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S.B. 225






Chief Sponsor: Howard A. Stephenson

House Sponsor: David Clark

             8      LONG TITLE
             9      General Description:
             10          This bill amends the procedures and requirements to seek judicial review of a State Tax
             11      Commission redetermination of a tax deficiency.
             12      Highlighted Provisions:
             13          This bill:
             14          .    amends the procedures and requirements related to the judicial review of a State
             15      Tax Commission redetermination of a tax deficiency; and
             16          .     makes technical changes.
             17      Monies Appropriated in this Bill:
             18          None
             19      Other Special Clauses:
             20          This bill provides an effective date.
             21      Utah Code Sections Affected:
             22      ENACTS:
             23          59-1-611, Utah Code Annotated 1953
             24      REPEALS:
             25          59-1-505, as last amended by Chapter 214, Laws of Utah 1996
             27      Be it enacted by the Legislature of the state of Utah:

             28          Section 1. Section 59-1-611 is enacted to read:
             29          59-1-611. Payment of tax on appeal -- Interest.
             30          (1) As used in this section, "post security" means:
             31          (a) posting with the commission, for the full or a partial amount of the deficiency as
             32      determined by the commission:
             33          (i) a letter of credit;
             34          (ii) a bond; or
             35          (iii) other similar financial instrument acceptable to the commission; or
             36          (b) as determined by the commission, depositing with the commission:
             37          (i) the full amount of the deficiency; or
             38          (ii) a partial amount of the deficiency.
             39          (2) Except as provided in Subsection (3), a taxpayer that seeks judicial review of a final
             40      commission redetermination of a deficiency shall post security with the commission.
             41          (3) The commission shall waive the requirements of Subsection (2) if a taxpayer
             42      establishes:
             43          (a) that the taxpayer has assets or income worth substantially more than the amount of
             44      the deficiency; or
             45          (b) as determined by the commission, that collection of the deficiency that is the
             46      subject of the appeal is not jeopardized by waiving the requirements of Subsection (2).
             47          (4) (a) The commission may not unreasonably deny a waiver described in Subsection
             48      (3).
             49          (b) A taxpayer may seek judicial review of the commission's decision to deny a waiver
             50      under Subsection (3) by the court reviewing the redetermination of the deficiency.
             51          (5) If a taxpayer fails to comply with the requirements of Subsection (2), the reviewing
             52      court may, in its discretion, dismiss the taxpayer's appeal of the redetermination of the
             53      deficiency.
             54          (6) If the commission grants a waiver under Subsection (3), the taxpayer shall pay any
             55      tax, interest, or penalties:
             56          (a) ordered by a court of competent jurisdiction; and
             57          (b) within a 45-day period beginning on the day on which the order described in
             58      Subsection (6)(a) becomes final.

             59          (7) If a taxpayer posts security with the commission, or the commission grants a waiver
             60      in accordance with this section, interest shall accrue on the unpaid taxes that are the subject of
             61      the deficiency at the rate and in the manner provided in Section 59-1-402 .
             62          Section 2. Repealer.
             63          This bill repeals:
             64          Section 59-1-505, Prerequisites to appeal -- Interest.
             65          Section 3. Effective date.
             66          (1) Except as provided in Subsection (2), this bill applies to an appeal of a
             67      redetermination of a deficiency filed on or after May 1, 2006.
             68          (2) This bill applies to an appeal of the redetermination of a deficiency, of a State Tax
             69      Commission decision filed before May 1, 2006, if, as of January 1, 2006, the reviewing court
             70      has not issued a final unappealable judgment or order on the appeal.

Legislative Review Note
    as of 2-6-06 11:52 AM

Based on a limited legal review, this legislation has not been determined to have a high
probability of being held unconstitutional.

Office of Legislative Research and General Counsel

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