1. Tax Notices Identify the Agency and Available Procedure
Federal, California, and local tax disputes use separate procedures. The notice identifies the agency responsible for the next step.
IRS Notices Involve Federal Tax Law
An IRS examination letter may request records concerning income or deductions. A statutory Notice of Deficiency generally permits a U.S. Tax Court challenge before payment. Broader tax lawyer representation covers federal audits, appeals, and collection matters.
FTB, CDTFA, and EDD Handle Separate State Taxes
The Franchise Tax Board (FTB) handles income and corporate franchise taxes. The CDTFA handles sales and use taxes; the Employment Development Department (EDD) handles state payroll taxes. FTB protests, CDTFA redetermination petitions, and EDD payroll-tax petitions follow different rules. The California Unemployment Insurance Appeals Board hears EDD tax petitions.
City Business Tax and County Property Assessment
Businesses operating in San Jose generally need a Business Tax Certificate, separate from a state seller's permit. Municipal Code § 4.76.870 provides hearings for covered city assessments. Santa Clara County owners appeal property values through the Clerk of the Board. The Assessor values property; the Tax Collector handles bills.
2. The Notice Stage Sets the Filing Deadline
An assessment proposal, final determination, and collection notice create different rights and filing deadlines.
Protest Periods Vary by Notice
The periods below apply to these specific notices; statutory exceptions may apply.
| Notice | General Filing Period |
|---|---|
| IRS statutory Notice of Deficiency | 90 days to petition Tax Court; 150 days in qualifying overseas circumstances |
| FTB Notice of Proposed Assessment | 60 days to protest with FTB |
| FTB Notice of Action | 30 days to appeal to the Office of Tax Appeals |
| CDTFA sales-tax Notice of Determination | 30 days to petition for redetermination |
| San Jose business-tax assessment under § 4.76.870 | 10 days after service to request a hearing |
IRS statutory Notice of Deficiency
- General Filing Period90 days to petition Tax Court; 150 days in qualifying overseas circumstances
FTB Notice of Proposed Assessment
- General Filing Period60 days to protest with FTB
FTB Notice of Action
- General Filing Period30 days to appeal to the Office of Tax Appeals
CDTFA sales-tax Notice of Determination
- General Filing Period30 days to petition for redetermination
San Jose business-tax assessment under § 4.76.870
- General Filing Period10 days after service to request a hearing
Audit Objections and Collection Hearings Are Different
During an IRS audit, taxpayers can contest proposed adjustments with records. A qualifying IRS Collection Due Process notice concerning a levy or lien generally permits 30 days to request a hearing using Form 12153. Earlier opportunities to contest a liability can restrict later challenges. Payment plans and offers in compromise have separate rules.
Property and Payroll Appeals Follow Other Rules
Santa Clara County's regular assessment appeals generally run July 2 through September 15; supplemental and escape notices generally allow 60 days. Typical EDD payroll assessments permit 30 days to petition for reassessment, subject to exceptions. A property appeal does not itself suspend payment.
3. Tax Case Reviews Connect Records to Legal Grounds
Case review tests the agency's calculation against the tax law and records supporting the disputed items.
Returns and Notices Establish the Timeline
Start with returns, notices, payments, and earlier responses. Businesses may need payroll and sales records. Related small business tax services address filing duties, while an assessment dispute requires procedural review.
Evidence Must Answer the Specific Adjustment
A bank deposit may not be taxable income; a ledger alone may not prove a deduction. Reconcile accounts with invoices, refunds, and transfers. Residency disputes may require housing and travel records, while property appeals need market evidence tied to the valuation date.
Representation May Lead to Appeals or Litigation
Attorneys prepare protests and present evidence. Eligible FTB appeals go to California's Office of Tax Appeals; federal deficiency cases may go to the U.S. Tax Court. Qualifying refund suits may reach the Northern District of California, if venue is proper, or the Court of Federal Claims, subject to payment and administrative refund-claim requirements.
4. Procedural Mistakes Can Narrow the Available Remedies
A late filing or wrong procedure may foreclose remedies. Informal requests do not replace formal appeals.
Informal Review Does Not Extend Appeal Deadlines
Calling an examiner or requesting informal Assessor review does not extend the applicable deadline. An FTB protest must meet the date on its Notice of Proposed Assessment. Keep proof of submission. A later refund claim, if available, does not replace a timely protest.
Payments and Disclosures Affect the Available Options
Paying may limit interest without surrendering a timely protest, but deposits and refund claims follow different rules. Collection negotiations may require financial disclosures. Legal review can address privilege and disclosure obligations; related tax disputes may require separate refund litigation.
12 Nov, 2026
