BILL ANALYSIS
AB 2177
Page 1
Date of Hearing: April 28, 2010
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 2177 (Beall) - As Amended: April 14, 2010
Policy Committee: Revenue and
Taxation Vote: 8-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill authorizes the Franchise Tax Board (FTB) to
communicate with taxpayers and their authorized representatives
via e-mail. Specifically, the bill:
1)Allows FTB, at the request of a taxpayer, to provide an
electronic notification of statements, bills, or other
communications, that have been posted to the taxpayer's online
account.
2)Requires that prior to obtaining consent from the taxpayer to
use the elective method, the FTB advise the taxpayer of the
ramifications of such an election.
3)Allow taxpayers to file electronically a protest,
notification, and other communication to the FTB through its
website.
4)Will be implemented once FTB completes planned upgrades to its
online system, currently planned for 2013, and sunsets on
January 1, 2018
FISCAL EFFECT
1)No new costs, since FTB indicates that costs to provide
notices online are already embedded in ongoing "enterprise
data to revenue" (EDR) computer system project.
2)Use of electronic communication will result in unknown,
potentially significant ongoing savings.
AB 2177
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COMMENTS :
1)Rationale . The purpose of the bill is to reduce mailing costs
and streamline communications between the Franchises Tax Board
and the public. The author indicates the bill will enable the
state to "go green" by cutting down on paper mail and
improving efficiencies in tax administration workloads. The
option for electronic notification also ensures that taxpayers
who move frequently will be given a timely receipt of FTB
notices.
2)Background - FTB communications with taxpayers . According to
the FTB, it issues approximately 17 million bills and notices
each year to taxpayers, including responses to returns filed,
collection notices for unpaid liabilities, filing enforcement
notices when returns are not filed, and notices related to
audit activities of taxpayer returns. Some notices are merely
correspondence regarding a pending matter, but many have legal
significance. Under existing law, FTB is not able to mail
these notices electronically, even if the taxpayers receiving
the notices prefers electronic communication. In addition, a
notice of proposed assessment and final deficiency notice
issued after January 1, 2008, require a postmark, and thus,
cannot be mailed electronically. The existing restrictions can
be problematic in cases where taxpayers move frequently.
A taxpayer or his/her representative may obtain from the FTB
limited confidential information through the FTB Web site. As
part of its current EDR project, the FTB plans to update and
expand information provided through its online accounts to
include, among other items, current and historical notices or
bills issued to the taxpayer. This expanded capability, which
will be accessible to all taxpayers and their authorized
representatives, is expected to be completed by January 1,
2013.
Analysis Prepared by : Brad Williams / APPR. / (916) 319-2081