What to Do When The EDD Denies Your Claim For Refund
By Robert S. Schriebman
This article assumes that you have prepared and filed a Claim for Refund with the EDD. Most refund claims are filed because of an overpayment of employment and withholding taxes or to seek the abatement of a previously paid penalty. We will discuss the mechanics of preparing and filing a Claim for Refund in another article (The rules concerning EDD refund claims are found in the California Unemployment Insurance Code [CUIC] at §§ 1176 – 1185).
Most refund claims are denied by any taxing agency whether it is the IRS, FTB, or EDD. Most of the reasons for denial are because the refund claim is not timely, or the facts presented are not complete. Refund claims to abate penalties, such as late filing or late payment penalties are denied for lack of reasonable cause. “Reasonable cause” generally means that the taxpayer did not conduct his or her affairs as a prudent business person. In these tough economic times, when governments are short of revenue, claims are denied because the government knows that very few taxpayers will pursue a claim to litigation. Litigation is costly and time consuming.
If the EDD denies your Claim for Refund, the denial is final unless you file a petition with the California Unemployment Appeals Board (CUIAB). You petition must be filed within 30 days following the EDD’s denial of your refund claim. The notice is usually entitled “Denial of Penalty Waiver/ Claim for Refund.” The 30-day deadline for filing your petition can be a tricky matter. The EDD’s denial letter has two different dates on it. The first date is the date the denial letter was issued, the “issued date.” The second date is the date the notice of denial was mailed to you, the “mail date.” The EDD’s instructions are ambiguous too. The notice states that you must file your petition “within 30 days following the date of the attached letter” (the denial letter). If you are not careful you may run the risk of filing your petition too late. Always file your petition within 30 days of the “issued date.”
If you file your petition through the U.S. Postal Service send it by certified or registered mail with return receipt requested. You should also get a receipt from the post office showing the date of mailing. This is called the “round-stamp date.” You may also file your petition through UPS or FedEx. After filing you can go online to print out confirmation that your petition was received.
Send you petition to the CUIAB at the following address:
Office of the Chief Administrative Law Judge
California Unemployment Insurance Appeals Board
First Floor, Suite 150
2400 Venture Oaks Way
Sacramento CA 95833-3291
You may also fax your petition to the CUIAB at 916.263.6763. A fax petition gets there faster and the Clerk’s Office treats a faxed petition as a filed petition.
What should your petition contain? There is no set form for any petition. I have seen informal handwritten letters treated as valid petitions. The CUIAB apparently takes a liberal point of view on what constitutes a valid petition. As a minimum your petition should contain the following information:
- Your name and address.
- The tax periods and amounts involved.
- A statement that you request a refund hearing before and administrative law judge.
- A statement of facts or argument as to why you believe you are entitled to a refund.
- Attach any exhibits that you believe are relevant to your petition.
- Sign and date your petition.
Good luck on the filing and pursuit of your Claim for Refund.
©Robert Schriebman 2013.
Robert Schriebman has written over 20 books including the major manual used nationally by practitioners and the IRS, “IRS Tax Collection Procedures – A Manual for Practitioners” published by Commerce Clearing House in addition to the only 2 books ever published dealing with how California Employment Development Department (EDD) operates. See “California Tax Collection Practice and Procedures” and “California Taxation Practice and Procedure”, both published by Commerce Clearing House.