Revises provisions relating to the Department of Taxation. (BDR 32-1131)

EXEMPT

A.B. 557

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ASSEMBLY BILL NO. 557–COMMITTEE ON WAYS AND MEANS

(ON BEHALF OF THE OFFICE OF FINANCE
IN THE OFFICE OF THE GOVERNOR)

MAY 14, 2025
____________

Referred to Committee on Revenue

SUMMARY—Revises provisions relating to the Department of
Taxation. (BDR 32-1131)

FISCAL NOTE: Effect on Local Government: No.
Effect on the State: Yes.

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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

AN ACT relating to taxation; requiring the Department of Taxation
to develop and operate with financial institutions a system
for matching data for the collection of certain debts owed
to the State; authorizing the Department to disclose
certain confidential information to certain financial
institutions for certain purposes; revising certain
provisions relating to certain information held by
financial institutions; and providing other matters
properly relating thereto.
Legislative Counsel’s Digest:
Existing law creates the Department of Taxation, which has various powers and 1
duties related to the administration and collection of certain taxes, fees, assessments 2
and other amounts of money. (Chapter 360 of NRS) If a person owes d elinquent 3
taxes or has a deficiency determination against him or her with respect to any tax 4
administered by the Department, existing law authorizes the Department to attempt 5
collection of the tax or deficiency in certain ways. (NRS 360.4193, 360.420, 6
360.473, 360.483) Section 1 of this bill requires the Department to develop and 7
operate a system for matching data to collect certain outstanding debts owed to t he 8
State. Pursuant to section 1, financial institutions in this State must: (1) provide to 9
the Department information on persons who maintain accounts at the financial 10
institution and are identified by the Department as owing outstan ding debts to the 11
State; and (2) encumber certain assets held in the financial institution by the debtors 12
to pay their debts. 13
Existing law makes the records and files of the Department of Taxation 14
concerning the administration and collection of taxes, fe es, assessments and other 15
amounts and the imposition of disciplinary action confidential and privileged, but 16

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authorizes the disclosure of such records and files under certain circumstances. 17
(NRS 360.255) Section 2 of this bill provides that the Department may disclose 18
certain confidential information to certain financial institutions for the purpose of 19
carrying out the provisions of section 1. 20
Existing law prohibits, with certain exceptions, a governmental agency from 21
requesting, and a financial institution from providing, certain financial records of 22
certain customers. (NRS 239A.070, 239A.080) Section 3 of this bill provides that 23
the Department may request, and a financial institution may provide to the 24
Department in response to such a request, certain financial records of certain 25
customers of the financial institution who owe outstanding debts to the State. 26

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. Chapter 360 of NRS is hereby amended by adding 1
thereto a new section to read as follows: 2
1. The Department shall enter into agreements with financial 3
institutions doing business in this State to coordinate the 4
development and operation of a system for matching data, using 5
automated exchanges of data to the maximum extent feasible. 6
2. In addition to any other remedy provided for in this 7
chapter, the Department may use the system for matching data 8
developed and operated pursuant to subsection 1 to collect a debt, 9
plus any applicable penalties and interest. 10
3. A financial institution in this State shall: 11
(a) Cooperate with the Department in carrying out the 12
provisions of subsection 1. 13
(b) Use the system to provide to the Department for each 14
calendar quarter the name, address of record, social security 15
number or other number assigned for taxpayer identification of 16
each person who maintains an account at the financial institution, 17
as identified by the Department by name and social security 18
number or other number assigned for taxpayer identification. 19
(c) In response to the rece ipt from the Department of 20
notification of debt that a person owes the State, encumber on 21
behalf of the Department a portion of the assets of the person held 22
by the financial institution sufficient to cover the debt and 23
surrender those assets to the Department. A financial institution is 24
not required to encumber or surrender any assets received by the 25
financial institution on behalf of the person after the financial 26
institution received the notice of the debt from the Department. 27
4. A financial institution may not be held liable in any civil or 28
criminal action for: 29
(a) Any disclosure of information to the Department pursuant 30
to this section. 31

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(b) Encumbering or surrendering any assets held by the 1
financial institution pursuant to this section. 2
(c) Any ot her action taken in good faith to comply with the 3
requirements of this section. 4
5. If a court issues an order to return to a person any assets 5
surrendered by a financial institution pursuant to subsection 3, the 6
Department is not liable to the person for any of those assets that 7
have been provided to the Department in accordance with the 8
order for the payment of a debt. 9
6. All information provided to the Department by a financial 10
institution pursuant to this section may only be used by the 11
Department for use in the collection of a debt owed to the State. 12
7. As used in this section, “financial institution” has the 13
meaning ascribed to it in NRS 239A.030. 14
Sec. 2. NRS 360.255 is hereby amended to read as follows: 15
360.255 1. Except as otherwise provided in this section and 16
NRS 239.0115, 360.250 and 607.217, the records and files of the 17
Department concerning the administration or collection of any tax, 18
fee, assessment or other amount required by law to be collected or 19
the imposition of disciplinary action are confidential and privileged. 20
The Department, an employee of the Department and any other 21
person engaged in the administration or collection of any tax, fee, 22
assessment or other amount required by law to be collected or the 23
imposition of disciplinary action or charged with the custody of any 24
such records or files: 25
(a) Shall not disclose any information obtained from those 26
records or files; and 27
(b) May not be required to produce any of the records or files for 28
the inspection of any person or governmental entity or for use in any 29
action or proceeding. 30
2. The records and files of the Department concerning the 31
administration and collection of any tax, fee, assessment or other 32
amount required by law to be collected or the i mposition of 33
disciplinary action are not confidential and privileged in the 34
following cases: 35
(a) Testimony by a member or employee of the Department and 36
production of records, files and information on behalf of the 37
Department or a person in any action or proceeding before 38
the Nevada Tax Commission, the State Board of Equalization, the 39
Department, a grand jury or any court in this State if that testimony 40
or the records, files or information, or the facts shown thereby, are 41
directly involved in the action or proceeding. 42
(b) Delivery to a person or his or her authorized representative 43
of a copy of any document filed by the person pursuant to the 44
provisions of any law of this State. 45

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(c) Publication of statistics so classified as to prevent the 1
identification of a particular business or document. 2
(d) Exchanges of information with the Internal Revenue Service 3
in accordance with compacts made and provided for in such cases, 4
or disclosure to any federal agency, state or local law enforcement 5
agency, including, without limitation, the Cannabis Compliance 6
Board, or local regulatory agency that requests the information for 7
the use of the agency in a federal, state or local prosecution or 8
criminal, civil or regulatory investigation. 9
(e) Disclosure in confidence to: 10
(1) The Governor or his or her agent in the exercise of the 11
Governor’s general supervisory powers; 12
(2) The Budget Division of the Office of Finance for use in 13
the projection of revenue; 14
(3) Any person authorized to audit the accounts of the 15
Department in pursuance of an audit; 16
(4) The Attorney General or other legal representative of the 17
State in connection with an action or proceeding relating to a 18
taxpayer or licensee; or 19
(5) Any agency of this or any other state charged with the 20
administration or enforcement of laws relating to workers’ 21
compensation, unemployment compensation, public assistance, 22
taxation, labor or gaming. 23
(f) Exchanges of information pursuant to an agreement between 24
the Nevada Tax Commission and any county fair and recreation 25
board or the governing body of any county, city or town. 26
(g) Upon written request made by a public officer of a local 27
government, disclosure of the name and address of a taxpayer or 28
licensee who must file a return with the Department. The request 29
must set forth the social security number of the taxpayer or licensee 30
about which the request is made and contain a statement signed by 31
the proper authority of the local government certifying that the 32
request is made to allow the proper authority to enforce a law to 33
recover a debt or obligation owed to the local government. Except 34
as otherwise provided in NRS 239.0115, the information obtained 35
by the local government is confidential and privileged and may not 36
be used or disclosed for any purpose other than the col lection of a 37
debt or obligation owed to that local government. The Executive 38
Director may charge a reasonable fee for the cost of providing the 39
requested information. 40
(h) Disclosure of information as to amounts of any unpaid tax or 41
amounts of tax required to be collected, interest and penalties to 42
successors, receivers, trustees, executors, administrators, assignees 43
and guarantors, if directly interested. 44

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(i) Disclosure of r elevant information as evidence in an appeal 1
by the taxpayer from a determination of tax due if the Nevada Tax 2
Commission has determined the information is not proprietary or 3
confidential in a hearing conducted pursuant to NRS 360.247. 4
(j) Disclosure of the identity of a person and the amount of tax 5
assessed and penalties imposed against the person at any time after a 6
determination, decision or order of the Executive Director or other 7
officer of the Department imposing upon the person a penalty for 8
fraud or intent to evade a tax imposed by law becomes final or is 9
affirmed by the Nevada Tax Commission. 10
(k) Disclosure of the identity of a licensee against whom 11
disciplinary action has been taken and the type of disciplinary action 12
imposed against the licensee at any time after a determination, 13
decision or order of the Executive Director or other officer of the 14
Department imposing upon the licensee disciplinary action becomes 15
final or is affirmed by the Nevada Tax Commission. 16
(l) Disclosure of information pursuant to subsection 2 of 17
NRS 370.257. 18
(m) With respect to an application for a registration certificate to 19
operate a medical marijuana establishment pursuant to chapter 453A 20
of NRS, as that chapter existed on June 30, 2020, or a license to 21
operate a marijuana establishment pursuant to chapter 453D of 22
NRS, as that chapter existed on June 30, 2020, which was submitted 23
on or after May 1, 2017, and on or before June 30, 2020, and 24
regardless of whether the application was ultimately approved, 25
disclosure of the following information: 26
(1) The identity of an applicant, including, without 27
limitation, any owner, officer or board member of an applicant; 28
(2) The contents of any tool used by the Department to 29
evaluate an applicant; 30
(3) The methodology used by the Department to score and 31
rank applicants and any documentation or other evidence sh owing 32
how that methodology was applied; and 33
(4) The final ranking and scores of an applicant, including, 34
without limitation, the score assigned to each criterion in the 35
application that composes a part of the total score of an applicant. 36
(n) Disclosure of the name of a licensee and the jurisdiction of 37
that licensee pursuant to chapter 453A or 453D of NRS, as those 38
chapters existed on June 30, 2020, and any regulations adopted 39
pursuant thereto. 40
(o) Disclosure of the identity of a person and the amount of tax 41
assessed, plus any applicable penalties and interest, for the 42
purpose of carrying out the provisions of section 1 of this act. 43
3. The Executive Dire ctor shall periodically, as he or she 44
deems appropriate, but not less often than annually, transmit to the 45

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Administrator of the Division of Industrial Relations of the 1
Department of Business and Industry a list of the businesses of 2
which the Executive Director has a record. The list must include the 3
mailing address of the business as reported to the Department. 4
4. The Executive Director may request from any other 5
governmental agency or officer such information as the Executive 6
Director deems necessary to carry out his or her duties with respect 7
to the administration or collection of any tax, fee, assessment or 8
other amount required by law to be collected or the imposition of 9
disciplinary action. If the Executive Director obtains any 10
confidential information pursuant to such a request, he or she shall 11
maintain the confidentiality of that information in the same manner 12
and to the same extent as provided by law for the agency or officer 13
from whom the information was obtained. 14
5. As used in this section: 15
(a) “Applicant” means any person listed on the application for a 16
registration certificate to operate a medical marijuana establishment 17
pursuant to chapter 453A of NRS, as that chapter existed on 18
June 30, 2020, or a license to operate a marijuana establishmen t 19
pursuant to chapter 453D of NRS, as that chapter existed on 20
June 30, 2020. 21
(b) “Disciplinary action” means any suspension or revocation of 22
a license, registration, permit or certificate issued by the Department 23
pursuant to this title or chapter 453A or 453D of NRS, as those 24
chapters existed on June 30, 2020, or any other disciplinary action 25
against the holder of such a license, registration, permit or 26
certificate. 27
(c) “Licensee” means a person to whom the Department has 28
issued a license, registration, permit or certificate pursuant to this 29
title or chapter 453A or 453D of NRS, as those chapters existed on 30
June 30, 2020. The term includes, without limitation, any owner, 31
officer or board member of an entity to whom the Department has 32
issued a license. 33
(d) “Records” or “files” means any records and files related to 34
an investigation or audit or a disciplinary action, financial 35
information, correspondence, advisory opinions, decisions of a 36
hearing officer in an administrative hearing and any other 37
information specifically related to a taxpayer or licensee. 38
(e) “Taxpayer” means a person who pays any tax, fee, 39
assessment or other amount required by law to the Department. 40
Sec. 3. NRS 239A.070 is hereby amended to read as follows: 41
239A.070 This chapter does not apply to any subpoena issued 42
pursuant to title 14 or chapters 616A to 617, inclusive, of NRS or 43
prohibit: 44

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1. Dissemination of any financial information which is not 1
identified with or identifiable as being derive d from the financial 2
records of a particular customer. 3
2. The Attorney General, State Controller, district attorney, 4
Department of Taxation, Director of the Department of Health and 5
Human Services, Administrator of the Securities Division of the 6
Office o f the Secretary of State, public administrator or person 7
employed or contracted with pursuant to NRS 253.125, as 8
applicable, sheriff or a police department from requesting of a 9
financial institution, and the institution from responding to the 10
request, as to whether a person has an account or accounts with that 11
financial institution and, if so, any identifying numbers of the 12
account or accounts. 13
3. A financial institution, in its discretion, from initiating 14
contact with and thereafter communicating with an d disclosing the 15
financial records of a customer to appropriate governmental 16
agencies concerning a suspected violation of any law. 17
4. Disclosure of the financial records of a customer incidental 18
to a transaction in the normal course of business of the fi nancial 19
institution if the director, officer, employee or agent of the financial 20
institution who makes or authorizes the disclosure has no reasonable 21
cause to believe that such records will be used by a governmental 22
agency in connection with an investigation of the customer. 23
5. A financial institution from notifying a customer of the 24
receipt of a subpoena or a search warrant to obtain the customer’s 25
financial records, except when ordered by a court to withhold such 26
notification. 27
6. The examination by or disclosure to any governmental 28
regulatory agency of financial records which relate solely to the 29
exercise of its regulatory function if the agency is specifically 30
authorized by law to examine, audit or require reports of financial 31
records of financial institutions. 32
7. The disclosure to any governmental agency of any financial 33
information or records whose disclosure to that particular agency is 34
required by the tax laws of this State. 35
8. The disclosure of any information pursuant to NRS 36
353C.240, 425.393, 425.400 or 425.460 [.] or section 1 of this act. 37
9. A governmental agency from obtaining a credit report or 38
consumer credit report from anyone other than a financial 39
institution. 40
Sec. 4. This act becomes effective on July 1, 2025. 41

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