(a) The Franchise Tax Board may abate, upon written request by a qualified entity, unpaid qualified taxes, interest, and penalties for the taxable years in which the qualified entity certifies, under penalty of perjury, that it was not doing business, within the meaning of subdivision (a) of Section 23101, has ceased doing business, and does not have any remaining assets in the business.
(b) For purposes of this section:
(1) “Qualified entity” means a domestic corporation subject to Division 1 (commencing with Section 100) of Title 1 of the Corporations Code or a domestic limited liability company subject to Title 2.6 (commencing with Section 17701.01) of the Corporations Code that satisfies either of the following conditions:
(A) Was never doing business, within the meaning of subdivision (a) of Section 23101, in this state at any time after the time of its incorporation in this state.
(B) Was previously doing business, within the meaning of subdivision (a) of Section 23101, and has filed all returns required under Section 18601, 18633, or 18633.5 for the tax years prior to cessation of doing business.
(2) “Qualified taxes, interest, and penalties” means tax imposed under Section 17941 or 23153, and associated interest and penalties, and any penalties imposed under Section 19141. “Qualified taxes, interest, and penalties” does not include tax imposed under Section 17942, 23501, or 23731, or associated interest or penalties, and does not include additional tax, penalties, or interest resulting from a final or pending state or federal audit.
(c) In no instance shall the taxes abated pursuant to subdivision (a) exceed the minimum or annual tax imposed under Section 17941 or 23153.
(d) A qualified entity shall establish that it has ceased all business operations and has no remaining assets at the time of filing the request for abatement pursuant to this section.
(e) The abatement of unpaid qualified tax, interest, and penalties pursuant to this section is conditioned on the dissolution of a corporation or the cancellation of a limited liability company of the qualified entity with the Secretary of State prior to the abatement.
(f) (1) The Franchise Tax Board may prescribe any regulations that may be necessary or appropriate to implement the purposes of this section.
(2) Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code shall not apply to any standard, criterion, procedure, determination, rule, notice, or guideline established or issued by the Franchise Tax Board pursuant to this section.
(Added by Stats. 2018, Ch. 679, Sec. 3. (AB 2503) Effective January 1, 2019.)
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