BILL ANALYSIS
AB 852
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 852 (Fong)
As Amended August 31, 2009
Majority vote
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|ASSEMBLY: |52-27|(May 28, 2009) |SENATE: |22-14|(September 3, |
| | | | | |2009) |
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Original Committee Reference: REV. & TAX.
SUMMARY : Authorizes county assessors to require electronic
filing of annual business property statements in the format
prescribed by the Board of Equalization (BOE). Requires BOE to
adopt standard equipment codes for purposes of completing
business property statements.
The Senate amendments :
1)Recast the provisions of this bill for clarity and precision.
2)Allow the assessor to waive the electronic filing requirements
if the taxpayer has demonstrated that it would be an
unreasonable burden on the taxpayer's business.
3)Clarify the distinction between prescribed "electronic filing"
via the Internet and alternate filing methods that use
"electronic media" as the delivery method.
4)Clarify that the prescribed equipment codes are for purposes
of electronically-filed property statements that require these
codes.
5)Allow a county assessor to apply a penalty, pursuant to
Revenue and Taxation Code Section 463, on a taxpayer who fails
to file a property statement electronically.
6)Provide that, if BOE fails to adopt equipment codes by January
1, 2011, taxpayers may not be penalized for failing to use
them.
7)Require the assessor who refuses to accept a property
statement because it is not filed in the requested format to
notify the taxpayer and to allow the taxpayer to submit an
AB 852
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amended property statement within 12 days.
8)Provide that the assessor shall waive the penalty for a
taxpayer who demonstrates that the electronic filing
requirement would place an unreasonable burden on the
taxpayer's business.
9)Add double-jointing language to avoid chaptering out problems
with AB 311 (Ma), pending in the Senate.
AS PASSED BY THE ASSEMBLY , this bill:
1)Authorized 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)Required the assessor to notify the taxpayer, in writing, of
the requirement to file electronically.
3)Provided a one-year grace period for the taxpayer to comply
with the electronic filing requirement.
4)Allowed the taxpayer to file business property statements in a
paper format during the one-year grace period.
5)Required BOE to prescribe a format and method for filing
annual business property statements, including those filed
electronically.
6)Stated that the one year period to comply with the electronic
filing requirements begins on the date the notification is
mailed to the taxpayer.
7)Permitted a county assessor to reject property statements that
are not filed in the requested format.
8)Required BOE to adopt, on or before January 1, 2011, equipment
category codes and specified that BOE must consult with the
California Assessors' Association and taxpayer
representatives.
9)Provided that, on and after January 1, 2012, taxpayers filing
property tax statements must use the equipment category codes
adopted by BOE.
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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
electronically, via an interactive, online filing system. In
2004, local county assessors created a Joint Powers Agreement
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
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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: 0002903