(a) Except as otherwise provided in subdivisions (b) and (e), after 20 years have lapsed from the date the latest tax liability for a taxable year or the date any other liability that is not associated with a taxable year becomes “due and payable” within the meaning of Section 19221, the Franchise Tax Board may not collect that amount and the taxpayer’s liability to the state for that liability is abated by reason of lapse of time. Any actions taken by the Franchise Tax Board to collect an uncollectible liability shall be released, withdrawn, or otherwise terminated by the Franchise Tax Board, and no subsequent administrative or civil action shall be taken or brought to collect all or part of that uncollectible amount. Any amounts received in contravention of this section shall be considered an overpayment that may be credited and refunded in accordance with Article 1 (commencing with Section 19301) of Chapter 6.
(b) If a timely civil action filed pursuant to Article 2 of Chapter 6 of this part is commenced, or a claim is filed in a probate action, the period for which the liability is collectable shall be extended and shall not expire until that liability, probate claim, or judgment against the taxpayer arising from that liability is satisfied or becomes unenforceable under the laws applicable to the enforcement of civil judgments.
(c) For purposes of this section, both of the following apply:
(1) “Tax liability” means a liability imposed under Part 10 (commencing with Section 17001), Part 11 (commencing with Section 23001), or this part, and includes any additions to tax, interest, penalties, fees and any other amounts relating to the imposed liability.
(2) If more than one liability is “due and payable” for a particular taxable year, with the exception of a liability resulting from a penalty imposed under Section 19777.5, the “due and payable” date that is later in time shall be the date upon which the 20-year limitation of subdivision (a) commences.
(d) This section does not apply to amounts subject to collection by the Franchise Tax Board pursuant to Article 5.5 or 7 of this chapter, or any other amount that is not a tax imposed under Part 10 or Part 11, but which the Franchise Tax Board is collecting as though it were a final personal income tax delinquency.
(e) (1) The expiration of the period of limitation on collection under this section shall be suspended for the following periods:
(A) The period during which the Franchise Tax Board is prohibited by reason of a bankruptcy case from collecting, plus six months thereafter.
(B) The period described under subdivision (d) of Section 19008 relating to installment payment agreements.
(C) The period during which collection is postponed by operation of law under Section 18571, related to postponement by reason of service in a combat zone, or under Section 18572, related to postponement by reason of presidentially declared disaster or terroristic or military action.
(D) During any other period during which collection of a tax is suspended, postponed, or extended by operation of law.
(2) A suspension of the period of limitation under this subdivision applies with respect to both parties of any liability that is joint and several.
(f) This section shall be applied on and after July 1, 2006, to any liability “due and payable” before, on, or after that date.
(Amended by Stats. 2016, Ch. 86, Sec. 286. (SB 1171) Effective January 1, 2017.)