AB 2510

Bill Subjects

Abstract

(1) The Franchise Tax Board administers the Personal Income Tax Law and the Corporation Tax Law and the State Board of Equalization administers the Sales and Use Tax Law and various other tax and fee laws. Counties, cities, and districts, as specified, are authorized to impose local sales or transactions and use taxes in conformity with the Sales and Use Tax Law. Amendments to the Sales and Use Tax Law are automatically incorporated into the local laws. Those laws generally require a claim for refund to be filed within specified timeframes based on the date of overpayment or specified board action if any amount has been overpaid, as specified. Under those laws, the rule of res judicata, which provides that a matter that has been adjudicated by a court of competent jurisdiction may not be pursued further by the same parties is applicable only if the liability involved is for the same reporting period as was involved in the case previously determined. This bill would, notwithstanding existing law regarding the rule of res judicata, where a tax, fee, assessment, surcharge, or other amount levied or collected by the tax agency, which this bill would define to include the board and the Franchise Tax Board, has been determined to have been illegally levied or collected in a final and nonappealable decision of a court of competent jurisdiction, authorize any person who paid that tax, fee, assessment, surcharge, or other amount to file with the tax agency a claim for refund, within one year after the date of the final and nonappealable decision and would require the tax agency to refund the amount so paid. This bill would also require the tax agency to refund these amounts without the person filing a claim for refund when information in the tax agencies' records is sufficient to identify the person. This bill would, upon appropriation by the Legislature, allocate the amounts necessary to make these refunds to the applicable tax agency. (2) Existing law requires an action to recover property taxes levied on state-assessed property arising out of a dispute as to an assessment to be commenced only after payment of the taxes in issue and within 4 years after the latest of the dates that the State Board of Equalization mailed its decision or its written findings and conclusions, as provided. This bill would instead require, where the tax assessed or allocated has been determined to have been illegally assessed or allocated in a final and nonappealable decision of a court of competent jurisdiction, the action to commence no later than one year from the date the court rendered that decision. (3) This bill would make a legislative finding and declaration regarding the public purpose served by the bill.