74th OREGON LEGISLATIVE ASSEMBLY--2007 Regular Session
Enrolled
Senate Bill 176
Printed pursuant to Senate Interim Rule 213.28 by order of the
President of the Senate in conformance with presession filing
rules, indicating neither advocacy nor opposition on the part
of the President (at the request of Governor Theodore R.
Kulongoski for Department of Revenue)
CHAPTER ................
AN ACT
Relating to reorganized business entities; and prescribing an
effective date.
Be It Enacted by the People of the State of Oregon:
SECTION 1. { + Section 2 of this 2007 Act is added to and made
a part of ORS chapter 305. + }
SECTION 2. { + (1) As used in this section, 'reorganized
business entity':
(a) Means a business entity that, while operating substantially
the same business as another entity that incurred a liability for
taxes, interest or penalties administered by the Department of
Revenue, has been converted to a different form of business
entity from that of the entity that incurred the liability or has
changed ownership from that of the entity that incurred the
liability; and
(b) Does not include a business entity that is converted to a
different form or that has changed ownership solely because of a
transfer of assets or because of a transfer of an interest of an
investor who has no right to manage the business entity,
including, but not limited to, the interest of:
(A) A person that is solely a minority shareholder in a
corporation;
(B) A member of a manager-managed limited liability company; or
(C) A limited partner of a limited partnership that does not
participate in the control of the business of the limited
partnership.
(2) The department may transfer the liability for taxes,
interest or penalties that are administered and collected by the
department from the business entity that incurred the liability
to a reorganized business entity and may assess those amounts
against the reorganized business entity.
(3) Factors the department may consider when determining if a
business entity is a reorganized business entity include, but are
not limited to, whether the business entity:
(a) Operates from the same physical location as did the
taxpayer owing the debt.
(b) Provides the same services or manufactures the same
products as did the taxpayer owing the debt.
(c) Has one or more of the same:
Enrolled Senate Bill 176 (SB 176-INTRO) Page 1
(A) Corporate directors or officers as did the taxpayer owing
the debt.
(B) Owners or holders of a direct or indirect interest in the
business entity as did the taxpayer owing the debt.
(4) Following the determination to transfer a liability to a
reorganized business entity under subsections (2) and (3) of this
section and notwithstanding ORS 314.835, 314.840 or 314.991, the
department shall send a notice of liability to the reorganized
business entity stating the amount owed by the reorganized
business entity.
(5) Within 30 days from the date of notice of liability given
under subsection (4) of this section, the reorganized business
entity shall:
(a) Pay the liability stated in the notice and any other
penalty or interest related to that liability; or
(b) Advise the department in writing of objections to the
notice of liability and, if desired, request a conference. A
conference requested under this paragraph shall be governed by
those provisions of ORS 305.265 that govern a conference
requested from a notice of deficiency under ORS 305.265.
Notwithstanding ORS 314.835, 314.840 or 314.991, the department
may disclose any information to the reorganized business entity
that the department would be authorized to disclose to the
business entity that incurred the liability.
(6) After a determination of the issues raised in written
objections made under subsection (5) of this section or after a
conference, if a conference was requested, the department shall
mail the reorganized business entity a letter affirming,
canceling or adjusting the notice of liability. If the entity
remains liable for an outstanding amount under this section, the
letter shall be considered a notice of assessment and, within 90
days from the date the letter is mailed, the entity shall:
(a) Pay the amount set forth in the notice of assessment; or
(b) Appeal to the Oregon Tax Court in the manner provided for
an appeal from a notice of assessment.
(7) If neither payment nor written objections to the notice of
liability sent under subsection (4) of this section is received
by the department within 30 days after the date of the notice of
liability, the notice of liability becomes final. The reorganized
business entity may appeal the notice to the tax court within 90
days after the date the notice became final, in the manner
provided for an appeal from a notice of assessment. + }
SECTION 3. { + This 2007 Act takes effect on the 91st day
after the date on which the regular session of the Seventy-fourth
Legislative Assembly adjourns sine die. + }
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Enrolled Senate Bill 176 (SB 176-INTRO) Page 2
Passed by Senate February 26, 2007
...........................................................
Secretary of Senate
...........................................................
President of Senate
Passed by House June 1, 2007
...........................................................
Speaker of House
Enrolled Senate Bill 176 (SB 176-INTRO) Page 3
Received by Governor:
......M.,............., 2007
Approved:
......M.,............., 2007
...........................................................
Governor
Filed in Office of Secretary of State:
......M.,............., 2007
...........................................................
Secretary of State
Enrolled Senate Bill 176 (SB 176-INTRO) Page 4