H.B. 4312: COMMITTEE SUMMARY ERRONEOUS TAX LIENS
House Bill 4312
Sponsor: Representative Eric Bush House Committee: Tax Policy Senate Committee: Finance
Date Completed: 4-24-95
The bill would amend the revenue Act to require the Department of Treasury to indicate that a lien had been filed in error, or a warrant or warrant-notice of levy had been issued in error, when the Department recorded a lien or issued a warrant or warrant-notice of levy after a tax liability had been satisfied or the Department received information that would cancel the liability. The bill also would amend current requirements that the Department issue a certificate of nonattachment or a release when a lien is filed against property to which the State does not have a lien or a warrant or warrant-notice of levy is issued regarding property not subject to levy.
Specifically, if the Department received money to satisfy a tax liability or received information that would cancel a tax liability and subsequently recorded a lien or issued a warrant or warrant-notice of levy to satisfy the same tax liability, the Department, upon request and upon a determination by it that the lien was filed or recorded in error or the warrant-notice of levy was issued and served in error, would have to issue a certificate of withdrawal or a release of levy stating that the recorded lien was filed in error or the warrant or warrant-notice of levy was issued and served in error. The certificate or release would have to be issued with all due haste, but not more than three business days after the Department determined that it had erroneously recorded a lien or erroneously issued a warrant or warrant-notice of levy.
Currently, if the Department files for recording a lien to satisfy a tax liability and determines that the lien is recorded or filed against property or rights of property to which the State does not have a lien, the Department must file for recording a certificate of discharge, release, or nonattachment within three business days after it determines that the State does not have a lien. The bill provides, instead, that if the Department filed for recording a lien and upon request determined that the taxpayer named in the recorded lien did not have any interest in certain properties owned by another person, the Department would have to file for recording a certificate of nonattachment, within the three-day period. The Department also would have to indicate clearly on the certificate of nonattachment that the taxpayer named on the recorded lien did not have any interest in the property or rights of property of the other person.
Currently, if a warrant or warrant-notice of levy is issued to levy on property or property rights to satisfy a tax liability and the Department determines that the property or rights are not subject to levy, the Department must serve a releave of levy on the person who was served with the warrant or warrant-notice of levy within three days after determining that the property or rights are not
subject to levy. The bill would require that the Department also clearly indicate on the release of levy that the property or rights of property were not subject to levy.
MCL 205.29a Legislative Analyst: S. Margules
The Department of Treasury has indicated that the legislation would codify and clarify current operating procedures.
Fiscal Analyst: L. Nacionales-Tafoya
S9596\S4312SA
This analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent.