ARIZONA HOUSE OF REPRESENTATIVES Fifty-fifth Legislature First Regular Session
	House: WM DP 9-1-0-0 | 3^rd Read 57-2-1-0 Senate: FIN DPA/SE 4-2-4-0 | 3^rd Read 17-13-0-0 Final Read: 44-16-0-0

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HB 2879: conformity; internal revenue code; exception

NOW: DOR; procedures; administrative rulings

Sponsor:  Representative Toma, LD 22

Transmitted to the Governor

Overview

Allows the Department of Revenue (DOR) to issue draft rulings, procedures, notices and other administrative announcements that apply to tax laws and regulations. Requires DOR to meet with a requestor upon receiving a written request to issue a private taxpayer ruling or private taxpayer information ruling.

History

DOR is authorized to issue private taxpayer rulings to taxpayers and potential taxpayers on written request by the taxpayer. Under current law, DOR is required to issue any private taxpayer rulings or taxpayer information rulings within 45 days after receiving the written request and on receiving the facts that are relevant to the ruling. If the ruling is expected to be delayed, DOR is required to notify the requestor of the delay and the proposed date of issuance. A ruling is required to be maintained by DOR as public record and is subject to specific confidentiality requirements. A taxpayer may submit a written request that a ruling not be published. If the Director of DOR (Director) determines that a ruling should not be published, the ruling is deemed confidential. If the Director determines that a ruling should be published, then the taxpayer may withdraw the ruling request and DOR must not proceed with the ruling request. The decision by the Director to publish a ruling is not an appealable agency action and is not subject to appeal by the taxpayer.

Private taxpayer ruling and taxpayer information ruling are defined as written determinations by DOR that interpret and apply to one or more statutes in Title 42 or Title 43 and any applicable administrative rules that DOR has adopted to the specific facts described in the request for a private taxpayer ruling and taxpayer information ruling (A.R.S. § 42-2101).

Provisions

 Rulings, Procedures, Notices and Administrative Announcements (Draft Rulings)

1. Allows DOR to issue draft rulings that apply to tax laws and regulations either generally or for a specific set of facts and that otherwise do not change the substance and meaning of a statute or rule. (Sec. 1)

2. Requires DOR to allow written public comments on any draft ruling. (Sec. 1)

3. States that the draft ruling becomes final and effective 30 days after the draft ruling is issued for public comment, unless DOR withdraws the draft ruling. (Sec. 1)

4. Authorizes DOR to amend any draft ruling in response to public comments received in the 30-day period. (Sec. 1)

5. Requires DOR to do the following:

a) Establish and maintain a publicly accessible record of all draft and final rulings, procedures and administrative announcements on DOR's website; and

b) Announce additions, modifications and other changes to these records on the website. (Sec. 1)

6. Stipulates that a draft ruling is not final and effective unless it contains the following:

a) The subject matter of the draft ruling;

b) A citation to all statutes, rules and published administrative rulings that relate to the draft ruling;

c) The name and contact information or DOR personnel with whom persons may communicating regarding the draft ruling;

d) The date on which the draft ruling was proposed;

e) The date on which the draft ruling became final and effective;

f) A statement of whether public comments on the draft ruling were received and where the written comments and DOR's response are publicly available; and

g) The signature of the director. (Sec. 1)

7. Instructs DOR to respond with a comment explaining the basis for DOR's decision to not incorporate a public comment into the final ruling. (Sec. 1)

8. Requires the Director to ensure that any public records required by these provisions comply with confidentiality requirements. (Sec. 1)

9. Exempts DOR's rulemaking authority, private taxpayer rulings and other routine DOR communications that do not substantively apply to and interpret tax laws and regulations from the aforementioned procedures. (Sec. 1)

10. Requires the court to decide all questions of law without deference to any determination that is made by DOR and stipulates that agency actions pursuant to these provisions are an appealable action. (Sec. 1)

Private Taxpayer Ruling Requests

11. Requires DOR to do the following:

a) Meet with a requestor within 30 days of receiving the written request to discuss the facts and circumstances pertaining to the request, unless the requestor waives the meeting;

b) Issue private taxpayer ruling or taxpayer information rulings within 90 days of receiving a written request, unless DOR and the requestor delay the ruling; and

c) Notify the requestor of the basis for the proposed delay if the ruling is expected to be delayed. (Sec. 2)

12. Allows DOR to decline to issue a ruling provided that DOR issues appropriate written assistance or advice that explains the reason for declining to issue a ruling and provide a general discussion of relevant tax principles or applications. (Sec. 2)

13. Instructs DOR to do the following:

a) Provide the requestor with a draft of the private taxpayer ruling or taxpayer information ruling at least 30 days before issuing the ruling; and

b) Meet with the requestor within 14 days of providing the draft ruling to discuss the contents of the draft ruling, if requested by the requestor. (Sec. 2)

14. Allows the taxpayer to request that the ruling be kept confidential. (Sec. 2)

Miscellaneous

15. Makes technical and conforming changes. (Sec. 2)

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                        HB 2879

Initials VP/NM Page 0 Transmitted

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