Taxes, Franchise

Plain English Breakdown

The bill summary and text do not specify what happens if issues are found during audits or how taxpayer privacy is affected beyond making refund details public.

Making Franchise Tax Refunds Public and Auditing Them

This bill makes franchise tax refund payments open to public inspection as part of Tennessee's public records laws and requires annual financial audits by the comptroller of the treasury.

What This Bill Does

• Makes all franchise tax refund payments available for public review under Tennessee's public records laws upon written request to the department of revenue.
• Requires the comptroller of the treasury to conduct or contract for an annual financial audit of all franchise tax refunds claimed and issued in the previous fiscal year.
• Publishes the results of these audits on the comptroller’s website by December 31 each year.

Who It Names or Affects

• Taxpayers who receive franchise tax refunds
• The department of revenue, which must provide information about refunds upon request
• The comptroller of the treasury, responsible for conducting or contracting audits

Terms To Know

Franchise Tax Refund

Money returned to a business after paying franchise taxes.

Comptroller of the Treasury

A state official responsible for financial management and auditing.

Limits and Unknowns

• The bill does not specify what happens if audits reveal issues with refunds.
• It is unclear how this will affect taxpayer privacy beyond making refund details public.
• There are no penalties or rewards specified for compliance or non-compliance with the audit requirements.

Official Summary Text

This bill makes a
franchise tax refund that is paid open to public inspection as a public record. Upon written request to the
department of revenue,
a copy of a record, document, or other information, including the name of the taxpayer and total amount refunded, pertaining to a refund paid must be forwarded to the requesting party.

This bill also requires the comptroller of the treasury to conduct or contract for at least one annual financial audit of all franchise tax refunds claimed and all such tax refunds issued to taxpayers for the prior fiscal year. The audit must include any
other information the comptroller deems relevant in making such determinations. All audits conducted must be made available on the comptroller's website no later than December 31 of the subsequent fiscal year.

This bill provides that an officer or employee of the state,
or any other officer or employee
,
who act
s
in good faith in
complying

with
this bill
is not subject to criminal charges, penalties, or dismissal from employment for such good faith compliance.

Current Bill Text

<BillNo> <Sponsor>

HOUSE BILL 2324
By Miller
HB2324
011930
- 1 -

AN ACT to amend Tennessee Code Annotated, Title 10,
Chapter 7; Title 67, Chapter 1, Part 17; Title 67,
Chapter 1, Part 18; Title 67, Chapter 1, Part 8 and
Title 67, Chapter 4, Part 21, relative to audits of
refunds claimed for franchise taxes.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Section 67-4-2122, is amended by adding
the following as new subsections:
(e) Notwithstanding § 67-1-1702, subdivision (a)(4) or (8), or another law to the
contrary:
(1) A refund paid pursuant to this section is open to public inspection as
a public record under the public records laws compiled in title 10, chapter 7.
Upon written request to the department, a copy of a record, document, or other
information, including the name of the taxpayer and total amount refunded,
pertaining to a refund paid pursuant to this section must be forwarded to the
requesting party.
(2)
(A) The comptroller of the treasury shall conduct or contract for at
least one (1) annual financial audit of all franchise tax refunds claimed
and all such tax refunds issued to taxpayers for the prior fiscal year under
the authority granted in § 8-4-109. The audit must include any other
information the comptroller deems relevant in making such
determinations.

- 2 - 011930

(B) All audits conducted under subdivision (e)(2)(A) must be
made available on the comptroller's website no later than December 31 of
the subsequent fiscal year.
SECTION 2. Tennessee Code Annotated, Section 67-1-1709(d), is amended by
deleting "§ 67-4-2122(a)(8)" and substituting instead the language "§ 67-4-2122(a)(8) or (e)".
SECTION 3. This act takes effect upon becoming a law, the public welfare requiring it.