The California Department of Revenue handles almost all of the sales, use, and excise tax assessment, auditing, and collection of funds in the state of California. They are the state level department of the more commonly known federal agency, the Internal Revenue Service, or IRS. The California Department of Revenue has several dozen tax and fee programs as well as licensing programs. When some of these licenses are issued, the department may require the business or entity requesting a license to have a supplemental surety bond before they will issue the license.
A surety bond is used to help protect the general public from any wrongdoings that the license holder may intentionally or unintentionally commit. If any laws or regulations that the license covers are broken, then the surety bond can help restore compensation for any loss of earnings, income, or payments that were failed to be paid out as a result of the loss.
Common surety bonds that the California Department of Revenue requires include:
A California Alcoholic Beverage Tax Bond is required for anyone who holds a variety of different liquor license types. This bond is to ensure that the license holder will pay all applicable taxes. Unlike many other surety bonds, the bond can only be issued to current license holders, which means that this surety bond is obtained after the license is obtained.