BILL ANALYSIS Ó
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|Hearing Date:April 21, 2014 |Bill No:SB |
| |1159 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Ted W. Lieu, Chair
Bill No: SB 1159Author:Lara
As Amended:April 7, 2014 Fiscal: Yes
SUBJECT: Professions and vocations: license applicants: federal tax
identification number.
SUMMARY: Authorizes a board, as defined, the State Bar and the Bureau
of Real Estate to accept an application from an individual containing
a federal taxpayer identification number for an initial or renewal
license in lieu of a social security number.
Existing law:
1)Provides that each board under the Department of Consumer Affairs, as
well as the State Bar and Bureau of Real Estate shall, at the time
of issuance of the license, require that the licensee provide their
federal employer identification number, if the licensee is a
partnership, or social security number for all others. (Business
and Professions Code (BPC) § 30 (a))
2)Specifies that any licensee who does not provide the federal
identification number or social security number shall be reported by
the licensing board to the Franchise Tax Board and is subject to a
penalty. (BPC § 30 (b))
3)Provides that in addition to a penalty, a licensing board may elect
to not process any application for an original license if the
applicant or licensee fails to provide its federal employer
identification number or social security number where requested on
the application. (BPC § 30 (c))
4) Requires a licensing board, upon request of the Franchise Tax Board
(FTB), to furnish to the FTB specified information including the
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federal employer identification number if the entity is a
partnership, or social security number, for all others. (BPC § 30
(d)) (Revenue and Taxation Code § 19528)
5) Provides that it is the intent of the Legislature to utilize the
social security number or federal employer identification number
for the purpose of establishing the identification of persons
affected by state tax laws and for purposes of compliance with
Section 17520 of the Family Code and, to that end, the information
furnished pursuant to this section shall be used exclusively for
those purposes. (BPC § 30 (j))
6) Provides that the Department of Child Support Services (Department)
shall maintain a "certified list" that provides names of persons
who are found to be out of compliance with a judgment or order for
support in a case being enforced under Title IV-D of the Social
Security Act. (Family Code (FC) § 17520 (a) (3))
7) Provides that the Department shall provide the certified list to
each board that is responsible for the regulation of licenses, as
specified, and that all boards shall collect social security
numbers from all applicants for the purposes of matching the names
of the certified list to applicants and licensees and of responding
to requests for this information made by child support services.
(FC § 17520 (d))
8) Requires that promptly after receiving the certified list from the
Department, and prior to issuance or renewal of a license, each
board shall determine whether the applicant is on the most recent
certified list provided by the Department and provides that the
board shall have the authority to withhold issuance or renewal of
the license of any applicant on the list.
(FC § 17520 (e))
This bill:
1) Provides that each board under the Department of Consumer Affairs,
as well as the State Bar and Bureau of Real Estate shall at the
time of issuance of an initial or renewal license require that the
applicant provide its federal employer identification number, if
the applicant is a partnership, or the applicant's federal
taxpayer identification number or social security number, if one
has been issued, for all other applicants.
2) Requires that any applicant failing to provide the federal employer
identification number or the federal taxpayer identification number
or social security number, if one has been issued to the
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individual, to be reported by the licensing board to the FTB and
provides if the applicant fails to provide that information they
shall be subject to a penalty.
3) Provides that in addition to a penalty, a licensing board may elect
to not process any application for an original license if the
applicant or licensee fails to provide its federal employer
identification number, or federal taxpayer identification number or
social security number, if one has been issued to the individual,
where requested on the application.
4) Requires a licensing board, upon request of the Franchise Tax Board
(FTB), to furnish to the FTB specified information including the
federal employer identification number if the entity is a
partnership, or the licensee's federal taxpayer identification
number or social security number, if one has been issued to the
individual, for all other licensees.
5) Provides that it is the intent of the Legislature to utilize the
federal employer identification number, federal taxpayer
identification number, or social security number for the purpose of
establishing the identification of persons affected by state tax
laws and for purposes of compliance with Section 17520 of the
Family Code and, to that end, the information furnished pursuant to
this section shall be used exclusively for those purposes.
FISCAL EFFECT: Unknown. This measure has been keyed "fiscal" by
Legislative Counsel.
COMMENTS:
1. Purpose. The Author is the sponsor of this measure. According to
the Author, Business and Profession Code Section 30 currently
requires professional licensing boards to request, and applicants
to provide, social security numbers for the issuance of a
professional license; thereby limiting who may apply and obtain a
professional license in California. The Author argues that this
section is now inconsistent with sections of the Business and
Professions Code recently amended by AB 1024 (Gonzalez) in 2013 and
AB 1822 (Berryhill) in 2012.
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As indicated by the Author, AB 1024 clarified that all applicants who
meet the requirements for admission to the State Bar may be
licensed to practice law, regardless of immigration status. On
January 2, 2014, the State Supreme Court unanimously ruled to allow
for the admission of an applicant for licensure, an undocumented
immigrant who passed the bar exam, to the State Bar of California,
specifically citing the enactment of AB 1024. AB 1822 authorized,
for purposes of processing a licensing application or a renewal
application, submission of an individual tax identification number,
or other appropriate identification number as determined by the
California Architects Board, in lieu of a social security number,
if the individual is not eligible for a social security account
number at the time of application and is not in noncompliance with
a judgment or order for support pursuant to Section 17520 of the
Family Code.
The Author states that while the requirement for a social security
number was intended to ensure the payment and collection of taxes
associated with the practice of the profession under the given
license, the requirement has created inconsistencies and ambiguity
in the law. "While in some sections of the B&P Code (Sec. 6064 and
Sec. 5550.5) we authorize an individual access to a professional
license, regardless of immigration status, in another section we
still require that same individual to provide a social security
number in order to access the license."
The Author further explains that it is in the best social and economic
interest of our state to support efforts to educate our workforce
and enable our residents, including immigrants to improve their
economic mobility and self-sufficiency, which will increase their
contributions back to the state. SB 1159 would authorize an
applicant to provide a licensing board a federal identification
number, if one has been issued, in lieu of a social security
number, as part of the application for a professional license in
California.
"Over the last decade our state has understood the importance of a
continued investment in immigrant children. The natural step is to
ensure that as these young people complete their education a
professional license is accessible to them in their respective
fields. SB 1159 clarifies this ambiguity in the law."
2. Taxpayer Identification Numbers. A Taxpayer Identification Number
(TIN) is an identification number used by the Internal Revenue
Service (IRS) in the administration of tax laws. It is issued by
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the Social Security Administration (SSA) or by the IRS. A Social
Security Number is issued by the SSA whereas all other TINs are
issued by the IRS.
The Individual Taxpayer Identification Number, or ITIN, is a tax
processing number only available for certain nonresident and
resident aliens, their spouses, and dependents who cannot get a
SSN. It is a 9-digit number, beginning with the number "9" and is
formatted like a SSN. To obtain an ITIN, an individual must
complete an IRS form. The form requires documentation
substantiating foreign/alien status and true identity for the
individual. The person may either mail the documentation, along
with the required form, present it at the IRS office, or process
the application through an acceptable agent authorized by the IRS.
3. Policy Issue. As earlier indicated in a description of the law
regarding compliance with a judgment or order for support pursuant
to Section 17520 of the Family Code, it appears as if there is a
reliance on the social security number by the Department of Child
Support Services in providing the "certified list" to boards to
compare against applicants for licensure. The Author should
consider whether some corresponding changes may be necessary to
Section 17520 so that the boards will still be able to identify
those applicants who may be in noncompliance with a judgment or
order for support as identified by the Department of Child Support
Services.
SUPPORT AND OPPOSITION:
Support: None on file as of April 15, 2014.
Opposition: None on file as of April 15, 2014.
Consultant:Bill Gage