California OTA Partially Grants Taxpayer’s Appeal, Reduces Use Tax Liability

The California Office of Tax Appeals (OTA) partially granted the taxpayer’s appeal regarding a tax liability determination for the relevant tax period. The taxpayer, a construction contractor that installs residential solar energy systems, disputed a tax assessment by the California Department of Tax and Fee Administration (CDTFA) based on unreported purchases subject to use tax. The taxpayer argued that purchase discounts and certain components used in solar installations were improperly included in the taxable measure. During the appeal, the CDTFA conducted a reaudit and agreed to a reduction for purchase discounts, lowering the taxable measure and the tax. However, the ...