07 LC 18
6262S
The
House Committee on Ways and Means offers the following substitute to HB
353:
A
BILL TO BE ENTITLED
AN ACT
AN ACT
To
amend Title 48 of the Official Code of Georgia Annotated, relating to revenue
and taxation, so as to change and add provisions relative to enforcement and
collection of taxes; to provide for offsets against unclaimed property; to
provide for the notification, attachment, and seizure of funds held by financial
institutions; to provide for the service of summons of garnishment; to provide
for the service of subpoenas; to change certain provisions regarding the
attachment, priority, and perfection of state tax liens; to change certain
provisions regarding the disclosure of confidential tax information; to provide
effective dates; to repeal conflicting laws; and for other
purposes.
BE
IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:
SECTION
1.
Title
48 of the Official Code of Georgia Annotated, relating to revenue and taxation,
is amended by revising paragraph (4) of subsection (a) of Code Section 48-2-8,
relating to the state revenue commissioner´s authorization to issue
subpoenas, as follows:
"(4)
Subpoena the attendance of witnesses and require the production of books,
papers, records, and documents and, subject to the rights of the taxpayer as to
rights of privacy guaranteed to
him
the
taxpayer by the Constitution and laws of
this state, may examine such items and the books, records, inventories, or
business of any taxpayer or of any fiduciary, bailee, or other person having
knowledge of the tax liability of any taxpayer or knowledge pertinent to the
investigation or inquiry.
The subpoena
may be served by the commissioner or the commissioner´s authorized
representative to a person at the person´s last known address by registered
or certified mail or statutory overnight delivery, return receipt requested. If
a person refuses to accept service of a subpoena by registered or certified mail
or statutory overnight delivery, the subpoena shall be served by the
commissioner or the commissioner´s authorized representative under any
other method of lawful service and the person shall be personally liable to the
commissioner for a sum equal to the actual costs incurred to serve the subpoena.
This liability shall be paid upon notice and demand by the commissioner or the
commissioner´s delegate and shall be assessed and collected in the same
manner as other taxes administered by the
commissioner."
SECTION
2.
Said
title is further amended by revising Code Section 48-2-15.1, relating to the
disclosure of confidential taxpayer information or records, as
follows:
"48-2-15.1.
Notwithstanding
Code Section
48-7-60 and the prohibition against disclosure of income tax information
contained in any report or return under that Code section and
notwithstanding any other provision of law
to the contrary, confidential taxpayer information or records with respect to
which the taxpayer has granted express written authorization to the commissioner
or an officer or employee of the department may be disclosed to or discussed
with another party."
SECTION
3.
Said
title is further amended in Code Section 48-2-55, relating to attachment and
garnishment, by revising paragraph (2) of subsection (b) and by adding a new
subsection to read as follows:
"(2)
The commissioner or
his
the
commissioner´s authorized
representative may use garnishment to collect any tax, fee, license, penalty,
interest, or collection costs due the state which are imposed by this title or
which the commissioner or the department is responsible for collecting under any
other law. Garnishment may be issued by the commissioner or
his
the
commissioner´s authorized
representative against any person whom
he
the
commissioner believes to be indebted to
the defendant or who has property, money, or effects in
his
such
person´s hands belonging to the
defendant. The summons of garnishment shall be served by the commissioner or
his
the
commissioner´s authorized
representative, shall be served at least 15 days before the sitting of the court
to which the summons is made returnable, and shall be returned to either the
superior court or the state court of the county in which the garnishee is
served. The commissioner or
his
the
commissioner´s authorized
representative shall enter on the execution the names of the persons garnished
and shall return the execution to the appropriate court. All subsequent
proceedings shall be the same as provided by law regarding garnishments in other
cases when judgment has been obtained or execution issued.
In addition to
any other methods of service, the summons of garnishment may be served by the
commissioner or the commissioner´s authorized representative to the
garnishee by registered or certified mail or statutory overnight delivery,
return receipt requested. Either the return receipt indicating receipt by the
garnishee or the envelope bearing the official notification from the United
States Postal Service of the garnishee´s refusal to accept delivery of such
registered or certified mail or statutory overnight delivery shall be filed with
the clerk of the court in which the garnishment is pending. If statutory
overnight delivery was accomplished through a commercial firm as provided under
paragraph (1) of subsection (b) of Code Section 9-10-12, the return receipt
indicating receipt by the garnishee or the envelope bearing the official
notification of such commercial firm of the garnishee´s refusal to accept
delivery shall be filed with the clerk of the court in which garnishment is
pending. If a garnishee refuses to accept service of a summons of garnishment by
registered or certified mail or statutory overnight delivery, the summons of
garnishment shall be served by the commissioner or the commissioner´s
authorized representative under any other method of lawful service and the
garnishee shall be personally liable to the commissioner for a sum equal to the
actual costs incurred to serve the summons of garnishment. This liability shall
be paid upon notice and demand by the commissioner or the commissioner´s
delegate and shall be assessed and collected in the same manner as other taxes
administered by the
commissioner."
"(g)
If an apparent owner or other person entitled to any property paid or delivered
under Article 5 of Chapter 12 of Title 44, the 'Disposition of Unclaimed
Property Act,' is subject to a writ of execution issued under Code Section
48-3-1, the commissioner may offset the execution against the property. Prior to
the offset, the commissioner shall notify the apparent owner or other person
entitled to the property in writing at the owner´s last known address as
shown on the records of the department that the state intends to offset the
person´s delinquent state tax liability against the person´s interest
in or claim to the
property."
SECTION
4.
Said
title is further amended by revising subsections (a), (e), and (f) and by adding
a new subsection in Code Section 48-2-56, relating to creation and priority of
tax liens, to read as follows:
"(a)
Except as otherwise provided in this Code section, liens for all taxes due the
state or any county or municipality in the state shall arise as of the time the
taxes become due and unpaid and all tax liens shall
cover
attach
to all property in which the taxpayer has
any interest from the date the lien arises until such taxes are
paid."
"(e)
The lien for taxes imposed by the provisions of Article 2 of Chapter 7 of this
title, relating to certain income taxes, shall:
(1)
Arise and
cover
attach
to all property of the taxpayer as of the
time a tax execution for these taxes is entered upon the general execution
docket; and
(2)
Not be superior to the lien of a prior recorded instrument securing a bona fide
debt.
Before
the lien provided for in this subsection shall attach to real property it shall
be recorded in the county where the real property is located.
(f)
The lien for taxes imposed by the provisions of Article 5 of Chapter 7 of this
title, relating to withholding taxes, shall:
(1)
Arise and attach to all property of the defaulting employer or other person
required to deduct and withhold on the date of the assessment of the taxes by
operation of law or by action of the commissioner;
(2)
Not be superior to the lien of a prior recorded instrument securing a bona fide
debt; and
(3)
Not be superior to the lien of a subsequent bona fide purchaser or lender for
value recorded prior to the time the execution for the tax has been entered on
the general execution docket in the office of the superior court of the county
in which the property affected is located.
Before
the lien provided for in this subsection shall attach to real property it shall
be recorded in the county where the real property is
located."
"(i)
Before the liens provided for in this Code section for taxes imposed by the
provisions of Article 2 of Chapter 7 of this title, relating to certain income
taxes, and Article 5 of Chapter 7 of this title, relating to withholding taxes,
shall attach to real property in which the taxpayer has any interest, the
execution for these taxes shall be recorded with the clerk of the superior court
of the taxpayer´s last known residence as shown on the department´s
records or the county in which the taxpayer may own property. It shall then be
the duty of the clerk of the superior court of the county in which the tax
execution for these taxes or any other taxes due the state is filed to enter the
execution upon the lien records of the superior court of said county, with the
execution being recorded in the same manner and form as prescribed by the
general laws of the State of Georgia relating to executions issued by a superior
court of this state and processed and transmitted electronically for inclusion
in the state-wide uniform automated information system for real and personal
property records, as provided in Code Section 15-6-97. When the execution has
been issued, docketed, and included in the state-wide uniform automated
information system as required in this subsection, the lien shall be a perfected
lien upon all property and rights to property of the taxpayer, both real and
personal, in each county of this
state."
SECTION
5.
Said
title is further amended by adding a new Code section to read as
follows:
"48-2-62.
(a)
As used in this Code section, the term:
(1)(A)
'Account' means:
(i)
Any funds from a demand deposit account, checking account, negotiable order of
withdrawal account, savings account, time deposit account, money market mutual
fund account, or certificate of deposit account;
(ii)
Any funds paid towards the purchase of shares or other interest in a financial
institution, as defined in subparagraphs (B) and (C) of paragraph (3) of this
subsection; and
(iii)
Any funds or property held by a financial institution, as defined in
subparagraph (D) of paragraph (3) of this subsection.
(B)
'Account' does not include:
(i)
An account or portion of an account to which an obligor does not have access due
to the pledge of the funds as security for a loan or other
obligation;
(ii)
Funds or property deposited to an account after the time that the financial
institution initially attaches the account;
(iii)
An account or portion of an account to which the financial institution has a
present right to exercise a right of setoff;
(iv)
An account or portion of an account that has an account holder of interest named
as an owner on the account; or
(v)
An account or portion of an account to which the obligor does not have an
unconditional right of access.
(2)
'Account holder of interest' means any person, other than the obligor, who
asserts an ownership interest in an account.
(3)
'Financial institution' means:
(A)
A depository institution, as defined in the federal Deposit Insurance Act under
12 U. S. C. Section 1813(c), having Georgia deposits greater than $15 billion
according to the Federal Deposit Insurance Corporation Summary of Deposits
annual report as of June 30; or
(B)
A benefit association, insurance company, safe deposit company, money market
mutual fund, or similar entity doing business in this state that holds property
or maintains accounts reflecting property belonging to others.
(4)
'Obligor' means a person whose property is subject to a state tax lien.
(b)
The commissioner may request from a financial institution information and
assistance to enable the department to enforce the tax laws of the state.
(c)(1)
Not more frequently than once every calendar quarter or as otherwise agreed to
by the financial institution, the commissioner may request from a financial
institution the information set forth in paragraph (2) of subsection (d) of this
Code section concerning any obligor who is delinquent in the payment of taxes.
(2)
A request for information by the commissioner under paragraph (1) of this
subsection shall:
(A)
Contain the full name of the obligor and any other names known to be used by the
obligor and the social security number, federal employer identification number,
or other taxpayer identification number of the obligor; and
(B)
Be transmitted to the financial institution in machine readable form.
(d)(1)
Within 30 days of a request from the commissioner, or as otherwise agreed to by
the financial institution, for information under subsection (c) of this Code
section, the financial institution shall, with respect to each obligor whose
name the commissioner submitted to the financial institution, submit a report to
the commissioner.
(2)(A)
Except as provided in subparagraph (B) of this paragraph, the report described
in paragraph (1) of this subsection shall contain, to the extent reflected in
the records of the financial institution:
(i)
The full name of the obligor;
(ii)
The address of the obligor;
(iii)
The social security number, federal employer identification number, or other
taxpayer identification number of the obligor;
(iv)
Any other identifying information needed to ensure positive identification of
the obligor; and
(v)
For each account of the obligor, the obligor´s account number and
balance.
(B)
For a financial institution that submits reports through the federal parent
locator service under 42 U.S.C. Section 666(a)(17), the report described in
paragraph (1) of this subsection may contain information that meets the
specifications required for financial data match reports under the federal
parent locator service.
(3)
A report submitted under paragraph (1) of this subsection shall be provided to
the commissioner in machine readable form.
(4)
The commissioner shall pay the financial institution a reasonable fee, not to
exceed the actual costs incurred by the financial institution to comply with the
requirements of this Code section.
(5)
The commissioner may institute civil proceedings to enforce this Code
section.
(e)
A financial institution that complies with a request from the commissioner by
submitting a report to the commissioner in accordance with subsection (d) of
this Code section is not liable under state law to any person for
any:
(1)
Disclosure of information to the commissioner under this Code section; or
(2)
Other action taken in good faith to comply with the requirements of this Code
section.
(f)
A financial institution furnishing a report to the commissioner under this Code
section is prohibited from disclosing to an obligor that the name of that
obligor has been received from or furnished to the commissioner.
(g)(1)(A)
The commissioner may send notice of a tax lien to any financial institution that
the commissioner reasonably believes holds property subject to a tax
lien.
(B)
The notice to be sent under this paragraph shall be provided by:
(i)
First-class mail, under the postmark of the United States Postal Service, at the
address designated for this purpose by the financial institution or, if no
address has been designated, to the principal office of the financial
institution;
(ii)
An electronic format agreed on by the commissioner and the financial
institution; or
(iii)
Any other reasonable manner as agreed on by the commissioner and the financial
institution.
(2)
The notice to be sent by the commissioner to a financial institution under
paragraph (1) of this subsection shall contain:
(A)
The name of the obligor;
(B)
The amount of the tax lien;
(C)
The last known address of the obligor;
(D)
The social security number, federal employer identification number, or other
taxpayer identification number of the obligor; and
(E)
A notice to immediately seize and attach from one or more accounts held by the
financial institution in the name of the obligor an aggregate amount equal to
the lesser of the amounts in all accounts or the amount of the tax lien.
(h)(1)
On receipt of the notice described in subsection (g) of this Code section, the
financial institution promptly shall seize and attach from one or more of the
accounts of the obligor held by the financial institution an aggregate amount
equal to the lesser of:
(A)
The total of the amounts in all the accounts of the obligor held by the
financial institution; or
(B)
The amount stated in the notice sent under subsection (g) of this Code
section.
(2)
Within 15 days after the financial institution receives the notice directing it
to seize and attach accounts of the obligor, the financial institution shall
send notice to the commissioner, in the manner specified in subsection (g) of
this Code section, specifying the aggregate amount held under this subsection.
(3)(A)
The financial institution may assess a fee against the accounts of the obligor
in addition to the amount identified in the notice under subsection (g) of this
Code section.
(B)
In the case of insufficient funds to cover both the fee and the amount
identified in the notice under subsection (g) of this Code section, the
financial institution may first deduct and retain the fee from the amount seized
and attached as provided in this Code section.
(4)
The financial institution shall not be held liable to any person, including the
commissioner, the obligor, or any account holder of interest, for wrongful
dishonor or for any other claim relating to the seizure and attachment of an
account or other actions taken in compliance with this Code
section.
(i)(1)
Within ten business days after the commissioner has received notice from the
financial institution under paragraph (2) of subsection (h) of this Code
section, the commissioner shall send a notice to the obligor, by regular mail,
to the obligor´s last known address.
(2)
The notice shall contain the following information, to the extent known by the
commissioner:
(A)
The address of the commissioner;
(B)
The telephone number, address, and name of a contact person at the office of the
commissioner;
(C)
The name and social security number, federal employer identification number, or
other taxpayer identification number of the obligor;
(D)
The address of the obligor;
(E)
For each account of the obligor, the name of the financial institution that has
seized and attached amounts as required by this Code section;
(F)
The total amount of the tax lien owed by the obligor;
(G)
The date the notice is being sent;
(H)
A statement informing the obligor that the commissioner has directed the
financial institution to seize and attach the amount of the tax lien owed by the
obligor from one or more of the accounts of the obligor and, on subsequent
notice by the commissioner, to forward the amount to the commissioner;
and
(I)
A statement informing the obligor that, unless a timely challenge is made by the
obligor or an account holder of interest under subsection (l) of this Code
section, the commissioner shall notify the financial institution to forward the
amount seized and attached by the financial institution to the
commissioner.
(3)
The commissioner shall not be obligated to send the notice described in
paragraphs (1) and (2) of this subsection if, prior to the time that the
notice must be sent, the commissioner and the obligor agree to an arrangement
under which the obligor will pay amounts owed under the tax lien.
(j)(1)
If a timely challenge is not made by the obligor or an account holder of
interest under subsection (l) of this Code section, the commissioner shall send
a notice to the financial institution, in the manner specified in subsection (g)
of this Code section, directing the institution to:
(A)
Forward the amount seized and attached by the financial institution to the
commissioner;
(B)
Reduce the amount seized and attached by the financial institution to a revised
amount as stated, forward the revised amount to the commissioner, and release
the excess amount; or
(C)
Release the amount seized and attached by the financial
institution.
(2)
The commissioner may send the notice described in paragraph (1) of this
subsection before the time for filing a timely challenge under subsection (l) of
this Code section on agreement among the commissioner, the obligor, and, if the
commissioner is aware of an account holder of interest, the account holder of
interest.
(k)
The commissioner shall apply the amount seized and forwarded by the financial
institution to the obligor´s tax lien obligation.
(l)(1)
An obligor or an account holder of interest may challenge the actions of the
commissioner under this Code section by filing a motion with the commissioner
within 30 days of the date of the notice sent under paragraph (1) of subsection
(i) of this Code section.
(2)
An obligor or an account holder of interest may challenge the actions of the
commissioner based on:
(A)
A mistake in the identity of the obligor;
(B)
A mistake in the ownership of the account;
(C)
A mistake in the contents of the account; or
(D)
A mistake in the amount of the lien obligation due.
(3)
An obligor or an account holder of interest may not challenge the actions of the
commissioner based on a mistake or error in the original tax assessment
underlying the tax lien against the obligor.
(4)
The commissioner´s denial of an obligor or an account holder of
interest´s motion challenging the actions of the commissioner under this
Code section is not a contested case under Chapter 13 of Title 50, the 'Georgia
Administrative Procedure Act.'
(m)(1)
The commissioner may withdraw the notice to seize and attach accounts by sending
notice to the financial institution, in the manner specified in subsection (g)
of this Code section, directing the financial institution to release the
attachment on the accounts.
(2)
If a determination is made by the commissioner that the account or accounts of
the obligor should not have been held, the commissioner shall notify the
financial institution, in the manner specified in subsection (g) of this Code
section, to release the amount seized and attached by the financial
institution.
(3)
If a determination is made by the commissioner, pursuant to a challenge under
subsection (l) of this Code section, to reduce the amount seized and attached by
the financial institution, the commissioner shall notify the financial
institution, in the manner specified in subsection (g) of this Code section, to
revise the amount as stated, forward the revised amount to the commissioner, and
release the excess amount seized and attached by the financial
institution.
(4)(A)
If a challenge made under subsection (l) of this Code section is denied by the
commissioner, the commissioner shall notify the financial institution, in the
manner specified in subsection (g) of this Code section, to forward the amount
seized and attached by the financial institution to the
commissioner.
(B)
A financial institution that complies with a notice from the commissioner sent
under this Code section is not liable under state law to any person
for:
(i)
Any disclosure of information to the commissioner under this Code
section;
(ii)
Seizing and attaching any amounts from an account or sending any amount seized
and attached by the financial institution to the commissioner; or
(iii)
Any other action taken in good faith to comply with the requirements of this
Code section.
(n)
A financial institution has no obligation to reimburse fees assessed as a result
of the commissioner instituting an action under this Code section or as
otherwise permitted by law or authorized by contract.
(o)
This Code section may not be construed to prohibit the commissioner from
collecting taxes due from the obligor in any other manner authorized by
law."
SECTION
6.
(a)
Except as otherwise provided in subsection (b) of this section, this Act shall
become effective upon its approval by the Governor or upon its becoming law
without such approval.
(b) Section 5 of this Act shall become effective on July 1, 2008.
(b) Section 5 of this Act shall become effective on July 1, 2008.
SECTION
7.
All
laws and parts of laws in conflict with this Act are repealed.