Tag: Taxpayer Bill of Rights

Alabama Legislature Strengthening Protections For Taxpayers

On April 21, the Alabama House of Representatives voted 88-0 to pass HB427 , Rep. Paul DeMarco’s Taxpayer Bill of Rights.  HB 427 / SB 347 has been endorsed by the Alabama State Bar, the Business Associations’ Tax Coalition, the Business Council of Alabama, the Alabama Retail Association, the Alabama Society of CPAs, the Birmingham Business Alliance, the Council On State Taxation (“COST”) and the Tax Executives Institute (“TEI”).  Below is a good summary of what the bill will do:

  • If it Ain’t Broke…. The Appearance of Fairness – by creating the Alabama Tax Appeals Commission (“ATAC”), this bill eliminates the cloak of unfairness that exists when a taxpayer’s case is decided by an employee of the Department of Revenue, or the local city or county government or its bounty hunter firm, which was the same entity that issued the assessment.  And to illustrate that, the current ALJ nearly lost his job and was audited by the Commissioner of Revenue when the judge ruled against the Department for the taxpayer. He was even threatened at knifepoint and had to hire an attorney to resolve the matter.
  • Critical for Economic Development/State’s Reputation – Alabama is now in the distinct minority of states that lack an independent tax appeals tribunal and we continually receive a “D” on the annual State Tax Due Process Scorecard issued by COST, primarily for this reason. (Send them the COST endorsement letter if you think this would help.)  The creation of an independent tax appeals process and extending the appeal deadlines from 30 to 60 days will greatly improve Alabama’s rank among neighboring states competing for the same scarce jobs. Heck, even MS and LA have enacted independent tax commissions in the last year! [Note–Cam Ward and Phil Williams are both involved in econ. development]
  • “It will cost the State money.” The Legislative Fiscal Office has scored the bill as revenue neutral.  We are merely carving out the ALD and creating a separate agency to house the same people. No increase in pay. We may need a second judge in 2 years or so when taxpayers can start appealing final assessments from self-administered localities, but that will be a Godsend to taxpayers.
  • Helps not Harms Small Businesses – No filings fees are imposed by ATAC. No attorney is needed—just as under current practice. Ask Judge Thompson.  Plus, taxpayers may appeal final assessments of sales, use, rental and lodgings taxes from self-administered cities and countries (and their private auditing firms) to the ATAC, unless the governing body of the city or county opts-out.  Instead of being faced with filing separate appeals in numerous cities and counties at one time, or facing a hearing officer hired/paid by RDS/AlaTax, taxpayers may appeal to ONE independent agency with specialized tax expertise—without paying the tax or posting an expensive surety bond up front.  The ability to appeal all state and local tax disputes to one agency is a huge step towards simplifying compliance Alabama’s “unique” system that allows all local governments to collect their own taxes or contract out that function.  No other state is like this.
  • “The bill is too long” – Yes, it is a long bill but part of that is due to the requirement that we include the entire statute in the bill even when we are amending only one sentence; and about half of it relates to creating ATAC.  It addresses a long list of problems with the current tax procedures and updates several procedures to conform to federal law.
  • Implements Important Updates to Certain Procedures, including ELIMINATING the $50 failure to file penalty when an individual taxpayer is due an income tax refund and expands the innocent spouse relief available to Alabama residents consistent with recent federal changes.
  • Overrules Rheem and levels the playing field by clarifying that the ATAC may consider any arguments that may be raised by the taxpayer regarding their refund claim, just as the Department of Revenue may conduct a second audit of a taxpayer in response to their refund claims.  AEA totally misrepresented the result of that case and even the facts.
  • The AEA is opposed to it – so that should tell the Senators something.  The ADOR is opposed only to the ATAC provisions because they don’t want lose control over the appointment process (even though the Governor will effectively control it under the bill and the Commissioner IS ON THE NOMINATING COMMITTEE, too).
  • Endorsements – BATC, BCA, ARA, ASCPA, the Council On State Taxation (COST), and the American Bar Association have endorsed the entire bill, while ALEC, NCSL, and even the National Taxpayers Union have endorsed the ATAC provisions.

Coming Up This Week In The Alabama Legislature

On the Senate side…

In Committee:

SB196–Sen. Paul Bussman’s Shared Parenting bill:  Changes the custodial presumption in child custody cases from 80%/20% to 50%/50%

HB58–Rep. Mike Ball’s Ethics Disclosure Requirements:  Requires public officials/candidates and spouses of public officials/candidates to disclose if they are employed by the state or federal government or have a contract with the state or federal government.

HB64–Rep. Kurt Wallace’s Secret Ballot Protection Act:  Constitutional amendment protecting the right to a secret ballot in employee representation.

SB46–Sen. Cam Ward’s Health Care Rights of Conscience Act:  This legislation will provide a conscience exception for health care providers and pharmacists who believe in the sanctity of life and choose not to perform procedures or provide medication that do not comply with that belief.

SB310–Sen. Trip Pittman’s Teacher Tenure Law and Fair Dismissal Act:  Reforms the state’s tenure system for teachers in order to improve the quality of education in Alabama.

On the floor:

SB301–Rep. Phil Williams’ pro-life legislation:  Redefines person to include all humans from the moment of fertilization.

SB172–Sen. Del Marsh’s legislation to prohibit the use of gas chambers when euthanizing cats or dogs.

SB112–Sen. Arthur Orr’s legislation to remove racist language from the Alabama Constitution of 1901.

SB256–Sen. Scott Beason’s Immigration Reform Legislation–reforming the state immigration laws to provide for enforcement of federal immigration laws.

On the House side…

In Committee:

HB98–Rep. Kerry Rich and Rep. Wayne Johnson’s legislation to impose term limits on legislators in Alabama:  Limits to three consecutive full terms in the House and/or Senate.

HB206–Rep. Jack Williams’ legislation to increase the distance campaign materials and candidates can be to a polling location to 300 ft.

HB427–Rep. Paul DeMarco’s Taxpayer Bill of Rights:  This legislation will, among other things, amend the Alabama Taxpayer Bill of Rights to conform to the federal Taxpayer Bill of Rights including certain aspects like an “innocent spouse” defense.  It will also increase the time period in which a taxpayer has to file an appeal of a preliminary or final assessment.

HB193–Rep. Mike Jones’ legislation to prohibit lawsuits against restaurants for obesity or weight gain.

On the floor:

HB123–Rep. Jay Love: Education Budget for fiscal year ending Sept. 30, 2012