sb470 intr

Senate Bill No. 470
(By Senators Craigo, Rowe, McCabe, Minard, Sharpe, Ross, Love, Hunter, Oliverio, Deem, Boley, Fanning, Prezioso, Bowman, Plymale, Jackson, Bailey, Anderson, Kessler, Sprouse, Minear, Tomblin, Mr. President and Redd)
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[Introduced March 13, 2001; referred to the Committee

on the Judiciary; and then to the Committee on Finance.]
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A BILL to amend and reenact sections eight, ten, fourteen and seventeen, article ten, chapter eleven of the code of West Virginia, one thousand nine hundred thirty-one, as amended; and to further amend said chapter by adding thereto a new article, designated article ten-a, all relating to West Virginia tax procedure and administration; creation of a board of tax and revenue appeals; notice of assessment; petition for reassessment or payment of assessment within sixty days; finality of assessment; payment of final assessment; effective date; termination date; appeals; overpayments; credits; refunds and limitations; extensions of time for filing; overpayment of federal taxes; transition rules; interest; legislative purpose; definitions; creating board of tax and revenue appeals; jurisdiction of board; composition of board; appointment, qualifications, term of office and removal of members; conflicts of interest prohibited; oath of office; credentials; compensation of board members; executive director; employees; expenses; prohibiting conflicts of interest; powers; duties; operation of board; principal office; general practice and procedure; small claims procedure; disputes involving ten thousand dollars or less; recordation of hearings; notice that hearing to be recorded; representation of parties; notice of right to representation at hearing; requiring written decisions; proposed findings of fact and conclusions of law; notice; publication of decisions; finality of board decisions; petition for rehearing; judicial review; service of notice of administrative decisions; timely filing; time for performance of acts when last day falls on Saturday, Sunday or legal holiday; confidentiality and disclosure of returns and return information; criminal penalty; effective date; transition rules; and severability.

Be it enacted by the Legislature of West Virginia:

That sections eight, ten, fourteen and seventeen, article ten, chapter eleven of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended and reenacted; and that said chapter be further amended by adding thereto a new article, designated article ten-a, all to read as follows:
ARTICLE 10. PROCEDURE AND ADMINISTRATION.

§11-10-8. Notice of assessment; petition for reassessment or
payment of assessment within sixty days; finality of assessment; payment of final assessment; effective date.

(a) Notice of assessment. -- The tax commissioner shall give the taxpayer written notice of any assessment or amended or supplemental assessment made pursuant to this article. The assessment or amended or supplemental assessment, as the case may be, shall become final and conclusive of the liability of the taxpayer and not subject to either administrative or judicial review under the provisions of sections nine or nine-a, and ten of this article unless the taxpayer to whom a notice of assessment or amended or supplemental assessment, is given, shall within sixty days after service thereof (except in the case of jeopardy assessments, as to which the time for filing a petition is specified in section seven of this article) either:

(1) Petition for reassessment. -- Personally or by certified mail, files with the tax commissioner a petition in writing, verified under oath by the taxpayer or his or her duly authorized agent, having knowledge of the facts, setting forth with particularity the items of the assessment objected to, together with the reasons for ~~such~~ the objections; or

(2) Payment of assessment. -- Personally or by certified mail, remits to the tax commissioner the total amount of the assessment or amended or supplemental assessment, including ~~such~~ the additions to tax and penalties as may have been assessed and the amount of interest due.

(b) Finality of assessment. -- The amount of an assessment or amended or supplemental assessment shall be due and payable on the day following the date upon which the assessment or amended or supplemental assessment becomes final. Payment of the amount of the assessment, or amended or supplemental assessment, as provided in subdivision (2) above, subsection (a) of this section, within sixty days after service of notice of ~~such~~ the assessment ~~shall~~ may not prohibit or otherwise bar the taxpayer from filing a claim for refund or credit under the provisions of section fourteen or fourteen-b of this article within the time prescribed therein for the filing of a claim for refund or credit.

(c) Payment of assessment after petition filed. -- A taxpayer who has timely filed a petition for reassessment may, at any time prior to issuance of the ~~tax commissioner's~~ administrative decision under section nine or nine-a of this article, or under article ten-a of this chapter, pay under protest the amount of the assessment. Upon ~~such~~ payment, the contested case shall thereafter be treated for all purposes as a petition for refund: Provided, That if payment is made after the administrative hearing under section nine or nine-a of this article or under article ten-a of this chapter has commenced or concluded, a new hearing ~~shall~~ may not be held, but the record thereof shall be properly amended ~~by the tax commissioner~~ to show that the amount assessed has been paid under protest by the taxpayer and that the petition for reassessment previously filed under this section is now to be treated as a petition for refund filed under section fourteen of this article.

(d) Effective date. -
(1) This section, as originally amended, shall apply to all assessments (including amended and supplemental assessments) which are issued on or after the first day of July, one thousand nine hundred eighty-six, and to all assessments issued prior to ~~such~~ the effective date which have not become final as provided in this section.

(2) As subsequently amended in two thousand one, this section may not apply to assessments (including amended and supplemented assessments) issued after the thirty-first day of December, two thousand two, which shall be subject to the provisions of article ten-a of this chapter.

§11-10-10. Appeals.

(a) Right of appeal. --
(1) A taxpayer may appeal the administrative decision of the tax commissioner issued under section nine or fourteen of this article, by taking an appeal to the circuit courts of this state within sixty days after being served with notice of the administrative decision.

(2) A taxpayer may appeal an administrative decision of the board of tax and revenue appeals as provided in section seventeen, article ten-a of this chapter.

(b) Venue. -- The appeal may be taken in the circuit court of any county:

(1) Wherein the activity taxed was engaged in; or

(2) Wherein the taxpayer resides; or

(3) Wherein the will of the decedent was probated or letters of administration granted; or

(4) To the circuit court of Kanawha County.

(c) Petition for appeal. -- The appeal proceeding shall be instituted by filing a petition with the circuit court, or the judge thereof in vacation, within the sixty-day period prescribed in subsection (a) of this section. The clerk of the circuit court shall, within ten days after date the petition is filed, serve the tax commissioner with a copy of the same by registered or certified mail. This petition shall be in writing, verified under oath by the taxpayer, or his or her duly authorized agent, having knowledge of the facts, set forth with particularity the items of the administrative decision or the assessment objected to, together with the reasons for ~~such~~ the objections.

(d) Appeal bond. -- If the appeal is of any assessment for additional taxes (except a jeopardy assessment for which security in the amount thereof was previously filed with the tax commissioner), then within ninety days after the petition for appeal is filed, or sooner if ordered by the circuit court, the taxpayer shall file with the clerk of the circuit court a cash bond or a corporate surety bond approved by the clerk. The surety must be qualified to do business in this state. These bonds shall be conditioned that the taxpayer shall perform the orders of the court. The penalty of this bond shall be not less than the total amount of tax, additions to tax, penalties and interest for which the taxpayer was found liable in the administrative decision of the tax commissioner. Notwithstanding the foregoing and in lieu of ~~such~~ the bond, the tax commissioner, in his or her discretion upon ~~such~~ the terms as he or she may prescribe, may upon a sufficient showing by the taxpayer, certify to the clerk of the circuit court that the assets of the taxpayer subject to the lien imposed by section twelve of this article, or other indemnification, are adequate to secure performance of the orders of the court.

(e) Hearing of appeal. -- The court shall hear the appeal and determine anew all questions submitted to it on appeal from the determination of the tax commissioner. In ~~such~~ the appeal a certified copy of the tax commissioner's notice of assessment or amended or supplemental assessment and administrative decision thereon shall be admissible and shall constitute prima facie evidence of the tax due under the provisions of those articles of this chapter to which this article is applicable. The court shall render its decree thereon and a certified copy of ~~said~~ the decree shall be filed by the clerk of the court with the tax commissioner who shall then correct the assessment in accordance with the decree. An appeal may be taken by the taxpayer or the tax commissioner to the supreme court of appeals of this state.

§11-10-14. Overpayments; credits; refunds and limitations.

(a) Refunds of credits of overpayments. -- In the case of overpayment of any tax (or fee), additions to tax, penalties or interest imposed by this article, or any of the other articles of this chapter, or of this code, to which this article is applicable, the tax commissioner shall, subject to the provisions of this article, refund to the taxpayer the amount of the overpayment or, if the taxpayer so elects, apply the same as a credit against the taxpayer's liability for the tax for other periods. The refund or credit shall include any interest due the taxpayer under the provisions of section seventeen of this article.

(b) Refunds or credits of gasoline and special fuel excise
tax or motor carrier road tax. -- Any person who seeks a refund or credit of gasoline and special fuel excise taxes under the provisions of section ten, eleven or twelve, article fourteen of this chapter, or section nine or eleven, article fourteen-a of this chapter, shall file his or her claim for refund or credit in accordance with the provisions of such sections. The ninety-day time period for determination of claims for refund or credit provided in subsection (d) of this section ~~shall~~ may not apply to these claims for refund or credit.

(c) Claims for refund or credit. -- No refund or credit shall be made unless the taxpayer has timely filed a claim for refund or credit with the tax commissioner. A person against whom an assessment or administrative decision has become final ~~shall~~ may not be entitled to file a claim for refund or credit with the tax commissioner as prescribed herein. The tax commissioner shall determine the taxpayer's claim and notify the taxpayer in writing of his or her determination.

(d) Petition for refund or credit; hearing. --

(1) If the taxpayer is not satisfied with the tax commissioner's determination of taxpayer's claim for refund or credit, or if the tax commissioner has not determined the taxpayer's claim within ninety days after the claim was filed, or six months in the case of claims for refund or credit of the taxes imposed by articles twenty-one, twenty-three and twenty-four of this chapter, after the filing thereof, the taxpayer may file, with the tax commissioner, either personally or by certified mail, a petition for refund or credit: Provided, That no petition for refund or credit may be filed more than sixty days after the taxpayer is served with notice of denial of taxpayer's claim.

(2) The petition for refund or credit shall be in writing, verified under oath by the said taxpayer, or by taxpayer's duly authorized agent having knowledge of the facts, and shall set forth with particularity the items of the determination objected to, together with the reasons for the objections.

(3) When a petition for refund or credit is properly filed, the procedures for hearing and for decision applicable when a petition for reassessment is timely filed shall be followed. On or after the first day of July, two thousand three, a petition for refund or credit shall be filed with the board of tax and revenue appeals and the provisions of article ten-a of this chapter shall be followed.

(e) Appeal. -- An appeal from the tax commissioner's administrative decision upon the petition for refund or credit may be taken by the taxpayer in the same manner and under the same procedure as that provided for judicial review of an administrative decision on a petition for reassessment, but no bond shall be required of the taxpayer. An appeal from the board's decision, if taken by the taxpayer, shall be taken as provided in article ten-a of this chapter.

(f) Decision of the court. -- Where the appeal is to review an administrative decision on a petition for refund or credit, the court may determine the legal rights of the parties but in no event shall it enter a judgment for money.

(g) Refund made or credit established. -- The tax commissioner shall promptly issue his or her requisition on the treasury or establish a credit, as requested by the taxpayer, for any amount finally administratively or judicially determined to be an overpayment of any tax (or fee) administered under this article. The auditor shall issue his or her warrant on the treasurer for any refund requisitioned under this subsection payable to the taxpayer entitled to the refund, and the treasurer shall pay the warrant out of the fund into which the amount so refunded was originally paid: Provided, That refunds of personal income tax may also be paid out of the fund established pursuant to section ninety-three, article twenty-one of this chapter.

(h) Forms for claim for refund or a credit; where return shall constitute claim. -- The tax commissioner may prescribe by rule or regulation the forms for claims for refund or credit. Notwithstanding the foregoing, where the taxpayer has overpaid the tax imposed by article twenty-one, twenty-three or twenty-four of this chapter, a return signed by the taxpayer which shows on its face that an overpayment of ~~such~~ the tax has been made shall constitute a claim for refund or credit.

(i) Remedy exclusive. -- The procedure provided by this section shall constitute the sole method of obtaining any refund, or credit, or any tax (or fee) administered under this article, it being the intent of the Legislature that the procedure set forth in this article shall be in lieu of any other remedy, including the uniform declaratory judgments act embodied in article thirteen, chapter fifty-five of this code, and the provisions of section two-a, article one of this chapter.

(j) Applicability of this section. -- The provisions of this section shall apply to refunds or credits of any tax (or fee), additions to tax, penalties or interest imposed by this article, or any article of this chapter, or of this code, to which this article is applicable. This section, as amended in the year two thousand one, shall apply to all petitions filed after the first day of July, two thousand three. As to petitions filed on or before the date, the provisions of this section as in effect when the petition was filed shall apply and are fully preserved: Provided, That as to any petitions filed with the tax commissioner, which remain on the tax commissioner's hearing docket as of the close of business on the first day of July, two thousand three, and for which no administrative hearing was had under section nine of this article, the tax commissioner shall transmit the petition therefor to the board of tax and revenue appeals as soon as practicable after the first day of July; and thereafter, the petition so transmitted shall, for all purposes except timeliness of filing, be treated as if it had been filed with the board of tax and revenue appeals on the first day of July, two thousand two.

(k) Erroneous refund or credit. -- If the tax commissioner believes that an erroneous refund has been made or an erroneous credit has been established, he or she may proceed to investigate and make an assessment or institute civil action to recover the amount of ~~such~~ the refund or credit, within two years from the date the erroneous refund was paid or the erroneous credit was established, except that the assessment may be issued or civil action brought within five years from ~~such~~ the date if it appears that any portion of the refund or credit was induced by fraud or misrepresentation of a material fact: Provided, That for credits granted under article thirteen-c, thirteen-d or thirteen-e of this chapter, section eight-a, article twenty-one of this chapter or section twenty-three-a, article twenty-four of this chapter, the investigations, assessments and civil actions may be brought or pursued by the tax commissioner against a tax payer or his or her successor at any time during the time that the taxpayer or successor may be entitled to take the credit against any tax, and three years subsequent to the termination of the entitlement.

(l) Limitation on claims for refund or credit. --

(1) General rule. -- Whenever a taxpayer claims to be entitled to a refund or credit of any tax (or fee), additions to tax, penalties or interest imposed by this article, or any article of this chapter, or of this code, administered under this article, paid into the treasury of this state, ~~such~~ the taxpayer shall, except as provided in subsection (d) of this section, file a claim for refund, or credit, within three years after the due date of the return in respect of which the tax (or fee) was imposed, determined by including any authorized extension of time for filing the return, or within two years from the date the tax, (or fee), was paid, whichever of such periods expires the later, or if no return was filed by the taxpayer, within two years from the time the tax (or fee) was paid, and not thereafter.

(2) Extensions of time for filing claim by agreement. -- The tax commissioner and the taxpayer may enter into a written agreement to extend the period within which the taxpayer may file a claim for refund or credit, which period shall not exceed two years. The period so agreed upon may be extended for additional periods not in excess of two years each by subsequent agreements in writing made before expiration of the period previously agreed upon.

(3) Special rule where agreement to extend time for making an assessment. -- Notwithstanding the provisions of subdivisions (1) and (2) of this subsection, if an agreement is made under the provisions of section fifteen of this article extending the time period in which an assessment of tax can be made, then the period for filing a claim for refund or credit for overpayment of the same tax made during the periods subject to assessment under the extension agreement shall also be extended for the period of the extension agreement plus ninety days.

(4) Overpayment of federal tax. -- Notwithstanding the provisions of subdivisions (1) and (2) of this subsection, in the event of a final determination by the United States Internal Revenue Service or other competent authority of an overpayment in the taxpayer's federal income or estate tax liability, the period of limitation upon claiming a refund reflecting the final determination in taxes imposed by articles eleven, twenty-one and twenty-four of this chapter ~~shall~~ may not expire until six months after the determination is made by the United States Internal Revenue Service or other competent authority.

(5) Tax paid to the wrong state. -- Notwithstanding the provisions of subdivisions (1) and (2) of this subsection, when an individual, or the fiduciary of an estate, has in good faith erroneously paid personal income tax, estate tax or sales tax, to this state on income or a transaction which was lawfully taxable by another state and, therefore, not taxable by this state, and no dispute exists as to the jurisdiction to which the tax should have been paid, then the time period for filing a claim for refund, or credit, for the tax erroneously paid to this state ~~shall~~ may not expire until ninety days after the tax is lawfully paid to the other state.

(6) Exception for gasoline and special fuel excise tax and motor carrier road tax. -- This subsection ~~shall~~ may not apply to refunds of gasoline and special fuel excise tax or motor carrier road tax sought under the provisions of article fourteen or fourteen-a of this chapter.

(m) Effective date. -- This section, as amended in the year one thousand nine hundred ninety-six, shall apply to claims for refund or credit filed on or after the first day of July, one thousand nine hundred ninety-six.

§11-10-17. Interest.

(a) Underpayments. -- If any amount of a tax administered under this article is not paid on or before the last date prescribed for payment, interest on ~~such~~ the amount at the rate of eight percent per annum shall be paid for the period from ~~such~~ the last date to the date paid: Provided, That on and after the first day of July, one thousand nine hundred eighty-six, interest on under payments shall be paid at an annual rate of one percent above the annual rate established under section seventeen-a of this article, from the period beginning on the ~~said~~ the first day of July, or from the last day prescribed for payment, whichever is the later, to the date paid, regardless of when liability for the tax arose. For purposes of this subsection, the last date prescribed for payment shall be the due date of the return and shall be determined without regard to any extension of time for payment.

(b) Last date for payment not otherwise prescribed. -- In the case of taxes payable by stamp or other indicia of tax payment and in all other cases in which the last day for payment is not otherwise prescribed, the last date for payment shall be ~~deemed~~ considered to be the date the liability for tax arises and in no event shall be later than the date notice and demand for payment of the tax is made by the tax commissioner.

(c) Erroneous refund or credit. -- If any refund is made or credit is established upon an erroneous claim for refund or credit, interest on ~~such~~ the amount refunded or credited at the annual rate established under section seventeen-a of this article, shall be paid by the claimant from the date the refund was made or the credit was taken to the date ~~such~~ the amount is recovered.

(d) Overpayments. -- Interest shall be allowed and paid at the annual rate of eight percent per annum upon any amount which has been finally administratively or judicially determined to be an overpayment in respect of each tax administered under this article except the taxes imposed by articles twelve, fourteen and fourteen-a of this chapter: Provided, That on and after the first day of July, one thousand nine hundred eighty-six, interest on overpayments shall be paid at the annual rate established under section seventeen-a of this article, from ~~said~~ the first day of July, or the date the claim for refund or credit is filed, whichever is the later, regardless of when the tax was paid. ~~Such~~ The interest shall be allowed and paid for the period commencing with the date of the filing by the taxpayer of a claim for refund or credit with the tax commissioner and ending with the date of a final administrative or judicial determination of overpayment. The tax commissioner shall, within thirty days after ~~such~~ the determination of entitlement to refund, issue his or her requisition or establish a credit as requested by the taxpayer. Whenever the tax commissioner fails or refuses to issue any ~~such~~ requisition or establish ~~such~~ credit within said thirty-day period, the interest provided herein shall commence to accrue until performance by the tax commissioner. The acceptance of ~~such~~ the refund check or credit shall be without prejudice to any right of the taxpayer to claim any additional overpayment and interest thereon.

(e) Applicable rules. -- For purposes of this section:

(1) No interest payable on tax refunded or credited within ninety days after claim for refund or credit is filed. -- In the event of the overpayment of any tax administered under this article, except the tax imposed by articles twenty-one and twenty-four of this chapter, where the tax commissioner issues his or her requisition or establishes a credit as requested by the taxpayer within ninety days after the date of the filing by the taxpayer of a claim for refund or credit, no interest shall be allowed under this section.

(2) No interest payable where personal income tax and corporation net income tax refunded or credited within six months after claim for refund or credit is filed. -- In the event of the overpayment of the tax imposed by articles twenty-one and twenty-four of this chapter, where the tax commissioner issues his or her requisition or establishes a credit as requested by the taxpayer within six months after the date of the filing by the taxpayer of a claim for refund or credit, no interest shall be allowed under this section.

(3) Interest treated as tax. -- Interest prescribed under this section on any tax shall be collected and paid in the same manner as taxes.

(4) No interest on interest. -- No interest under this section shall be imposed on the interest provided by this section prior to the first day of July, one thousand nine hundred eighty-six.

(5) Interest on penalties or additions to tax. -- Interest shall be imposed under subsection (a) of this section on any assessable penalty or additions to tax only if ~~such~~ the penalty or additions to tax is not paid within fifteen days from the date of notice and demand therefor, and in such case interest shall be imposed only for the period from the date of the notice and demand to the date of payment.

(6) Payments made within fifteen days after notice and demand. -- If notice and demand is made for payment of any amount, and if ~~such~~ the amount is paid within fifteen days after the date of ~~such~~ the notice and demand, interest under this section on the amount so paid ~~shall~~ may not be imposed for the period after the date of ~~such~~ the notice and demand.

(7) Limitation on collection. -- Interest prescribed under this section on any tax may be collected at any time during the period within which the tax to which ~~such~~ the interest relates may be collected.

(8) Exception as to estimated tax. -- This section ~~shall~~ may not apply to any failure to pay any estimated tax required to be paid under articles thirteen, thirteen-c, thirteen-b, twenty-one, twenty-three or twenty-four of this chapter.

ARTICLE 10A. WEST VIRGINIA BOARD OF TAX AND REVENUE APPEALS.

§11-10A-1. Legislative purpose.

The Legislature finds that there is a need for an independent agency, within the department of tax and revenue but separate and apart from the tax division of the department, to hear and determine tax disputes between the tax division and taxpayers. The Legislature further declares that the creation of a board of tax and revenue appeals is necessary to satisfy this need.

§11-10A-2. Definitions.

The following words when used in this article have the meaning ascribed to them in this section unless the context in which the term is used clearly indicates a different meaning is intended:

(a) "Board" means the West Virginia board of tax and revenue appeals; and whenever article five, chapter twenty-nine-a of this code is read in conjunction with this article, the term "agency" as used in article five, means the board of tax and revenue appeals unless the context in which the term "agency" is used clearly indicates that it means the department.

(b) "Commissioner" or "tax commissioner" means the tax commissioner of the state of West Virginia, or his or her authorized designee.

(c) "Contested matter" means an administrative proceeding before the board, initiated and heard as provided in this article and article five, chapter twenty-nine-a of this code, in which the legal rights, duties, interests or privileges of specific parties are required by statutory, regulatory or constitutional right to be determined after a board hearing.

(d) "Department" means the West Virginia department of tax and revenue.

(e) "Division" means the tax division of the West Virginia department of tax and revenue.

(f) "Member" means a member of the West Virginia board of tax and revenue appeals.

(g) "Order" means the whole or any part of the final disposition, whether affirmative, negative, injunctive or declaratory in form, by the board of any contested matter other than rule making.

(h) "Rule making" means the process for the formulation, amendment or repeal of a rule as provided in article three, chapter twenty-nine-a of this code.

(i) "Taxpayer" means any taxpayer as defined in section four, article ten of this chapter, or any other taxpayer or person who is an adversarial party in a contested matter involving the department under this article.

§11-10A-3. Board of tax and revenue appeals created.

There is created the West Virginia board of tax and revenue appeals which is an independent agency in the department of tax and revenue which operates separate and apart from the tax division of the department.

§11-10A-4. Jurisdiction of board.

The board has jurisdiction to review and render decisions relating to any one or more of the following contested matters:

(a) Petitions for reassessment filed pursuant to section eight-a, article ten of this chapter;

(b) Petitions for refund or credit filed pursuant to section fourteen, article ten of this chapter;

(c) Petitions for reconsideration of adverse decisions or actions by a division or agency within the department of tax and revenue concerning the following taxes not subject to the provisions of article ten of this chapter:

(1) The premium taxes imposed under article three, chapter thirty-three of this code, subsequent to a hearing or rehearing by the insurance commissioner conducted pursuant to section thirteen, article two, chapter thirty-three of this code;

(2) The taxes imposed on dog and horse racing under article twenty-three, chapter nineteen of this code; and

(3) The taxes imposed on liquor under section twenty-one, article three-a, chapter sixty of this code;

(d) Any other matter specified in legislatively authorized rules promulgated pursuant to article three, chapter twenty-nine-a of this code; and

(e) Other matters as may by statute or executive order be conferred on the board.

§11-10A-5. Composition of board; appointment, qualifications,
term of office, and removal of members; conflicts of interest prohibited; oath of office; credentials.

(a) Composition. -- The board of tax and revenue appeals shall consist of three members appointed by the governor with the advice and consent of the Senate. Additionally, the governor shall designate one of the members appointed to serve, at the governor's will and pleasure, as chairperson of the board. The chairperson shall be the chief administrative officer of the board and its staff. No more than two members shall be members of the same political party.

(b) Qualifications. -- Each member shall be a citizen of the United States and a resident of this state. No more than two members shall be duly licensed to practice law in this state.

(1) The term of office of each board member shall be six calendar years except that the terms of the first three board members shall respectively be for two, four and six calendar years. A person appointed to fill an unexpired term shall be appointed only for the remainder of that unexpired term. Any member whose term expires may be reappointed for another term.

(2) All terms shall begin on the first day of January of the first calendar year of the term and expire at the close of business on the last day of the calendar year during which the term expires, except that the first three board members may be appointed by the governor any time after the first day of January, two thousand two, and upon taking the oath of office, each member shall begin performing his or her duties under this article.

(3) Each member shall continue to serve until his or her successor is appointed and takes the oath of office, unless the member dies or resigns during his or her term. A resignation shall be effective as of the date it is accepted by the governor or on a later date agreed upon by the governor and the resigning member.

(d) Removal. -- The governor may remove any member only for incompetence, neglect of duty, gross immorality, malfeasance in office or violation of subsection (e) of this section; and removal shall be in the same manner as that specified for removal of elected state officers.

(e) Conflicts of interest prohibited. -- Each member, during his or her term shall:

(1) Devote his or her full time to board duties during the regular business hours of the board;

(2) Not otherwise engage in the active practice of law or be associated with any group or entity which is itself engaged in the active practice of law: Provided, That nothing in this subdivision shall be construed to prohibit a board member from being a member of a national, state or local bar association (or committee thereof) or of any other similar type group or organization, or to prohibit the member from engaging in the practice of law by representing himself or herself or his or her immediate family in their personal affairs in matters not subject to this article;

(3) Not engage, directly or indirectly, in any activity, occupation or business interfering or inconsistent with his or her duties as a board member;

(4) Not hold any other appointed public office or any elected public office or any other position of public trust; and

(5) Not be a candidate for any elected public office, or serve on or under any committee of any political party.

(f) Oath of office. -- Every person appointed a member of the board of tax and revenue appeals, before proceeding to exercise the authority or discharge the duties of that office, shall take the oath prescribed in section 5, article IV of the constitution of this state. The oath shall be taken and recorded as provided in article one, chapter six of this code; and a copy of the oath thereof shall be filed and recorded in the office of the secretary of state and in the office of the executive secretary of the board.

(g) Credentials. -- The credentials of members of the board shall consist of a certificate or commission issued by the governor under the great seal of this state, showing the appointment of the person to the board of tax and revenue appeals.

§11-10A-6. Compensation of board members.

(a) The annual salary of the chairperson shall be fifty-five thousand dollars per year and the annual salary of the other board members shall be fifty thousand dollars per year. This salary shall be paid out of moneys appropriated to the board for that purpose under the same procedures and in the same manner as the state auditor pays other appointed state officials in the executive branch of state government.

(b) Additionally, members of the board shall be reimbursed for their actual and necessary expenses incurred while engaged in the performance of their official duties, in the same manner and under the same conditions as other officials and employees of the executive branch of state government.

§11-10A-7. Alternate board member.

(a) Whenever necessary for hearing or decision by the entire membership of the board, and whenever a request in writing is addressed to the governor by any member of the board stating that the member has disqualified himself or herself from participating in a particular matter or matters coming before the board, or that the member is unable because of illness, disability or other good reason to take part in the matter or matters, or that a vacancy exists on the board, the governor shall designate a lawyer licensed to practice law in this state as a special alternate member of the board for that matter or matters only, and the designee is a member of the board for all purposes concerning the matter or matters.

(b) Any person designated an alternate member of the board who renders services as a member shall be paid at the rate of two hundred dollars per day for his or her services.

§11-10A-8. Executive director; employees; expenses; conflicts
of interest prohibited.

(a) General. -- The board may appoint an executive director, employ other persons as may be necessary, and make expenditures which it considers necessary for library publications, furniture, equipment, supplies, services, office space and other reasonable needs of the board within amounts appropriated for those purposes.

(b) Executive director. -- The board shall appoint and fix the compensation of an executive director, who shall serve at the will and pleasure of the board. This is a full-time position. The executive director shall keep a full and true record of all proceedings, acts, orders and questions of the board; to issue all necessary process, returns and notices; to keep all books, documents and papers ordered filed by the board; and to carry out other duties as may be specified by the board. The executive director shall be responsible to the board for the safe custody and preservation of all documents and papers on file in that office.

(c) Other employees. -- The board may employ other persons as may be necessary to carry out the provisions of this article and fix their compensation. All other employees shall be in the classified service of the West Virginia civil service system provided for in article six, chapter twenty-nine of this code.

(d) Conflicts of interest prohibited. --

(1) All persons employed by the board other than on a part-time basis shall devote their full time to the performance of their duties as employees during the regular working hours set by the board. Part-time persons employed by the board shall similarly devote full time to their duties as employees, during the hours they work as part-time employees of the board.

(2) The executive director and other employees of the board may not act as attorney, counselor, accountant or tax practitioner on behalf of a taxpayer in a matter involving any tax imposed by this state, another state or the United States. Nor shall the executive director or any other employee engage in any activity, occupation or business inconsistent with their duties as an employee of the board.

§11-10A-9. Powers; duties; operation of board.

The board has the following powers and duties:

(a) Annual report to governor and to the Legislature. -- The board shall submit an annual report to the governor and to the Legislature, as soon as practicable after the end of the fiscal year, containing suggestions and recommendations for the amendment, alteration and modification of existing laws relative to taxation and revenue and related matters as it may consider desirable. This report shall summarize and describe the board's activities since the end of the last report period and shall include a statement of the number and type of matters handled by it during the preceding state fiscal year and the number of matters pending at the end of the year.

(b) Capacity. -- The board of tax and revenue appeals may not be made a party in any judicial review of the decision of the board in a contested matter.

(c) Contempt. -- If any person fails or refuses to obey any lawful process of the board, the board may apply ex parte to the circuit court of Kanawha County or the circuit court of the county in which it is sitting for an order of contempt to be enforced as a contempt of court.

(d) Continuous session. -- The board shall be in continuous session and open for the transaction of business every day except Saturdays, Sundays and legal holidays in this state; and the session of the board shall stand and be considered to be adjourned from day-to-day without formal entry thereof upon its records.

(e) Depositions. -- Any party to a proceeding before the board or his or her attorney may cause depositions to be taken of witnesses who reside within or without the state in the manner prescribed under the rules of civil procedure.

(f) Filing fees. -- The board is authorized to impose a fee in an amount not to exceed fifty dollars to be fixed by the board for the filing of all petitions under the jurisdiction of the board. The fee may be uniform, or may vary based on whether the proceeding is a small claims proceeding, and shall be used to meet the costs of the board incurred in performing its statutory duties.

(g) Oaths. -- Any member or any employee of the board may be designated in writing by the chairman to administer oaths in all matters before the board.

(h) Quorum. -- A majority of the board constitutes a quorum to transact the board's business. A vacancy may not prevent the remaining board members from transacting the board's business as long as a majority remains.

(i) Records of the board. -- The board shall maintain the following records:

(1) A register in which the board shall enter by its title any proceedings appealed to it according to the day of its commencement. Thereafter, until after entry of the board's opinion and final order, there shall be noted in the register, according to date, the filing or return of any paper or process for the making of any order, ruling or other directive in or concerning the proceeding, and any other steps in the proceeding; and

(2) The files of the board consisting of all papers or other process filed by the board.

(j) Rules. -- The board shall promulgate, in accordance with article three, chapter twenty-nine-a of this code, any rules necessary to carry out its duties under this article.

(k) Seal. -- The board of tax and revenue appeals shall have a seal. The seal shall have the following words engraved on it: "West Virginia Board of Tax and Revenue Appeals." The board shall authenticate all of its orders, records and proceedings with the seal; and the courts of this state shall take judicial notice of the seal.

(l) Subpoenas. -- Any member of the board of tax and revenue appeals, on the request of any party to the proceedings before it or his or her attorney, shall issue subpoenas requiring the attendance of witnesses and the giving of testimony and subpoena duces tecum requiring the production of any returns, books, papers, documents, correspondence and other evidence pertaining to the matter under inquiry, in accordance with the rules of civil procedure.

(m) Other powers and duties. -- In addition to the powers and duties expressed in this article, the board shall have other powers and duties necessary or proper to carry out its duties under this article that are not specifically denied to it by this or any other statute or by the constitution of this state or of the United States of America.

§11-10A-10. Principal office.

The principal office of the board shall be in Charleston, West Virginia, but the board may hold hearings at any place within this state. The time and place of hearings shall be fixed by the board, with a view to providing reasonable opportunity to the parties to appear before the board with as little inconvenience and expense to the parties as practicable. The state shall provide adequate office and hearing facilities in Charleston, West Virginia. Any county commission, upon request by the board, shall provide the board with suitable rooms and facilities for hearings it holds in that county.

§11-10A-11. General practice and procedure.

(a) A proceeding before the board shall be initiated by filing a petition in accordance with the provisions of this article.

(b) Once a petition for reassessment, refund or credit, reconsideration or hearing is filed, the board shall have exclusive jurisdiction over the petition until it renders a decision on the petition or the petition is dismissed from the docket.

(c) All hearings shall be held in conformity with this article and chapter twenty-nine-a of this code. In case of any conflict, the provisions of this article shall control.

(d) The executive director of the board shall, within ten days after the date the petition is filed, serve the commissioner of the respondent division or agency with a copy of the petition. After the copy is served upon the commissioner, the commissioner is considered a party to the proceeding and, at the hearing on the petition, may appear in opposition in the petition.

(e) The respondent has sixty days from the date of service of the petition in which to file an answer. The answer shall contain a specific admission or denial of each material allegation in the petition; however, if the respondent is without knowledge or information sufficient to form a belief as to the truth of an allegation, he or she shall so state, and statement has the effect of a denial.

(f) The board shall assign a time and place of a hearing on the petition and shall notify the parties of the hearing by written notice at least thirty days in advance of the hearing. The hearing shall be held within one hundred twenty days from the filing of the petition, unless continued by the board upon its own motion or the board grants the written motion of any party stating good cause for the continuance.

(g) The chairperson of the board shall assign petitions and apportion the business of the board. The chairperson is authorized to assign any member to hear a petition for reassessment, refund or credit, reconsideration or hearing or, in the chairperson's discretion, designate the petition as one to be heard by the entire board.

(h) Before a hearing on a petition, the board may, in its discretion, and shall, at the request of any party, direct the parties to appear before the board or a member of the board for a prehearing conference to consider the simplification of the issues, the stipulation of facts and other matters as may aid in disposition of the contested matter. The member assigned to preside over the hearing shall preside over the conference. If any action is taken at the conference, or if any agreement is made by the parties as to any of the matters considered which limit the issues for hearing to those not disposed of by agreement of the parties, the member presiding over the conference shall enter an order after the order has been examined by the parties or their counsel. This order shall control the subsequent course of the proceeding, unless modified to prevent manifest injustice.

(i) All hearings on petitions before the board shall be de novo. The respondent's notice of assessment constitutes prima facie evidence of the tax or revenue due. If the hearing is on a petition for reassessment, the burden of proof is upon the petitioner to show the assessment is incorrect and contrary to law, either, in whole or in part. If the hearing is on any other petition filed under section four of this article, the petitioner shall also have the burden of proof.

(j) Hearings and conferences held pursuant to this article are exempt from the requirements of article nine-a, chapter six, and article one, chapter twenty-nine-b of this code.

(k) All notices, pleadings, hearings and proceedings shall be in accordance with rules of practice and procedures promulgated by the board which, as far as practical, shall conform to the practice and procedure in this state in civil trials without juries.

§11-10A-12. Small claims procedure; disputes involving ten
thousand dollars or less.

(a) In general. -- If the amount in dispute in any petition for reassessment or any petition for refund or credit filed with the board does not exceed ten thousand dollars for any one taxable year, then, at the option of the taxpayer and concurred in by the board before the hearing on the petition, the hearing shall be conducted under this section. Notwithstanding the provisions of section eleven of this article, a hearing under this section shall be conducted in an informal manner and in accordance with such rules of evidence, practice and procedure as the board may prescribe. A decision, together with a brief summary of the reasons for the decision shall be issued in a small claims proceeding by the member assigned to hear the matter.

(b) Finality of decision. -- A decision entered in any hearing conducted under this section is not subject to review, administrative or judicial, under this article, article ten of this chapter or article five, chapter twenty-nine-a of this code; and may not be treated as precedent for any other contested matter. The amount, if any, owed by the taxpayer to the state shall be paid within thirty days after notice of the decision is served on the taxpayer. The amount of overpayment by the taxpayer, if any, shall be refunded or credited, at the election of the taxpayer, in the manner prescribed in section fourteen, article ten of this chapter.

(c) Discontinuance of proceedings. -- At any time before commencement of the hearing held under this section, the petitioner may withdraw unilaterally its election made under subsection (a) of this section, and at any time before a decision is issued under this section, the petitioner may request or the board, on its own motion, may order that further proceedings under this section be discontinued if there are reasonable grounds for believing that the amount in dispute exceeds the amount described in subsection (a) of this section. Upon a discontinuance, or change of election, a hearing shall be held in the same manner as other contested matters to which this article applies.

(d) Amount in dispute. -- For purposes of this section, the amount in dispute includes tax, additions to tax and penalties, but excludes interest.

§11-10A-13. Recordation of hearings; notice that hearing to be
recorded.

All witnesses who testify at an administrative hearing shall do so under oath. All hearings before the board shall be reported by the official reporter of the board or by other means of recording acceptable for use in courts of this state. The board shall notify the taxpayer that the hearing will be recorded and that the taxpayer may receive a copy of the recording at cost. Recording charges and expenses shall be paid by the board from its appropriation. Copies of the record made shall be available to any party upon request and payment of a reasonable fee set by the board to cover the cost of the copies.

§11-10A-14. Representation of parties; notice of right to representation at hearing.

(a) In all contested matters before the board, the tax commissioner may represent himself or herself or, in his or her discretion, be represented by any attorney employed by him or her or by the attorney general.

(b) A taxpayer may appear on his or her own behalf or by his or her agent. The taxpayer shall be informed before any hearing that he or she has a right to have present at the hearing his or her attorney, accountant or other designated agent.

(c) Nothing in this section may be construed to permit the unauthorized practice of law as defined by the West Virginia supreme court of appeals.

§11-10A-15. Written decisions required; proposed findings of
fact and conclusions of law; notice; publication of decisions.

(a) Written decisions. -- An administrative decision shall be issued by the member assigned to hear the petition or by the board, as the case may be. This decision shall be in writing and include a concise statement of the material facts and conclusions of law. This decision may affirm, modify, reverse or remand any determination of the tax commissioner with respect to the petition and may grant other relief and invoke other remedies as may be appropriate. The board may issue the orders in accordance with the administrative decision as may be appropriate. Any member may file a concurring or dissenting opinion with regard to any decision in a matter heard by the board.

(b) Proposed findings of fact and conclusions of law. -- Prior to the rendering of an administrative decision, the parties may be provided the opportunity to submit proposed findings of fact and conclusions of law.

(c) Notice of decisions. -- Notice of administrative decisions shall be served upon the parties within a reasonable time after the hearing on the petition is concluded.

(d) Publication of decisions. -- The board shall provide for the publication of its administrative decisions, or a summary of the decisions. Publication shall be in a form determined by the board. A decision is considered published when a certified copy of the decision is filed in the state register maintained by the secretary of state. Copies of published decisions and published summaries of decisions are subject to sale in the same manner and upon the same terms as other public documents of this state.

(e) Exception. -- The provisions of this section do not apply to small claims decisions issued under section twelve of this article.

§11-10A-16. Finality of board decisions; petition for rehearing.

(a) Unless the administrative decision issued as provided in section fifteen of this article is appealed within sixty days after notice of the decision is served on the petitioner, the decision becomes final and may not thereafter be subject to either administrative or judicial review under this article or article ten of this chapter. The amount, if any, owed by the petitioner to the state is due and payable on the day after the day the administrative decision becomes final. The amount of overpayment by the petitioner, if any, shall be refunded or credited, at the election of the petitioner, in the manner prescribed by law. For taxes and fees administered under article ten of this chapter, section fourteen applies.

(b) Rehearing. -- Any party in a contested matter may, within thirty days after written notice of an administrative decision is served on them, file a written petition for rehearing with the board. A majority of the board shall decide whether or not to grant the rehearing. Timely filing of a petition for rehearing stops the running of the sixty-day appeal period until the petition for rehearing is acted upon by the board. If a rehearing is granted, the rehearing shall be heard by the entire board and a new sixty-day appeal period begins to run when the board's administrative decision is served on the parties.

(c) The tax commissioner may publish notice in the state register of whether or not he or she acquiesces, either in whole or in part, in any adverse decision. A copy of the notice shall be filed with the board.

(d) Exception. -- The provisions of this section do not apply to small claims decisions issued under section twelve of this article.

§11-10A-17. Judicial review.

(a) Right of appeal. -- Either the petitioner or the respondent, or both of them, may appeal the administrative decision of the board issued under section fifteen of this article, by taking an appeal to the circuit courts of this state within sixty days after being served with notice of the administrative decision.

(b) Venue. --

(1) The appeal may be taken in the circuit court of Kanawha County or of any county:

(A) In which the activity sought to be taxed was engaged in;

(B) In which the taxpayer resides; or

(2) In the event the parties appeal to different circuit courts, the appeals shall be consolidated. In the absence of agreement by the parties, the appeal shall be consolidated in the circuit court of Kanawha County.

(c) Petition for appeal. -- The appeal proceeding shall be instituted by filing a petition with the circuit court, or the judge of the circuit court in vacation, within the sixty-day period prescribed in subsection (a) of this section. There shall be attached to the petition a memorandum of all the parties who appeared at the hearing before the board. The clerk of the circuit court shall, within ten days after the day the petition is filed, serve all parties appearing of record, other than the petitioner, with a copy of the petition by registered or certified mail. The petition shall be in writing, verified under oath by the petitioner, or his or her duly authorized agent having knowledge of the facts, and shall set forth with particularity the items of the administrative decision objected to, together with the reasons for the objections.

(d) Appeal bond. -- If the appeal is of an assessment except a jeopardy assessment for which security in the amount thereof was previously filed with the tax commissioner, then within ninety days after the petition for appeal is filed, or sooner if ordered by the circuit court, the petitioner shall file with the clerk of the circuit court a cash bond or a corporate surety bond approved by the clerk. The surety shall be qualified to do business in this state. These bonds shall be conditioned upon the petitioner performing the orders of the court. The penalty of this bond shall be not less than the total amount of tax or revenue plus additions to tax, penalties and interest for which the taxpayer was found liable in the administrative decision of the board. Notwithstanding the foregoing and in lieu of the bond, the tax commissioner, upon terms as he or she prescribes, may upon a sufficient showing by the taxpayer, certify to the clerk of the circuit court that the assets of the taxpayer subject to the lien imposed by section twelve, article ten of this chapter, or other indemnification, are adequate to secure performance of the orders of the court. No bond may be required of the tax commissioner.

(e) Appeal of order dismissing petition. -- If a petition for reassessment, refund or credit, reconsideration or hearing is dismissed by the board, the order of the board dismissing the proceeding shall be considered an administrative decision of the board affirming the determination of the respondent which precipitated the filing of the petition with the board, and that order may be appealed as provided in this section.

(f) Appeal to circuit court. -- The circuit court shall hear the appeal as provided in section four, article five, chapter twenty-nine-a of this code: Provided, That when the appeal is to review an administrative decision on a petition for refund or credit, the court may determine the legal rights of the parties, but in no event shall it enter a judgment for money.

(g) Appeal to supreme court of appeals. -- Either party may appeal to the supreme court of appeals as provided in article six, chapter twenty-nine-a of this code: Provided, That notwithstanding the provisions of subsection (f) of this section, either party may appeal an order of the board directly to the supreme court of appeals when the sole legal issue or issues to be decided involve issues of constitutionality properly raised in proceedings before the board, and when the board's conclusions of fact are not in dispute.

(h) Correction of assessment; issuance of refund, etc. -- Unless the commissioner appeals an adverse decision of the circuit court or the supreme court of appeals, the commissioner, upon receipt of the certified order of the court, shall promptly correct his or her assessment or issue his or her requisition on the treasury or establish a credit, as requested by the taxpayer, for the amount of an overpayment.

(i) Exception. -- This section does not apply to decisions issued in small claims proceedings under section twelve of this article.

(j) Conflicts. -- In case of any conflict between the provisions of this article and article five, chapter twenty-nine-a of this code, the provisions of this article are controlling.

§11-10A-18. Service of notice of administrative decisions.

Notice of administrative decisions shall be served upon the parties either by personal or substituted service, or by certified mail. Service of notice by personal or substituted service is valid if made by any method authorized by Rule 4 of the West Virginia Rules of Civil Procedure. Service of notice by certified mail is valid if accepted by the party, or if addressed to and mailed to the party's usual place of business or usual place of abode or last known address and accepted by any officer, partner, employee, spouse or child of the taxpayer over the age of sixteen. Any notice addressed and mailed in the manner specified in this section and accepted by any person, is presumed to be accepted by the party unless proven otherwise by the taxpayer. Any notice addressed and mailed in the manner specified in this section, which is refused or not claimed, may then be served by regular mail if the notice is subsequently mailed by first-class mail, postage prepaid, to the same address and the date of posting in the United States mail is the date of service.

§11-10A-19. Timely filing.

(a) Delivery in person. -- If any petition, statement or other document required to be filed within a prescribed period or on or before a prescribed date under authority of this article is delivered in person on or before the date to the board of tax and revenue appeals at its office in Charleston, West Virginia, during normal business hours, it is timely filed: Provided, That the board may authorize delivery to be made to its agent at any other location or locations in this state, as it may from time to time prescribe.

(b) Timely mailing. -- If any petition, statement or other document required to be filed within a prescribed period or on or before a prescribed date under authority of this article, is after the period or the date delivered by United States mail to the board of tax and revenue appeals, the date of the United States postmark stamped on the cover in which the petition, statement or other document is mailed is considered to be the date of delivery if the following mailing requirements are met:

(1) The postmark date falls within the prescribed period or on or before the prescribed date for filing, including any extension granted for the filing, of the petition, statement or other document; and

(2) The petition, statement, or other document was, within the time prescribed in subdivision (1) of this subsection, deposited in the mail in the United States in an envelope or other appropriate wrapper or container, postage prepaid, properly addressed to the board of tax and revenue appeals.

(c) Postmarks not made by the U.S. postal service. -- This section applies in the case of postmarks not made by the United States postal service only if and to the extent provided by rules prescribed by the board.

(d) Registered and certified mailing. -- For purposes of this section, if any petition, statement or other document is sent by United States registered or certified mail, the date of registration or certification is considered the postmark date.

(e) Last date for filing. -- The last date for timely filing includes any extension of time authorized by law or rule and any extension of time granted in writing by the board.

§11-10A-20. Time for performance of acts where last day falls
on Saturday, Sunday or legal holiday.

When the last day prescribed under authority of this article or article ten of this chapter for performing any act falls on Saturday, Sunday or a legal holiday, the performance of the act is considered timely if it is performed on the next succeeding day which is not a Saturday, Sunday or a legal holiday. For purposes of this section, the last day for the performance of any act shall be determined by including any authorized extension of time. The term "legal holiday" means a legal holiday in this state.

§11-10A-21. Confidentiality and disclosure of returns and return information; criminal penalty.

(a) General rule. -- Except when required in a judicial review under this article of an administrative decision of the board, in any proceeding, and except as provided in subsections (d) through (f) of this section, it is unlawful for any present or former public officer or employee of the board to divulge or make known in any manner the tax return, or any part of the tax return, of any person or disclose information concerning the personal affairs of any individual or the business affairs of any firm, corporation or other organization or entity or disclose the amount of income, or any other particulars set forth or disclosed in any report, declaration or return required to be filed with the tax commissioner by any article of this code imposing any tax or fee administered under article ten of this chapter or by any rule of the tax commissioner issued thereunder or in any audit or investigation conducted under said article ten. This section is specifically exempted from disclosure under the provisions of subsection (5), section four, article one, chapter twenty-nine-b of this code.

(b) Definitions. -- For purposes of this section:

(1) Background file document. -- The term "background file document," with respect to a written determination, includes the request for that written determination, any written material submitted in support of the request, and any communication, written or otherwise, between the board and persons outside the board in connection with the written determination received before issuance of the written determination.

(2) Disclosure. -- The term "disclosure" means the making known to any person in any manner whatsoever a return or return information: Provided, That disclosure does not mean the exchange of information between officials, employees, legal representatives or agents of the board of tax and revenue appeals, for official purposes only, to the extent necessary to perform their statutory duties under this article.

(3) Inspection. -- The terms "inspection" and "inspected" mean any examination of a return or return information.

(4) Return. -- The term "return" means any tax or information return or report, declaration of estimated tax, claim or petition for refund or credit, or petition for reassessment that is required by, or provided for or permitted under, the provisions of article ten of this chapter (or any article of this chapter administered under said article ten) which is filed with the tax commissioner by, on behalf of, or with respect to any person, and any amendment or supplement to the return, including supporting schedules, attachments, or lists which are supplemental to, or part of, the return that was filed.

(5) Return information. -- The term "return information" means:

(A) A taxpayer's identity, the nature, source or amount of his or her income, payments, receipts, deductions, exemptions, credits, assets, liabilities, net worth, tax liability, tax withheld, deficiencies, over-assessments or tax payments, whether the taxpayer's return was, is being or will be examined or subject to other investigation or processing, or any other data, received by, recorded by, prepared by, furnished to or collected by the tax commissioner with respect to a return or with respect to the determination of the existence, or possible existence, of liability, or the amount thereof, or by any person under the provisions of article ten of this chapter, or any article of this chapter administered under article ten, for any tax, additions to tax, penalty, interest, fine, forfeiture or other imposition or offense; and

(B) Any part of any written determination or of any background file document relating to the written determination.

"Return information" does not include, however, data in a form which cannot be associated with, or otherwise identify, directly or indirectly, a particular taxpayer or the mere fact that a person has or has not filed a return. Nothing in the preceding sentence, or in any other provision of this code, may be construed to require the disclosure of standards used or to be used for the selection of returns for examination or data used or to be used for determining the standards.

(6) Tax administration. -- The term "tax administration" means:

(A) The administration, management, conduct, direction and supervision of the execution and application of the tax laws or related statutes of this state, and the development and formulation of state tax policy relating to existing or proposed state tax laws and related statutes of this state; and

(B) Includes assessment, collection, enforcement, litigation, publication and statistical gathering functions under the laws of this state.

(7) Taxpayer identity. -- The term "taxpayer identity" means the name of a person with respect to whom a return is filed, his or her mailing address, his or her social security number, any state or federal taxpayer identifying number or any combination thereof.

(8) Taxpayer return information. -- The term "taxpayer return information" means return information as defined in subdivision (5), of this subsection, which is filed with, or furnished to, the tax commissioner by or on behalf of the taxpayer to whom the return information relates.

(9) Written determination. -- The term "written determination" means a written ruling, determination letter, technical assistance advisory or administrative decision issued by the tax commissioner or the board.

(c) Criminal penalty. -- Any officer or employee, or former officer or employee, of this state who willfully violates this section is guilty of a felony and, upon conviction thereof, shall be imprisoned in a state correctional facility not less than ten nor more than twenty years.

(d) Waiver of confidentiality. -- Any person protected by the provisions of this article may, in a signed writing, waive the confidentiality provisions of this section for the purpose and period as he or she states in the writing. The board may, subject to requirements and conditions as it prescribes, thereupon release to designated recipients the information to which the waiver applies.

(e) Statistical use. -- This section may not be construed to prohibit the publication or release of statistics presented as to prevent the identification of particular returns and the items of the returns.

(f) Certain other persons. -- Pursuant to rules prescribed by the board, protected information may be disclosed to any person, but only to the extent necessary in connection with the processing, storage, transmission and reproduction of the information and the programming, maintenance, repair, testing and procurement of equipment for purposes of carrying out its duties under this article.

§11-10A-22. Effective date; transition rules.

(a) Effective date. -- The provisions of this article take effect on the first day of January, two thousand two.

(b) Transition rules. -- To provide for the orderly transition, the following rules are provided:

(1) All petitions for reassessment, refund, credit or reconsideration filed with the tax commissioner after the thirty-first day of May, two thousand two, shall be docketed in his or her office, but no administrative hearing may be held on the petition.

(2) On the first day of July, two thousand two, or as soon thereafter as practicable, the tax commissioner shall transmit all petitions for reassessment, refund, credit or reconsideration which remain on his or her hearing docket as of the close of business on the thirtieth day of June, two thousand two, and for which no hearing was held, to the board of tax and revenue appeals which shall place them on its hearing docket. Once docketed, these petitions shall be treated, for all purposes except timeliness, as if the petitions had been filed originally with the board.

(3) As to contested matters remaining on the tax commissioner's hearing docket as of the close of business on the thirtieth day of June, two thousand one, for which an administrative hearing has been held but no administrative decision issued, those matters shall remain in the tax commissioner's office and administrative decisions shall be issued by him or her as soon as practicable. A taxpayer desiring to appeal his or her administrative decision shall proceed as provided in section ten or fourteen, article ten of this chapter, or as otherwise provided in this code, as in effect prior to the first day of July, two thousand one: Provided, That in the event the circuit court remands an appeal for the taking of additional evidence, the remand shall be to the board of tax and revenue appeals. Upon remand, the tax commissioner shall immediately file with the board a copy of the record before the circuit court and a copy of all briefs or memoranda filed in the record.

NOTE: This bill would create an independent Board of Tax and Revenue appeals to hear petitions for reassessment, refund or credit, reconsideration or hearing concerning taxes collected by the tax commissioner of the department of tax and revenue. Transition rules are provided for such petitions filed with the tax commissioner before the new board becomes operational. Also, a new informal preassessment procedure is provided to give taxpayers an opportunity to request an informal conference or submit written arguments prior to an assessment being issued.

The effective date for the above provisions would be July 1, 2002.

Strike-throughs indicate language that would be stricken from the present law and underscoring indicates language that would be added.

§§11-10A is new; therefore, strike-throughs and underscoring have been omitted.