Gov. Code, § 7174

(a) If the agency determines that the amount of tax, interest, and any penalty are sufficiently secured by a lien on other property or that the release or subordination of the state tax lien will not jeopardize the collection of the amount of the tax, including interest and penalty, the agency may at any time release all or any portion of the property subject to the state tax lien from the lien or may subordinate the state tax lien to other liens and encumbrances.

(b) If the agency finds that the liability represented by the state tax lien, including any interest accrued thereon, is legally unenforceable, the agency may release the lien.

(c) If the agency has recorded a notice of state tax lien as provided in Section 7171 and the liability represented by the lien, including any interest and penalty, has been satisfied in full:

(1) If the agency is other than the Controller or the State Board of Equalization, the agency shall, not later than 40 days after the liability is satisfied, record a certificate of release in the office of the county recorder where the notice of state tax lien is recorded.

(2) In the case of the Controller or the State Board of Equalization, the agency shall, not later than 40 days after the liability is satisfied, do one of the following:

(A) Record a certificate of release in the office of the county recorder where the notice of state tax lien is recorded.

(B) Deposit in the mail or otherwise deliver to the taxpayer a certificate of release.

(d) If the agency records a certificate of release under subdivision (c) or files a certificate of release under subdivision (e), the cost of recording or filing is an obligation of the taxpayer and may be collected from the taxpayer in any manner provided by law for the collection of the tax.

(e) If the agency has filed a notice of state tax lien with the Secretary of State as provided in Section 7171 and the liability represented by the state tax lien, including any interest and penalty, has been satisfied in full, the agency shall, not later than 40 days after the liability is satisfied, do one of the following:

(1) File a certificate of release with the Secretary of State.

(2) Deposit in the mail or otherwise deliver a certificate of release to the taxpayer.

(f) For the purpose of subdivisions (c) and (e), if payment is made by check, the 40-day period does not commence to run until the check has been paid by the financial institution upon which it was drawn.

(g) A certificate by the agency to the effect that any property has been released from a state tax lien or that the lien has been subordinated to other liens and encumbrances is conclusive evidence that the property has been released or that the lien has been subordinated as provided in the certificate.

(h) If the certificate of release recorded pursuant to subdivisions (a), (b), and (c) reflects an out-of-state address as the last known address of the taxpayer, the agency shall pay the fees permitted by Sections 27361, 27361.2, 27361.4, and 27361.8.