Sep 20th 2011
By AccountingWEB Staff
The California State Assembly has approved Assembly Bill 1424, the Delinquent Taxpayer Accountability Act, aimed at the state's worst tax debtors. The bill delivers a clear message: pay your back taxes or we'll suspend your driver's license and/or professional licenses.
The bill was initially targeted at the top 250 debtors identified by the California Franchise Tax Board and the State Board of Equalization, but assembly members asked that the bill cover the top 500 debtors. According to Henry Perea, who authored the bill, $6.5 billion goes uncollected every year from delinquent taxpayers.
"The people on these lists have no doubt worked hard to build their fortunes, and I applaud them for that," he said. "However, they must pay their fair share like the rest of us, and this bill will make it clear to them that we are serious."
In addition to yanking drivers' licenses and professional licenses, such as the license to practice medicine, the bill also gives California officials permission to work with other states and the IRS to find debtors who have shifted their money into out-of-state accounts.
The bill, which is now in the hands of Governor Jerry Brown, says licenses will be reinstated after the debtor makes payment arrangements with the state or demonstrates financial hardship.
Central Valley Business Times said the list of debtors includes "a Hollywood celebrity, a dot-com millionaire, former professional athletes, doctors, lawyers, dentists, realtors, major builders, and many others."
Take Action California is urging taxpayers to write letters in support of the bill, saying, "Nearly ninety percent of Californians pay their taxes, however, to allow individuals to avoid paying their fair share places an undue burden on those who do."
You can find the California Franchise Tax Board's list of the top 250 delinquent taxpayers at http://www.ftb.ca.gov/individuals/txdlnqnt.shtml. Since publication of the list began in 2007, the state has collected $81 million in owed taxes.
The California State Board of Equalization's list of delinquent sales and use tax accounts over $100,000 can be found at http://www.boe.ca.gov/cgi-bin/deliq.cgi.