DeMarco bill brings fairness and organization to tax appeals process
From the Office of the Speaker of the House Mike Hubbard
MONTGOMERY – The House of Representatives today passed Rep. Paul DeMarco’s (R – Homewood) “Alabama Taxpayers’ Bill of Rights II” bill, a measure that streamlines the process for appealing tax assessments and ensures fairness throughout.
House Bill 105 is part of a three-bill “Taxpayers’ Bill of Rights” package Rep. DeMarco is sponsoring that will make Alabama more competitive by reducing business costs associated with unemployment, workers’ compensation and tax appeals.
“This bill will ensure that businesses and taxpayers choosing to appeal tax assessments are given a level playing field and referees who will remain neutral from the beginning of the process to the end,” DeMarco said.
Under the provisions of his legislation, the appeals process for tax assessments will be streamlined and made independent of the taxing governments, all of which have a vested interest in denying such appeals. Instead, an independent Alabama Tax Appeals Commission would be created and tasked with hearing disputes over assessments involving income, sales, use, rental and lodging taxes issued by the State Department of Revenue, by cities or counties or by private auditing firms they employ.
To avoid costly duplication, the bill also abolishes the Administrative Law Division of the Department of Revenue and transfers its personnel, equipment and functions to the newly-formed Commission. Doing so would bring Alabama into conformity with the vast majority of states that have created an independent tax appeals process for both businesses and individuals.
Passage of the legislation would save both administrative costs and legal fees for Alabama taxpayers pursuing the appeal process, although decisions made by the Commission could still be appealed to the circuit courts, as current law allows. The legislation also increases protections for “innocent spouses” and lengthens the appeal time for taxpayers from 30 days to 60 days.
Nearly two dozen business-affiliated associations have endorsed DeMarco’s bill including the Business Council of Alabama, the Alabama Retail Association, the Alabama Bankers Association and several more. The Birmingham Business Alliance, the Alabama Bar Association and the Council On State Taxation have also embraced the legislation.