006.05.06 Ark. Code R. 005-GR-81.2

Current through Register Vol. 49, No. 10, October, 2024

Rule 006.05.06-005-GR-81.2 - ADMINISTRATIVE AND JUDICIAL REMEDIES

A. PROTEST.

1. Protest of Assessment. If a taxpayer objects to a proposed assessment of tax, the taxpayer must file his protest in writing within sixty (60) days of receipt of the Notice of Proposed Assessment setting forth under oath facts and/or law supporting the protest of the assessment. The protest shall be mailed to the address set forth in the Notice of Proposed Assessment. If the taxpayer fails to file a written protest within sixty (60) days of receipt of the Notice of Proposed Assessment, then the Director shall issue by certified mail, return receipt, a Notice of Final Assessment. Failure to pay the Notice of Final Assessment within thirty (30) days of receipt shall subject the taxpayer to the filing of a Certificate of Indebtedness, constituting a judgment, and to the collection remedies available to the Director.

2. Protest of Refund Claim Denial. If a taxpayer objects to the denial of a claim for refund, the taxpayer must file his or her protest in writing within sixty (60) days of receipt of the Notice of Claim Denial setting forth under oath facts and law to support the protest. The protest shall be mailed to the address set forth in the notice. The taxpayer shall specify the form of hearing as described in GR-81.2(B)(2).

B. HEARINGS.

1. If the taxpayer files a written protest of the Notice of Proposed Assessment, or a written protest of the denial of a claim for refund, within the sixty (60) day time period allowed for a protest then the taxpayer will be granted a hearing before a Hearing Officer. The Hearing Officer shall set the time and place for the hearing which will be in any city in which the Revenue Division maintains a Field Audit District Office, or in such city as the Director, in his or her discretion, may designate. It is not necessary to request an administrative hearing prior to seeking judicial relief.

2. At the hearing the taxpayer has the option of:

a. Appearing in person and representing himself or herself or being represented by an authorized spokesperson for the presentation of evidence or argument in support of the taxpayer's protest of the assessment;

b. Not personally appearing, but requesting that a hearing be held and a decision rendered by the Hearing Officer upon the basis of documentation or written arguments submitted by the taxpayer; or

c. Requesting a hearing to be held by telephone, video conference, or other electronic means available to the Revenue Division.

3. The taxpayer shall elect the form of administrative hearing in his or her written protest. In any instance an attorney for the Revenue Division may appear to offer evidence and legal argument in support of the Notice of Proposed Assessment or the denial of the claim for refund.

C. REVISIONS.

1. Upon completion of the hearing and submission of all documentary evidence and argument, the Hearing Officer shall render a decision in writing and serve copies upon the taxpayer and the Office of Revenue Legal Counsel. If the Notice of Proposed Assessment or the denial of the claim for refund is sustained in whole or in part, the taxpayer or Revenue Legal Counsel may request in writing, within twenty (20) days of the mailing of the decision, that the Director revise the decision of the Hearing Officer. Either the taxpayer or Revenue Legal Counsel must provide a copy of any written request for revision to the other. The request for revision to the Director shall state the legal or factual basis for the revision. If the Director revises the decision of the Hearing Officer, the Director must send the final decision to the taxpayer and Revenue Legal Counsel. If the Director's final decision sustained a proposed assessment of tax, then a Notice of Final assessment shall be issued. No further notice will be issued for a final decision of the Director that results in no tax due, including the denial of a claim for refund. A taxpayer may not request a revision of the final decision of the Director.

2. If the Director refuses to make a revision, or if the taxpayer or Revenue Legal Counsel does not make a request for revision, then the Director will send either of the following:

a. A final assessment to the taxpayer, as provided by Ark. Code Ann. § 26-18401, that is made upon the final determination of the Hearing Officer that sustained the proposed assessment of tax; or

b. A notice in writing to both the taxpayer and Revenue Legal Counsel, if a revision was requested, of the Director's determination not to revise a decision that resulted in no tax due, including the denial of a claim for refund.

D. JUDICIAL RELIEF.

1. Proposed Assessments of Tax. A taxpayer may seek judicial relief by one of the following methods:

a. Within one (1) year of the date of the notice of final assessment, paying the tax, penalty, and interest assessed for at least one (1) taxable period within the audit period and then filing suit within one (1) year of the date of payment. Collection activities will proceed with respect to any taxable periods that are not paid. A taxable period for gross receipts, use or withholding tax is one (1) month. A taxable period for income tax is one year; or

b. Within thirty (30) days of the notice of final assessment, filing with the Director a surety bond, letter of credit, or other collateral approved by the Director in double the amount of the tax deficiency, interest, and penalty and filing suit in circuit court within thirty (30) days to stay the determination of the Director. The taxpayer shall faithfully and diligently prosecute the suit to a final determination and shall pay any deficiency found by the court to be due and any court cost assessed against him or her. The failure of the taxpayer to file suit, diligently prosecute the suit or pay any tax deficiency and court costs shall result in the forfeiture of the collateral in the amount of the assessment and assessed court costs.

2. Denial of Claims for Refund. Within one (1) year of the issuance of the Notice of Claim Denial, decision of the hearing officer, or revision decision of the Director, whichever occurs latest, the taxpayer may file suit in court seeking a refund. It is not necessary to request an administrative hearing prior to seeking judicial relief.

006.05.06 Ark. Code R. 005-GR-81.2

Ark. Code Ann. §§ 26-18-404; 26-18-405; 26-18-406