68th Legislature SB 507.1
1 SENATE BILL NO. 507
2 INTRODUCED BY D. ZOLNIKOV
3
4 A BILL FOR AN ACT ENTITLED: “AN ACT GENERALLY REVISING TAX LAWS; REVISING VARIOUS
5 PROCEDURES OF THE COUNTY TAX APPEAL BOARD AND THE MONTANA TAX APPEAL BOARD;
6 ELIMINATING A PROPERTY TAX EXEMPTION FOR CERTAIN ENTITIES THAT USE EXEMPT PROPERTY
7 TO PRODUCE UNRELATED BUSINESS TAXABLE INCOME; REQUIRING A FORMER EMPLOYEE OF THE
8 DEPARTMENT OF REVENUE TO WAIT A PERIOD OF TIME BEFORE APPOINTMENT TO A COUNTY TAX
9 APPEAL BOARD; AMENDING SECTIONS 15-1-222, 15-2-201, 15-2-301, 15-2-302, 15-2-303, 15-6-201, 15-7-
10 102, 15-7-105, 15-7-106, 15-15-101, AND 15-15-103, MCA; AND PROVIDING EFFECTIVE DATES AND
11 APPLICABILITY DATES.”
12
13 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
14
15 Section 1. Section 15-1-222, MCA, is amended to read:
16 "15-1-222. (Temporary) Taxpayer bill of rights. The department of revenue shall in the course of
17 performing its duties in the administration and collection of the state's taxes ensure that:
18 (1) the taxpayer has the right to record any interview, meeting, or conference with auditors or any
19 other representatives of the department;
20 (2) the taxpayer has the right to hire a representative of the taxpayer's choice to represent the
21 taxpayer's interests before the department or any tax appeal board, a county tax appeal board, or the Montana
22 tax appeal board. The representative is not considered to be practicing law pursuant to 37-61-201 and is not
23 required to be an attorney or a certified public accountant. The taxpayer has a right to obtain a representative at
24 any time, except that the selection of a representative may not be used to unreasonably delay a field audit that
25 is in progress. The representative must have written authorization from the taxpayer to receive from the
26 department confidential information concerning the taxpayer. The department shall provide copies to the
27 authorized representative of all information sent to the taxpayer and shall notify the authorized representative
28 concerning contacts with the taxpayer.
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1 (3) except as provided in subsection (5), the taxpayer has the right to be treated by the department
2 in a similar manner as all similarly situated taxpayers regarding the administration and collection of taxes,
3 imposition of penalties and interest, and available taxpayer remedies unless there is a rational basis for the
4 department to distinguish them;
5 (4) the taxpayer has the right to obtain tax advice from the department. The taxpayer has a right to
6 the waiver of penalties and interest, but not taxes, when the taxpayer has relied on written advice provided to
7 the taxpayer by an employee of the department.
8 (5) at the discretion of the department, upon consideration of all facts relevant to the specific
9 taxpayer, the taxpayer has the right to pay delinquent taxes, interest, and penalties on an installment basis.
10 This subsection applies only to taxes collected by the department, provided the taxpayer meets reasonable
11 criteria.
12 (6) the taxpayer has the right to a complete and accurate written description of the basis for any
13 additional tax assessed by the department;
14 (7) the taxpayer has the right to a review by management level employees of the department for
15 any additional taxes assessed by the department;
16 (8) the taxpayer has the right to a full explanation of the available procedures for review and
17 appeal of additional tax assessments;
18 (9) the taxpayer, after the exhaustion of all appropriate administrative remedies, has the right to
19 have the Montana tax appeal board or a court, or both, review any final decision of the department assessing
20 an additional tax. The taxpayer shall seek a review in a timely manner. A taxpayer is entitled to collect court
21 costs and attorney fees from the department for frivolous or bad faith lawsuits as provided in 25-10-711, and
22 lawsuits pertaining to an appeal of the value of class four residential property in which the taxpayer substantially
23 prevails, as provided in 15-2-306.
24 (10) the taxpayer has the right to expect that the department will adhere to the same tax appeal
25 deadlines as are required of the taxpayer unless otherwise provided by law;
26 (11) the taxpayer has the right to a full explanation of the department's authority to collect
27 delinquent taxes, including the procedures and notices that are required to protect the taxpayer;
28 (12) the taxpayer has the right to have certain property exempt from levy and seizure as provided in
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1 Title 25, chapter 13, part 6, and any other applicable provisions in Montana law;
2 (13) the taxpayer has the right to the immediate release of any lien the department has placed on
3 property when the tax is paid or when the lien is the result of an error by the department;
4 (14) the taxpayer has the right to assistance from the department in complying with state and local
5 tax laws that the department administers; and
6 (15) the taxpayer has the right to be guaranteed that an employee of the department is not paid,
7 promoted, or in any way rewarded on the basis of assessments or collections from taxpayers.
8 15-1-222. (Effective January 1, 2024) Taxpayer bill of rights. The department of revenue shall in
9 the course of performing its duties in the administration and collection of the state's taxes ensure that:
10 (1) the taxpayer has the right to record any interview, meeting, or conference with auditors or any
11 other representatives of the department;
12 (2) the taxpayer has the right to hire a representative of the taxpayer's choice to represent the
13 taxpayer's interests before the department, a county tax appeal board, or the Montana tax appeal board. The
14 representative is not considered to be practicing law pursuant to 37-61-201 and is not required to be an
15 attorney or a certified public accountant. The taxpayer has a right to obtain a representative at any time, except
16 that the selection of a representative may not be used to unreasonably delay a field audit that is in progress.
17 The representative must have written authorization from the taxpayer to receive from the department
18 confidential information concerning the taxpayer. The department shall provide copies to the authorized
19 representative of all information sent to the taxpayer and shall notify the authorized representative concerning
20 contacts with the taxpayer.
21 (3) except as provided in subsection (5), the taxpayer has the right to be treated by the department
22 in a similar manner as all similarly situated taxpayers regarding the administration and collection of taxes,
23 imposition of penalties and interest, and available taxpayer remedies unless there is a rational basis for the
24 department to distinguish them;
25 (4) the taxpayer has the right to obtain tax advice from the department. The taxpayer has a right to
26 the waiver of penalties and interest, but not taxes, when the taxpayer has relied on written advice provided to
27 the taxpayer by an employee of the department.
28 (5) at the discretion of the department, upon consideration of all facts relevant to the specific
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1 taxpayer, the taxpayer has the right to pay delinquent taxes, interest, and penalties on an installment basis.
2 This subsection applies only to taxes collected by the department, provided the taxpayer meets reasonable
3 criteria.
4 (6) the taxpayer has the right to a complete and accurate written description of the basis for any
5 additional tax assessed by the department;
6 (7) the taxpayer has the right to a review by management level employees of the department for
7 any additional taxes assessed by the department;
8 (8) the taxpayer has the right to a full explanation of the available procedures for review and
9 appeal of additional tax assessments;
10 (9) the taxpayer, after the exhaustion of all appropriate administrative remedies, has the right to
11 have the Montana tax appeal board or a court, or both, review any final decision of the department assessing
12 an additional tax. The taxpayer shall seek a review in a timely manner. A taxpayer is entitled to collect court
13 costs and attorney fees from the department for frivolous or bad faith lawsuits as provided in 25-10-711, and
14 lawsuits pertaining to an appeal of the value of class four residential property in which the taxpayer substantially
15 prevails, as provided in 15-2-306.
16 (10) the taxpayer has the right to expect that the department will adhere to the same tax appeal
17 deadlines as are required of the taxpayer unless otherwise provided by law;
18 (11) the taxpayer has the right to a full explanation of the department's authority to collect
19 delinquent taxes, including the procedures and notices that are required to protect the taxpayer;
20 (12) the taxpayer has the right to have certain property exempt from levy and seizure as provided in
21 Title 25, chapter 13, part 6, and any other applicable provisions in Montana law;
22 (13) the taxpayer has the right to the immediate release of any lien the department has placed on
23 property when the tax is paid or when the lien is the result of an error by the department;
24 (14) the taxpayer has the right to assistance from the department in complying with state and local
25 tax laws that the department administers; and
26 (15) the taxpayer has the right to be guaranteed that an employee of the department is not paid,
27 promoted, or in any way rewarded on the basis of assessments or collections from taxpayers."
28
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1 Section 2. Section 15-2-201, MCA, is amended to read:
2 "15-2-201. Powers and duties. (1) It is the duty of the Montana tax appeal board to:
3 (a) prescribe rules for the tax appeal boards of the different counties in the performance of their
4 duties and for this purpose may schedule meetings of county tax appeal boards, and it is the duty of all invited
5 county tax appeal board members to attend if possible, and the cost of their attendance must be paid from the
6 appropriation of the Montana tax appeal board;
7 (b) grant, at its discretion, whenever good cause is shown and the need for the hearing is not
8 because of taxpayer negligence, permission to a county tax appeal board to meet beyond the normal time
9 period provided for in 15-15-101(4) to hear an appeal;
10 (c)(b) hear appeals from decisions of the county tax appeal boards and assess attorney fees against
11 the department when a taxpayer substantially prevails on the merits of an appeal of the value of class four
12 residential property, as provided in 15-2-306;
13 (d)(c) hear appeals from decisions of the department of revenue in regard to business licenses,
14 property assessments, taxes, except determinations that an employer-employee relationship existed between
15 the taxpayer and individuals subjecting the taxpayer to the requirements of chapter 30, part 25, and penalties.
16 (2) Oaths to witnesses in any investigation by the Montana tax appeal board may be administered
17 by a member of the board or the member's agent. If a witness does not obey a summons to appear before the
18 board or refuses to testify or answer any material questions or to produce records, books, papers, or
19 documents when required to do so, that failure or refusal must be reported to the attorney general, who shall
20 then institute proceedings in the proper district court to punish the witness for the neglect or refusal. A person
21 who testifies falsely in any material matter under consideration by the board is guilty of perjury and punished
22 accordingly. Witnesses attending must receive the same compensation as witnesses in the district court. The
23 compensation must be charged to the proper appropriation for the board.
24 (3) The Montana tax appeal board also has the duties of an appeal board relating to other matters
25 as may be provided by law."
26
27 Section 3. Section 15-2-301, MCA, is amended to read:
28 "15-2-301. Appeal of county tax appeal board decisions. (1) (a) The county tax appeal board shall
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1 mail a copy of its decision to the taxpayer and to the property assessment division of the department of
2 revenue.
3 (b) If the appearance provisions of 15-15-103 have been complied with, a person or the
4 department on behalf of the state or any municipal corporation aggrieved by the action of the county tax appeal
5 board may appeal to the Montana tax appeal board by filing with the Montana board a notice of appeal within
6 30 calendar days after the receipt of the decision of the county board. The notice must specify the action
7 complained of and the reasons assigned for the complaint.
8 (c) Notice of acceptance of an appeal must be given to the county board by the Montana board.
9 (d) The Montana board shall set the appeal for hearing either in its office in the capital or at the
10 county seat as the Montana board considers advisable to facilitate the performance of its duties or to
11 accommodate parties in interest.
12 (e) The Montana board shall give to the appellant and to the respondent at least 15 calendar days'
13 notice of the time and place of the hearing.
14 (2) (a) At the time of giving notice of acceptance of an appeal, the Montana board may require the
15 county board to certify to it the minutes of the proceedings resulting in the action and all testimony taken in
16 connection with its proceedings.
17 (b) The Montana board may, in its discretion, determine the appeal on the record if all parties
18 receive a copy of the transcript and are permitted to submit additional sworn statements, or the Montana board
19 may hear further testimony.
20 (c) For industrial property that is assessed annually by the department, the Montana board's
21 review must be de novo and conducted in accordance with the contested case provisions of the Montana
22 Administrative Procedure Act.
23 (d) For the purpose of expediting its work, the Montana board may refer any appeal to one of its
24 members or to a designated hearings officer. The board member or hearings officer may exercise all the
25 powers of the Montana board in conducting a hearing and shall, as soon as possible after the hearing, report
26 the proceedings, together with a transcript or a tape recording of the hearing, to the Montana board. The
27 Montana board shall determine the appeal on the record.
28 (3) (a) Except as provided in subsection (3)(b), the Montana tax appeal board shall consider an
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1 independent appraisal provided by the taxpayer if the appraisal meets standards set by the Montana board of
2 real estate appraisers and the appraisal was conducted within 6 months of the valuation date. If the Montana
3 board does not use the appraisal provided by the taxpayer in conducting the appeal, the Montana board shall
4 provide to the taxpayer the reason for not using the appraisal.
5 (b) If the appeal is an appeal of the valuation of residential property, the Montana board shall
6 consider an independent appraisal provided by the taxpayer if the appraisal meets standards set by the
7 Montana board of real estate appraisers and uses values obtained within the timeframe provided for in
8 subsection (3)(a). The appraisal that is provided by the taxpayer is presumed to establish assessed value in the
9 Montana board proceeding unless the department provides sufficient evidence to rebut the presumption of
10 correctness, including another independent appraisal or other compelli