Bill Text: CA SB1327 | 2013-2014 | Regular Session | Introduced
Bill Title: Tax administration: refunds: property tax: state assessees: actions.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2014-04-24 - Set, first hearing. Failed passage in committee. (Ayes 2. Noes 4. Page 3257.) Reconsideration granted. [SB1327 Detail]
Download: California-2013-SB1327-Introduced.html
BILL NUMBER: SB 1327 INTRODUCED
BILL TEXT
INTRODUCED BY Senator Knight
FEBRUARY 21, 2014
An act to amend Section 5148 of, and to add Section 41 to, the
Revenue and Taxation Code, relating to taxation.
LEGISLATIVE COUNSEL'S DIGEST
SB 1327, as introduced, Knight. Tax administration: refunds:
property tax: state assessees: actions.
(1) The Franchise Tax Board administers the Personal Income Tax
Law and the Corporation Tax Law and the State Board of Equalization
administers the Sales and Use Tax Law and various other tax and fee
laws. Counties, cities, and districts, as specified, are authorized
to impose local sales or transactions and use taxes in conformity
with the Sales and Use Tax Law. Amendments to the Sales and Use Tax
Law are automatically incorporated into the local laws. Those laws
generally require a claim for refund to be filed within specified
timeframes based on the date of overpayment or specified board action
if any amount has been paid or overpaid, as specified. Under those
laws, the rule of res judicata, which provides that a matter that has
been adjudicated by a court of competent jurisdiction may not be
pursued further by the same parties, is applicable only if the
liability involved is for the same reporting period as was involved
in the case previously determined.
This bill would, notwithstanding existing law regarding the rule
of res judicata, where a tax, fee, assessment, surcharge, or other
amount levied or collected by the tax agency, which this bill would
define to include the board and the Franchise Tax Board, has been
determined to have been illegally levied or collected in a final and
nonappealable decision of a court of competent jurisdiction,
authorize any person who paid that tax, fee, assessment, surcharge,
or other amount to file with the tax agency a claim for refund,
within one year after the date of the final and nonappealable
decision and would require the tax agency to refund the amount so
paid. This bill would also require the tax agency to refund these
amounts without the person filing a claim for refund when information
in the tax agencies' records is sufficient to identify the person.
This bill would, upon appropriation by the Legislature, allocate the
amounts necessary to make these refunds to the applicable tax agency.
(2) Existing law requires an action to recover property taxes
levied on state-assessed property arising out of a dispute as to an
assessment to be commenced only after payment of the taxes in issue
and within 4 years after the latest of the dates that the State Board
of Equalization mailed its decision or its written findings and
conclusions, as provided.
This bill would instead require, where the tax assessed or
allocated has been determined to have been illegally assessed or
allocated in a final and nonappealable decision of a court of
competent jurisdiction, the action to commence no later than one year
from the date the court rendered that decision.
(3) This bill would make a legislative finding and declaration
regarding the public purpose served by the bill.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 41 is added to the Revenue and Taxation Code,
to read:
41. (a) Where a tax, fee, assessment, surcharge, or other amount
levied or collected by the tax agency has been determined to have
been illegally levied or collected in a final and nonappealable
decision of a court of competent jurisdiction, any person who paid
that tax, fee, assessment, surcharge, or other amount may file with
the tax agency a claim for refund of the amount so paid in accordance
with this section and the tax agency shall refund the amount so
paid.
(b) Notwithstanding subdivision (a), a person who has paid to the
tax agency a tax, fee, assessment, surcharge, or other amount
described in subdivision (a) that filed a claim for refund prior to
the effective date of the act adding this section that the tax agency
has not refunded before that date shall be refunded by the tax
agency to the person in accordance with the provisions of this
section. The act adding this section shall not be construed to
require refiling of those previously filed claims for refund.
(c) Notwithstanding any other law relating to the limitations
period for filing a claim for refund, this section shall apply to any
claims for refund of any amounts described in subdivision (a) paid
to the tax agency.
(d) A claim for refund for any amounts described in subdivision
(a) shall be filed within one year after the date upon which the
court decision described in subdivision (a) becomes final and
nonappealable.
(e) Interest shall be paid on the refunds provided by this section
in accordance with applicable provisions of this code related to the
tax, fee, assessment, surcharge, or other amount subject to refund.
(f) For the purposes of bringing an action against the tax agency
for recovery of the whole or any part of the amount claimed as an
overpayment of an amount described in subdivision (a), the period for
filing such action provided in this code and applicable to the tax,
fee, assessment, surcharge, or other amount, shall not commence until
the one-year claim period provided in subdivision (d) has expired
pursuant to the terms of this section. Suits for refund shall be
brought in accordance with the applicable provisions in this code.
(g) When information in the tax agencies' records is sufficient to
identify the person that paid an amount described in subdivision
(a), and the person's current address, the date of payment, and the
amount paid, the tax agency shall refund that amount. The person
shall not be required to file a claim for refund.
(h) Except as provided in Chapter 4 (commencing with Section 7275)
of Part 1.6, this section shall apply to the tax, fee, assessment,
surcharge, or other amount paid to the tax agency and collected or
levied pursuant to applicable provisions of this code.
(i) Upon appropriation by the Legislature, the amounts necessary
to make refunds pursuant to this section shall be allocated to the
applicable tax agency.
(j) For purposes of this section, "tax agency" includes the board
and the Franchise Tax Board.
SEC. 2. Section 5148 of the Revenue and Taxation Code is amended
to read:
5148. Notwithstanding Section 5140, an action to recover taxes
levied on state-assessed property arising out of a dispute as to an
assessment made pursuant to Section 721, including a dispute as to
valuation, assessment ratio, or allocation of value for assessment
purposes, shall be brought under this section. In any action brought
under this section, the following requirements shall apply:
(a) The action shall be brought by the state assessee. There shall
be a single complaint with all parties joined therein with respect
to disputes for any year.
(b) The action shall name the board and the county or counties.
When a county is named which collected taxes on behalf of a city or
cities, the county shall give notice of that action to the city or
cities within 30 days of receipt of advice from the board of the
action. A fee shall be payable by the state assessee in an amount
prescribed by the court to cover the reasonable costs incurred by a
county or counties in giving that notice. Any city receiving notice
of the action filed against the board and the county may, within 30
days of the receipt of that notice, intervene in that action. Whether
or not a city intervenes in the action, any judgment rendered for an
assessee shall be entered exclusively against the county; however,
the county shall be entitled to recover separately from the city or
cities and other tax entities those taxes collected by the county on
behalf of the city or cities and other tax entities which are subject
to refund to the assessee as the result of the judgment. Payment to
the taxpayer upon the judgment and any interest thereon may be
deferred by the county until the apportionment of property tax
revenue next following the date of the judgment, or as the county and
the taxpayer may otherwise agree. Interest shall accrue during any
deferral period unless the county and taxpayer otherwise agree. The
county may if it chooses to do so offset the amount of the judgment
and interest recoverable by it from the city or cities and other tax
entities against amounts held in the county treasury therefor or
against amounts due and payable thereto, including, but not limited
to, property tax apportionments. The amount of the fee required by
this section shall not be recoverable by the assessee in the action
and no judgment entered in the action in favor of the assessee shall
provide for the recovery of the fee.
As used in this section, "county" includes a city and county.
(c) Service of the summons and complaint shall be only upon the
board. The board shall serve as agent of the defendant county or
counties for the purpose of service of process. A fee shall be
payable by the state assessee in an amount prescribed by the court to
cover all reasonable costs incurred by the board while acting in its
capacity as agent for the defendant counties.
(d) Venue of the action shall be in any county in which the
Attorney General of California has an office or in which the state
assessee has a significant presence.
(e) The action shall be limited in the case of valuation and
allocation disputes to the grounds specified in the following:
(1) A petition for reassessment filed under Section 741, or any
proceeding thereon.
(2) A petition for correction of allocated assessment filed under
Section 747, or any proceeding thereon.
(f) A timely filed petition for reassessment or petition for
correction of allocated assessment shall constitute a claim for
refund if the petitioner states in the petition it is intended to so
serve.
(g) The Except as otherwise provided in
subdivision (j), the action shall be commenced only after
payment of the taxes in issue and within four years after the latest
of the dates that the State Board of Equalization mailed its decision
or its written findings and conclusions on the following:
(1) A petition for reassessment filed under Section 741 and
intended to constitute a claim for refund.
(2) A petition for correction of allocated assessment filed under
Section 747 and intended to constitute a claim for refund.
(h) The action shall not be joined with any action filed under
Section 5140.
(i) Any refund of tax overpayments and any interest thereon,
determined in any action brought under this section to be due shall
be made by the defendant county or counties.
(j) Where the tax assessed or allocated has been determined to
have been illegally assessed or allocated in a final and
nonappealable decision of a court of competent jurisdiction, the
action shall commence no later than one year from the date the court
rendered that decision.
SEC. 3. The Legislature finds and declares that the refunds
allowed to persons by this act with respect to taxes, fees,
assessments, surcharges, or other amounts levied or collected by the
Franchise Tax Board or the State Board of Equalization, as
applicable, that have been determined to be illegally levied or
collected in a final and nonappealable decision of a court of
competent jurisdiction, serves a public purpose and does not
constitute a gift of public funds within the meaning of Section 6 of
Article XVI of the California Constitution.
