Appendices Taxpayers’ Bill of Rights Annual Report to the Legislature

Appendix 1

All tables in Appendix 1 reflect tax increase assessments only. The assessments became final in FY 2018/2019. We may have issued the assessments in prior years; however, due to cases in protest status, we did not resolve them until FY 2018/2019. Appendix 1 totals reflect rounded figures and may not compute exactly.

Table 1A Corporation Tax Law

NPAs Finalized in FY 2018/2019 Categorized by Primary Statute (Issue)
Issue Number of
NPAs
% Tax Assessed
(Millions)
% Average Assessment
Per NPA
Allocation/Apportionment 673 29.9 $307.6 79.8 $457,031
Assess Minimum Tax 41 1.8 0.0 0.0 795
Revenue Agent Reports 1,216 54.0 48.5 12.6 39,921
State Adjustments 73 3.2 9.5 2.5 130,552
Other 250 11.1 19.8 5.1 79,028
Totals/Average 2,253 100 $ 343.6 100 $ 118,478
  • Allocation/Apportionment involves corporations doing business within and outside of California.
  • Revenue Agent Reports typically result when California conforms to federal law, and a change to a taxpayer’s federal tax return applies to the taxpayer’s California tax return.
  • State Adjustments reflect the differences between the Internal Revenue Code and the California Revenue and Taxation Code.

Table 1B Personal Income Tax Law

NPAs Finalized in FY 2018/2019 Categorized by Primary Statute (Issue)
Issue Number of
NPAs
% Tax Assessed
(Millions)
% Average Assessment
Per NPA
CP2000 114,059 16.6 $103,433 4.9 $907
Filing Enforcement 484,899 70.6 1,620,617 77.1 3,342
Filing Status 6,078 0.9 8,986 0.4 1,478
Revenue Agent Reports 20,280 3.0 110,743 5.3 5,461
Other 61,262 8.9 257,433 12.3 4,202
Totals/Average 686,578 100 $2,101,212 100 $3,060
  • The CP2000 category results from the IRS comparing information documents that report income paid to individuals by third parties against income reported on their tax returns.
  • Filing Enforcement refers to assessments issued to individuals who have not filed a state income tax return after we notified them of their filing requirement.
  • Filing Status primarily reflects notices issued due to head of household adjustments.

Table 2 Corporation Tax Law

Corporations by Industry with NPAs Finalized in FY 2018/2019
Industry All Corporations
2017 Tax Year
% Corporations with NPAs % Tax Assessed(Millions) %
F.I.R.E.* 145,727 15.6 1 0.1 $0.0 0.0
Manufacturing 47,509 5.1 1 0.1 0.0 0.0
Services 496,001 52.9 3 0.2 0.0 0.0
Trade 126,571 13.5 4 0.3 0.0 0.0
Other** 120,403 12.9 1,204 99.3 385.4 100.0
Totals 936,211 100 1,213 100 $385.4 100

* Finance, insurance, real estate, and holding companies.

** Includes agriculture, construction, utilities, transportation, communication, information, and other industries not classified in this report.

For corporations not filing through a combined report, we base the industry designation on the corporation’s primary business activity in California. In the case of corporations filing through combined reports, we base the industry designation on the primary occupation of the group, not necessarily on the industry of the parent. If the parent is a holding company of a diverse group of subsidiary corporations, then we group it with finance, insurance, real estate, and holding companies.

Tables 3A, 3B, and 4, apply to either the taxable years for which we issued NPAs or the number of years for which a taxpayer receives Notices of Proposed Assessment because of multiple taxable year audits during the same audit cycle.

Table 3A Corporation Tax Law

NPAs Finalized in FY 2018/2019 Issued by Taxable Year
Average Taxable Year Number of
NPAs
% Tax Assessed
(Millions)
% Average Assessment
Per NPA
2011 and prior 422 18.7 $253.2 65.7 $600,085
2012 247 10.9 23.1 6.0 93,560
2013 495 22.0 42.1 10.9 84,982
2014 622 27.6 44.6 11.6 71,706
2015 337 15.0 15.9 4.1 47,030
2016 114 5.1 6.2 1.6 54,611
2017 and later 16 0.7 0.4 0.1 22,391
Totals/Average 2,253 100 $385.4 100 $171,081

Because the statute of limitations for assessing additional tax has passed, the earlier years reflect final figures.

Table 3B Corporation Tax Law

Multiple NPAs Finalized in FY 2018/2019 for the Same Taxpayer
Corporations With… Number of Taxpayers Tax Assessed (Millions) Average Assessment Per Taxpayer
One NPA 552 46.1 83,568
Two NPAs 404 123.7 306,226
Three NPAs 191 73.6 385,215
Four or more NPAs 66 142.0 2,151,893
Totals/Average 1,213 $385.4 $317,762

Table 4 Personal Income Tax Law

NPAs Finalized in FY 2018/2019 Issued by Taxable Year
Taxable Year Number of NPAs % Assessment Amount (Thousands) % Average Assessment Amount
2012 and prior 431,218 62.8 $1,582,616 75.3 $3,670
2013 5,644 0.8 52,743 2.5 9,345
2014 78,914 11.5 173,024 8.2 2,193
2015 170,802 24.9 292,828 13.9 1,714
2016 0 0.0 0 0.0 0
2017 and later 0 0.0 0 0.0 0
Totals/Average 686,578 100 $2,101,212 100 $3,060

Table 5 Personal Income Tax Law

Resident Tax Return Preparation, Process Years 2017 and 2018
Preparer 2017 Tax Returns Processed (Thousands) % 2018 Tax Returns Processed (Thousands) % % Change
Professional 10,778 64.9 11,866 67.8 2.9
Taxpayer 5,495 33.19 5,331 30.4 -2.7
VITA* 328 2.0 319 1.8 -0.2
Totals 16,601 100 17,516 100  

*Volunteer Income Tax Assistance is a program that provides tax return preparation assistance for seniors, disabled, non-English speaking, and those with limited or fixed incomes.

Table 6 e-file Tax Return and Electronic Payment Statistics

E-file Tax Return and Electronic Payment Statistics
Activities June 30, 2018 June 30, 2019 % Change
Individual Payments 5,453,000 5,848,000 7
Business Payments 833,000 1,052,000 26
Direct Deposit Refund 8,603,000 9,461,000 10
Individual e-file 16,482,000 16,941,000 3
** CalFile 143,000 122,000 -15
Business e-file 1,561,000 1,655,000 6

** We include these volumes in the e-file volume.

Table 7A Corporation Tax Law

Nonfilers Detected Through the Automated Nonfiler System
Fiscal Year Demands NPAs Issued
2008/2009 65,954 23,807
2009/2010 26,367 27,286
2010/2011 43,924 23,629
2011/2012 54,595 30,492
2012/2013 92,683 53,470
2013/2014 109,146 70,766
2014/2015 100,463 35,424
2015/2016 120,703 77,310
2016/2017 95,454 58,166
2017/2018 78,793 44,166
2018/2019 75,828 65,381

Table 7B Personal Income Tax Law

Nonfilers Detected Through the Automated Nonfiler System

Fiscal Year Demands/
Requests
NPAs Issued
2008/2009 1,222,050 849,650
2009/2010 1,243,842 706,104
2010/2011 1,067,776 774,627
2011/2012 1,043,258 689,165
2012/2013 1,003,994 625,018
2013/2014 900,194 579,296
2014/2015 910,828 592,071
2015/2016 886,328 644,479
2016/2017 831,646 400,028
2017/2018 861,376 750,007
2018/2019 360,821 265,201

Appendix 2

Table 8A Top Errors by Tax Return Type

July 1, 2018, through June 30, 2019
Code Code Description Grand Total 540 2EZ 540 540 NR 540 X
EP Estimate Payment Revised 221,278 4 189,088 27,921 4,265
GC Withholding Adjusted 170,090 4,969 132,263 31,030 1,828
WS Withhold at Source Revised 55,484 * 15,444 39,429 611
OC Estimated Tax Transfer Revised: Error Affected the Available Transfer Amount 48,852 * 38,146 10,705 *
BW Error Calculating Total Payments 45,207 303 44,795 109 *
OF Refund Reported on Amended Tax Return Does Not Match Original Tax Return 44,713 151 16,231 1,133 27,198
FM Dependent Exemption Disallowed Because Dependent’s ID Number Used On Another Tax Return 39,307 353 38,251 703 *
GF CA Tax Rate Incorrectly Calculated 32,596 * * 32,596 *
OM Amount Paid With Original Tax Return Plus Payments Made After Tax Return Filed Does Not Match Amount Claimed on Amended Tax Return 26,136 55 11,070 854 14,157
SS State Disability Insurance Revised 24,824 * 23,870 549 405
BK Error Transferring Deductions To Tax Return 18,349 * 16,812 1,225 312
BJ Math Error Made When Calculating CA Adjusted Gross Income 12,736 * 12,736 * *
EM Earned Income Tax Credit: Form Issue 12,729 1,564 10,482 145 538
GH Error Calculating CA Exemption Credit Percentage 11,711 * * 11,711 *
TC Tax Amount Revised 11,245 * 9,444 669 1,132
AC Incomplete Tax Return 10,174 436 8,657 1,068 13
BG Error Transferring Schedule CA Federal Adjusted Gross Income 10,038 * 10,038 * *
FK Dependent Exemption Disallowed Because Provided Dependent ID Was Invalid 9,770 187 8,171 1,412 *
BB Personal Exemptions Revised Based On Filing Status 9,347 * 7,725 1,622 *
KI Error Using 2EZ Table When Calculating Tax 8,173 8,173 * * *
Top Twenty 822,759 16,196 593,223 162,881 50,459
All Others 186,293 14,436 133,805 29,961 8,091
Grand Total 1,009,052 30,632 727,028 192,842 58,550

*Reflects fewer than three tax returns.

Table 8B Top Errors by Filing Method

July 1, 2018, through June 30, 2019
Code Code Description Grand Total Electronic Paper
EP Estimate Payment Revised 221,278 174,653 46,625
GC Withholding Adjusted 170,090 133,182 36,908
WS Withhold at Source Revised 55,484 42,510 12,974
OC Estimated Tax Transfer Revised: Error Affected the Available Transfer Amount 48,852 35,151 13,701
BW Error Calculating Total Payments 45,207 44,158 1,049
OF Refund Reported on Amended Tax Return Does Not Match Original Tax Return 44,713 2,805 41,908
FM Dependent Exemption Disallowed Because Dependent’s ID Number Used On Another Tax Return 39,307 19,176 20,131
GF CA Tax Rate Incorrectly Calculated 32,596 8,909 23,687
OM Amount Paid With Original Tax Return Plus Payments Made After Tax Return Filed Does Not Match Amount Claimed on Amended Tax Return 26,136 1,352 24,784
SS State Disability Insurance Revised 24,824 20,061 4,763
Top Ten 708,487 481,957 226,530
All Others 300,565 86,899 213,666
Grand Total 1,009,052 568,856 440,196

*Reflects fewer than three tax returns.

Appendix 3

Regulation Section 17951-7 and 25137(e) – 1031 Exchanges

On June 27, 2013, the California Legislature enacted AB 92. (Stats. 2013, Ch. 26.) Under AB 92, for tax years beginning on or after January 1, 2014, taxpayers who perform IRC Section 1031 exchanges of property located in California for property located outside of California are required to file an annual information return with FTB for each year in which the gain or loss from that exchange has not been recognized. (Refer to R&TC Sections 18032 and 24953.) AB 92 reflects existing California law requiring taxpayers to recognize deferred gains/losses associated with IRC Section 1031 exchanges of property located in California as California source income; however, as a result of the new reporting requirement, FTB has received numerous requests for clarification of the determination of California source income in such exchanges.

For personal income tax, R&TC Section 17954 specifically authorizes FTB to issue regulations for allocating and apportioning gross income from sources within and without California for the purposes of computing taxable income of nonresidents and part-year residents under paragraph (1) of subdivision (i) of R&TC Section 17041.

FTB also has authority for corporate franchise and income tax taxpayers to require alternative apportionment formulas where the standard allocation and apportionment provisions of the Uniform Division of Income for Tax Purposes Act (UDITPA) do not fairly represent the extent of the taxpayer’s business activity in this state. (R&TC Section 25137).

The purpose of this regulation project is to: (1) clarify the sourcing of deferred gains/losses from IRC Section 1031 exchanges of property located in California; and (2) determine which year’s apportionment factor(s) should be applied to deferred gains/losses from IRC Section 1031 exchanges for apportioning taxpayers.

Staff held an interested parties meeting on February 3, 2016, to discuss multiple scenarios regarding the sourcing and factors for 1031 exchanges. Staff anticipates drafting language and holding another interested parties meeting in 2020.

Regulation Section 18001- Other State Tax Credit

Pursuant to R&TC Section 18001, California allows a credit against the net tax for net income taxes imposed by and paid to another state on specified income. Under R&TC Section 18001 the payment of tax to a sister state is generally eligible for an Other State Tax Credit (OSTC) only where the other state’s tax is a net income tax.

The purpose of this regulation project is to elicit public input on the potential adoption of a regulation which would clarify the statutory term "net income taxes paid to another state" for purposes of the OSTC.

On December 10, 2018, the three-member Board approved staff’s request to begin the informal regulatory process. Staff held a first interested parties meeting on August 7, 2019, to receive public input on the issue.  

Regulation Section 18567 - Automatic Extension of Time for Filing Tax Returns by Partnerships

California Code of Regulations, Title 18, Section 18567 (Automatic Extension Regulation) was adopted on October 12, 2001, to provide an automatic paperless extension for a tax return required to be filed by an individual, fiduciary, or partnership, if the tax return is filed within the extension period. Subsequent to its adoption, FTB staff determined that the Automatic Extension Regulation required updating, to provide consistency with the authority granted by the California Legislature in 2017, to extend the automatic extension period to seven months for a tax return filed by a partnership, or by a limited liability company (LLC) that is classified as a partnership for California tax purposes. Accordingly, the purpose of this regulation project is to provide consistency with the statutory authority granted by the Legislature and provide clarity to taxpayers and tax preparers that the automatic extension period is seven months for a tax return filed by a partnership or an LLC that is classified as a partnership for California tax purposes, for taxable years beginning on or after January 1, 2017, while the extension period for an individual or fiduciary tax return remains six months.

Staff received permission to proceed to the formal regulatory process at the Franchise Tax Board meeting on December 7, 2017. Staff anticipates publishing the Notice of Proposed Rulemaking in late 2019.

Regulation Section 18662-0 through 18662-6 and 18662-8 – Withholding

The purpose of this proposed regulatory item is to amend California Code of Regulations (CCR), Title 18, Sections 18662-0 through 18662-6, and Section 18662-8 (withholding regulations), to make various technical changes to the withholding regulations, including changes to terminology in the current regulatory language and line items on the withholding forms. Specifically, planned amendments include, but are not limited to:

  • Clarifying the process by which a waiver is requested using California Form 588, Nonresident Withholding Waiver Request;
  • Clarifying the threshold requirements (Part IV, Withholding Computation) for California Form 589, Nonresident Reduced Withholding Request;
  • Within the withholding regulations, adding a new term, “remitter,” to the definition section (Regulation Section 18662-2), and revising the definition of “withholding agent” and other terms as necessary in the definition section;
  • Clarifying the process by which a promoter may qualify for an exemption if certain requirements are met;
  • Within the withholding regulations, adding total sales price and ownership percentage fields to California Form 593, Real Estate Withholding Statement, which is proposed because these additions will make the audit process more accurate;
  • Within the withholding regulations, clarifying the modified information return penalty amounts in R&TC Section 19183 as per AB 154 (Stats. 2015, Ch. 359);
  • Within the withholding regulations, detailing that Form 593 will now include elements of the following forms which will no longer exist: California Form 593-I, Real Estate Withholding Installment Sale Acknowledgement, California Form 593-C, Real Estate Withholding Certificate, and California Form 593-E, Real Estate Withholding Computation of Estimated Gain or Loss;
  • Within the withholding regulations, changing the terms “alternate withholding calculation” and “optional gain on sale” to the term “alternative withholding calculation”;
  • Clarifying and correcting the person responsible for withholding during an installment sale (buyer is responsible for withholding, not the real estate escrow person);
  • Within the withholding regulations, changing the term “California tax” to “resident and/or nonresident tax” in Regulation Section 18662-8;
  • Clarifying what can or cannot be filed electronically;
  • Within the withholding regulations, making other grammatical and technical changes as necessary.

Staff held interested parties meetings on October 12, 2015, and July 11, 2016. Staff received permission to proceed to the formal regulatory process at the Franchise Tax Board meeting on April 13, 2017. The Notice of Proposed Rulemaking was published on November 16, 2018. A 15-day notice of amendments to the text of the proposed regulations was published on April 24, 2019. A second 15-day notice of amendments to the text of the proposed regulations was published on July 3, 2019. The amended regulations were filed with the Secretary of State’s Office, and became effective on October 8, 2019.

Regulation Section 18662-7 – Withholding on Domestic Pass-through Entities

The purpose of this proposed regulation is to revise existing withholding on pass-through entities to reflect current statutory requirements under R&TC Section 18662. In particular, the purpose of this regulation is to modify the withholding on pass-through entities to consider withholding on the “distributive share” of income.

There are two reasons supporting this modification. First, R&TC Section 18662, subdivision (a) and (b), authorizes FTB to require a pass-through entity to withhold on “items of income,” including “partnership income or gains.” Requiring a pass-through entity to withhold on a nonresident partner or member’s “distributive share” of the pass-through entity’s income is consistent with Section 18662, subdivision (a) and (b), because the withholding amount is determined by the pass-through entity’s income rather than distributions made. Second, FTB staff has found that a vast majority of the states have switched to requiring pass-through entities to withhold on “distributive share” of income. Modifying California’s pass-through entity withholding to be consistent with the rest of the states will lessen the burden on out-of-state pass-through entities that are required to comply with multiple state withholding schemes.

A secondary purpose behind this proposed regulation is to adopt a withholding scheme that best resolves the issues arising from the allocation of withholding.

Specifically, pass-through entities have difficulty in filing timely forms to allocate withholding through multiple tiers. This results in the ultimate individual partners or members being denied a claimed withholding credit because the withholding has not been properly allocated.

Staff held interested parties meetings on December 12, 2014, and September 8, 2017. Staff noticed amended proposed regulation draft language in a ninety-day notice on March 15, 2019. Staff anticipates requesting permission from the three-member Board to proceed to the formal regulatory process in late 2019.

Regulation Sections 23038-1 through 23038-5 – Check the Box

On January 1, 1997, the IRS issued regulations designated 26 Code of Federal Regulations Sections 301.7701-1 through 301.7701-3, commonly called the “check-the-box” regulations. These regulations provided rules for the classification of business entities for federal tax purposes.

In 1997, the California R&TC was amended to state in part that the classification of a BE shall be determined under regulations of FTB, which shall be consistent with the new federal regulations. FTB adopted regulations implementing this legislation which were designated CCR, Title 18, Sections 23038(b)-1 through 23038(b)-3.

This proposed rulemaking action would make California’s regulations consistent with the applicable federal regulations.

Staff held interested parties meetings on January 11, 2016, and August 3, 2016. Staff received permission to proceed to the formal regulatory process at the Franchise Tax Board meeting on December 8, 2016. The Notice of Proposed Rulemaking was published on May 11, 2018. On May 20, 2019, the Office of Administrative Law approved the rulemaking and submitted the regulations to the Secretary of State’s Office for filing.  The amended regulations became effective on July 1, 2019.

Regulation Section 23663 – Assignment of Credits to Combined Group Members

a. Regulation Section 23663-1 through 5

R&TC Section 23663 permits the assignment of credits among affiliated members of the same combined reporting group. In some situations taxpayers have made defective elections to assign credits under this section. Because the assignment election is irrevocable, taxpayers are left with uncertainty regarding the allocation of credits which are the subject of a defective election, as well as having no clear recourse to correct a defective election. Therefore, the purpose of the proposed regulations is to give taxpayers certainty as to how credits are allocated when a defective election occurs. The proposed regulations also give taxpayers flexibility in determining how credits are allocated when there is agreement between the parties involved in the defective election. Finally, the proposed regulations give taxpayers one year to correct certain errors in defective elections.

Staff held three interested parties meetings for the defective election regulation project and received positive feedback from attendees and other interested parties.

On December 4, 2014, the three-member Board granted permission for the proposed regulations to proceed with the formal regulatory process. The Notice of Proposed Rulemaking was published on November 24, 2017. On September 18, 2018, the Office of Administrative Law approved the rulemaking and submitted the regulations to the Secretary of State’s Office for filing. The regulations were filed with the Secretary of State’s Office, and became effective on September 18, 2018.

b. Regulation Section 23663-6

Staff began a separate regulation project for Section 23663 to clarify when an eligible assignee is properly treated as being in the same combined reporting group as an assignor. This clarification is important since a requirement to assign credits under Section 23663 is that the assignee be in the same combined reporting group as the assignor. The regulation project includes providing related guidance on reorganizations and other corporate restructuring, such as transactions in which tax attributes, including credits, would survive.

On June 12, 2014, the same date that staff held the third interested parties meeting for the previously completed defective election regulation project at Regulation sections 23663-1 through 23663-5, staff also held the first interested parties meeting for this project, during which general structural issues for the regulation were discussed. Staff held a second interested parties meeting on June 12, 2018, to present draft regulatory language for public comment. Staff received permission to proceed to the formal regulatory process at the Franchise Tax Board meeting on September 21, 2018. Staff anticipates publishing the Notice of Proposed Rulemaking in late 2019.

Regulation Section 25136-2 – Market Based Rules for Sales Other Than Sales of Tangible Personal Property

For tax years beginning on or after January 1, 2011, R&TC Section 25136 provides the sales factor numerator assignment rules for all sales other than sales of tangible personal property. R&TC Section 25136, subdivision (b), provides the market-based rules for assignment of sales of other than sales of tangible personal property where taxpayers have made a single-sales factor election.

CCR, Title 18, Section 25136-2 (which became effective on March 27, 2012, and operative for tax years beginning on or after January 1, 2011) provides cascading rules for sales of services and sales of intangible property. In those rules, there are specific provisions for assignment of sales of stock or interests in a pass-through entity and for the incorporation of the special industry rules under CCR Section 25137, including those for mutual fund providers under CCR Section 25137-14.

Staff held an interested parties meeting on January 20, 2017, to elicit public input on further amendments to Section 25136-2, regarding benefit of the service received, asset management fees, government contracts, reasonable approximation, dividends, freight forwarding, and other issues. Staff held additional interested parties meetings on June 16, 2017, May 18, 2018, and July 19, 2019, to present draft amendments. A fifth interested parties meeting is expected to be held in 2020.

Regulation Section 25137 – Alternative Apportionment Method Petition Procedures

R&TC Section 25137 states that when the standard allocation and apportionment provisions of the UDITPA (R&TC Sections 25120-25139) do not fairly represent the extent of a taxpayer’s business activity in this state, the taxpayer may petition for the use of an alternative method to accomplish an equitable allocation or apportionment of income to this state. In recent years, the number of taxpayers seeking to utilize alternative apportionment methodologies under the authority of R&TC Section 25137 has increased. This proposed rulemaking project would provide guidance to assist taxpayers with submitting petitions for relief under R&TC Section 25137.

On July 12, 2016, the three-member Board gave permission for staff to move forward with the informal regulatory process. Staff held an interested parties meeting on June 30, 2017, and held a second interested parties meeting on November 28, 2018. Staff is currently drafting proposed regulatory amendments with an expected third interested parties meeting to be held in late 2019.

Regulation Sections 25137-1 and 17951-4 – Apportionment and Allocation of Partnership Income

When a taxpayer subject to the corporation tax law is a partner in a partnership as defined in R&TC Section 17008, the computation of its distributive share of partnership items is determined in accordance with Chapter 10 of Part 10 of Division 2 of the R&TC. The portion of such distributive share (constituting business and nonbusiness income) that has its source in this state, or that is included in the taxpayer’s business income, is determined in accordance with CCR, Title 18, Section 25137-1 (the “partnership regulation”), which was first promulgated in 1972 and last amended in 1985.

The partnership regulation has generally functioned well over the years, but the passage of time has rendered some of its provisions out-of-date and new business models have arisen that the regulation does not address. For these reasons, FTB staff has studied the regulation and identified several issues that it believes should give rise to consideration of amending the regulation.

On November 28, 2007, staff received permission from the three-member Board to hold an interested parties meeting to address numerous issues identified by staff. Staff held an interested parties meeting on September 19, 2008. On October 18, 2013, staff held a second interested parties meeting to discuss proposed amendments to the regulation. On July 8, 2014, staff held a third interested parties meeting to discuss a revision of the proposed amendments and solicit input on any other issues that might need to be addressed.

On September 30, 2014, staff received approval from the three-member Board to proceed with the formal regulation process. The Notice of Proposed Rulemaking was published on November 3, 2017, and a Public Regulation Meeting was held December 18, 2017. A 15-day Notice of amendments to the text of the proposed regulations was published on February 15, 2018, noticing the excision of a previously proposed amendment to Regulation section 17951-4. At the April 12, 2018, Franchise Tax Board meeting, the three-member Board instructed staff by formal motion to excise the proposed amendment. On November 20, 2018, the Office of Administrative Law approved the rulemaking and submitted the regulations to the Secretary of State’s Office for filing. The amended regulations became effective on January 1, 2019.