2016 Regular Session
To: Ways and Means
By: Representative Smith
AN ACT TO AUTHORIZE THE DEPARTMENT OF REVENUE TO CONSIDER AND ENTER INTO AGREEMENTS WITH TAXPAYERS FOR THE SETTLEMENT OR COMPROMISE OF TAX LIABILITIES; TO BRING FORWARD SECTIONS 31-19-27 AND 31-19-29, MISSISSIPPI CODE OF 1972, WHICH PROVIDE FOR THE COMPROMISE OF DOUBTFUL CLAIMS, FOR PURPOSES OF AMENDMENT; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. (1) (a) The Department of Revenue is authorized to enter into an agreement with a taxpayer under which the taxpayer's tax liabilities, or any part thereof, including any applicable or assessed interest and penalty, are settled and compromised, and in connection therewith to receive and consider offers in compromise and settlement proposals, and to enter into binding settlement agreements and closing agreements under which a taxpayer's liabilities for taxes, interest and penalties are fully and finally compromised and settled. Such authority shall include compromise and settlements of proposed tax assessments, final tax assessments, and tax liabilities reflected by filed returns, judgments for taxes, and other proposed or final tax assessments and liabilities, and applicable interest and penalties.
(b) The Department of Revenue shall develop procedures for the receipt and consideration of offers in compromise and settlement proposals. In considering and taking action upon such offers and proposals, the Department of Revenue shall take into account:
(i) Controversy or doubt as to the taxpayer's liability for the tax that is the subject of the offer in compromise or settlement proposal;
(ii) Controversy or doubt as to the collectability of the tax that is the subject of the offer in compromise or settlement proposal;
(iii) That payment of the tax liability, or the interest or penalty thereon, will render the taxpayer insolvent or
incapable of continuing as a going business concern;
(iv) That the taxpayer has had an offer in compromise accepted by the Internal Revenue Service or has otherwise compromised or settled the federal tax liability relating to the same or a similar type of federal tax for the periods in question; and
(v) Hazards and costs of administrative proceedings and litigation.
With respect to the compromise of interest or penalties, the
Department of Revenue shall take into account, in addition to the factors listed in this paragraph (b), whether the failure to pay the applicable tax resulted from a mistake of fact or law made in good faith.
(2) A closing agreement or settlement agreement signed by the Commissioner of Revenue, or his designee, and a taxpayer shall be final and conclusive, and, except upon a showing of fraud or misrepresentation of a material fact, no additional assessment or collection may be made by the Department of Revenue and the
taxpayer shall not institute any judicial proceeding to recover the taxpayer's liabilities as agreed to in the closing agreement or settlement agreement.
(3) The Department of Revenue shall have all powers necessary to implement and administer this section, and the department shall promulgate rules and regulations, in accordance with the Mississippi Administrative Procedures Law, necessary for the implementation of this section.
SECTION 2. Section 31-19-27, Mississippi Code of 1972, is brought forward as follows:
31-19-27. A doubtful claim of the state, or of the county, city, town, village, or levee board is one for which judgment has been rendered and for the collection of which the ordinary process of law has been ineffectual; debts due by drainage districts or other taxing districts or sinking funds to counties under the Rehabilitation Act of 1928, being Chapter 88 of the Laws of 1928, and Chapter 16 of the Acts of the Special Session of 1931; those debts due counties by drainage districts, which the Reconstruction Finance Corporation has heretofore refused to refinance; debts due for sixteenth section township school fund loans made to churches, where the board of supervisors finds that the value of the security given therefor is insufficient or inadequate to pay or satisfy the principal and interest of said loan, and when the church repays the principal of said loan; and debts due by counties and townships to drainage districts for drainage district assessments or taxes levied and assessed upon sixteenth section lands.
SECTION 3. Section 31-19-29, Mississippi Code of 1972, is brought forward as follows:
31-19-29. The Governor, on the advice of the Attorney General or Chairman of the State Tax Commission, may, upon application of the defendant or debtor proposing a compromise, settle and compromise any doubtful claim of the state, or of any county, city, town, or village, or of any levee board against such defendant or debtor, upon such terms as he may deem proper, the board of supervisors in the case of a county, and the municipal authorities in the case of a city, town or village, and the levee board in the case of a claim of a levee board, concurring therein. The Governor, upon application of a drainage district having obligations outstanding to a county under the provisions of Chapter 88, Laws of 1928, and Chapter 16, Laws of the Extraordinary Session of 1931, or obligations which the Reconstruction Finance Corporation has heretofore refused to refinance, may settle and compromise any claim, debt or obligation that said drainage district may owe any county in the State of Mississippi for money loaned said district under the provisions of said Chapter 88, Laws of 1928, or any other claim, debt or obligation that said drainage district may owe the county which the Reconstruction Finance Corporation has heretofore refused to finance, if the board of supervisors of said county concurs in the application of the drainage district. The Governor, upon application by the board of supervisors for any taxing districts of said county or sinking funds of said county under the control and supervision of said board of supervisors having obligations outstanding and due to said county under the provisions of Chapter 88, Laws of 1928, and Chapter 16, Laws of the Extraordinary Session of 1931, may settle and compromise any claim, debt, or obligation that said taxing districts or sinking funds may owe said county for money loaned said taxing districts or sinking funds under the provisions of said Chapter 88, Laws of 1928; and provided that the Governor, on the advice of the Attorney General, and upon application of a church owing a sixteenth section township school fund loan, may settle and compromise such debt or obligation if the board of supervisors of the said county concurs in the application of the said church. The Governor may, on the advice of the Attorney General, in like manner compromise and settle a claim of a drainage district for unpaid assessments or taxes upon sixteenth section lands upon application of the board of supervisors wherein such sixteenth section is situated, if the commissioners of the drainage district concur therein.
SECTION 4. This act shall take effect and be in force from and after July 1, 2016.