Bill Text: IN HB1303 | 2013 | Regular Session | Introduced
Bill Title: Collection of amounts owed to local units.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2013-01-14 - First reading: referred to Committee on Government and Regulatory Reform [HB1303 Detail]
Download: Indiana-2013-HB1303-Introduced.html
Citations Affected: IC 6-8.1; IC 36-1-4-17.
Synopsis: Collection of amounts owed to local units. Requires the
department of state revenue to establish a pilot collection program
(pilot program) allowing up to 10 cities, towns, counties, or townships
to participate in a program assigning to the department the collection
of judgments and delinquent assessments due to those local units of
government. Provides that a delinquent assessment is any amount due
and payable to a local unit that has remained unpaid for at least 30
days. Permits the department to carry out the pilot program by: (1)
enforcing judgment warrants by levying against property or garnishing
earnings; (2) using the data match system that the department operates
with each Indiana financial institution; and (3) employing special
counsel or contracting with a collection agency. Provides that in
contracting with collection agencies, the department shall give a
preference to collection agencies that meet certain criteria. Establishes
procedures for issuance of demand notices and warrants. Provides that
a warrant becomes a judgment when recorded by the circuit court clerk.
Provides for various fees to be assessed by the department with respect
to the collection process. Permits the department to disclose all
information relating to a judgment warrant subject to collection under
the pilot program to a local unit of government participating in the
program.
Effective: July 1, 2013.
January 14, 2013, read first time and referred to Committee on Government and Regulatory
Reform.
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A BILL FOR AN ACT to amend the Indiana Code concerning
taxation.
(1) members and employees of the department;
(2) the governor;
(3) the attorney general or any other legal representative of the state in any action in respect to the amount of tax due under the
provisions of the law relating to any of the listed taxes; or
(4) any authorized officers of the United States;
when it is agreed that the information is to be confidential and to be
used solely for official purposes.
(b) The information described in subsection (a) may be revealed
upon the receipt of a certified request of any designated officer of the
state tax department of any other state, district, territory, or possession
of the United States when:
(1) the state, district, territory, or possession permits the exchange
of like information with the taxing officials of the state; and
(2) it is agreed that the information is to be confidential and to be
used solely for tax collection purposes.
(c) The information described in subsection (a) relating to a person
on public welfare or a person who has made application for public
welfare may be revealed to the director of the division of family
resources, and to any director of a county office of the division of
family resources located in Indiana, upon receipt of a written request
from either director for the information. The information shall be
treated as confidential by the directors. In addition, the information
described in subsection (a) relating to a person who has been
designated as an absent parent by the state Title IV-D agency shall be
made available to the state Title IV-D agency upon request. The
information shall be subject to the information safeguarding provisions
of the state and federal Title IV-D programs.
(d) The name, address, Social Security number, and place of
employment relating to any individual who is delinquent in paying
educational loans owed to a postsecondary educational institution may
be revealed to that institution if it provides proof to the department that
the individual is delinquent in paying for educational loans. This
information shall be provided free of charge to approved postsecondary
educational institutions (as defined by IC 21-7-13-6(a)). The
department shall establish fees that all other institutions must pay to the
department to obtain information under this subsection. However, these
fees may not exceed the department's administrative costs in providing
the information to the institution.
(e) The information described in subsection (a) relating to reports
submitted under IC 6-6-1.1-502 concerning the number of gallons of
gasoline sold by a distributor and IC 6-6-2.5 concerning the number of
gallons of special fuel sold by a supplier and the number of gallons of
special fuel exported by a licensed exporter or imported by a licensed
transporter may be released by the commissioner upon receipt of a
written request for the information.
(f) The information described in subsection (a) may be revealed upon the receipt of a written request from the administrative head of a state agency of Indiana when:
(1) the state agency shows an official need for the information; and
(2) the administrative head of the state agency agrees that any information released will be kept confidential and will be used solely for official purposes.
(g) The information described in subsection (a) may be revealed upon the receipt of a written request from the chief law enforcement officer of a state or local law enforcement agency in Indiana when it is agreed that the information is to be confidential and to be used solely for official purposes.
(h) The name and address of retail merchants, including township, as specified in IC 6-2.5-8-1(j) may be released solely for tax collection purposes to township assessors and county assessors.
(i) The department shall notify the appropriate innkeepers' tax board, bureau, or commission that a taxpayer is delinquent in remitting innkeepers' taxes under IC 6-9.
(j) All information relating to the delinquency or evasion of the motor vehicle excise tax may be disclosed to the bureau of motor vehicles in Indiana and may be disclosed to another state, if the information is disclosed for the purpose of the enforcement and collection of the taxes imposed by IC 6-6-5.
(k) All information relating to the delinquency or evasion of commercial vehicle excise taxes payable to the bureau of motor vehicles in Indiana may be disclosed to the bureau and may be disclosed to another state, if the information is disclosed for the purpose of the enforcement and collection of the taxes imposed by IC 6-6-5.5.
(l) All information relating to the delinquency or evasion of commercial vehicle excise taxes payable under the International Registration Plan may be disclosed to another state, if the information is disclosed for the purpose of the enforcement and collection of the taxes imposed by IC 6-6-5.5.
(m) All information relating to the delinquency or evasion of the excise taxes imposed on recreational vehicles and truck campers that are payable to the bureau of motor vehicles in Indiana may be disclosed to the bureau and may be disclosed to another state if the information is disclosed for the purpose of the enforcement and collection of the taxes imposed by IC 6-6-5.1.
(n) All information relating to a judgment warrant subject to
collection by the department under IC 6-8.1-8.5 may be disclosed
to the local unit.
(n) (o) This section does not apply to:
(1) the beer excise tax, including brand and packaged type
(IC 7.1-4-2);
(2) the liquor excise tax (IC 7.1-4-3);
(3) the wine excise tax (IC 7.1-4-4);
(4) the hard cider excise tax (IC 7.1-4-4.5);
(5) the malt excise tax (IC 7.1-4-5);
(6) the motor vehicle excise tax (IC 6-6-5);
(7) the commercial vehicle excise tax (IC 6-6-5.5); and
(8) the fees under IC 13-23.
(o) (p) The name and business address of retail merchants within
each county that sell tobacco products may be released to the division
of mental health and addiction and the alcohol and tobacco commission
solely for the purpose of the list prepared under IC 6-2.5-6-14.2.
(b) Each financial institution doing business in Indiana shall provide information to the department on all individuals:
(1) who hold one (1) or more accounts with the financial institution; and
(2) upon whom a levy (including a levy under IC 6-8.1-8.5) may be issued by the department or a county treasurer.
(c) To provide the information required under subsection (b), a financial institution shall do one (1) of the following:
(1) Identify individuals by comparing records maintained by the financial institution with records provided by the department by:
(A) name; and
(B) either:
(i) Social Security number; or
(ii) tax identification number.
(2) Comply with IC 31-25-4-31(c)(2). The child support bureau established by IC 31-25-3-1 shall regularly make reports submitted under IC 31-25-4-31(c)(2) accessible to the department or its agents for use only in tax judgment and levy administration.
(d) The information required under subsection (b) must:
(1) be provided on a quarterly basis; and
(2) include the:
(A) name;
(B) address of record; and
(C) either:
(i) the Social Security number; or
(ii) tax identification number;
of individuals identified under subsection (b).
(e) When the department determines that the information required under subsection (d)(2) is identical for an individual who holds an account with a financial institution and an individual against whom a levy may be issued by the department or a county treasurer, the department or its agents shall provide a notice of the match, in compliance with section 4 of this chapter, if action is to be initiated to levy or encumber the account.
(f) This section does not preclude a financial institution from exercising its right to:
(1) charge back or recoup a deposit to an account; or
(2) set off from an account held by the financial institution in which the individual has an interest in any debts owed to the financial institution that existed before:
(A) the state's levy; and
(B) notification to the financial institution of the levy.
(g) A financial institution ordered to block or encumber an account under this section is entitled to collect its normally scheduled account activity fees to maintain the account during the period the account is blocked or encumbered.
(h) All information provided by a financial institution under this section is confidential and is available only to the department or its agents for use only in levy collection activities.
(i) A financial institution providing information required under this section is not liable for:
(1) disclosing the required information to the department or the child support bureau established by IC 31-25-3-1;
(2) blocking or surrendering an individual's assets in response to a levy imposed under this section by:
(A) the department; or
(B) a person or an entity acting on behalf of the department; or
(3) any other action taken in good faith to comply with this section.
(j) A person or an entity that is acting on behalf of the department is not liable for any action taken in good faith to collect the state's levy under this section unless:
(1) the action is contrary to the department's direction to the person or entity; or
(2) for information provided under this section, the person or entity acts with:
(A) deliberate ignorance of the truth or falsity of the information; or
(B) reckless disregard for the truth or falsity of the information.
(k) The department or its agents shall pay a financial institution performing the data match required by this section a reasonable fee, as determined by the department, of at least five dollars ($5) for each levy issued to the financial institution.
(l) This section does not prevent the department or its agents from encumbering an obligor's account with a financial institution by any other remedy available under the law.
Chapter 8.5. Pilot Program for Agreements for Collection of Amounts Owed to Judgment Warrants for Local Units
Sec. 1. As used in this chapter, "judgment warrant" or "warrant" means any amount due and payable to a local unit that has been assigned to the department for collection under this chapter.
Sec. 2. As used in this chapter, "delinquent assessment" means any amount due and payable to a local unit that has remained unpaid for at least thirty (30) days.
Sec. 3. As used in this chapter, "local unit" means a county, city, town, or township.
Sec. 4. (a) The department shall establish a pilot collection program allowing up to ten (10) local units to participate in a program assigning to the department the collection of judgments and delinquent assessments due to the local units. In order to participate in the pilot collection program, a local unit must adopt an ordinance electing to participate in the program and assigning to the department collection of all judgment warrants owed to the local unit for one (1) year.
(b) If a local unit adopts an ordinance described in subsection (a), the local unit shall immediately send a certified copy of the ordinance to the commissioner.
(c) The determination of the department concerning the participation of a local unit in the pilot collection program is final and not subject to appeal or review.
Sec. 5. (a) The department may issue a warrant on a delinquent
assessment to reduce it to a judgment warrant collectible by the
department under this chapter. Before issuing a warrant on a
delinquent assessment, the department or a special counsel or
collection agency designated by the department under section 9 of
this chapter shall issue a demand notice for payment of the
delinquent assessment and any interest or penalties accrued on the
delinquent assessment. The demand notice must state the
following:
(1) That the person has ten (10) days from the date the
department, special counsel, or collection agency mails the
notice to either pay the amount demanded or show reasonable
cause for not paying the amount demanded.
(2) The statutory authority of the department for the issuance
of a warrant.
(3) The earliest date on which a warrant may be filed and
recorded.
(4) The statutory authority for the department to levy against
the person's property that is held by a financial institution.
(5) The remedies available to the person to prevent the filing
and recording of the judgment.
(b) If the department files a warrant in more than one (1)
county, the department is not required to issue more than one (1)
demand notice.
Sec. 6. (a) If a person does not pay the amount demanded or
show reasonable cause for not paying the amount demanded within
the ten (10) day period stated in the demand notice issued under
section 4 of this chapter, the department may issue a warrant for:
(1) the amount of the delinquent assessment; plus
(2) fees established under section 7 of this chapter.
(b) The department may also send a warrant issued under
subsection (a) to the sheriff of any county in which the person
owing the delinquent assessment owns property and direct the
sheriff to file the warrant with the circuit court clerk:
(1) at least twenty (20) days after the date the demand notice
was mailed to the person; and
(2) not later than five (5) days after the date the department
issues the warrant.
(c) When the circuit court clerk receives a warrant from the
department or the sheriff, the clerk shall record the warrant by
making an entry in the judgment debtor's column of the judgment
record, listing the following:
(1) The name of the person owing the delinquent assessment.
(2) The amount of the delinquent assessment plus fees established under section 7 of this chapter.
(3) The date the warrant was filed with the clerk.
(d) When an entry is made by the circuit court clerk under subsection (c), the total amount of the warrant becomes a judgment warrant against the person owing the delinquent assessment. The judgment warrant creates a lien in favor of the state that attaches to all the person's interest in any:
(1) chose in action in the county; and
(2) real or personal property in the county;
excepting only negotiable instruments not yet due. The circuit court clerk shall mail a copy of the judgment warrant by certified mail to the person named in the warrant to the person's last known address within five (5) days of the warrant's filing with the clerk.
Sec. 7. After an uncollected judgment warrant is assigned to the department for collection or after a warrant is issued on a delinquent assessment under section 6(d) of this chapter, the department may assess the following fees:
(1) A collection fee equal to ten percent (10%) of the total amount due.
(2) Interest, penalties, sheriff's costs, clerk's costs, and reasonable fees established under subdivision (3).
(3) The commissioner and the budget agency shall set the fee that the special counsel or collection agency will receive and payment of the fee shall be made after a claim for that fee has been approved by the department.
(4) The fees become due and owing by the person upon the filing of an amended judgment warrant with the circuit court clerk adding the fees authorized by this section to the amount of the judgment warrant.
(5) If the judgment warrant is final and not subject to amendment, the fee established under this section shall be collected from postjudgment interest assessed on the judgment.
(6) All amounts collected by the department other than the fees assessed under this section shall be remitted to the local unit by the department.
Sec. 8. The department may, without judicial proceedings, take one (1) or more of the following actions with respect to the person named in the judgment warrant:
(1) The department may levy upon the property of the person that is held by a financial institution by sending a claim to the
financial institution. Upon receipt of a claim under this
subdivision, the financial institution shall surrender to the
department the person's property. If the person's property
exceeds the amount owed by the person, the financial
institution shall surrender the person's property in an amount
equal to the amount owed. After receiving the department's
notice of levy, the financial institution shall place a sixty (60)
day hold or restriction on the withdrawal of funds the person
has on deposit or subsequently deposits, in an amount not to
exceed the amount owed.
(2) The department may garnish the accrued earnings and
wages of the person by sending a notice to the person's
employer. Upon receipt of a notice under this subdivision, an
employer shall garnish the accrued earnings and wages of the
individual in an amount equal to the full amount that is
subject to garnishment under IC 24-4.5-5. The employer shall
remit the amount garnished to the department. The employer
is entitled to a fee in an amount equal to the fee allowed under
IC 24-4.5-5-105(5). However, the fee shall be borne entirely by
the person.
(3) The department may levy upon and sell property and may:
(A) take immediate possession of the property and store it
in a secure place; or
(B) leave the property in the custody of the person;
until the day of the sale. The department shall provide notice
of the sale in one (1) newspaper, as provided in IC 5-3-1-2. If
the property is left in the custody of the person, the
department may require the person to provide a joint and
several delivery bond, in an amount and with a surety
acceptable to the department. At any time before the sale, any
owner or part owner of the property may redeem the
property from the judgment by paying the department the
amount of the judgment. The proceeds of the sale shall be
applied first to the collection expenses and second to the
payment of the delinquent overpayment. Any balance
remaining shall be paid to the person.
(4) The department may use the data match system
established under IC 6-8.1-8-8.7 for collection of judgments
under this chapter.
Sec. 9. (a) When the department collects a judgment warrant
under this chapter, the department may proceed in the same
manner that any debt due the state is collected, except as provided
in this chapter. The department may employ special counsel or
contract with a collection agency for the collection of a judgment
plus interest, penalties, collection fees, sheriff's costs, clerk's costs,
and reasonable fees established under section 7 of this chapter.
(b) In contracting with a collection agency, the department shall
give preference to a collection agency that is headquartered and
domiciled in Indiana, is licensed as a debt collector in all fifty (50)
states, and has a demonstrated familiarity with the data match
system operated by the department under IC 6-8.1-8-8.7.
(b) A unit or a person designated in writing by the unit may do the following:
(1) Collect any money that is owed to the unit.
(2) Compromise the amount of money owed to the unit.
(c) A unit shall determine the costs of collecting money under this section. The costs of collection, including reasonable attorney's fees, may be added to money that is owed and collected under this subsection.
(d) A unit or the unit's agent that collects money under this section shall deposit that money, less the costs of collection, in the account required by law.
(e) A unit may elect to participate in a program assigning judgments and delinquent assessments owed to it to the department of state revenue for collection under IC 6-8.1-8.5.
