Law:Division 6. Withholding Tax On Wages (California)

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Contents

Chapter 1. General Provisions

Ca Codes (uic:13000-13019) Unemployment Insurance Code Section 13000-13019



13000. The department shall have the powers and duties necessary to administer the reporting, collection, refunding to the employer, and enforcement of taxes required to be withheld by employers pursuant to Section 13020, except as otherwise provided by this division.


13001. The definitions set forth in Sections 126, 127, 129, 133, 134, and 144 shall apply to this division.


13002. The following provisions of this code shall apply to any amount required to be deducted, reported, and paid to the department under this division: (a) Sections 301, 305, 306, 310, 311, 312, 317, and 318, relating to general administrative powers of the department. (b) Sections 403 to 413, inclusive, Section 1336, and Chapter 8 (commencing with Section 1951) of Part 1 of Division 1, relating to appeals and hearing procedures. (c) Sections 1110.6, 1111, 1111.5, 1112, 1113, 1113.1, 1114, 1115, 1116, and 1117, relating to the making of returns or the payment of reported contributions. (d) Article 8 (commencing with Section 1126) of Chapter 4 of Part 1 of Division 1, relating to assessments. (e) Article 9 (commencing with Section 1176), except Section 1176, of Chapter 4 of Part 1 of Division 1, relating to refunds and overpayments. (f) Article 10 (commencing with Section 1206) of Chapter 4 of Part 1 of Division 1, relating to notice. (g) Article 11 (commencing with Section 1221) of Chapter 4 of Part 1 of Division 1, relating to administrative appellate review. (h) Article 12 (commencing with Section 1241) of Chapter 4 of Part 1 of Division 1, relating to judicial review. (i) Chapter 7 (commencing with Section 1701) of Part 1 of Division 1, relating to collections. (j) Chapter 10 (commencing with Section 2101) of Part 1 of Division 1, relating to violations.


13003. (a) Except where the context otherwise requires, the definitions set forth in this chapter, and in addition the definitions and provisions of the Personal Income Tax Law referred to and hereby incorporated by reference as set forth in the following provisions of the Revenue and Taxation Code, shall apply to and govern the construction of this division: (1) "Corporation" as defined by Section 17009. (2) "Fiduciary" as defined by Section 17006. (3) "Fiscal year" as defined by Section 17011. (4) "Foreign country" as defined by Section 17019. (5) "Franchise Tax Board" as defined by Section 17003. (6) "Husband" and "wife" as defined by Section 17021. (7) "Individual" as defined by Section 17005. (8) "Military or naval forces" as defined by Section 17022. (9) "Nonresident" as defined by Section 17015. (10) "Partnership" as defined by Section 17008. (11) "Person" as defined by Section 17007. (12) "Resident" as defined by Sections 17014 and 17016. (13) "State" as defined by Section 17018. (14) "Taxable year" as defined by Section 17010. (15) "Taxpayer" as defined by Section 17004. (16) "Trade or business" as defined by Section 17020. (17) "United States" as defined by Section 17017. (b) The provisions of Part 10 (commencing with Section 17001) and Part 10.2 (commencing with Section 18401) of Division 2 of the Revenue and Taxation Code, relating to the following items, are hereby incorporated by reference and shall apply to and govern construction of this division: (1) Trade or business expense (Article 6 (commencing with Section 17201) of Chapter 3 of Part 10). (2) Deductions for retirement savings (Article 6 (commencing with Section 17201) of Chapter 3 of Part 10). (3) Distributions of property by a corporation to a shareholder (Chapter 4 (commencing with Section 17321) of Part 10). (4) Deferred compensation (Chapter 5 (commencing with Section 17501) of Part 10). (5) Partners and partnerships (Chapter 10 (commencing with Section 17851) of Part 10). (6) Gross income of nonresident taxpayers Chapter 11 (commencing with Section 17951) of Part 10). (7) Postponement of the time for certain acts by individuals in or in support of the armed forces (Article 3 (commencing with Section 18621) of Chapter 2 of Part 10.2). (8) Disclosure of information (Article 2 (commencing with Section 19542) of Chapter 7 of Part 10.2). For this purpose "Franchise Tax Board" as used therein shall mean the Employment Development Department in respect to information obtained in the administration of this division.

13004. "Employee" means a resident individual who receives remuneration for services performed within or without this state or a nonresident individual who receives remuneration for services performed within this state and includes an officer, employee, or elected official of the United States, a state, territory, or any political subdivision thereof, or any agency or instrumentality of any one or more of the foregoing. "Employee" also includes an officer of a corporation. Whether an individual provides equipment in the performance of services for remuneration shall not be considered in a determination of whether that individual is an employee.


13004.1. "Employee" does not include any individual if all of the following conditions exist: (a) The individual is licensed pursuant to the provisions of Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code and is performing services in the capacity of a licensee, or the individual is engaged in the trade or business of primarily in-person demonstration and sales presentation of consumer products, including services or other intangibles, in the home or sales to any buyer on a buy-sell basis, a deposit-commission basis, or any similar basis, for resale by the buyer or any other person in the home or otherwise than in a retail or wholesale establishment. (b) Substantially all of the remuneration (whether or not paid in cash) for the services performed by that individual is directly related to sales or other output (including the performance of services) rather than to the number of hours worked by that individual. (c) The services performed by the individual are performed pursuant to a written contract between that individual and the person for whom the services are performed and the contract provides that the individual will not be treated as an employee with respect to those services for state tax purposes.

13004.5. (a) "Employee" also means any individual who is an employee pursuant to Section 2750.5 of the Labor Code, of a person who holds a valid state contractor's license pursuant to Chapter 9 (commencing with Section 7000) of Division 3 of the Business and Professions Code. (b) When subdivision (a) does not apply, "employee" shall also mean any individual who is an employee, pursuant to Section 2750.5 of the Labor Code, of a person who is required to obtain a valid state contractor's license pursuant to Chapter 9 (commencing with Section 7000) of Division 3 of the Business and Professions Code.


13005. (a) "Employer" means any individual, person, corporation, association, partnership, or limited liability company, or any agent thereof, doing business in this state, deriving income from sources within this state, or in any manner whatsoever subject to the laws of this state, the State of California or any political subdivision or agency thereof, including the Regents of the University of California, any city organized under a freeholders' charter, or any political body not a subdivision or agency of the state, and any person, officer, employee, department, or agency thereof, making payment of wages to employees for services performed within this state, except as provided in subdivision (b). (b) If the employer, as defined in subdivision (a), for whom the employee performs or performed the service does not have control of the payment of wages for such services, "employer" (except for purposes of Section 13009) means the person having control of the payment of such wages, whether or not the person having control of the payment of such wages is subject to the jurisdiction of the laws of this state.


13005.7. An employment agency, as defined in paragraph (3) of subdivision (a) or (h) of Section 1812.501 of the Civil Code shall not be deemed the employer of the domestic worker for whom it procures, offers, refers, provides, or attempts to provide work if all of the factors set forth in Section 687.2 exist.


13006. "Gross income" means all compensation for services including fees, commissions, and similar items, except as otherwise provided by this division. "Gross income" shall specifically include those items relating to compensation specified by Article 2 (commencing with Section 17081) of, and shall specifically exclude those items relating to compensation specified by Article 3 (commencing with Section 17131) of, Chapter 3 of Part 10 of Division 2 of the Revenue and Taxation Code.


13007. "Miscellaneous payroll period" means a payroll period other than a daily, weekly, biweekly, semimonthly, monthly, quarterly, semiannual, or annual payroll period.


13008. "Payroll period" means a period for which a payment of wages is ordinarily made to the employee by his or her employer.


13009. "Wages" means all remuneration, other than fees paid to a public official, for services performed by an employee for his or her employer, including all remuneration paid to a nonresident employee for services performed in this state, and the cash value of all remuneration paid in any medium other than cash, except as provided by this section. "Wages" includes tips received by an employee in the course of his or her employment. The wages shall be deemed to be paid at the time a written statement including tips is furnished to the employer pursuant to Section 13055 or, if no statement including those tips is so furnished, at the time received. "Wages" includes compensation, that is deductible under Section 162 of the Internal Revenue Code, paid to a member of a limited liability company filing a federal corporate income tax return. "Wages" shall not include remuneration paid under any of the following conditions: (a) For agricultural labor, as defined in subdivision (g) of Section 3121 of the Internal Revenue Code. (b) For domestic service in a private home, local college club, or local chapter of a college fraternity or sorority. (c) For service not in the course of the employer's trade or business performed in any calendar quarter by an employee, unless the cash remuneration paid for that service is fifty dollars ($50) or more and the service is performed by an individual who is regularly employed by the employer to perform the service. For purposes of this subdivision, an individual shall be deemed to be regularly employed by an employer during a calendar quarter only if either of the following conditions is met: (1) On each of some 24 days during the quarter, the individual performs for the employer for some portion of the day service not in the course of the employer's trade or business. (2) The individual was regularly employed, as determined under paragraph (1), by the employer in the performance of the service during the preceding calendar quarter. (d) For services by a citizen or resident of the United States for a foreign government or an international organization. (e) For services performed by a nonresident alien individual as designated by regulations prescribed by the department. (f) For services performed by a duly ordained, commissioned, or licensed minister of a church in the exercise of his or her ministry or by a member of a religious order in the exercise of duties required by the order. (g) (1) For services performed by an individual under the age of 18 years in delivery or distribution of newspapers or shopping news, not including delivery or distribution to any point for subsequent delivery or distribution. (2) For services performed by an individual in, and at the time of, the sale of newspapers or magazines to ultimate consumers, under an arrangement under which the newspapers or magazines are to be sold by him or her at a fixed price, his or her compensation being based on the retention of the excess of the price over the amount at which the newspapers or magazines are charged to him or her whether or not he or she is guaranteed a minimum amount of compensation for the services, or is entitled to be credited with the unsold newspapers or magazines turned back. (h) For services not in the course of the employer's trade or business, to the extent paid in any medium other than cash. (i) To, or on behalf of, an employee or his or her beneficiary under any of the following situations: (1) From or to a trust which is exempt from tax under Section 17631 of the Revenue and Taxation Code at the time of payment, unless the payment is made to an employee of the trust as remuneration for services rendered as an employee and not as a beneficiary of the trust. (2) Under or to an annuity plan which, at the time of payment, is a plan qualified pursuant to Chapter 5 (commencing with Section 17501) of Part 10 of Division 2 of the Revenue and Taxation Code. (3) Under or to a bond purchase plan which, at the time of payment, is a bond purchase plan qualified pursuant to Chapter 5 (commencing with Section 17501) of Part 10 of Division 2 of the Revenue and Taxation Code. (4) For a payment which qualifies for deduction by an employee pursuant to Section 219 of the Internal Revenue Code if, at the time of payment, it is reasonable to believe that the employee will be entitled to a deduction under that section for payment. (5) Under a cafeteria plan (within the meaning of Section 125 of the Internal Revenue Code). (j) To a master, officer, or any other seaman who is a member of a crew on a vessel engaged in foreign, coastwise, intercoastal, interstate, or noncontiguous trade. (k) Pursuant to any provision of law other than Section 5(c) or 6 (l) of the Peace Corps Act, for service performed as a volunteer or volunteer leader within the meaning of that act. (l) In the form of group-term life insurance on the life of an employee. (m) To or on behalf of an employee, and to the extent that, at the time of the payment of remuneration it is reasonable to believe that a corresponding deduction is allowable for moving expenses pursuant to Article 6 (commencing with Section 17201) of Chapter 3 of Part 10 of Division 2 of the Revenue and Taxation Code. (n) (1) As tips in any medium other than cash. (2) As cash tips to an employee in any calendar month in the course of his or her employment by an employer, unless the amount of the cash tips is twenty dollars ($20) or more. (o) For service performed by an individual on a boat engaged in catching fish or other forms of aquatic animal life under an arrangement with the owner or operator of the boat pursuant to which all of the following apply: (1) The individual does not receive any cash remuneration, other than as provided in paragraph (2). (2) The individual receives a share of the boat's (or the boats' in the case of a fishing operation involving more than one boat) catch of fish or other forms of aquatic animal life or a share of the proceeds from the sale of the catch. (3) The amount of the individual's share depends on the amount of the boat's (or the boats' in the case of a fishing operation involving more than one boat) catch of fish or other forms of aquatic animal life. This subdivision shall apply only where the operating crew of the boat (or each boat from which the individual receives a share in the case of a fishing operation involving more than one boat) is normally made up of fewer than 10 individuals. (p) For any medical care reimbursement made to, or for the benefit of, an employee under a self-insured medical reimbursement plan pursuant to Section 105(h)(6) of the Internal Revenue Code. (q) To, or on behalf of, an employee to the extent not includable in gross income pursuant to Section 13006. (r) For services to which Section 633 applies.


13009.5. (a) For purposes of the report required by subdivision (a) of Section 1088 and the statement required by Section 13050, "wages subject to personal income tax" means all of the following: (1) Remuneration defined as wages by Section 13009, except that in the case of tips received by an employee in the course of his or her employment, the amounts shall include only those tips included in statements furnished to the employer, pursuant to Section 13055. (2) Remuneration described in subdivisions (a), (b), (f), and (l) of Section 13009, to the extent included in gross income. (3) Payments made by a third party for sick pay as specified in Section 931.5. (A) Any employer who receives a report of wages from a third-party payer as provided for in subdivisions (a) and (b) of Section 931.5 shall report those wages to the department as required under paragraph (2) of subdivision (a) of Section 1088. (B) Any third-party payer described in Section 931.5 who fails to report wages to an employer as provided for in that section shall report those wages to the department as required under paragraph (2) of subdivision (a) of Section 1088. (b) (1) A person or entity shall not be required to register with the Employment Development Department solely for the purpose of reporting wages subject to personal income tax pursuant to Section 1088 unless that registration is otherwise required by this code. (2) A person or entity shall not be required to withhold any tax under Section 13020 for wages, as defined by this section, unless that person or entity is required to withhold tax for those wages as defined by Section 13009.

13010. "Withholding agent" means any person required to deduct and withhold any tax under the provisions of Section 13020.


13011. The department shall retain the possession and control of all records, papers, offices, equipment, supplies, moneys, funds, appropriations, land, and other property real or personal held for the benefit or use of the Franchise Tax Board in the performance of the duties, powers, purposes, responsibilities, and jurisdiction of the Franchise Tax Board that were previously delegated by Section 15702.1 of the Government Code and that are vested in the department by Section 13000.


13013. All regulations heretofore adopted by the Franchise Tax Board pursuant to powers transferred to the department by this division and in effect immediately preceding the operative date of this division, shall remain in effect and shall be fully enforceable unless and until readopted, amended, or repealed by the director.


13014. This division does not apply to the payment of interest obligations not taxable under this division.


13015. The department is authorized to require such information with respect to persons subject to the taxes imposed by this division as is necessary or helpful in securing proper identification of such persons.

13016. When necessary to make effective the provisions of this division, the name and address of the recipient of income shall be furnished upon demand of the person paying the income.


13017. Unless otherwise specifically provided, the provisions of any law effecting changes in withholding under this division shall begin in the manner set forth by Section 18665 of the Revenue and Taxation Code.

13018. (a) Except as otherwise provided by this division or other express provision of law, the information furnished or secured pursuant to this division shall be used solely for the purpose of administering the tax laws or other laws administered by the person or agency obtaining it. Any willful unauthorized inspection or unwarranted disclosure or use of the information by the person or agency, or the employees and officers thereof, is a misdemeanor. For purposes of this section, "inspection" means any examination of confidential information furnished or secured pursuant to this division. (b) The department shall notify a taxpayer of any known incidents of willful unauthorized inspection or unwarranted disclosure or use of the taxpayer's confidential tax records, but only if criminal charges have been filed for the willful unauthorized inspection or unwarranted disclosure.


13019. (a) (1) With respect to tax advice, the protections of confidentiality that apply to a communication between a client and an attorney, as set forth in Article 3 (commencing with Section 950) of Chapter 4 of Division 8 of the Evidence Code, also shall apply to a communication between a taxpayer and any federally authorized tax practitioner to the extent the communication would be considered a privileged communication if it were between a client and an attorney. (2) Paragraph (1) may only be asserted in any noncriminal tax matter before the Employment Development Department. (3) For purposes of this section: (A) "Federally authorized tax practitioner" means any individual who is authorized under federal law to practice before the Internal Revenue Service if the practice is subject to federal regulation under Section 330 of Title 31 of the United States Code, as provided by federal law as of January 1, 2000. (B) "Tax advice" means advice given by an individual with respect to a state tax matter, which may include federal tax advice if it relates to the state tax matter. For purposes of this subparagraph, "federal tax advice" means advice given by an individual within the scope of his or her authority to practice before the federal Internal Revenue Service on noncriminal tax matters. (C) "Tax shelter" means a partnership or other entity, any investment plan or arrangement, or any other plan or arrangement if a significant purpose of that partnership, entity, plan, or arrangement is the avoidance or evasion of federal income tax. (b) The privilege under subdivision (a) shall not apply to any written communication between a federally authorized tax practitioner and a director, shareholder, officer, or employee, agent, or representative of a corporation in connection with the promotion of the direct or indirect participation of the corporation in any tax shelter, or in any proceeding to revoke or otherwise discipline any license or right to practice by any governmental agency. (c) This section shall be operative for communications made on or after the effective date of the act adding this section.


Chapter 2. Withholding And Payment Of Tax

Ca Codes (uic:13020-13031) Unemployment Insurance Code Section 13020-13031



13020. (a) (1) Every employer who pays wages to a resident employee for services performed either within or without this state, or to a nonresident employee for services performed in this state, shall deduct and withhold from those wages, except as provided in subdivision (c) and Sections 13025 and 13026, for each payroll period, a tax computed in that manner as to produce, so far as practicable, with due regard to the credits for personal exemptions allowable under Section 17054 of the Revenue and Taxation Code, a sum which is substantially equivalent to the amount of tax reasonably estimated to be due under Part 10 (commencing with Section 17001) of Division 2 of the Revenue and Taxation Code resulting from the inclusion in the gross income of the employee of the wages which were subject to withholding. The method of determining the amount to be withheld shall be prescribed by the Franchise Tax Board pursuant to Section 18663 of the Revenue and Taxation Code. (2) For each payroll period ending on or after November 1, 2009, the sum shall comport with the changes made to Section 18663 of the Revenue and Taxation Code, by the act adding this paragraph. (b) The department upon request may permit the use of accounting machines to calculate the proper amount to be deducted and withheld from wages, if the calculation produces an amount substantially equivalent to the amount of tax required to be withheld under subdivision (a). (c) Withholding shall not be required by this section with respect to wages, salaries, fees, or other compensation paid by a corporation for services performed in California for that corporation to a nonresident corporate director for director services, including attendance at a board of directors' meeting.


13021. (a) Every employer required to withhold any tax under Section 13020 shall for each calendar quarter, whether or not wages or payments are paid in the quarter, file a withholding report, a quarterly return, as prescribed in subdivision (a) of Section 1088, and a report of wages in a form prescribed by the department, and pay over the taxes so required to be withheld. The report of wages shall include individual amounts required to be withheld under Section 13020 or withheld under Section 13028. Except as provided in subdivisions (c) and (d), the employer shall file a withholding report, a quarterly return, as prescribed in subdivision (a) of Section 1088, and a report of wages, and remit the total amount of income taxes withheld during the calendar quarter on or before the last day of the month following the close of the calendar quarter. (b) Every employer electing to file a single annual return under subdivision (d) of Section 1110 shall report and pay any taxes withheld under Section 13020 on an annual basis within the time specified in subdivision (d) of Section 1110. (c) (1) Effective January 1, 1995, whenever an employer is required, for federal income tax purposes, to remit the total amount of withheld federal income tax in accordance with Section 6302 of the Internal Revenue Code and regulations thereunder, and the accumulated amount of state income tax withheld is more than five hundred dollars ($500), the employer shall remit the total amount of income tax withheld for state income tax purposes within the number of banking days as specified for withheld federal income taxes by Section 6302 of the Internal Revenue Code, and regulations thereunder. (2) Effective January 1, 1996, the five hundred dollar ($500) amount referred to in paragraph (1) shall be adjusted annually as follows, based on the annual average rate of interest earned on the Pooled Money Investment Fund as of June 30 in the prior fiscal year: Average Rate of Interest Greater than or equal to 9 percent: $ 75 Less than 9 percent, but greater than or equal 250 to 7 percent: Less than 7 percent, but greater than or equal 400 to 4 percent: Less than 4 percent: 500 (d) (1) Notwithstanding subdivisions (a) and (c), for calendar years beginning prior to January 1, 1995, if in the 12-month period ending June 30 of the prior year the cumulative average payment made pursuant to this division or Section 1110, for eight-month periods, as defined under Section 6302 of the Internal Revenue Code and regulations thereunder, was fifty thousand dollars ($50,000) or more, the employer shall remit the total amount of income tax withheld within three banking days following the close of each eight-month period, as defined by Section 6302 of the Internal Revenue Code and regulations thereunder. For purposes of this subdivision, payment shall be made by electronic funds transfer in accordance with Section 13021.5, for one calendar year beginning on January 1. Payment is deemed complete on the date the electronic funds transfer is initiated if settlement to the state's demand account occurs on or before the banking day following the date the transfer is initiated. If settlement to the state's demand account does not occur on or before the banking day following the date the transfer is initiated, payment is deemed complete on the date settlement occurs. The department shall, on or before October 31 of the prior year, notify all employers required to make payment by electronic funds transfer of these requirements. (2) Notwithstanding subdivisions (a) and (c), for calendar years beginning on or after January 1, 1995, if in the 12-month period ending June 30 of the prior year, the cumulative average payment made pursuant to this division or Section 1110 for any deposit periods, as defined under Section 6302 of the Internal Revenue Code and regulations thereunder, was twenty thousand dollars ($20,000) or more, the employer shall remit the total amount of income tax withheld within the number of banking days as specified for federal income taxes by Section 6302 of the Internal Revenue Code and regulations thereunder. For purposes of this subdivision, payment shall be made by electronic funds transfer in accordance with Section 13021.5, for one calendar year beginning on January 1. Payment is deemed complete on the date the electronic funds transfer is initiated if settlement to the state's demand account occurs on or before the banking day following the date the transfer is initiated. If settlement to the state's demand account does not occur on or before the banking day following the date the transfer is initiated, payment is deemed complete on the date settlement occurs. The department shall, on or before October 31 of the prior year, notify all employers required by this paragraph to make payments by electronic funds transfer of these requirements. (3) Notwithstanding paragraph (2), effective January 1, 1995, electronic funds transfer payments that are subject to the one-day deposit rule, as defined by Section 6302 of the Internal Revenue Code and regulations thereunder, shall be deemed timely if the payment settles to the state's demand account within three banking days after the date the employer meets the threshold for the one-day deposit rule. (4) Any taxpayer required to remit payments pursuant to paragraphs (1) and (2) may request from the department a waiver of those requirements. The department may grant a waiver only if it determines that the particular amounts paid in excess of fifty thousand dollars ($50,000) or twenty thousand dollars ($20,000), as stated in paragraphs (1) and (2), respectively, were the result of an unprecedented occurrence for that employer, and were not representative of the employer's cumulative average payment in prior years. (5) Any state agency required to remit payments pursuant to paragraphs (1) and (2) may request a waiver of those requirements from the department. The department may grant a waiver if it determines that there will not be a negative impact on the interest earnings of the General Fund. If there is a negative impact to the General Fund, the department may grant a waiver if the requesting state agency follows procedures designated by the department to mitigate the impact to the General Fund. (e) Any employer not required to make payment pursuant to subdivision (d) of this section may elect to make payment by electronic funds transfer in accordance with Section 13021.5 under the following conditions: (1) The election shall be made in a form, and shall contain information, as prescribed by the director, and shall be subject to approval by the department. (2) If approved, the election shall be effective on the date specified in the notification to the employer of approval. (3) The election shall be operative from the date specified in the notification of approval, and shall continue in effect until terminated by the employer or the department. (4) Funds remitted by electronic funds transfer pursuant to this subdivision shall be deemed complete in accordance with subdivision (d) or as deemed appropriate by the director to encourage use of this payment method. (f) Notwithstanding Section 1112, no interest or penalties shall be assessed against any employer who remits at least 95 percent of the amount required by subdivision (c) or (d) if the failure to remit the full amount is not willful and any remaining amount due is paid with the next payment. The director may allow any employer to submit the amounts due from multiple locations upon a showing that those submissions are necessary to comply with subdivision (c) or (d). (g) The department may, if it believes that action is necessary, require any employer to make the report or return required by this section and pay to it the tax deducted and withheld at any time, or from time to time but no less frequently than provided for in subdivision (a). (h) Any employer required to withhold any tax and who is not required to make payment under subdivision (c) shall remit the total amount of income tax withheld during each month of each calendar quarter, on or before the 15th day of the subsequent month if the income tax withheld for any of the three months or, cumulatively for two or more months, is three hundred fifty dollars ($350) or more. (i) For purposes of subdivisions (a), (c), and (h), payment is deemed complete when it is placed in a properly addressed envelope, bearing the correct postage, and it is deposited in the United States mail. (j) (1) In addition to the withholding report, quarterly return, and report of wages described in subdivision (a), each employer shall file with the director an annual reconciliation return showing the amount required to be withheld under Section 13020, and any other information the director shall prescribe. This annual reconciliation return shall be due on the first day of January following the close of the prior calendar year and shall become delinquent if not filed on or before the last day of that month. (2) The requirement to file the annual reconciliation return for the prior calendar year under this subdivision shall not apply to the 2012 calendar year and thereafter. (k) The requirement in subdivision (a) to file a quarterly return shall begin with the first calendar quarter of the 2011 calendar year.

13021.5. (a) "Electronic funds transfer" means any transfer of funds, other than a transaction originated by check, draft, or similar paper instrument, that is initiated through an electronic terminal, telephonic instrument, or computer or magnetic tape, so as to order, instruct, or authorize a financial institution to debit or credit an account. Electronic funds transfers shall be accomplished by an automated clearinghouse debit, an automated clearinghouse credit, Fedwire, or by other specific electronic funds transfer methods approved in advance by the department. (b) "Automated clearinghouse" means any federal reserve bank, or an organization established in agreement with the National Automated Clearing House Association, that operates as a clearinghouse for transmitting or receiving entries between banks and/or bank accounts and which authorizes an electronic transfer of funds between those banks or bank accounts. (c) "Automated clearinghouse debit" means a transaction in which the state, through its designated depository bank, originates an automated clearinghouse transaction debiting the employer's bank account and crediting the state's bank account for the amount of tax. Banking costs incurred for the automated clearinghouse debit transaction shall be paid by the state. (d) "Automated clearinghouse credit" means an automated clearinghouse transaction in which the employer through its own bank, originates an entry crediting the state's bank account and debiting its own bank account. Banking costs incurred for the automated clearinghouse credit transaction charged to the employer and to the state shall be paid by the employer. (e) "Fedwire" means any transaction originated by the employer and utilizing the national electronic payment system to transfer funds through the federal reserve banks, pursuant to which the employer debits its own bank account and credits the state's bank account. Electronic funds transfer payments may be made by Fedwire only if prior approval is obtained from the department and payment cannot, for good cause, be made pursuant to subdivision (a). Banking costs incurred for the Fedwire transaction charged to the employer and to the state shall be paid by the employer. (f) "Banking day" means any day other than a Saturday, Sunday, or banking holiday as recognized by the Internal Revenue Service. (g) "Settlement date" means the date on which an exchange of funds with respect to an entry is reflected on the books of the Federal Reserve Bank. (h) For the purposes of Section 13021, the "cumulative average payment" means the cumulative dollar amount of deposits divided by the number of payments submitted during a given period. For the purposes of this section, the "cumulative average payment" may also be defined as a single annual deposit, when only one payment is made during the 12-month period ending June 30.


13022. In determining the amount to be deducted and withheld under Section 13020, the wages may, at the election of the employer, be computed to the nearest dollar.


13023. The department may, by regulation, permit employers to estimate the wages which will be paid to any employee in any quarter of the calendar year, to determine the amount to be deducted and withheld upon each payment of wages to such employee during such quarter as if the appropriate average of the wages so estimated constituted the actual wages paid, and to deduct and withhold upon any payment of wages to such employee, during such quarter such amount as may be necessary to adjust the amount actually deducted and withheld upon the wages of such employee during such quarter to the amount that would be required to be deducted and withheld during such quarter if the payroll period of the employee were quarterly.


13024. The department may provide by authorized regulation, under such conditions and to such extent as it deems proper, for withholding in addition to that otherwise required under Section 13020 in cases in which the employer and employee agree to such additional withholding. Such additional withholding shall for all purposes be considered a tax required to be deducted and withheld under this division.


13025. In the case of remuneration paid in any medium other than cash for services performed by an individual as a retail salesperson for a person where the service performed by such individual for such person is ordinarily performed for remuneration solely by way of cash commission an employer shall not be required to deduct or withhold any tax under this division with respect to such remuneration, if such employer files with the department such information with respect to such remuneration as the department may prescribe by regulation.


13026. An employer shall not be required to deduct and withhold any tax under this division upon a payment of wages (except wages exempt from federal income tax but not exempt under this division) to an employee if there is in effect with respect to such payment a withholding exemption certificate, in such form and containing such other information as the department may prescribe, furnished to the employer by the employee certifying that the employee-- (a) Incurred no liability for federal income tax imposed under subtitle A of the Internal Revenue Code of 1954 for his or her preceding taxable year, and (b) Anticipates that he or she will incur no liability for federal income tax imposed under subtitle A of the Internal Revenue Code of 1954 for his or her current taxable year.

13027. In the case of tips which constitute wages, subdivision (a) of Section 13020 shall be applicable only to such tips as are included in a written statement furnished to the employer pursuant to Section 13055, and only to the extent that the tax can be deducted and withheld by the employer, at or after the time such statement is so furnished and before the close of the calendar year in which such statement is furnished, from such wages of the employee (excluding tips, but including funds turned over by the employee to the employer for the purpose of such deduction and withholding) as are under the control of the employer. An employer who is furnished by an employee a written statement of tips (received in a calendar month) pursuant to Section 13055 to which paragraph (2) of subdivision (n) of Section 13009 is applicable may deduct and withhold the tax with respect to such tips from any wages of the employee (excluding tips) under his or her control, even though at the time such statement is furnished the total amount of the tips included in statements furnished to the employer as having been received by the employee in such calendar month in the course of his or her employment by the employer is less than twenty dollars ($20). Such tax shall not at any time be deducted and withheld in any amount which exceeds the aggregate of such wages and funds.


13028. (a) For purposes of this division (and so much of Part 10 (commencing with Section 17001) and Part 10.2 (commencing with Section 18401) of Division 2 of the Revenue and Taxation Code as relates to this division) pensions, annuities, and other deferred income, as described in Section 3405 of the Internal Revenue Code, are wages and subject to withholding under this division. Amounts withheld shall be treated as if the amounts are withheld by an employer for a payroll period and only amounts withheld shall be reported to the department pursuant to Section 1088 and Section 13021. (b) If an individual makes an election under Section 3405(a)(2) or Section 3405(b)(2) of the Internal Revenue Code not to have tax withheld, that election shall apply to withholding under this division, unless the individual elects, with the consent of the payer, to have those payments subject to withholding under this division. If an individual has not made an election under Section 3405(a)(2) or Section 3405(b)(2) of the Internal Revenue Code, that individual may elect to exclude those payments from withholding under this division. Elections provided in this subdivision shall be made pursuant to regulations of the director. (c) Where Section 3405 of the Internal Revenue Code provides that tables or other computational procedures shall be prescribed by the Secretary of the Treasury, for the purposes of this division, any of the following amounts may be withheld, upon election of the payer: (1) An amount determined by the method prescribed under Section 13020. (2) A designated dollar amount as requested by the payee. (3) Ten percent of the amount of federal withholding computed pursuant to Section 3405 of the Internal Revenue Code. (d) Where the amount of withholding computed pursuant to subdivision (c) is less than ten dollars ($10) per month, the payer shall not be required to withhold that amount. (e) This section shall not apply to pensions, annuities, and other deferred income of payees with addresses outside this state, as shown on the most current records of the payer. (f) The department shall, in consultation with the affected payers and payees, issue regulations to implement this section. Those regulations shall provide for delay (but not beyond July 1, 1987) of the application of this section with respect to any payer or class of payers until that time as the payers are able to comply without undue hardship with the requirements of this section. In that case, no retroactive compliance shall be required.


13028.1. If the director determines that nonpayment of tax by a nonresident under the income tax laws of this state may occur, the director shall notify the payer of payments described in subdivision (a) of Section 13028 that withholding shall be made from those payments. Upon notice from the director, the payer shall withhold from those payments as if they were subject to Section 13020. The director shall also notify the payee that withholding has been ordered pursuant to this section, and the reason for his or her determination that nonpayment of tax may occur.


13028.5. (a) For purposes of this division (and so much of Part 10 (commencing with Section 17001) and Part 10.2 (commencing with Section 18401) of Division 2 of the Revenue and Taxation Code as relates to this division) any supplemental unemployment compensation benefit paid to an individual shall be treated as if it were a payment of wages by an employer to an employee for a payroll period. (b) For purposes of subdivision (a), "supplemental unemployment compensation benefits" means amounts which are paid to an employee, pursuant to a plan to which the employer is a party, because of an employee's involuntary separation from employment (whether or not that separation is temporary), resulting directly from a reduction in force, the discontinuance of a plant or operation, or other similar conditions, but only to the extent those benefits are includable in the employee's gross income.


13028.6. (a) For purposes of this division (and so much of Part 10 (commencing with Section 17001) and Part 10.2 (commencing with Section 18401) of Division 2 of the Revenue and Taxation Code as relates to this division), any payment to an individual of sick pay which does not constitute wages (determined without regard to this subdivision), if at the time the payment is made a request that such sick pay be subject to withholding under this division is in effect, shall be treated as if it were a payment of wages by an employer to an employee for a payroll period. (b) For purposes of this subdivision, "sick pay" means any amount which satisfies both of the following: (1) Is paid to an employee pursuant to a plan to which the employer is a party. (2) Constitutes remuneration or a payment in lieu of remuneration for any period during which the employee is temporarily absent from work on account of sickness or personal injuries. (c) If a payee makes a request that any sick pay be subject to withholding under this chapter, the amount to be deducted and withheld under this chapter from any payment to which that request applies shall be an amount (not less than a minimum amount determined by the Franchise Tax Board) specified by the payee in that request. The amount deducted and withheld with respect to a payment which is greater or less than a full payment shall bear the same relation to the specified amount as that payment bears to a full payment. (1) A request that any sick pay be subject to withholding under this chapter shall satisfy all of the following: (A) Shall be made by the payee in writing to the person making the payments and shall contain the social security number of the payee. (B) Shall specify the amount to be deducted and withheld from each full payment. (C) Shall take effect with respect to payments made more than seven days after the date on which that request is furnished to the payer, or as the department shall by regulations prescribe. That request may be changed or terminated by furnishing to the person making the payments a written statement of change or termination which shall take effect in the same manner as provided in the preceding sentence. At the election of the payer, any such request (or statement of change or revocation) may take effect earlier than as provided in this subparagraph. (2) Any sick pay paid pursuant to a collective bargaining agreement between employee representatives and one or more employers which contains a provision specifying that this paragraph is to apply to sick pay paid pursuant to that agreement and contains a provision for determining the amount to be deducted and withheld from each payment of that sick pay as follows: (A) The requirement of paragraph (3) of subdivision (a) that a request for withholding be in effect shall not apply. (B) Except as provided in Section 13026, the amounts to be deducted and withheld under this chapter shall be determined in accordance with that agreement. The preceding sentence shall not apply with respect to sick pay paid pursuant to any agreement to any individual, unless the social security number of that individual is furnished to the payer and the payer is furnished with that information as is necessary to determine whether the payment is pursuant to the agreement and to determine the amount to be deducted and withheld.


13029. The department may by authorized regulations provide for withholding-- (a) From remuneration for services performed by an employee for his or her employer which (without regard to this section) does not constitute wages, and (b) From any other type of payment with respect to which the department finds that withholding would be appropriate under the provisions of this division, if the employer and the employee, or in the case of any other type of payment the person making and the person receiving the payment, agree to the withholding. The agreement shall be made in the form and manner as the department may by authorized regulations provide. For purposes of this division (and so much of Part 10 (commencing with Section 17001) and Part 10.2 (commencing with Section 18401) of Division 2 of the Revenue and Taxation Code as relates to this division) remuneration or other payments with respect to which the agreement is made shall be treated as if they were wages paid by an employer to an employee to the extent that the remuneration is paid or other payments are made during the period for which the agreement is in effect.


13030. If wages are paid with respect to a period which is not a payroll period, the amount to be deducted and withheld shall be that applicable in the case of a miscellaneous payroll period containing a number of days, including Sundays and holidays, equal to the number of days in the period with respect to which such wages are paid. In any case in which wages are paid by an employer without regard to any payroll period or other period, the amount to be deducted and withheld shall be that applicable in the case of a miscellaneous payroll period containing a number of days equal to the number of days, including Sundays and holidays, which have elapsed since the date of the last payment of such wages by such employer during the calendar year, or the date of commencement of employment with such employer during such year, or January 1st of such year, whichever is the later. In any case in which the period of time described, or the time prescribed in the preceding sentence in respect of any wages, is less than one week, the department may by authorized regulation permit an employer, in computing the tax required to be deducted and withheld, to use the excess of the aggregate of the wages paid to the employee during the calendar week over the withholding exemption allowed by Section 13020 for a weekly payroll period.


13031. If the remuneration paid by an employer to an employee for services performed during one-half or more of any payroll period of not more than 31 consecutive days constitutes wages, all the remuneration paid by such employer to such employee for such period shall be deemed to be wages, but if the remuneration paid by an employer to an employee for services performed during more than one-half of any such payroll period does not constitute wages, then none of the remuneration paid by such employer to such employee for such period shall be deemed to be wages.


Chapter 3. Withholding Exemptions

Ca Codes (uic:13040-13043) Unemployment Insurance Code Section 13040-13043



13040. (a) An employer shall use the exemption certificate filed by the employee with the employer in such form and containing such information as the department may prescribe, for determining the number of withholding exemptions to be allowed in computing the tax required to be deducted and withheld under Section 13020. However, if the employer cannot determine the employee's marital status from the exemption certificate the employee shall be considered unmarried. (b) No withholding exemptions shall be allowed until the employee files a new withholding exemption certificate if the department finds that the withholding exemption certificate filed under this division does not properly reflect the number of exemptions allowable and so advises the employer in writing.


13041. The number and amount of withholding exemptions allowed shall be based upon the persons claimed in a withholding exemption certificate in effect under Section 13040, except that if no such certificate is in effect, the number of withholding exemptions claimed shall be considered to be zero.


13042. A new withholding exemption certificate filed under this division in cases in which a previous certificate was in effect shall take effect with respect to the first payment of wages made on or after the first status determination date which occurs at least 30 days from the date on which such certificate is so furnished, except that at the election of the employer such certificate may be made effective with respect to any payment of wages made on or after the date on which such certificate is so furnished. For purposes of this section, "status determination date," means January 1, May 1, July 1, and October 1, of each year.


13043. (a) The amount to be deducted and withheld under this division shall be prescribed pursuant to Section 18663 of the Revenue and Taxation Code when a payment of wages is made to an employee by an employer in any of the following cases: (1) With respect to a payroll period or other period, any part of which is included in a payroll period or other period with respect to which wages are also paid to the employee by the employer. (2) Without regard to any payroll period or other period, but on or prior to the expiration of a payroll period or other period with respect to which wages are also paid to the employee by the employer. (3) With respect to a period beginning in one and ending in another calendar year. (4) Through an agent, fiduciary, or other person who also has the control, receipt, custody, or disposal of, or pays, the wages payable by another employer to the employee. (b) For purposes of this section, an employee's remuneration may consist of wages paid for a payroll period and supplemental wages. Supplemental wages include, but are not limited to, bonus payments, overtime payments, commissions, sales awards, back pay including retroactive wage increases, and reimbursements for nondeductible moving expenses that are paid for the same or different period, or without regard to a particular period. (c) When any supplemental wages are paid subsequent to the payment of regular wages, the employer may determine the personal income tax to be withheld from supplemental wages paid by (1) using a flat percentage rate pursuant to subdivision (b) of Section 18663 of the Revenue and Taxation Code without allowance for exemptions and credits and without reference to any regular payment of wages, or (2) adding the supplemental wages to the regular wages paid the employee and computing the personal income tax to be withheld on the whole amount (the computed tax minus the tax withheld from the regular wages shall be withheld from the supplemental wages). Where supplemental wages are paid at the same time as regular wages, the personal income tax to be withheld shall be computed on the total of the supplemental and regular wages and shall be determined as if the total of the supplemental wages and the regular wages constituted a single wage payment for the regular payroll period. (d) For stock options and bonus payments that constitute wages paid on or after January 1, 2002, the employer may determine the personal income tax to be withheld from the stock options and bonus payments paid by either (1) using a flat percentage rate pursuant to subdivision (c) of Section 18663 of the Revenue and Taxation Code, without allowance for exemptions and credits and without reference to any regular payment of wages, or (2) adding the stock options and bonus payments to the regular wages paid the employee and computing the personal income tax to be withheld on the whole amount (the computed tax minus the tax withheld from the regular wages shall be withheld from the stock options and bonus payments). Where the stock options and bonus payments are paid at the same time as regular wages, the personal income tax to be withheld shall be computed on the total of the stock options and bonus payments and regular wages, and shall be determined as if the total of the stock options and bonus payments and the regular wages constituted a single wage payment for the regular payroll period.


Chapter 4. Reports, Returns, And Statements

Ca Codes (uic:13050-13059) Unemployment Insurance Code Section 13050-13059



13050. (a) Every employer or person required to deduct and withhold from an employee a tax under Section 986, 3260, or 13020, or who would have been required to deduct and withhold a tax under Section 13020 (determined without regard to Section 13025) if the employee had claimed no more than one withholding exemption, shall furnish to each employee in respect of the remuneration paid by the person to the employee during the calendar year, on or before January 31 of the succeeding year, or, if his or her employment is terminated before the close of the calendar year, on the day on which the last payment of remuneration is made, a written statement showing all of the following: (1) The name of the person. (2) The name of the employee, and his or her social security or identifying number if wages have been paid. (3) The total amount of wages subject to personal income tax, as defined by Section 13009.5. (4) The total amount deducted and withheld as tax under Section 13020. (5) The total amount of worker contributions paid by the employee pursuant to Section 986. (6) The total amount of worker contributions paid by the employee pursuant to Section 3260. (7) The total amount of elective deferrals (within the meaning of Section 402(g)(3) of the Internal Revenue Code) and compensation deferred pursuant to Section 457 of the Internal Revenue Code. (b) The statement required to be furnished pursuant to this section in respect of any remuneration shall be furnished at other times, shall contain other information, and shall be in a form, as the department may by authorized regulations prescribe. (c) If, during any calendar year, any person makes a payment of third-party sick pay to an employee, that person shall, on or before January 15 of the succeeding year, furnish a written statement to the employer in respect of whom the payment was made showing all of the following: (1) The name and, if there is withholding under this division, the social security number of that employee. (2) The total amount of the third-party sick pay paid to that employee during the calendar year. (3) The total amount, if any, deducted and withheld from that sick pay under this division. For purposes of the preceding sentence, the term "third-party sick pay" means any sick pay, as defined in subdivision (b) of Section 13028.6, which does not constitute wages for purposes of this division, determined without regard to subdivision (a) of Section 13028.6. (A) For purposes of Chapter 10 (commencing with Section 2101) of Part 1 of Division 1, the statements required to be furnished by this subdivision shall be treated as statements required under this section to be furnished to employees. (B) Every employer who receives a statement under this subdivision with respect to sick pay paid to any employee during any calendar year shall, on or before January 31 of the succeeding year, furnish a written statement to that employee showing all of the information shown on the statement furnished under this subdivision. (d) The Franchise Tax Board shall be allowed access to the information filed with the department pursuant to this section.


13052. Any person or employer required under Section 13050 to furnish a statement to an employee who furnishes a false or fraudulent statement, or who fails to furnish a statement in the manner, at the time, and showing the information required under Section 13050, or regulations prescribed thereunder, shall for each such failure, unless due to reasonable cause, pay a penalty of fifty dollars ($50). The penalty shall be assessed and collected in the same manner as the tax.

13052.5. (a) In addition to the penalty imposed by Section 19183 of the Revenue and Taxation Code (relating to failure to file information returns), if any person, or entity fails to report amounts paid as remuneration for personal services as required under Section 13050 of this code or Section 6041A of the Internal Revenue Code on the date prescribed thereof (determined with regard to any extension of time for filing), that person or entity may be liable for a penalty determined under subdivision (b). (b) For purposes of subdivision (a), the amount determined under this subdivision is the maximum rate under Section 17041 of the Revenue and Taxation Code multiplied by the unreported amounts paid as remuneration for personal services. (c) The penalty imposed by subdivision (a) shall be assessed against that person or entity required to file a return under Section 13050 of this code or Section 6041A of the Internal Revenue Code. (d) Sections 1221 and 1222 of the Unemployment Insurance Code shall not apply to assessments imposed by this section. (e) The penalty imposed under this section shall be in lieu of the penalty imposed under Section 19175 of the Revenue and Taxation Code. In the event that a penalty is imposed under both this section and Section 19175 of the Revenue and Taxation Code, only the penalty imposed under this section shall apply. (f) The penalty imposed by this section may be assessed in lieu of, or in addition to, the penalty imposed by Section 13052 with respect to the failure to furnish a withholding statement to an employee.

13055. Every employee who, in the course of his or her employment by an employer, receives in any calendar month tips which are wages shall report all such tips in one or more written statements furnished to his or her employer on or before the 10th day following such month. Such statements shall be furnished by the employee under such authorized regulations, at such other times before such 10th day, and in such form and manner as may be prescribed by the department.

13056. (a) When required by authorized regulations prescribed by the department: (1) Any person or employer required under the authority of this division to make a return, report, statement, or other document shall include in the return, report, statement, or other document the identifying number as may be prescribed for securing proper identification of the person. (2) Any person with respect to whom a return, report, statement, or other document is required under the authority of this division to be made by another person shall furnish to the other person the identifying number as may be prescribed for securing his or her proper identification. (3) Any person or employer required under the authority of this division to make a return, report, statement, or other document with respect to another person shall request from the other person, and shall include in the return, report, statement, or other document, the identifying number as may be prescribed for securing proper identification of the other person. (b) (1) Except as provided in paragraph (2), a return or report of any person with respect to his or her liability for tax, or any statement or other document in support thereof, shall not be considered for purposes of paragraphs (2) and (3) of subdivision (a) as a return, report, statement, or other document with respect to another person. (2) For purposes of paragraphs (2) and (3) of subdivision (a), a return or report of an estate or trust with respect to its liability for tax, and any statement or other document in support thereof, shall be considered as a return, report, statement, or other document with respect to each beneficiary of the estate or trust. (c) For purposes of this section, the department is authorized to require the information that may be necessary to assign an identifying number to any person.


13057. (a) If any person who is required by regulations prescribed under Section 13056 to provide a required identifying number fails without good cause to comply with that requirement at the time prescribed by the regulations, the person shall pay a penalty of five dollars ($5) for each failure: (1) To include his or her identifying number in any return, report, statement, or other document. (2) To furnish his or her identifying number to another person. (3) To include in any return, report, statement, or other document made with respect to another person the identifying number of the other person. (4) To furnish any other agency's taxpayer identification number. (b) The penalty under this section shall be assessed and collected in the same manner as the tax.

13058. Except as otherwise provided by the department, any return, report, statement, or other document required to be made under any provision of this division or authorized regulations shall contain, or be verified by, a written declaration that it is made under the penalty of perjury. The returns, reports, and all other returns, reports, statements, or other documents or copies thereof required by this division, shall be in the form as the department may from time to time prescribe, and shall be filed with the department. The department shall prepare blank forms for the returns, reports, declarations, statements, or other documents and shall distribute them throughout the state and furnish them upon application. Failure to receive or secure the form does not relieve any employer or person from making any return, report, statement, or other document required.

13059. If the Governor declares a state of emergency, the director may extend the time requirements for filing returns, reports, and statements required by this chapter. The extension granted by the director pursuant to this section shall only apply to employers prevented by the conditions giving rise to the state of emergency from timely filing their returns, reports, and statements of wages or timely payment of the taxes due.


Chapter 5. Collections

Ca Codes (uic:13070-13077) Unemployment Insurance Code Section 13070-13077



13070. (a) The employer shall be liable for the payment of the tax required to be deducted and withheld under Section 13020, and shall not be liable to any person for the amount of such payment. (b) Whenever any employer or person has withheld any amount pursuant to this division, the amount so withheld shall be held to be a special fund in trust for the State of California.


13071. If the employer, in violation of the provisions of this division, fails to deduct and withhold the tax under this division, and thereafter the tax against which the tax may be credited is paid or the taxpayer reports to the Franchise Tax Board the wages or gross income against which the tax would have been imposed, the tax so required to be deducted and withheld shall not be collected from the employer, but this section shall in no case relieve the employer from liability for any penalties or additions to the tax otherwise applicable with respect to the failure to deduct and withhold.


13072. The department may by notice, served personally or by first-class mail, require any employer, person, officer or department of the state, political subdivision or agency of the state, including the Regents of the University of California, a city organized under a freeholders' charter, or a political body not a subdivision or agency of the state, having in their possession, or under their control, any credits or other personal property or other things of value, belonging to a taxpayer or to an employer or person who has failed to withhold and transmit amounts due pursuant to Section 13070 or 13073 to withhold, from such credits or other personal property or other things of value, the amount of any tax, interest, or penalties due from the taxpayer or the amount of any liability incurred by such employer or person for failure to withhold and transmit amounts due from a taxpayer and to transmit the amount withheld to the department at such times as it may designate.


13073. Any employer or person failing to withhold the amount due from any taxpayer and to transmit the same to the department after service of a notice pursuant to Section 13072 is liable for such amounts.

13074. Any employer or person required to withhold and transmit any amount pursuant to this division shall comply with the requirement without resort to any legal or equitable action in a court of law or equity. Any employer or person paying to the department any amount required by it to be withheld is not liable therefor to the person from whom withheld unless the amount withheld is refunded to the withholding agent.


13075. Whenever, under any provision of this division, service is authorized upon the state of any notice to withhold, unless expressly exempted from the provisions of this section, such service to be effective must, in addition to any other requirements, be made on the state agency owing the obligation prior to the time such agency presents the claim for payment thereof to the State Controller.


13076. If the employer is the United States, or this state, or any political subdivision thereof, including the Regents of the University of California, a city organized under a freeholders' charter, or any agency or instrumentality of any one or more of the foregoing, the return of the amount deducted and withheld upon any wages may be made by any officer or employee of the United States, or of such state, city organized under a freeholders' charter, or political subdivision, or of such agency or instrumentality, as the case may be, having control of the payment of such wages, or appropriately designated for that purpose.


13077. (a) For purposes of Sections 13020 and 13070, if a lender, surety, or other person, who is not an employer under such sections with respect to an employee or group of employees, pays wages directly to such an employee or group of employees, employed by one or more employers, or to an agent on behalf of such employee or employees, such lender, surety, or other person shall be liable in his or her own person and estate to the State of California in a sum equal to the taxes (together with interest) required to be deducted and withheld from such wages by such employer. (b) If a lender, surety, or other person supplies funds to or for the account of an employer for the specific purpose of paying wages of the employees of such employer, with actual notice or knowledge that such employer does not intend to or will not be able to make timely payment or deposit of the amounts of tax required by this part to be deducted and withheld by such employer from such wages, such lender, surety, or other person shall be liable in his or her own person and estate to the State of California in a sum equal to the taxes (together with interest) which are not paid over to the State of California by such employer with respect to such wages. However, the liability of such lender, surety, or other person shall be limited to an amount equal to 25 percent of the amount so supplied to or for the account of such employer for such purpose. (c) Any amounts paid to the State of California pursuant to this section shall be credited against the liability of the employer.


Chapter 6. Violations

Ca Codes (uic:13101) Unemployment Insurance Code Section 13101



13101. (a) In addition to any criminal penalty provided by law, if any individual makes a statement under Section 13040, 13041, or 13042 which results in a decrease in the amounts deducted and withheld under this division, and as of the time the statement was made, there was no reasonable basis for the statement, the individual shall pay a penalty of five hundred dollars ($500) for the statement. (b) The department may waive, in whole or in part, the penalty imposed under subdivision (a) if the taxes imposed with respect to the individual under Part 10 (commencing with Section 17001) of Division 2 of the Revenue and Taxation Code for the taxable year are equal to or less than the sum of both of the following: (1) The credits against those taxes allowed by Sections 17052.1 through 17053.7 and Section 19002. (2) The payments of estimated tax which are considered payments on account of those taxes. (c) Article 11 (commencing with Section 1221) of Chapter 4 of Part 1, relating to administrative appellate review, shall not apply to the assessment or collection of any penalty imposed by subdivision (a). (d) This section shall apply to acts and failures to act after December 31, 1981.


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