BILL NUMBER: SB 385	INTRODUCED
	BILL TEXT


INTRODUCED BY   Senator Block

                        FEBRUARY 20, 2013

   An act to add Section 6812.5 to the Revenue and Taxation Code,
relating to bulk sales.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 385, as introduced, Block. Bulk sales: sales and use taxes:
collection of taxes: successor's liability: notifications:
disclosures.
   Existing law, the Uniform Commercial Code-Bulk Sales, is a
comprehensive body of law regulating bulk sales, which are defined to
include a sale not in the ordinary course of the seller's business
of more than 1/2 the seller's inventory and equipment, as specified,
and which imposes specified obligations on an escrow agent for that
sale.
   The Sales and Use Tax Law, employment tax laws, and personal
property laws impose liabilities for unpaid taxes upon the purchaser
of a business under specified circumstances. Under the Sales and Use
Tax Law, if any person liable for any amount under that law sells out
the business or stock of goods or quits the business, the successors
or assigns are required to withhold sufficient of the purchase price
to cover such amount until the former owner either produces a
receipt from the State Board of Equalization showing that it has been
paid or produces a certificate from the board stating that no amount
is due. Under that law, if the purchaser of a business or stock of
goods fails to withhold from the purchase price as required, the
purchaser becomes personally liable for the payment of the amount
required to have been withheld to the extent of the purchase price,
valued in money.
   This bill would require an escrow agent to make specified
notifications in writing to a potential purchaser of a business
regarding a purchaser's liabilities under the Sales and Use Tax Law.
This bill would also require specified sellers of a business to
provide under penalty of perjury a successor liability disclosure
statement, as may be prescribed by the State Board of Equalization,
to all potential purchasers or their authorized agents. By expanding
the crime of perjury, this bill would impose a state-mandated local
program.
   The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that no reimbursement is required by this
act for a specified reason.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 6812.5 is added to the Revenue and Taxation
Code, to read:
   6812.5.  (a) For a bulk sale handled through an escrow, the escrow
agent shall notify in writing a potential purchaser of a business
that is required to hold a permit under this part of the following
information:
   (1) That if a person is liable for any amount under this part
sells his or her business or stock of goods, the purchaser must
withhold a sufficient amount of the purchase price to cover that
amount, until the seller produces a receipt from the board showing
payment or no amount due.
   (2) That a tax clearance certificate is available from the board
that will identify amounts owed under this part by the seller of the
business.
   (3) That the purchaser may be personally liable for the payment of
the amounts owed by the seller under this part to the extent of the
purchase price.
   (b) If a person liable for any amount due under this part sells
out his or her business or stock of goods or quits the business, the
person shall provide under penalty of perjury a successor liability
disclosure statement, as may be prescribed by the board, to all
potential purchasers or their authorized agents to identify any
unpaid amounts due under this part.
   (c) For purposes of this section, "bulk sale" has the same meaning
as defined in paragraph (3) of subdivision (a) of Section 6102 of
the Commercial Code.
  SEC. 2.  No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.