(C) of the Internal Revenue Code is modified by substituting the phrase “income or franchise tax” for “Federal income tax.”

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Legislative history

Amended by Stats. 2022, Ch. 28, Sec. 148. (SB 1380) Effective January 1, 2023.