The new state Office of Tax Appeals (OTA) began hearing appeals cases as of January 1, 2018. California taxpayers may file an appeal with the OTA after receiving a Notice of Action or Notice of Determination from the Franchise Tax Board (FTB) or the new California Department of Tax and Fee Administration (CDTFA) with an appeal deadline. Appeals will be heard by three-member panels of Administrative Law Judges in Sacramento, Fresno, and Los Angeles. Draft emergency regulations governing the appeals process are available here: https://ota.ca.gov/draft-emergency-regulations/
As we inch closer to the January 1, 2018 official changeover of many responsibilities from the Board of Equalization to California's two new tax agencies (the Department of Tax and Fee Administration [TFA], and the Office of Tax Appeals [OTA]), legislators are refining and narrowing the details of future responsibilities and processes for taxpayers to avail themselves of these administrative bodies.
On Tuesday, June 27, 2017, California Governor Jerry Brown signed into law the Taxpayer Transparency and Fairness Act of 2017. Sweeping changes to the administration of taxes and fees formerly administered by the Board of Equalization take effect on July 1, 2017. A new Office of Tax Appeals will begin hearing tax appeals of California income tax, sales tax, use tax, hazardous waste fees, and other taxes and fees effective January 1, 2018. The rules and regulations that will govern the two newly created state agencies remain a work in progress. For more information, click here.
The Taxpayer Transparency and Fairness Act of 2017, which will create two new entities (the California Department of Tax and Fee Administration and the Office of Tax Appeals) to take over most of the California State Board of Equalization's functions, has passed both the Assembly and the Senate and was presented to Governor Brown on June 21, 2017. Once approved by the Governor, the bill will take effect on July 1, 2017. Keep track of developments in the bill process here.
The Board of Equalization is attempting to respond to the California Legislature's mandate to turn over most of its authority to two newly created agencies, the California Department of Tax and Fee Administration, and a Department of Administrative Tax Appeals. It's obvious that the short time frame and political climate have the Board of Equalization members and management scrambling to meet the July 1, 2017 deadline for most of the changes to occur. The Governor is expected to sign the Taxpayer Transparency and Fairness Act of 2017 into law any day now.