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A BILL TO BE ENTITLED
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AN ACT
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relating to certain tax and fee collection procedures and taxpayer |
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suits. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 111.0041(c), Tax Code, is amended to |
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read as follows: |
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(c) A taxpayer shall produce sufficient [contemporaneous] |
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records and supporting documentation appropriate to the tax or fee |
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for the transactions in question to substantiate and enable |
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verification of the taxpayer's claim related to the amount of tax, |
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penalty, or interest to be assessed, collected, or refunded in an |
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administrative or judicial proceeding. Sufficient |
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[Contemporaneous] records and supporting documentation appropriate |
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to the tax or fee may include[, for example,] invoices, vouchers, |
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checks, shipping records, contracts, or other equivalent records, |
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such as electronically stored images of such documents, reflecting |
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legal relationships and taxes collected or paid. |
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SECTION 2. Section 111.0081, Tax Code, is amended by |
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amending Subsection (c) and adding Subsection (d) to read as |
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follows: |
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(c) The amount of a determination made under this code is |
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due and payable 20 days after a comptroller's decision in a |
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redetermination hearing becomes final. Except as provided by |
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Subsection (d), if [If] the amount of the determination is not paid |
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within 20 days after the day the decision became final, a penalty of |
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10 percent of the amount of the determination, exclusive of |
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penalties and interest, shall be added. |
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(d) The penalty provided by Subsection (c) is abated with |
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respect to the disputed amount that is the subject of a timely filed |
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suit under Subchapter E, Chapter 112. If the amount determined to |
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be due in a final judgment in the suit is not paid within 20 days |
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after the day the judgment became final, a penalty of 10 percent of |
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the amount due, exclusive of penalties and interest, shall be |
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added. |
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SECTION 3. Subchapter A, Chapter 111, Tax Code, is amended |
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by adding Section 111.0091 to read as follows: |
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Sec. 111.0091. DISPUTING RESULTS OF MANAGED AUDITS: NOTICE |
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OF INTENT TO BYPASS REDETERMINATION PROCESS. (a) A person who |
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conducts a managed audit authorized by Section 151.0231 or 201.3021 |
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may file with the comptroller a notice of intent to bypass the |
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redetermination process under Section 111.009. The notice of |
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intent must: |
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(1) be filed on or before the 60th day after the date |
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the comptroller issues a letter notifying the person of the results |
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of the managed audit; |
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(2) be in writing; |
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(3) assert the material facts and each specific legal |
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basis for disputing the results of the managed audit; and |
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(4) specify the amounts of the disputed underpayments |
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or overpayments contained in the report of the managed audit |
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results. |
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(b) A person who files a notice of intent under Subsection |
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(a) may bypass the redetermination process under Section 111.009 |
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and bring a suit under Subchapter D, Chapter 112, if: |
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(1) the person participated in a conference under |
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Subsection (c), in which case the suit must be filed on or before |
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the 60th day after the date the conference concludes or a later date |
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agreed to by the comptroller; or |
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(2) the comptroller does not provide notice in the |
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time required by Subsection (d) that a conference is required, in |
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which case the suit must be filed on or before the 90th day after the |
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date the notice of intent was filed. |
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(c) The comptroller may require a conference between a |
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person who files a notice of intent under Subsection (a) and a |
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designated officer or employee of the comptroller to clarify any |
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fact or legal issue in dispute regarding the results of the managed |
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audit and to discuss the availability of additional documentation |
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that may assist in resolving outstanding issues regarding the |
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managed audit. The person who filed the notice of intent may amend |
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a material fact or legal basis described by Subsection (a)(3) |
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following the conference if the comptroller agrees in writing to |
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the amendment. |
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(d) If the comptroller requires a conference under |
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Subsection (c), the comptroller shall notify the person of the |
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conference requirement not later than the 30th day after the date |
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the notice of intent under Subsection (a) was filed. The notice of |
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the conference requirement must be in writing and include a date and |
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time for the conference. The conference date provided in the notice |
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must be not later than the 90th day after the date the notice of |
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intent was filed. |
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(e) The person who filed the notice of intent under |
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Subsection (a) may request to reschedule the conference date |
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provided in the notice under Subsection (d). The comptroller shall |
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make a good faith effort to accommodate the request. If the |
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comptroller and the person who filed the notice of intent do not |
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agree on or before the 90th day after the date the notice of intent |
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was filed to a rescheduled date for the conference, the person may |
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on or before the 120th day after the date the notice of intent was |
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filed rescind the notice of intent and petition the comptroller for |
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a redetermination under Section 111.009. |
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(f) Except as provided by Subsection (e), a person who files |
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a notice of intent under Subsection (a) waives the person's right to |
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a redetermination under Section 111.009. |
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SECTION 4. Section 112.052(d), Tax Code, is amended to read |
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as follows: |
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(d) A taxpayer shall produce sufficient [contemporaneous] |
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records and supporting documentation appropriate to the tax for the |
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transactions in question to substantiate and enable verification of |
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a taxpayer's claim relating to the amount of the tax, penalty, or |
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interest that has been assessed or collected or will be refunded, as |
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required by Section 111.0041. |
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SECTION 5. The heading to Subchapter D, Chapter 112, Tax |
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Code, is amended to read as follows: |
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SUBCHAPTER D. SUIT FOR TAX REFUND OR TO DISPUTE RESULTS OF MANAGED |
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AUDIT |
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SECTION 6. Section 112.151(f), Tax Code, is amended to read |
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as follows: |
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(f) A taxpayer shall produce sufficient [contemporaneous] |
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records and supporting documentation appropriate to the tax or fee |
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for the transactions in question to substantiate and enable |
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verification of a taxpayer's claim relating to the amount of the |
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tax, penalty, or interest that has been assessed or collected or |
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will be refunded, as required by Section 111.0041. |
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SECTION 7. Subchapter D, Chapter 112, Tax Code, is amended |
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by adding Section 112.1511 to read as follows: |
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Sec. 112.1511. SUIT TO DISPUTE RESULTS OF MANAGED AUDIT. |
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(a) A person may sue the comptroller to dispute the results of a |
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managed audit conducted under Section 151.0231 or 201.3021 if the |
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person: |
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(1) has been issued a letter by the comptroller |
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notifying the person of the results of the managed audit; and |
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(2) is authorized to bring the suit under Section |
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111.0091(b). |
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(b) The suit must be brought against both the comptroller |
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and the attorney general and must be filed in a district court. |
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(c) The suit must be filed during the time provided by |
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Section 111.0091(b) or it is barred. |
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(d) The amounts of the disputed underpayments or |
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overpayments contained in the report of the managed audit results |
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must be set out in the original petition. A copy of the notice of |
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intent filed under Section 111.0091(a) must be attached to the |
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original petition filed with the court and to the copies of the |
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original petition served on the comptroller and the attorney |
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general. |
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(e) A person may not intervene in the suit. |
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(f) A taxpayer shall produce sufficient records and |
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supporting documentation appropriate to the tax or fee for the |
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transactions in question to substantiate and enable verification of |
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a taxpayer's claim relating to the amount of the tax, penalty, or |
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interest to be assessed, collected, or refunded, as required by |
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Section 111.0041, including the amounts of the disputed |
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underpayments or overpayments contained in the report of the |
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managed audit results. |
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(g) After the comptroller has been timely served in a suit |
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that complies with this section, the comptroller and the attorney |
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general: |
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(1) are enjoined from collecting disputed |
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underpayments identified in Section 111.0091(a)(4) from the person |
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bringing the suit during the pendency of the suit; and |
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(2) are not enjoined from: |
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(A) asserting tax liens; or |
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(B) as an alternative to asserting tax liens, |
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requiring the person to provide security: |
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(i) in an amount sufficient to secure |
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payment of the entire disputed amount, including penalties and |
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accrued interest, that is the subject of the suit; and |
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(ii) in the form of a cash deposit filed |
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with the comptroller or paid into the registry of the court, a |
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surety bond, a letter of credit, or another form of guarantee. |
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(h) Damages may be awarded under Chapter 65, Civil Practice |
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and Remedies Code, if the court determines that all or part of the |
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enjoined collection amounts under Subsection (g) were disputed |
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solely for delay. |
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SECTION 8. Section 112.152, Tax Code, is amended to read as |
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follows: |
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Sec. 112.152. ISSUES IN SUIT. (a) The only issues that may |
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be raised in a suit under this subchapter are, as applicable, the: |
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(1) grounds of error contained in the motion for |
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rehearing; or |
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(2) material facts and legal bases contained in the |
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notice of intent filed under Section 111.0091(a) or 111.106(a). |
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(b) The suit applies only to a tax liability period |
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considered in the comptroller's decision or covered by the notice |
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of intent filed under Section 111.0091 or 111.106, as applicable. |
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SECTION 9. Section 112.201, Tax Code, is amended by |
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amending Subsection (c) and adding Subsections (c-1) and (c-2) to |
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read as follows: |
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(c) A person bringing a suit under this subchapter may pay |
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the disputed amounts as provided by Chapter 111. A disputed amount |
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that is not paid as provided by Chapter 111 and that is determined |
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to be due in a final judgment accrues penalties and interest as |
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provided by Chapter 111. |
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(c-1) After the comptroller has been timely served in a suit |
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that complies with this subchapter, the comptroller and the |
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attorney general: |
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(1) are enjoined from collecting disputed amounts from |
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the person bringing the suit during the pendency of the suit; and |
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(2) [but] are not enjoined from: |
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(A) asserting tax liens; or |
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(B) as an alternative to asserting tax liens, |
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requiring the person to provide security: |
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(i) in an amount sufficient to secure |
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payment of the entire disputed amount, including penalties and |
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accrued interest, that is the subject of the suit; and |
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(ii) in the form of a cash deposit filed |
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with the comptroller or paid into the registry of the court, a |
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surety bond, a letter of credit, or another form of guarantee. |
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(c-2) Damages may be awarded under Chapter 65, Civil |
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Practice and Remedies Code, if the court determines that all or part |
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of the enjoined collection amounts under Subsection (c-1) were |
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disputed solely for delay. |
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SECTION 10. Section 112.202, Tax Code, is amended to read as |
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follows: |
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Sec. 112.202. RECORDS. A person shall produce, in |
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connection with a suit under this subchapter, sufficient |
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[contemporaneous] records and supporting documentation appropriate |
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to the tax for the transactions in question to substantiate and |
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enable verification of the person's claim relating to the amount of |
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the tax, penalty, or interest that has been assessed or collected, |
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as required by Section 111.0041. |
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SECTION 11. Section 111.105(e), Tax Code, is repealed. |
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SECTION 12. This Act applies to a managed audit that is in |
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progress and an administrative or judicial proceeding that is |
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pending or filed on or after the effective date of this Act, without |
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regard to whether the taxes that are the subject of the managed |
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audit or proceeding were due before, on, or after that date. |
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SECTION 13. This Act takes effect immediately if it |
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receives a vote of two-thirds of all the members elected to each |
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house, as provided by Section 39, Article III, Texas Constitution. |
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If this Act does not receive the vote necessary for immediate |
|
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effect, this Act takes effect September 1, 2023. |