Tennessee § 67-1-1438 - Assessments by commissioner.

§ 67-1-1438. Assessments by commissioner.

When the commissioner determines that any person has failed to pay the correct amount of any tax administered by the commissioner under this or any other title, the commissioner shall promptly issue to such taxpayer a notice of proposed assessment, together with notice that the taxpayer shall have the right to an informal conference with the commissioner or the commissioner's designee as set forth in subsection (b) and that the proposed assessment shall become a final assessment as set forth herein. The notice shall also state that, upon an assessment becoming final, the taxpayer shall have the right, as set forth in § 67-1-1801, to file suit to challenge the final assessment and collection of the tax in the appropriate chancery court of this state within ninety (90) days from the date such assessment becomes final. The commissioner may authorize any division, unit, or official within the department to issue notices of proposed assessment on the commissioner's behalf. Any taxpayer to whom a notice of proposed assessment is issued shall have the right to an informal conference with the commissioner or the commissioner's designee to discuss the proposed assessment and to present such matters as may be relevant to the proposed assessment; provided, that written request for such conference is made within thirty (30) days after the date of the notice of proposed assessment. If a timely request for a conference is made, the commissioner or the commissioner's designee shall set a time and place for the conference within ten (10) days from the date of the request and shall give the taxpayer written notice of the conference. Upon written request by the taxpayer, the commissioner or the commissioner's designee may grant, in the commissioner's or designee's discretion, a continuation of the conference in writing for a period of time reasonably necessary for the taxpayer to provide additional information or documentation relevant to the proposed assessment. A continuation may be granted either before or after the conference is held, and the conference shall not be deemed to be concluded until the expiration of any such period of continuation. Within ten (10) days after the conclusion of the conference, the commissioner or the commissioner's designee shall give the taxpayer written notification of the commissioner's decision. If the commissioner's decision does not result in an adjustment to the proposed assessment, the proposed assessment shall become a final assessment as of the date of such decision. If the commissioner's decision results in an adjustment to the proposed assessment, the commissioner shall issue to the taxpayer a written determination setting forth the amount of tax that is due, if any, and such amount shall be a final assessment. If the taxpayer does not request an informal conference within the time period prescribed in subsection (b), the proposed assessment shall become a final assessment on the thirty-first day after the date of the notice of proposed assessment. In addition, any taxpayer that has requested a conference as provided in subsection (b) may cancel the request, in writing, at any time before, during, or after such conference; in which case the proposed assessment shall become a final assessment on the date of the written notification by the taxpayer of such cancellation or on the thirty-first day after the date of the notice of proposed assessment, whichever is later. Except as provided in subsection (c), the taxpayer shall not be prejudiced in any manner by either seeking or failing to seek an informal conference. The informal conference shall not be considered to be an administrative remedy and shall not constitute a contested case subject to the Uniform Administrative Procedures Act, compiled in title 4, chapter 5. The commissioner shall not be prejudiced in any manner as a result of such conference, including any failure to issue a final assessment within the ten-day period prescribed in subsection (b); provided, however, that no interest shall accrue on any deficiency during the period beginning on the eleventh day after conclusion of the conference and ending upon issuance of the final assessment. The informal conference process shall have all of the following characteristics: Personnel conducting informal conferences shall exercise independent judgment with the objective of resolving disputed proposed assessments without litigation; Informal conferences shall be conducted in an informal manner either by telephone or in person, at the taxpayer's option; The taxpayer may participate in an informal conference without representation; may be represented by an officer, employee, partner, or member of the taxpayer; or may be represented by a third party of the taxpayer's choice; Informal conference personnel shall make determinations regarding individual issues based on the facts and the law; Informal conference personnel shall consider arguments as to the applicability of the tax laws and any new evidence presented; provided, that if the new evidence is substantial and should have been presented at the time of audit, the informal conference personnel may request the audit division to examine the evidence and to make a recommendation as to the effect of the evidence on the relevant issue; The taxpayer shall have the right to bring witnesses to an in-person conference; Informal conference personnel shall not engage in ex parte communications with audit division personnel regarding the issue under review; provided, however, that informal conference personnel may, on an ex parte basis, ask questions that involve ministerial, administrative, or procedural matters and that do not address the substance of the issues or the positions taken in the audit; Informal conference decisions shall not be considered as precedent; and Informal conference personnel may recommend to the commissioner that the department compromise a proposed assessment in accordance with § 67-1-102(b)(8). When an assessment becomes final by operation of subsection (b) or (c), the taxpayer shall have the rights and remedies provided in part 18 of this chapter. The commissioner or the commissioner's designee, in such person's discretion, may hold an informal conference with a taxpayer to discuss an assessment that has become final by operation of subsection (c) or to discuss the denial or deemed denial of a claim for refund under § 67-1-1802. Any such conference shall not toll any period of limitation or otherwise affect any remedy provided in part 18 of this chapter. The commissioner may publish or otherwise publicize guidance to taxpayers, practitioners, and departmental personnel resulting from conference decisions; provided, however, that nothing in this subsection (h) shall be construed as authorizing the disclosure of return or tax information as defined in § 67-1-1701 and provided further that no conference decision shall be referenced or cited as: Precedence in any instance; or Guidance unless such guidance has been published or publicized as provided in this subsection (h). Acts 1972, ch. 762, § 26; 1974, ch. 484, § 4; T.C.A., § 67-6043; Acts 2003, ch. 418, § 9; 2014, ch. 854, § 7. Compiler's Notes. Acts 2003, ch. 418, § 16(c) provided that § 9 of the act shall apply to all currently pending or future suits except for those currently pending suits in which a challenge to the assessment based on the department's recording procedures was specifically alleged in either the plaintiff's complaint, interrogatories, requests for production of documents, or requests for admissions prior to May 1, 2003. Amendments. The 2014 amendment, effective January 1, 2015, rewrote the section which read: “(a) When any person shall fail to file any statement, report or return required to be filed with the commissioner by any law levying a public tax, license or fee, after being given written notice of the assessment, the commissioner is authorized to determine that liability of such person from whatever source of information may be available to the commissioner. An assessment made by the commissioner pursuant to this authority shall be binding as if made upon the sworn statement, report or return of the person liable for the payment of any such tax, license or fee. Any such assessment that is lawfully made against such person shall be presumed accurate, unless records are submitted evidencing otherwise.“(b) An assessment of any tax by the commissioner shall be deemed to be made by recording the liability of the taxpayer in the office of the department in accordance with existing procedures of the department or as such may be established by rules and regulations prescribed by the commissioner. No claim, cause of action or other proceeding to challenge an assessment or seek a refund shall arise based on the department's procedures for signing or recording the liability of the taxpayer in the office of the department under this section, regulations promulgated by the commissioner, or bulletins issued by the commissioner.” Effective Dates. Acts 2014, ch. 854, § 11. January 1, 2015. Textbooks. Tennessee Jurisprudence, 23 Tenn. Juris., Taxation, § 29. Law Reviews. Preferences, Priorities, and Powers of the State in the Collection of Delinquent Revenue: Tennessee's Tax Enforcement Procedures Act (Donald J. Serkin), 8 Mem. St. U.L. Rev. 707 (1978). Cited: James v. Huddleston, 795 S.W.2d 661, 1990 Tenn. LEXIS 308 (Tenn. 1990).