I looked on the USGA site, but could not find anything specific (perhaps I just did not look in the proper place). There is a course I play where the cart path runs next to a lateral water hazard. The hazard stakes are on the fairway side of the cart path for some odd reason. If you hit a ball, and it comes to rest against the cart path (where you would normally get relief without penalty), since it is within the margin of the hazard, would you still get to take relief without penalty?

No relief if its an integral part of the hazard. Play it as if its in a bunker or penalty drop im afraid. If you look in your local rules it is probably mentioned.

No free relief because the cart path is in the water hazard. To take relief, you have to proceed under the water hazard rule.

Thanks for the response. I have another question about sort of the same thing.

Some of this particular cart path is outside of the hazard, and some of it is inside. If your ball is resting against the cartpath, not in the hazard, but the only place to take relief would put you within the hazard, could you take the relief and drop it in the hazard? There is about 4' of grass between the path and the water, but it is marked as part of the hazard.

No, you would find the nearest point of relief outside of the hazard then take 1 club length from there. You never drop into a hazard from outside.

For certain you are not permitted to take relief from a hazard and still remain in the hazard.
However in your case you are taking relief from a cart path which is not within the hazard. In this case I believe you may be entitled to take a relief drop within the hazard if you choose to do so, but I am not certain. My guess is that this is an option for you, so long as your relief within the hazard is clear of the cart path from which you were originally entitled relief.

No, you cannot drop a ball in the hazard (see Rule 20-2c(i)). If the nearest point of relief from the cart path is in the hazard, you are essentially in the hazard. Your only options would be to play it as it lies or declare the ball unplayable and proceed under penalty of one stroke according to Rule 28 (replay from the previous spot; drop a ball behind the point where the ball lay, keeping that point directly between the hole and the spot on which the ball is dropped, with no limit to how far behind that point the ball may be dropped; or drop a ball within two clubs of its current position, but no closer to the hole (which should get you on the other side of the cart path)).

Now that I think about it a little more, the nearest point of relief could be on the other side of the cart path opposite the hazard (assuming there is actually no space between the path and the hazard in which you could conceivably drop). That means, you wouldn't have to declare the ball unplayable to drop on the other side of the cart path. However, there must not be any room at all on the hazard side of the path to allow for relief. Also, keep in mind that the rules only state that the dropped ball cannot come to rest in a hazard. Your stance could still be in the hazard, from which you would not be entitled to free relief.

Nothing in the Rules says that the player can not drop in a hazard.
If that was the case, there wouldn't be a Rule 20-2c(ii)

Okay, let me make it clear this time. Your drop cannot come to rest inside a hazard if you are taking relief from a situation outside the hazard according to Rule 20-2c(i). Therefore, you can drop inside a hazard if you are in a hazard and I suppose you can drop inside a hazard as long as the ball comes to rest outside the hazard. Neither of those possibilities exists here because of another rule.

Now, if you want to get real specific, Rule 24-2b(i) is the rule specifically applicable to his situation, which explicitly prohibits dropping in a hazard.

http://www.usga.org/bookrule.aspx?id=14300#24-2

Correct, nearest relief cannot be in the hazard. Now if it was determined that nearest relief was in a bush a shrub than that's a different story. Thats why you always figure out nearest relief prior to picking up your ball. Once you pick it up you have to take the relief.