Bill Text: MI HB4003 | 2013-2014 | 97th Legislature | Engrossed
Bill Title: Taxation; administration; offer-in-compromise program; provide for. Amends sec. 28 of 1941 PA 122 (MCL 205.28) & adds sec. 23a.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Passed) 2014-07-16 - Assigned Pa 240'14 With Immediate Effect [HB4003 Detail]
Download: Michigan-2013-HB4003-Engrossed.html
HB-4003, As Passed House, January 23, 2014
HOUSE BILL No. 4003
January 9, 2013, Introduced by Rep. Walsh and referred to the Committee on Tax Policy.
A bill to amend 1941 PA 122, entitled
"An act to establish the revenue collection duties of the
department of treasury; to prescribe its powers and duties as the
revenue collection agency of this state; to prescribe certain
powers and duties of the state treasurer; to establish the
collection duties of certain other state departments for money or
accounts owed to this state; to regulate the importation, stamping,
and disposition of certain tobacco products; to provide for the
transfer of powers and duties now vested in certain other state
boards, commissions, departments, and offices; to prescribe certain
duties of and require certain reports from the department of
treasury; to provide procedures for the payment, administration,
audit, assessment, levy of interests or penalties on, and appeals
of taxes and tax liability; to prescribe its powers and duties if
an agreement to act as agent for a city to administer, collect, and
enforce the city income tax act on behalf of a city is entered into
with any city; to provide an appropriation; to abolish the state
board of tax administration; to prescribe penalties and provide
remedies; and to declare the effect of this act,"
by amending section 28 (MCL 205.28), as amended by 2010 PA 313, and
by adding section 23a.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 23a. (1) The state treasurer, or an authorized
representative of the state treasurer, may compromise all or any
part of any payment of a tax, unpaid account, or amount due the
state or any of its departments, institutions, or agencies, subject
to administration under this act including any related penalties
and interest if 1 or more of the following grounds exist:
(a) A doubt exists as to liability.
(b) A doubt exists as to collectibility.
(c) A substantial probability exists that a compromise would
further the fair and efficient administration of the tax.
(2) Except as otherwise provided under subsection (3), if the
state treasurer, or an authorized representative of the state
treasurer, compromises all or any part of any payment of a tax,
unpaid account, or amount due the state or any of its departments,
institutions, or agencies as authorized under subsection (1), he or
she shall place on file in the office of the state treasurer a
written report outlining the basis for the compromise and, at a
minimum, a statement of each of the following:
(a) The amount of tax assessed or other amount due to this
state.
(b) The amount of interest, additional amount, addition to the
tax, or assessable penalty imposed by law on the person against
whom the tax is assessed.
(c) The amount actually paid in accordance with the terms of
the compromise.
(3) The state treasurer, or an authorized representative of
the state treasurer, is not required to file a report if the
compromise is related to a civil case that involves an unpaid
amount of tax assessed, an unpaid account, or other amount due
including any interest, additional amount, addition to the tax, or
other assessable penalty that is less than $25,000.00.
(4) A compromise under this section is subject to continuing
quality review by the state treasurer. The department may revoke
any compromise if the compromise was induced by fraud or perjury,
or if the taxpayer fails to comply with any tax payment agreement
within 5 years after the date the compromise is made.
(5) The fact that a taxpayer received a federal compromise of
tax in a tax year is prima facie evidence that the same taxpayer is
entitled to a compromise of any similar or comparable Michigan tax
liability that exists, at least in a proportional amount, for the
tax year in which the federal compromise was granted.
(6) Within 90 days after the effective date of the amendatory
act that added this section, the state treasurer shall do all of
the following:
(a) Establish guidelines for the offer-in-compromise program
authorized under this section. If appropriate, the guidelines shall
be modeled after those guidelines published by the internal revenue
service of the United States department of treasury in regards to
the federal offer-in-compromise program established under section
7122 of the internal revenue code.
(b) Establish administrative guidelines for officers and
employees within the department to use when making decisions on
whether an offer-in-compromise is appropriate.
(c) Establish procedures for an independent administrative
review of any rejection of a proposed offer-in-compromise made by a
taxpayer under this section before the rejection is communicated to
the taxpayer.
(d) Establish procedures for the appeal of any rejection of an
offer-in-compromise by the taxpayer.
(e) Establish appropriate application fees and procedures to
allow for payment plans to satisfy a compromised liability.
(7) The department shall disclose return information to
members of the general public to the extent necessary to permit
inspection of any accepted offer-in-compromise under this section
relating to the liability for a tax imposed by this state.
Sec. 28. (1) The following conditions apply to all taxes
administered under this act unless otherwise provided for in the
specific tax statute:
(a) Notice, if required, shall be given either by personal
service or by certified mail addressed to the last known address of
the taxpayer. Service upon the department may be made in the same
manner.
(b) An injunction shall not issue to stay proceedings for the
assessment and collection of a tax.
(c) In addition to the mode of collection provided in this
act, the department may institute an action at law in any county in
which the taxpayer resides or transacts business.
(d) The state treasurer may request in writing information or
records in the possession of any other department, institution, or
agency of state government for the performance of duties under this
act. Departments, institutions, or agencies of state government
shall furnish the information and records upon receipt of the state
treasurer's request. Upon request of the state treasurer, any
department, institution, or agency of state government shall hold a
hearing under the administrative procedures act of 1969, 1969 PA
306, MCL 24.201 to 24.328, to consider withholding a license or
permit of a person for nonpayment of taxes or accounts collected
under this act.
(e)
Except as otherwise provided in section sections 23a and
30c, the state treasurer or an employee of the department shall not
compromise or reduce in any manner the taxes due to or claimed by
this state or unpaid accounts or amounts due to any department,
institution, or agency of state government. This subdivision does
not prevent a compromise of interest or penalties, or both.
(f) Except as otherwise provided in this subdivision or in
subsection (6) or (7), an employee, authorized representative, or
former employee or authorized representative of the department or
anyone connected with the department shall not divulge any facts or
information obtained in connection with the administration of a tax
or information or parameters that would enable a person to
ascertain the audit selection or processing criteria of the
department for a tax administered by the department. An employee or
authorized representative shall not willfully inspect any return or
information contained in a return unless it is appropriate for the
proper administration of a tax law administered under this act. A
person may disclose information described in this subdivision if
the disclosure is required for the proper administration of a tax
law administered under this act or the general property tax act,
1893 PA 206, MCL 211.1 to 211.155, pursuant to a judicial order
sought by an agency charged with the duty of enforcing or
investigating support obligations pursuant to an order of a court
in a domestic relations matter as that term is defined in section 2
of the friend of the court act, 1982 PA 294, MCL 552.502, or
pursuant to a judicial order sought by an agency of the federal,
state, or local government charged with the responsibility for the
administration or enforcement of criminal law for purposes of
investigating or prosecuting criminal matters or for federal or
state grand jury proceedings or a judicial order if the taxpayer's
liability for a tax administered under this act is to be
adjudicated by the court that issued the judicial order. A person
required to disclose information under section 10(1)(j) of the
Michigan economic growth authority act, 1995 PA 24, MCL 207.810,
may disclose the information only to the individuals described in
that section. A person may disclose the adjusted gross receipts and
the wagering tax paid by a casino licensee licensed under the
Michigan gaming control and revenue act, 1996 IL 1, MCL 432.201 to
432.226, pursuant to section 18, sections 341, 342, and 386 of the
management and budget act, 1984 PA 431, MCL 18.1341, 18.1342, and
18.1386, or authorization by the executive director of the gaming
control board. However, the state treasurer or a person designated
by the state treasurer may divulge information set forth or
disclosed in a return or report or by an investigation or audit to
any department, institution, or agency of state government upon
receipt of a written request from a head of the department,
institution, or agency of state government if it is required for
the effective administration or enforcement of the laws of this
state, to a proper officer of the United States department of
treasury, and to a proper officer of another state reciprocating in
this privilege. The state treasurer may enter into reciprocal
agreements with other departments of state government, the United
States department of treasury, local governmental units within this
state, or taxing officials of other states for the enforcement,
collection, and exchange of data after ascertaining that any
information provided will be subject to confidentiality
restrictions substantially the same as the provisions of this act.
(2) A person who violates subsection (1)(e), (1)(f), or (4) is
guilty of a felony, punishable by a fine of not more than
$5,000.00, or imprisonment for not more than 5 years, or both,
together with the costs of prosecution. In addition, if the offense
is committed by an employee of this state, the person shall be
dismissed from office or discharged from employment upon
conviction.
(3) A person liable for any tax administered under this act
shall keep accurate and complete records necessary for the proper
determination of tax liability as required by law or rule of the
department.
(4) A person who receives information under subsection (1)(f)
for the proper administration of the general property tax act, 1893
PA 206, MCL 211.1 to 211.155, shall not willfully disclose that
information for any purpose other than the administration of the
general property tax act, 1893 PA 206, MCL 211.1 to 211.155. A
person who violates this subsection is subject to the penalties
provided in subsection (2).
(5) A person identified in section 10(1) of the Michigan
economic growth authority act, 1995 PA 24, MCL 207.810, who
receives information under section 10(1)(j) of the Michigan
economic growth authority act, 1995 PA 24, MCL 207.810, as
permitted in subsection (1)(f), shall not willfully disclose that
information for any purpose other than the proper administration of
his or her legislative duties nor disclose that information to
anyone other than an employee of the legislature, who is also bound
by the same restrictions. A person who violates this subsection is
responsible for and subject to a civil fine of not more than
$5,000.00 per violation.
(6) The department shall annually prepare a report containing
statistics described in this subsection concerning the Michigan
business tax act, 2007 PA 36, MCL 208.1101 to 208.1601, for the
most recent tax year for which reliable return data have been
processed and cleared in the ordinary course of return processing
by the department. A copy of the report shall be provided to the
chairpersons of the senate and house of representatives standing
committees that have jurisdiction over matters relating to taxation
and finance, the director of the senate fiscal agency, and the
director of the house fiscal agency. The department shall report
the following information broken down by business sector and,
provided that no grouping consists of fewer than 10 taxpayers, by
firm size in compliance with subsection (1)(f) and in a manner that
does not result in the disclosure of information regarding any
specific taxpayer:
(a) Apportioned business income tax base.
(b) Apportioned modified gross receipts tax base.
(c) Business income tax liability.
(d) Use of credits.
(e) Modified gross receipts tax liability.
(f) Total final liability.
(g) Total liability before credits.
(7) A person may disclose the following information described
in this subsection:
(a) Information required to be reported under section 455 of
the Michigan business tax act, 2007 PA 36, MCL 208.1455.
(b) An application to enter into an agreement, a communication
denying an application to enter into an agreement, an agreement, a
postproduction certificate, a communication denying a
postproduction certificate, or the total amount of credits claimed
in a tax year under section 455 of the Michigan business tax act,
2007 PA 36, MCL 208.1455, notwithstanding section 455(6) of the
Michigan business tax act, 2007 PA 36, MCL 408.1455.
(c) An application to enter into an agreement, a communication
denying an application to enter into an agreement, an agreement, an
investment expenditure certificate, a communication denying an
investment expenditure certificate, or the total amount of credits
claimed in a tax year under section 457 of the Michigan business
tax act, 2007 PA 36, MCL 208.1457, notwithstanding section 457(6)
of the Michigan business tax act, 2007 PA 36, MCL 408.1457.
(d) An application to enter into an agreement, a communication
denying an application to enter into an agreement, an agreement, a
qualified job training expenditures certificate, a communication
denying a qualified job training expenditures certificate, or the
total amount of credits claimed in a tax year under section 459 of
the Michigan business tax act, 2007 PA 36, MCL 208.1459,
notwithstanding section 459(6) of the Michigan business tax act,
2007 PA 36, MCL 408.1459.
(8) As used in subsection (1), "adjusted gross receipts" and
"wagering tax" mean those terms as described in the Michigan gaming
control and revenue act, 1996 IL 1, MCL 432.201 to 432.226.
