Montgomery – The Alabama House on Thursday awarded its approval to the “Alabama Taxpayers’ Bill of Rights II,” a measure sponsored by State Representative Paul DeMarco (R – Homewood) that streamlines the process for appealing both state and local tax assessments and ensures fairness throughout.
The bill is included in the House Republican Caucus’ “Commonsense Conservative Agenda” that was announced prior to the start of the session.
“This bill will ensure that businesses and individual 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. “This bill can be summed up in two words that are at the core of its intent – simple fairness.”
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, privilege, 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 budget, personnel, equipment and functions to the newly-formed Tax Appeals 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. The bill has been endorsed both by the American Bar Association and the American Institute of CPAs.
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. Among several other pro-taxpayer changes, the legislation also increases protections for “innocent spouses” and lengthens the appeal time for taxpayers from 30 days to 60 days.
The bill now moves to the State Senate for consideration.