Subject 560-1-2 COLLECTIONS
|(1)||Purpose. O.C.G.A. § 48-2-52 permits the collection of an entity's unpaid trust fund taxes from the party(ies) responsible for collecting, paying over, and accounting for such taxes on behalf of an entity. The Department of Revenue uses this as a collection mechanism when taxes are not fully collected or collectible from the entity itself. This regulation sets forth the Department's policies for determining, assessing, and collecting against a Responsible Party, as well as procedures for protesting a Responsible Party assessment with the Department.|
|(3)||Trust Fund Taxes. O.C.G.A. § 48-2-52 applies to taxes that are required to be collected and held in trust. In Georgia, trust fund taxes include sales, withholding, and prepaid 911 tax, and may include any amounts that are required to be collected and remitted to the Department.|
|(4)||Incorporation of IRS Law. O.C.G.A. § 48-2-52 mirrors the federal responsible party statute, I.R.C. § 6672. Responsible Party liability is a two-prong test: 1) the person must be "responsible," and 2) the nonpayment of the tax must be "willful."|
|(5)||Prong 1: Identifying the Responsible Party.
|(6)||Prong Two: Willfulness. A
Responsible Party's nonpayment of the tax will be willful if the failure to pay
the tax is voluntary and knowing, or reckless. Willfulness does not require a
bad motive or intent to defraud the state.
|(7)||Assessments. All Responsible
Party assessments will conform to the procedures set forth in this paragraph.
|(8)||Protests. A person may
protest a Responsible Party Proposed Assessment to the Department within 30
days of the Issue Date of the Assessment. O.C.G.A. § 48-2-46. The person must complete
and submit the Protest of Proposed Assessment or Refund Denial
Form ( TSD-1), available on the Department's website.
Only this form and no other correspondence will constitute a
Protest. Once the Department receives this form, all
collections activities against the person for the Responsible Party liability
will be stayed, and the statute of limitations for issuing a final assessment
will be tolled. O.C.G.A § 48-2-46. If the person desires a
conference with the Department for consideration of the protest, the person
must check the appropriate box on the form.
|(9)||Disclosures. The person may
request from the Department the information used to conclude that the person is
a Responsible Party. Information about third parties is subject to
confidentiality laws. O.C.G.A. § 48-2-15.
|(1)||Imposition. The collection fees authorized under O.C.G.A. § 48-16-10(a)are hereby imposed.|
|(2)||Rate. When the Department issues a Notice of State Tax Execution, a cost of collection fee will be added at the rate of 20% of the assessed liability. O.C.G.A. § 48-16-10(a). The collection fee shall be in addition to all other penalties, fees, expenses, or costs associated with the collection process.|
|(3)||Waiver. The Department may waive the cost of collection fee when it is reasonably determined that the deficiency is due to reasonable cause and is not the result of negligence, intentional disregard of administrative rules and regulations, or fraud. O.C.G.A. § 48-16-10(a). A taxpayer may request a waiver of the collection fee along with, or in the alternative of, a penalty waiver.|
|(4)||Collection Agencies. The Department may employ the services of a contracted debt collection agency or attorney for the collection of any debt once the imposition of the collection fee has been added to the debt, pursuant to paragraph (1). O.C.G.A. § 48-16-11.|