75th OREGON LEGISLATIVE ASSEMBLY--2009 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 3365
Senate Bill 690
Sponsored by COMMITTEE ON FINANCE AND REVENUE
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Authorizes Department of Revenue to disclose taxpayer-related
information to state agencies and local law enforcement agencies,
to develop data-matching systems with financial institutions
doing business in state and to report taxpayers with tax
delinquencies to consumer reporting agencies. Provides for
penalty in frivolous Oregon Tax Court proceedings regardless of
lack of monetary harm to department.
Takes effect on 91st day following adjournment sine die.
A BILL FOR AN ACT
Relating to personal income tax compliance; creating new
provisions; amending ORS 305.225, 305.385, 305.437, 314.840,
673.415 and 673.710; and prescribing an effective date.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 305.225 is amended to read:
305.225. (1) Notwithstanding ORS 314.835, if the Department of
Revenue determines that assistance of a law enforcement agency is
necessary to insure compliance with any of the laws of this state
administered by it, the department may request such assistance.
In connection with assistance requested under this section only,
the Department of Revenue may disclose a tax return, report or
claim, or information in its files regarding a tax return, report
or claim permitted or required to be filed with the department
under any law administered by the department to the Oregon State
Police, district attorney, grand jury { - or - } { + , + }
judicial authority { + or local law enforcement agency + } for
the investigation or the prosecution of violations of the
criminal laws of this state relating to perjury, theft or forgery
if those violations occur in connection with the filing of such a
return, report or claim, or of the tax laws of this state.
Disclosure under this section shall be solely for the purpose of
investigation or prosecution of violations involving the filing
of a false or fraudulent return, report or claim, wherein the
validity of the return, report or claim, or information contained
therein, is at issue. Returns, reports or claims, or information
contained therein shall not be disclosed if the purpose for which
the information is sought is as evidence of a crime unrelated to
the validity of the return, report or claim, or the information
contained therein, supplied to the department or if the
information is requested by a law enforcement agency in
connection with any other investigation or prosecution.
(2) Each person given access to the confidential tax
information authorized to be disclosed under this section shall
first execute and file with the department the certificate
required by ORS 314.840 (3) and shall cause a similar certificate
to be executed and filed with the department by any associate or
subordinate who is assigned to use the information for the
purposes stated in this section.
SECTION 2. ORS 305.385 is amended to read:
305.385. (1) Upon request of the Department of Revenue, an
agency issuing or renewing a license to conduct a business, trade
or profession shall annually, on or before March 1, supply the
department with a list of specified licenses issued or renewed by
the agency during the preceding calendar year.
(2) Upon request of the department, an agency shall annually,
on or before March 1, supply the department with a list of
specified persons contracting with the agency to provide goods,
services or real estate space to the agency during the preceding
calendar year.
(3) The lists required by subsections (1) and (2) of this
section shall contain the name, address, Social Security or
federal employer identification number of each licensee or
provider or such other information as the department may by rule
require.
(4)(a) If the department determines that any licensee or
provider has neglected or refused to file any return or to pay
any tax and that such person has not filed in good faith a
petition before the department contesting the tax, and the
department has been unable to obtain payment of the tax through
other methods of collection, the Director of the Department of
Revenue may, notwithstanding ORS 118.525, 314.835 or 314.840 or
any similar provision of law, notify the agency and the person in
writing.
(b) Upon receipt of such notice, the agency shall refuse to
reissue, renew or extend any license, contract or agreement until
the agency receives a certificate issued by the department that
the person is in good standing with respect to any returns due
and taxes payable to the department as of the date of the
certificate.
(c) Upon the written request of the director and after a
hearing and notice to the licensee as required under any
applicable provision of law, the agency shall suspend the
person's license if the agency finds that the returns and taxes
have not been filed or paid and that the licensee has not filed
in good faith a petition before the department contesting the tax
{ - and the department has been unable to obtain payment of the
tax through other methods of collection - } . For the purpose of
the agency's findings, the written representation to that effect
by the department to the agency shall constitute prima facie
evidence of the person's failure to file returns or pay the tax.
The department shall have the right to intervene in any license
suspension proceeding.
(d) Any license suspended under this subsection shall not be
reissued or renewed until the agency receives a certificate
issued by the department that the licensee is in good standing
with respect to any returns due and taxes payable to the
department as of the date of the certificate.
(5) The department may enter into an installment payment
agreement with a licensee or provider with respect to any unpaid
tax, penalty and interest. The agreement shall provide for
interest on the outstanding amount at the rate prescribed by ORS
305.220. The department may issue a provisional certificate of
good standing pursuant to subsection (4)(b) and (d) of this
section which shall remain in effect so long as the licensee or
provider fully complies with the terms of the installment
agreement. Failure by the licensee or provider to fully comply
with the terms of the installment agreement shall render the
agreement and the provisional certificate of good standing null
and void, unless the department determines that the failure was
due to reasonable cause. If the department determines that the
failure was not due to reasonable cause, the total amount of the
tax, penalty and interest shall be immediately due and payable,
and the department shall notify any affected agency that the
licensee or provider is not in good standing. The agency shall
then take appropriate action under subsection (4)(b) and (d) of
this section.
(6) No contract or other agreement for the purpose of providing
goods, services or real estate space to any agency shall be
entered into, renewed or extended with any person, unless the
person certifies in writing, under penalty of perjury, that the
person is, to the best of the person's knowledge, not in
violation of any tax laws described in ORS 305.380 (4).
(7) The certification under subsection (6) of this section
shall be required for each contract and renewal or extension of a
contract or may be provided on an annual basis. A certification
shall not be required for a contract if the consideration for the
goods, services or real estate space provided under the contract
is no more than $1,000.
(8)(a) The requirements of the certification under subsection
(6) of this section shall be subject to the rules adopted by the
department in accordance with this section.
(b) The department may by rule exempt certain contracts from
the requirements of subsection (6) of this section.
SECTION 3. ORS 314.840 is amended to read:
314.840. (1) The Department of Revenue may:
(a) Furnish any taxpayer, representative authorized to
represent the taxpayer under ORS 305.230 or person designated by
the taxpayer under ORS 305.193, upon request of the taxpayer,
representative or designee, with a copy of the taxpayer's income
tax return filed with the department for any year, or with a copy
of any report filed by the taxpayer in connection with the
return, or with any other information the department considers
necessary.
(b) Publish lists of taxpayers who are entitled to unclaimed
tax refunds.
(c) Publish statistics so classified as to prevent the
identification of income or any particulars contained in any
report or return.
(d) Disclose a taxpayer's name, address, telephone number,
refund amount, amount due, Social Security number, employer
identification number or other taxpayer identification number to
the extent necessary in connection with collection activities or
the processing and mailing of correspondence or of forms for any
report, return or claim required in the administration of ORS
310.630 to 310.706, any local tax under ORS 305.620, or any law
imposing a tax upon or measured by net income.
(2) The department also may disclose and give access to
information described in ORS 314.835 to:
(a) The Governor of the State of Oregon or the authorized
representative of the Governor:
(A) With respect to an individual who is designated as being
under consideration for appointment or reappointment to an office
or for employment in the office of the Governor. The information
disclosed shall be confined to whether the individual:
(i) Has filed returns with respect to the taxes imposed by ORS
chapter 316 for those of not more than the three immediately
preceding years for which the individual was required to file an
Oregon individual income tax return.
(ii) Has failed to pay any tax within 30 days from the date of
mailing of a deficiency notice or otherwise respond to a
deficiency notice within 30 days of its mailing.
(iii) Has been assessed any penalty under the Oregon personal
income tax laws and the nature of the penalty.
(iv) Has been or is under investigation for possible criminal
offenses under the Oregon personal income tax laws. Information
disclosed pursuant to this paragraph shall be used only for the
purpose of making the appointment, reappointment or decision to
employ or not to employ the individual in the office of the
Governor.
(B) For use by an officer or employee of the Oregon Department
of Administrative Services duly authorized or employed to prepare
revenue estimates, or a person contracting with the Oregon
Department of Administrative Services to prepare revenue
estimates, in the preparation of revenue estimates required for
the Governor's budget under ORS 291.201 to 291.226, or required
for submission to the Emergency Board, or if the Legislative
Assembly is in session, to the Joint Committee on Ways and Means,
and to the Legislative Revenue Officer under ORS 291.342, 291.348
and 291.445. The Department of Revenue shall disclose and give
access to the information described in ORS 314.835 for the
purposes of this subparagraph only if:
(i) The request for information is made in writing, specifies
the purposes for which the request is made and is signed by an
authorized representative of the Oregon Department of
Administrative Services. The form for request for information
shall be prescribed by the Oregon Department of Administrative
Services and approved by the Director of the Department of
Revenue.
(ii) The officer, employee or person receiving the information
does not remove from the premises of the Department of Revenue
any materials that would reveal the identity of a personal or
corporate taxpayer.
(b) The Commissioner of Internal Revenue or authorized
representative, for tax administration and compliance purposes
only.
(c) For tax administration and compliance purposes, the proper
officer or authorized representative of any of the following
entities that has or is governed by a provision of law that meets
the requirements of any applicable provision of the Internal
Revenue Code as to confidentiality:
(A) A state;
(B) A city, county or other political subdivision of a state;
(C) The District of Columbia; or
(D) An association established exclusively to provide services
to federal, state or local taxing authorities.
(d) The Multistate Tax Commission or its authorized
representatives, for tax administration and compliance purposes
only. The Multistate Tax Commission may make the information
available to the Commissioner of Internal Revenue or the proper
officer or authorized representative of any governmental entity
described in and meeting the qualifications of paragraph (c) of
this subsection.
(e) The Attorney General, assistants and employees in the
Department of Justice, or other legal representative of the State
of Oregon, to the extent the department deems disclosure or
access necessary for the performance of the duties of advising or
representing the department pursuant to ORS 180.010 to 180.240
and the tax laws of this state.
(f) Employees of the State of Oregon, other than of the
Department of Revenue or Department of Justice, to the extent the
department deems disclosure or access necessary for such
employees to perform their duties under contracts or agreements
between the department and any other department, agency or
subdivision of the State of Oregon, in the department's
administration of the tax laws.
(g) Other persons, partnerships, corporations and other legal
entities, and their employees, to the extent the department deems
disclosure or access necessary for the performance of such
others' duties under contracts or agreements between the
department and such legal entities, in the department's
administration of the tax laws.
(h) The Legislative Revenue Officer or authorized
representatives upon compliance with ORS 173.850. Such officer or
representative shall not remove from the premises of the
department any materials that would reveal the identity of any
taxpayer or any other person.
(i) The Department of Consumer and Business Services, to the
extent the department requires such information to determine
whether it is appropriate to adjust those workers' compensation
benefits the amount of which is based pursuant to ORS chapter 656
on the amount of wages or earned income received by an
individual.
(j) Any agency of the State of Oregon, or any person, or any
officer or employee of such agency or person to whom disclosure
or access is given by state law and not otherwise referred to in
this section, including but not limited to the Secretary of State
as Auditor of Public Accounts under section 2, Article VI of the
Oregon Constitution; the Department of Human Services pursuant to
ORS 314.860 and 412.094; the Division of Child Support of the
Department of Justice and district attorney regarding cases for
which they are providing support enforcement services under ORS
25.080; the State Board of Tax Practitioners, pursuant to ORS
673.710; and the Oregon Board of Accountancy, pursuant to ORS
673.415.
(k) The Director of the Department of Consumer and Business
Services to determine that a person complies with ORS chapter 656
and the Director of the Employment Department to determine that a
person complies with ORS chapter 657, the following employer
information:
(A) Identification numbers.
(B) Names and addresses.
(C) Inception date as employer.
(D) Nature of business.
(E) Entity changes.
(F) Date of last payroll.
(L) The Director of Human Services to determine that a person
has the ability to pay for care that includes services provided
by the state institutions as described in ORS 179.321 or the
Department of Human Services or to collect any unpaid cost of
care as provided by ORS chapter 179.
(m) Employees of the Employment Department to the extent the
Department of Revenue deems disclosure or access to information
on a combined tax report filed under ORS 316.168 is necessary to
performance of their duties in administering the tax imposed by
ORS chapter 657.
(n) The State Fire Marshal to assist the State Fire Marshal in
carrying out duties, functions and powers under ORS 453.307 to
453.414, the employer or agent name, address, telephone number
and standard industrial classification, if available.
(o) Employees of the Department of State Lands for the purposes
of identifying, locating and publishing lists of taxpayers
entitled to unclaimed refunds as required by the provisions of
chapter 694, Oregon Laws 1993. The information shall be limited
to the taxpayer's name, address and the refund amount.
(p) In addition to the disclosure allowed under ORS 305.225,
state or local law enforcement agencies to assist in the
investigation or prosecution of the following criminal
activities:
(A) Mail theft of a check, in which case the information that
may be disclosed shall be limited to the stolen document, the
name, address and taxpayer identification number of the payee,
the amount of the check and the date printed on the check.
(B) The counterfeiting, forging or altering of a check
submitted by a taxpayer to the Department of Revenue or issued by
the Department of Revenue to a taxpayer, in which case the
information that may be disclosed shall be limited to the
counterfeit, forged or altered document, the name, address and
taxpayer identification number of the payee, the amount of the
check, the date printed on the check and the altered name and
address.
(q) The United States Postal Inspection Service or a federal
law enforcement agency, including but not limited to the United
States Department of Justice, to assist in the investigation of
the following criminal activities:
(A) Mail theft of a check, in which case the information that
may be disclosed shall be limited to the stolen document, the
name, address and taxpayer identification number of the payee,
the amount of the check and the date printed on the check.
(B) The counterfeiting, forging or altering of a check
submitted by a taxpayer to the Department of Revenue or issued by
the Department of Revenue to a taxpayer, in which case the
information that may be disclosed shall be limited to the
counterfeit, forged or altered document, the name, address and
taxpayer identification number of the payee, the amount of the
check, the date printed on the check and the altered name and
address.
(r) The United States Financial Management Service, for
purposes of facilitating the reciprocal offsets described in ORS
305.612.
(s) A municipal corporation of this state for purposes of
assisting the municipal corporation in the administration of a
tax of the municipal corporation that is imposed on or measured
by income, wages or net earnings from self-employment. Any
disclosure under this paragraph may be made only pursuant to a
written agreement between the Department of Revenue and the
municipal corporation that ensures the confidentiality of the
information disclosed.
{ + (t) A financial institution, to the extent necessary to
carry out the purposes of section 8 of this 2009 Act.
(u) A consumer reporting agency, to the extent necessary to
carry out the purposes of section 9 of this 2009 Act. + }
(3)(a) Each officer or employee of the department and each
person described or referred to in subsection (2)(a), (e) to (k)
or (m) to (p) of this section to whom disclosure or access to the
tax information is given under subsection (2) of this section or
any other provision of state law, prior to beginning employment
or the performance of duties involving such disclosure or access,
shall be advised in writing of the provisions of ORS 314.835 and
314.991, relating to penalties for the violation of ORS 314.835,
and shall as a condition of employment or performance of duties
execute a certificate for the department, in a form prescribed by
the department, stating in substance that the person has read
these provisions of law, that the person has had them explained
and that the person is aware of the penalties for the violation
of ORS 314.835.
(b) The disclosure authorized in subsection (2)(q) of this
section shall be made only after a written agreement has been
entered into between the Department of Revenue and the person
described in subsection (2)(q) of this section to whom disclosure
or access to the tax information is given, providing that:
(A) Any information described in ORS 314.835 that is received
by the person pursuant to subsection (2)(q) of this section is
confidential information that may not be disclosed, except to the
extent necessary to investigate or prosecute the criminal
activities described in subsection (2)(q) of this section;
(B) The information shall be protected as confidential under
applicable federal and state laws; and
(C) The United States Postal Inspection Service or the federal
law enforcement agency shall give notice to the Department of
Revenue of any request received under the federal Freedom of
Information Act, 5 U.S.C. 552, or other federal law relating to
the disclosure of information.
(4) The Department of Revenue may recover the costs of
furnishing the information described in subsection (2)(k), (L)
and (n) to (p) of this section from the respective agencies.
SECTION 4. ORS 673.415 is amended to read:
673.415. (1) The Department of Revenue may furnish to the
Oregon Board of Accountancy a copy of the signature block of an
income tax return prepared by any person for another. The
signature block may be furnished in instances in which the
department or the board has reasonable grounds to believe the
person preparing the return prepared it in violation of any
provision of ORS 673.010 to 673.457. The signature block shall
include the name, address and signature of the person who
prepared the income tax return and the date the return was
prepared. The department may include with the signature block the
name and address of the taxpayer, the number of the tax form
prepared
{ - and - } { + , + } the tax year of the income tax return
prepared { + and the information described in ORS 314.835 + }.
The board, and its members, officers and employees, shall use the
names and addresses furnished under this section solely in the
enforcement of ORS 673.010 to 673.457 and shall not otherwise
divulge or make known such information. A violation of this
prohibition against disclosure is punishable as provided in ORS
314.991 (2).
(2) The Department of Revenue may furnish to the board a copy
of the signature block of a tax return or report permitted or
required to be filed with the department and prepared by any
person for another. The signature block may be furnished in
instances where the department or the board has reasonable
grounds to believe the person preparing the return or report
prepared it in violation of any provision of ORS 673.010 to
673.457, or any rule adopted thereunder. The signature block
shall include the name, address and signature of the person who
prepared the tax return or report and the date the return or
report was prepared. The department may include with the
signature block the name and address of the taxpayer, the number
of the tax form or report prepared { - and - } { + , + } the
tax year of the return or report prepared { + and the
information described in ORS 314.835 + }. The board, its members,
officers and employees, shall use the names and addresses
furnished under this section solely in the enforcement of ORS
673.010 to 673.457 and shall not divulge or make known such
information. Any person who violates this prohibition against
disclosure, upon conviction, is punishable as provided in ORS
314.991 (2).
SECTION 5. ORS 673.710 is amended to read:
673.710. (1) If a personal income tax return is prepared by
someone other than the taxpayer, the Department of Revenue may
furnish to the State Board of Tax Practitioners a copy of that
portion of the return that shows:
(a) The name, business name and address of the preparer;
(b) The date of preparation; and
(c) The signature of the preparer.
(2) In instances where the department or the board has
reasonable grounds to believe the person preparing the return
prepared it in violation of ORS 673.605 to 673.740, the
department may furnish the following additional information:
(a) The name and address of the taxpayer;
(b) The identifying number used on any form, report or schedule
filed as part of the return; { - and - }
(c) The tax year reported on the return, or any portion of the
return { - . - } { + ; and
(d) The information described in ORS 314.835. + }
(3) The board, its members, officers and employees, shall use
the names and addresses furnished under this section solely in
the enforcement of ORS 673.605 to 673.740 and shall not otherwise
divulge or make known such information. Any person who violates
this prohibition against disclosure, upon conviction, is
punishable as provided in ORS 314.991 (2).
SECTION 6. ORS 305.437 is amended to read:
305.437. (1) Whenever it appears to the Oregon Tax Court that
proceedings before it have been instituted or maintained by a
taxpayer primarily for delay or that the taxpayer's position in
such proceeding is frivolous or groundless, { - damages - }
{ + a penalty + } in an amount not to exceed $5,000 shall be
awarded to the Department of Revenue by the Oregon Tax Court in
its judgment. { - Damages - } { + The penalty + } so awarded
shall be paid within 10 days after the judgment becomes final. If
the { - damages remain - } { + penalty + } { + remains + }
unpaid, the department may collect the amount awarded in the same
manner as income taxes are collected under ORS 314.430.
(2) As used in this section { - , - } { + :
(a) + } A taxpayer's position is 'frivolous' if there was no
objectively reasonable basis for asserting the position.
{ + (b) 'Position' means any claim, defense or argument
asserted by a taxpayer without regard to any other claim, defense
or argument asserted by the taxpayer. + }
SECTION 7. { + Sections 8 and 9 of this 2009 Act are added to
and made a part of ORS chapter 314. + }
SECTION 8. { + (1) The Department of Revenue and financial
institutions doing business in this state shall enter into
agreements to develop and operate a data match system using
automated data exchanges to the maximum extent feasible.
(2) Pursuant to the agreements, financial institutions shall
provide, for each calendar quarter, the name, address, Social
Security number or other taxpayer identification number and other
identifying information for each taxpayer who:
(a) Maintains an account at the institution; and
(b) Has neglected or refused to file any return or to pay any
tax and has not filed in good faith a petition before the
department contesting the tax.
(3) The department shall pay a reasonable fee to a financial
institution for conducting the data match provided for in this
section. The fee may not exceed the actual costs incurred by the
financial institution.
(4) A financial institution, including an
institution-affiliated party as defined in section 3(u) of the
Federal Deposit Insurance Act (12 U.S.C. 1813(u)), is not liable
under any state law to any person:
(a) For any disclosure of information to the department under
this section;
(b) For encumbering or surrendering any assets held by the
financial institution in response to a notice of lien or levy
issued by the department; or
(c) For any other action taken in good faith to comply with the
requirements of this section.
(5) As used in this section, 'account' and 'financial
institution' have the meaning given those terms in ORS
25.640. + }
SECTION 9. { + (1) As used in this section, 'consumer
reporting agency' means any person that, for monetary fees or
dues or on a cooperative nonprofit basis, regularly engages in
whole or in part in the practice of assembling or evaluating
consumer credit information or other information on consumers for
the purpose of furnishing consumer reports to third parties, and
that uses any means or facility of interstate commerce for the
purpose of preparing or furnishing consumer reports.
(2)(a) Notwithstanding ORS 314.840, and subject to rules
established by the Department of Justice, if a taxpayer has
neglected or refused to file any return or to pay any tax and has
not filed in good faith a petition before the department
contesting the tax, the department shall:
(A) Report periodically to consumer reporting agencies the name
of any taxpayer who is delinquent in the payment of taxes and the
amount owed by the taxpayer; and
(B) Otherwise make available to a consumer reporting agency
upon its request information regarding the amount of delinquent
taxes owed by a taxpayer.
(b) The department shall provide advance notice to the taxpayer
concerning the proposed reporting of information to the consumer
reporting agencies. The notice must inform the taxpayer:
(A) Of the amount of the tax liability that the department will
report to the consumer reporting agencies;
(B) That the department will continue to report the amount of
tax liability owed without sending additional notice to the
parties;
(C) Of the taxpayer's right to request an administrative review
within 30 days after the date of the notice; and
(D) Of the issues that may be considered on review.
(3) The department shall report information under subsection
(2) of this section only to a person that has furnished evidence
satisfactory to the department that the person is a consumer
reporting agency.
(4) When the department has made a report to a consumer
reporting agency under subsection (2) of this section, the
department shall promptly notify the consumer reporting agency
when the department's records show that the taxpayer no longer
owes delinquent taxes. + }
SECTION 10. { + This 2009 Act takes effect on the 91st day
after the date on which the regular session of the Seventy-fifth
Legislative Assembly adjourns sine die. + }
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