North Carolina § 105-258 - 2. Taxpayer conversations.

§ 105-258. 2. Taxpayer conversations.

Scope. - This section applies to a conversation that is conducted by telephone or in person, is between a taxpayer and an employee of the Department, and occurs at an office of the Department if the conversation is in person. It does not apply to a conversation that occurs at a presentation, a conference, or another forum. Documentation. - The Secretary must document advice given to a taxpayer in a conversation with that taxpayer when the taxpayer gives the Secretary the taxpayer's identifying information, asks the Secretary about the application of a tax to the taxpayer in specific circumstances, and requests that the Secretary document the advice in the taxpayer's records. The documentation may be an entry in the account record of the taxpayer or by another method determined by the Secretary. The documentation must set out the date of the conversation, the question asked, and the advice given. Sales Tax Inquiries. - The Secretary must document advice given in a conversation with a person who is not registered as a retailer or a wholesale merchant under Article 5 of this Chapter when the person gives the Secretary the person's name and address, describes a business in which the person is engaged, asks if the person is required to be registered under Article 5 of this Chapter, and requests that the Secretary document the advice. The Secretary must keep a record of the person's inquiry that sets out the date of the conversation, the person making the inquiry, the business described in the conversation, and the advice given. History (2008-107, s. 28.16(c), (d).) Editor's Note. - Session Laws 2008-107, s. 28.16(j), makes this section effective January 1, 2009. Session Laws 2008-107, s. 28.16(a), provides: "The General Assembly makes the following findings: "(1) The following areas of the sales and use tax laws are the areas for which the Department of Revenue receives the most questions from taxpayers: "a. The rate of tax that applies to food and prepared food. "b. The distinction between a retailer and a performance contractor. "c. The distinction between a service that is necessary to complete the sale of tangible personal property, and therefore taxable, and a service that is incidental to the sale of tangible personal property, and therefore not taxable. "d. The determination of whether a person is a manufacturer. "(2) These areas of the sales and use tax laws have been the subject of legislative changes in recent years. "(3) Small businesses have fewer resources to devote to resolving the complexities of the sales and use tax laws than large businesses have and, therefore, may be at a disadvantage with respect to compliance issues in complex areas and changing areas. "(4) Assessments against a small business for inadvertent noncompliance in these complex areas may threaten the viability of the small business. "(5) The sales and use tax laws are not intended to place the viability of small businesses in jeopardy. "(6) A study of these complex areas is needed to determine how to make the laws in these areas clearer and to reduce the compliance burden." Session Laws 2008-107, ss. 28.16(g), (h), and (i), provide: "(g) The Department of Revenue is directed to establish a plan to record telephone calls received at the Department's Taxpayer Assistance Center and to implement this plan by July 1, 2010. The plan shall, at a minimum, provide for recording calls for the purpose of training and evaluation with respect to customer service and quality control measures. The Department may retain up to seven hundred thousand dollars ($700,000) of the amount collected under Article 5 of Chapter 105 of the General Statutes in fiscal year 2008-2009 for this purpose, and this amount is appropriated to the Department for this purpose. Amounts not used in fiscal year 2008-2009 for this purpose do not revert but remain available to the Department for this purpose until the system is implemented. "(h) The Revenue Laws Study Committee shall study the issues listed in this Section and report on the study, including any recommendations or legislative proposals, to the 2009 General Assembly. "(1) The taxation of services necessary to complete the sale of tangible personal property and standards for distinguishing between a service that is taxable as one that is necessary to complete the sale and a service that is incidental to the sale of tangible personal property. "(2) The applicability of the sales and use tax to performance contracts and standards for distinguishing between performance contractors and retailers. "(3) The distinction between food and prepared food under the sales and use tax laws and whether to eliminate this distinction by applying a uniform, revenue-neutral rate to all food. "(i) The Department of Revenue shall make a report to the Revenue Laws Study Committee on customer service improvement initiatives conducted by the Department. The report is due prior to the convening of the 2009 General Assembly and shall address, at a minimum, the following issues: "(1) A review of the Department's efforts to ensure that inquiries on complicated tax matters are handled or reviewed by appropriate personnel within the Department. "(2) A review of the Department's efforts to provide accurate and timely information regarding changes in tax law resulting from legislative changes, court decisions, or revised interpretations. "(3) A review of the Department's outreach efforts designed to assist taxpayers, particularly small business taxpayers, in complying with the State's tax laws. "(4) A review of the Department's efforts to ensure that taxpayers are informed of their right to request written advice from the Department upon which they may reasonably rely. "(5) A review of the Department's plan to record telephone calls at the Department's Taxpayer Assistance Center." Session Laws 2008-107, s. 1.2, provides: "This act shall be known as 'The Current Operations and Capital Improvements Appropriations Act of 2008'." Session Laws 2008-107, s. 30.3, provides: "Except for statutory changes or other provisions that clearly indicate an intention to have effects beyond the 2008-2009 fiscal year, the textual provisions of this act apply only to funds appropriated for, and activities occurring during, the 2008-2009 fiscal year." Session Laws 2008-107, s. 30.5 is a severability clause. Effect of Amendments. - Session Laws 2008-107, s. 28.16(d), effective July 1, 2009, added subsection (c).