BILL ANALYSIS
AB 852
Page 1
ASSEMBLY THIRD READING
AB 852 (Fong)
As Amended May 4, 2009
Majority vote
REVENUE & TAXATION 6-1 APPROPRIATIONS 12-3
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|Ayes:|Charles Calderon, Beall, |Ayes:|De Leon, Ammiano, Charles |
| |Coto, Ma, Portantino, | |Calderon, Davis, Fuentes, |
| |Fong | |Hall, Harkey, |
| | | |John A. Perez, Price, |
| | | |Skinner, Solorio, |
| | | |Torlakson |
| | | | |
|-----+--------------------------+-----+---------------------------|
|Nays:|DeVore |Nays:|Nielsen, Duvall, Audra |
| | | |Strickland |
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SUMMARY : Authorizes county assessors to require electronic
filing of annual business property statements in the format
prescribed by the Board of Equalization (BOE). Requires the BOE
to adopt standard equipment codes for purposes of completing
business property statements. Specifically, this bill :
1)Authorizes a county assessor to require a taxpayer that owns
taxable personal property with an assessed value of $100,000
or more to electronically file a business property statement.
2)Requires the assessor to notify the taxpayer, in writing, of
the requirement to file electronically.
3)Provides a one-year grace period for the taxpayer to comply
with the electronic filing requirement.
4)Allows the taxpayer to file business property statements in a
paper format during the one-year grace period.
5)Requires BOE to prescribe a format and method for filing
annual business property statements, including those filed
electronically.
6)States that the one year period to comply with the electronic
filing requirements begins on the date the notification is
AB 852
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mailed to the taxpayer.
7)Permits a county assessor to reject property statements that
are not filed in the requested format.
8)Requires BOE to adopt, on or before January 1, 2011, equipment
category codes and specifies that BOE must consult with the
California Assessors' Association and taxpayer
representatives.
9)Provides that, on and after January 1, 2012, taxpayers filing
property tax statements must use the equipment category codes
adopted by BOE.
FISCAL EFFECT : The BOE staff estimates that this bill will have
no direct impact on state revenues.
COMMENTS : The author states that, "AB 852 directs the Board of
Equalization to adopt equipment category descriptions, in
consultation with assessors and taxpayers, and allows an
assessor to require a business to file electronically. This
bill will provide incentives to assessors and businesses to make
the necessary transitions in their electronic processing systems
such that Business Property Statements can be filed and accepted
electronically statewide. AB 853 will decrease the amount of
paper filings, which in turn will reduce human errors and costs
associated with postage, processing, and data entry."
According to the author, the purpose of this bill is to provide
incentives to assessors and businesses to make the necessary
transitions in their electronic processing systems, such that
business property statements can be filed and accepted
electronically statewide.
The California Assessors' Association, sponsor, states that AB
852, by requiring businesses to file their business property
statements electronically, will establish uniformity and will
reduce errors and costs associated with paper filings.
Personal property used in a trade or business is, generally,
taxable, and the taxpayer who owns that property must annually
report the cost of that property to the local assessor by filing
a property statement (Form 571). Many assessors provide an
opportunity for businesses to file their property statements
AB 852
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electronically, via an interactive, online filing system. In
2004, local county assessors created a Joint Powers Agreement
(JPA) for Standard Data Record Development (SDR) and Year to
Year Support. Currently, more than 40 counties participate in
the program. The SDR system is designed to simplify the process
of filing annual property statements for businesses that have
multiple locations in one or more California counties. The
system allows a business to upload data directly from its
internal data processing system into SDR, which will deliver the
data to the corresponding county assessor. The goal of the SDR
system is to allow major corporations to bypass filing a
business property statement in every county in which they have a
business presence. In addition, assessors could reduce the
costs associated with processing data from the paper statements
if statements are filed electronically. Finally, business
filing electronically via the SDR system would receive their
estimated assessed values earlier and the assessors could
process filings with fewer errors.
The SDR system, however, only accepts business property
statements that are filed electronically in the approved XML
file format, and, in order to create SDR files, a business must
have the SDR software and special programming. Arguably, the
level of effort and investment may not be practical for
businesses that are filing for a single location. Some counties
allow taxpayers to submit their business property statements via
the Internet, requiring no special data format. Generally, this
sort of e-filing is designed for small and medium business
owners.
SB 2092 (Senate Revenue and Taxation Committee), Chapter 775,
Statutes of 2002, authorized assessors to accept business
property statements filed electronically and allows taxpayer to
authenticate their signatures by means other than a traditional
signature.
Analysis Prepared by : Oksana Jaffe / REV. & TAX. / (916)
319-2098
FN: 0000850