Cal. RTC § 19551.1 — California Code / Code rtc / Division 2 / Part 10.2 / Chapter 7 / Article 2 / Section 19551.1
Section 19551.1
Status: in_force

(a) (1) The Franchise Tax Board may permit the tax officials of any city, county, or city and county to enter into a reciprocal agreement with the Franchise Tax Board to obtain tax information from the Franchise Tax Board, as specified in subdivision (b).

(2) For purposes of this section, “reciprocal agreement” means a formal agreement to exchange information for tax administration purposes between tax officials of a city, county, or city and county, and the Franchise Tax Board.

(b) The information furnished to tax officials of a city, county, or city and county under this section shall be limited as follows:

(1) The tax officials of a city, county, or city and county are authorized to receive information only with respect to taxpayers with an address as reflected on the Franchise Tax Board’s records within the jurisdictional boundaries of the city, county, or city and county who report income from a trade or business to the Franchise Tax Board.

(2) The tax information that may be provided by the Franchise Tax Board to a city, county, or city and county is limited to a taxpayer’s name, address, social security or taxpayer identification number, and business activity code.

(3) Tax information provided to the taxing authority of a city, county, or city and county shall not be furnished to, or used by, any person other than an employee of that taxing authority and shall be utilized in a form and manner to safeguard the tax information as required by the Franchise Tax Board, including, but not limited to:

(A) The completion of a data exchange security questionnaire provided by the Franchise Tax Board prior to approval of a data exchange by the Franchise Tax Board.

(B) The tax official of a city, county, or city and county shall allow for an onsite safeguard review conducted by the Franchise Tax Board.

(C) The completion of disclosure training provided by the Franchise Tax Board and a confidentiality statement signed by all employees with access to information provided by the Franchise Tax Board confirming the requirement of data security with respect to that information and acknowledging awareness of penalties for unauthorized access or disclosure under Sections 19542 and 19552 of this code and Section 502 of the Penal Code.

(D) The tax official of a city, county, or city and county shall notify the Franchise Tax Board within 24 hours upon discovery of any incident of unauthorized or suspected unauthorized access or disclosure of the tax information and provide a detailed report of the incident and the parties involved.

(E) All records received by the tax officials of a city, county, or city and county shall be destroyed in a manner to make them unusable or unreadable so an individual record may no longer be ascertained in a timeframe specified by the Franchise Tax Board.

(4) The information provided to the tax officials of the city, county, or city and county by the Franchise Tax Board under this section is subject to Section 19542, and may not be used for any purpose other than the city, county, or city and county’s tax enforcement, or as otherwise authorized by state or federal law.

(5) Section 19542.1 applies to this section.

(c) The Franchise Tax Board may not provide any information pursuant to this section until all of the following have occurred:

(1) An agreement has been executed between a city, county, or city and county and the Franchise Tax Board, that provides that an amount equal to all first year costs necessary to furnish the city, county, or city and county information pursuant to this section shall be received by the Franchise Tax Board before the Franchise Tax Board incurs any costs associated with the activity permitted by this section. For purposes of this section, first year costs include costs associated with, but not limited to, the purchasing of equipment, the development of processes, and labor.

(2) An agreement has been executed between a city, county, or city and county and the Franchise Tax Board, that provides that the annual costs incurred by the Franchise Tax Board, as a result of the activity permitted by this section, shall be reimbursed by the city, county, or city and county to the Franchise Tax Board.

(3) Pursuant to the agreement described in paragraph (1), the Franchise Tax Board has received an amount equal to the first year costs.

(d) Any information, other than the type of tax information specified in subdivision (b), may be requested by the tax officials of a city, county, or city and county from the Franchise Tax Board by affidavit. At the time a tax official makes the request, he or she shall provide the person whose information is the subject of the request, with a copy of the affidavit and, upon request, make the information obtained available to that person.

(e) This section does not invalidate any other law. This section does not preclude any city, county, or city and county from obtaining information about individual taxpayers, including those taxpayers not subject to this section, by any other means permitted by state or federal law.

(f) Nothing in this section shall be construed to affect any obligations, rights, or remedies regarding personal information provided under state or federal law.

(g) Notwithstanding subdivision (c), the Franchise Tax Board shall waive a city, county, or city and county’s reimbursement of the Franchise Tax Board’s cost if a city, county, or city and county enters into a reciprocal agreement as defined in paragraph (2) of subdivision (a). The reciprocal agreement shall specify that each party shall bear its own costs to furnish the data involved in the exchange authorized by this section and Section 19551.5, and a city, county, or city and county shall be precluded from obtaining reimbursement as specified under Section 5 of the act adding this subdivision.