The California Office of Tax Appeals (OTA) recently published two precedential sales tax pending decisions that, in practical terms, answered questions regarding personal liability, penalties, and interest abatements for unpaid sales tax. Part I focuses on the Appeal of Sundown Entertainment Group, Inc., 2026-OTA-225P. Here, the OTA sustained a large sales tax determination after the normal three-year statute of limitations had expired, holding that the CDTFA established fraud, properly imposed the 40 percent penalty for knowingly failing to remit collected sales tax reimbursement, and did not abuse its discretion in denying further interest abatement.
Philipp Behrendt is a Principal at Hochman Salkin Toscher Perez P.C., licensed in California as well as in Germany and assists in advising clients in civil and criminal tax controversies as well as international money laundering investigations stemming from tax avoidance structures. He also focuses on the technical aspects involved in advising voluntary disclosures in connection with DeFis, NFTs, and other crypto assets. Philipp is a Liaison to the Young Lawyer Committee for the ABA Tax Section’s Civil and Criminal Tax Penalties Committee and served on the Beverly Hills Bar Association’s Barristers Board of Governors from 2022 to 2023. Philipp is the Chair of the Beverly Hills Bar Association’s Tax Section and the Blockchain and Web3 Law Section.
For more information, please contact Philipp Behrendt at behrendt@taxlitigator.com
TAXLITIGATOR - Tax Controversy (Civil & Criminal) Report 
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