TITLE 34.PUBLIC FINANCE

Part 1. COMPTROLLER OF PUBLIC ACCOUNTS

Chapter 1. CENTRAL ADMINISTRATION

Subchapter A. PRACTICE AND PROCEDURES

1. PRACTICE AND PROCEDURES

34 TAC §1.6

The Comptroller of Public Accounts adopts an amendment to §1.6, concerning extensions of time, without changes to the proposed text as published in the June 8, 2001, issue of the Texas Register (26 TexReg 4069).

The rule is being amended to reflect current job titles that are assigned to attorneys in the comptroller's Administrative Hearings Section.

No comments were received regarding adoption of the amendment.

This amendment is adopted under the Tax Code, §111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2.

The amendment implements the Tax Code, §111.009 and §111.105.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on August 15, 2001.

TRD-200104775

Martin Cherry

Deputy General Counsel for Tax Policy and Agency Affairs

Comptroller of Public Accounts

Effective date: September 4, 2001

Proposal publication date: June 8, 2001

For further information, please call: (512) 463-4062


34 TAC §1.9

The Comptroller of Public Accounts adopts an amendment to §1.9, concerning position letters, without changes to the proposed text as published in the June 8, 2001, issue of the Texas Register (26 TexReg 9053).

The rule is being amended to reflect current job titles that are assigned to attorneys in the comptroller's Administrative Hearings Section.

No comments were received regarding adoption of the amendment.

This amendment is adopts under the Tax Code, §111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2.

The amendment implements Tax Code, Chapter 111.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on August 15, 2001.

TRD-200104776

Martin Cherry

Deputy General Counsel for Tax Policy and Agency Affairs

Comptroller of Public Accounts

Effective date: September 4, 2001

Proposal publication date: June 8, 2001

For further information, please call: (512) 463-4062


34 TAC §1.10

The Comptroller of Public Accounts adopts an amendment to §1.10, concerning acceptance or rejection of position letter; motion to dismiss petition or set for hearing, without changes to the proposed text as published in the June 8, 2001, issue of the Texas Register (26 TexReg 4070).

The rule is being amended to reflect the current title of the comptroller's Administrative Hearings Section.

No comments were received regarding adoption of the amendment.

This amendment is adopted under the Tax Code, §111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2.

The amendment implements Tax Code, Chapter 111.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on August 15, 2001.

TRD-200104777

Martin Cherry

Deputy General Counsel for Tax Policy and Agency Affairs

Comptroller of Public Accounts

Effective date: September 4, 2001

Proposal publication date: June 8, 2001

For further information, please call: (512) 463-4062


34 TAC §1.11

The Comptroller of Public Accounts adopts an amendment to §1.11, concerning modification of the position letter, without changes to the proposed text as published in the June 8, 2001, issue of the Texas Register (26 TexReg 4070).

The rule is being amended to reflect current job titles that are assigned to attorneys in the comptroller's Administrative Hearings Section.

No comments were received regarding adoption of the amendment.

This amendment is adopted under the Tax Code, §111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2.

The amendment implements Tax Code, Chapter 111.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on August 15, 2001.

TRD-200104778

Martin Cherry

Deputy General Counsel for Tax Policy and Agency Affairs

Comptroller of Public Accounts

Effective date: September 4, 2001

Proposal publication date: June 8, 2001

For further information, please call: (512) 463-4062


34 TAC §1.13

The Comptroller of Public Accounts adopts an amendment to §1.13, concerning initiation of an expedited hearing, with changes to the proposed text as published in the June 8, 2001, issue of the Texas Register (26 TexReg 4071).

The rule is being amended to reflect the current title of the comptroller's Administrative Hearings Section.

The proposed version failed to insert the title "Administrative Hearings Section" in subsections (b)(3) and (f)(2), and those corrections are reflected in this version.

No comments were received regarding adoption of the amendment.

This amendment is adopted under the Tax Code, §111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2.

The amendment implements Tax Code, Chapter 111.

§1.13.Initiation of an Expedited Hearing.

(a) A taxpayer may request an expedited hearing at the time a petition for redetermination or written request for refund hearing is filed. An expedited hearing is one conducted under the accelerated pre- hearing and hearing timetable set forth in this section.

(b) To obtain an expedited hearing, a taxpayer must do the following at the time the petition for redetermination or written request for refund hearing is filed:

(1) request in writing the election of the expedited procedure and specify whether an oral hearing or a hearing on written submissions is preferred;

(2) pre-file its statement of grounds and all evidence (other than resale and exemption certificates) on which it intends to rely at the hearing, including summaries of testimony of witnesses expected to be called at an oral hearing. Contentions and evidence not pre-filed by the taxpayer shall be deemed inadmissible;

(3) agree to abbreviated discovery timetables in the event the Administrative Hearings Section should initiate discovery during the pre-hearing phase;

(4) request an extended oral hearing, if desired;

(5) agree to file resale and exemption certificates no later than the date of hearing or by the 60th day from the date of the hearing request, whichever occurs first, and to waive in writing the requirement of written notice and the 60-day period for the presentation of certificates as provided in Tax Code, §151.054(e); and

(6) waive in writing the issuance of a proposed decision.

(c) The general counsel or his designee shall, within ten days of his receipt of a request for an expedited hearing, make a determination as to whether the request qualifies for an expedited hearing. If it does not, the taxpayer will be so notified in writing, and advised that either with the filing of additional curative documentation the case can proceed on an expedited basis or that the case will be placed on the agency's regular hearings docket.

(d) For good cause shown, a request for an expedited hearing may be withdrawn; however, the waiver of the 60-day period pursuant to subsection (b)(5) of this section cannot be withdrawn. A taxpayer's request for continuance, or a request for an extended oral hearing filed after the initial request for an expedited hearing, shall not be granted unless there is a showing of good cause. Withdrawal of the request for an expedited hearing, or the granting of a motion for continuance or an extended oral hearing, shall cause the hearing to be set on the agency's regular hearings docket.

(e) The Administrative Hearings Section may petition the Administrative Law Judge for conversion from an expedited to a regular hearing for good cause shown, including, but not limited to, the need for additional policy consideration of issues raised, the need for extended discovery, for reasons of agency policy or court case hold, or for extended examination of records presented by the taxpayer. The Administrative Law Judge shall rule on such motion on the basis of written pleadings submitted by the parties.

(f) A compliant expedited hearing request shall be set and decided on the following timetable:

(1) within 20 days of receipt of the request by the general counsel or his designee an oral hearing or written submission closing date not to exceed 60 days from the date of receipt of the request shall be set by the Chief Administrative Law Judge;

(2) a date, not to exceed 50 days from the date of receipt of the request by the general counsel or his designee, shall be set as a deadline for the Administrative Hearings Section to file a written response to the taxpayer's statement of grounds and pre-filed evidence;

(3) a final decision shall be issued as follows:

(A) if no audit amendment is required in order to issue the final decision, within 45 days of the date of the oral hearing or the date the written submission record closes; or

(B) if an audit amendment is required in order to issue the final decision, within 75 days of the date of the oral hearing or the date the written submission record closes; and

(4) a motion for rehearing may be filed as provided in §1.29 of this title (relating to Motion for Rehearing).

(g) Hearings conducted pursuant to the expedited timetable established in this section shall not be subject to the provisions of §§1.9, 1.10, 1.11, 1.14, 1.15, 1.16, 1.20, and 1.27 of this title (relating to Rules of Practice and Procedure).

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on August 15, 2001.

TRD-200104774

Martin Cherry

Deputy General Counsel for Tax Policy and Agency Affairs

Comptroller of Public Accounts

Effective date: September 4, 2001

Proposal publication date: June 8, 2001

For further information, please call: (512) 463-4062


34 TAC §1.14

The Comptroller of Public Accounts adopts an amendment to §1.14, concerning notice of setting, without changes to the proposed text as published in the June 8, 2001, issue of the Texas Register (26 TexReg 4072).

The rule is being amended to reflect current job titles that are assigned to attorneys in the comptroller's Administrative Hearings Section.

No comments were received regarding adoption of the amendment.

This amendment is adopted under the Tax Code, §111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2.

The amendment implements Tax Code, Chapter 111.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on August 15, 2001.

TRD-200104779

Martin Cherry

Deputy General Counsel for Tax Policy and Agency Affairs

Comptroller of Public Accounts

Effective date: September 4, 2001

Proposal publication date: June 8, 2001

For further information, please call: (512) 463-4062


34 TAC §1.16

The Comptroller of Public Accounts adopts an amendment to §1.16, concerning response to the administrative hearings section, without changes to the proposed text as published in the June 8, 2001, issue of the Texas Register (26 TexReg 4072).

The rule is being amended to reflect current job titles that are assigned to attorneys in the comptroller's Administrative Hearings Section.

No comments were received regarding adoption of the amendment.

This amendment is adopted under the Tax Code, §111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2.

The amendment implements Tax Code, Chapter 111.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on August 15, 2001.

TRD-200104780

Martin Cherry

Deputy General Counsel for Tax Policy and Agency Affairs

Comptroller of Public Accounts

Effective date: September 4, 2001

Proposal publication date: June 8, 2001

For further information, please call: (512) 463-4062


34 TAC §1.20

The Comptroller of Public Accounts adopts an amendment to §1.20, concerning continuances (postponement of hearings), without changes to the proposed text as published in the June 8, 2001, issue of the Texas Register (26 TexReg 4073).

The rule is being amended to reflect the current title of the comptroller's Administrative Hearings Section.

No comments were received regarding adoption of the amendment.

This amendment is adopted under the Tax Code, §111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2.

The amendment implements Tax Code, Chapter 111.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on August 15, 2001.

TRD-200104781

Martin Cherry

Deputy General Counsel for Tax Policy and Agency Affairs

Comptroller of Public Accounts

Effective date: September 4, 2001

Proposal publication date: June 8, 2001

For further information, please call: (512) 463-4062


34 TAC §1.33

The Comptroller of Public Accounts adopts an amendment to §1.33, concerning discovery, without changes to the proposed text as published in the June 8, 2001, issue of the Texas Register (26 TexReg 4073).

The rule is being amended to reflect current job titles that are assigned to attorneys in the comptroller's Administrative Hearings Section.

No comments were received regarding adoption of the amendment.

This amendment is adopted under the Tax Code, §111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2.

The amendment implements Tax Code, Chapter 111.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on August 15, 2001.

TRD-200104782

Martin Cherry

Deputy General Counsel for Tax Policy and Agency Affairs

Comptroller of Public Accounts

Effective date: September 4, 2001

Proposal publication date: June 8, 2001

For further information, please call: (512) 463-4062


34 TAC §1.39

The Comptroller of Public Accounts adopts an amendment to §1.39, concerning dismissal of case, without changes to the proposed text as published in the June 8, 2001, issue of the Texas Register (26 TexReg 4074).

The rule is being amended to reflect current job titles that are assigned to attorneys in the comptroller's Administrative Hearings Section.

No comments were received regarding adoption of the amendment.

This amendment is adopted under the Tax Code, §111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2.

The amendment implements Tax Code, Chapter 111.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on August 15, 2001.

TRD-200104783

Martin Cherry

Deputy General Counsel for Tax Policy and Agency Affairs

Comptroller of Public Accounts

Effective date: September 4, 2001

Proposal publication date: June 8, 2001

For further information, please call: (512) 463-4062


34 TAC §1.40

The Comptroller of Public Accounts adopts an amendment to §1.40, concerning burden of proof, without changes to the proposed text as published in the June 8, 2001, issue of the Texas Register (26 TexReg 4075).

The rule is being amended to reflect the current title of the comptroller's Administrative Hearings Section.

No comments were received regarding adoption of the amendment.

This amendment is adopted under the Tax Code, §111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2.

The amendment implements Tax Code, Chapter 111.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on August 15, 2001.

TRD-200104784

Martin Cherry

Deputy General Counsel for Tax Policy and Agency Affairs

Comptroller of Public Accounts

Effective date: September 4, 2001

Proposal publication date: June 8, 2001

For further information, please call: (512) 463-4062


34 TAC §1.42

The Comptroller of Public Accounts adopts an amendment to §1.42, concerning definitions, with changes to the proposed text as published in the June 8, 2001, issue of the Texas Register (26 TexReg 4075).

The rule is being amended to reflect current job titles and duties that are assigned to attorneys in the comptroller's Administrative Hearings Section, and to add a reference to the statutory provisions that authorize settlements of contested tax matters.

The proposed version failed to insert the title "Administrative Hearings Section" in paragraph (9), and that correction is reflected in this version.

No comments were received regarding adoption of the amendment.

This amendment is adopted under the Tax Code, §111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2.

The amendment implements Tax Code, Chapter 111.

§1.42.Definitions.

The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise.

(1) Administrative law judge--An individual appointed by the comptroller to conduct hearings on matters within the comptroller's jurisdiction and to prepare proposed decisions to properly resolve such matters.

(2) Agency--The Office of the Comptroller of Public Accounts.

(3) Applicant--A party seeking a license or permit from the agency, or seeking an exemption.

(4) Authorized representative--An individual who represents a party in a contested case and may be any individual other than the party.

(5) Contested case or case--A proceeding in which the legal rights, duties, or privileges of a party are to be determined by the agency after an opportunity for adjudicative hearing. It includes a request for redetermination or refund, as well as actions initiated by the agency to revoke or suspend permits or licenses administered by the agency on grounds other than failure to pay a final tax deficiency or failure to file a tax security. Contested cases are within the jurisdiction of the administrative law judges. Forfeitures of rights to do business, of certificates of authority, of articles of incorporation, penalties imposed under the Tax Code, §151.7031, the refusal or failure to settle under Tax Code, §111.101 or requests for or revocation of exemptions from taxation are not contested cases and are not within the jurisdiction of the administrative law judges.

(6) Determination--A written notice from the agency that a person is required to pay to the State of Texas a tax, fee, penalty, or interest.

(7) Assistant General Counsel--An attorney from the Administrative Hearings Section who is assigned to present the agency's position in a contested case.

(8) Licensing--The agency process respecting the granting, denial, renewal, revocation, suspension, annulment, withdrawal, or amendment of a permit.

(9) Party--Any person filing a petition or claim with the agency or asked by the agency to respond; the agency, acting through its Administrative Hearings Section; and any other person admitted as a party under §1.36 of this title (relating to Interested Parties).

(10) Permit--The whole or any part of a license, certificate, approval, registration, or similar form of permission, the issuance, renewal, amendment, suspension or revocation of which is within the jurisdiction of the agency.

(11) Permit holder--Includes a bonded agent, distributor, wholesaler, or retailer required to obtain a permit under the Tax Code, Chapters 154 or 155.

(12) Person--Any individual, partnership, corporation, association, governmental subdivision, or public or private organization of any character. It may also include an estate, trust, receiver, assignee for benefit of creditors, trustee, trustee in bankruptcy, assignee, or any other group or combination acting as a unit.

(13) Petition--A request for official action by the agency regarding the rights, duties or privileges accorded to the person making the request under a statute administered or enforced by the agency. If the request is made orally, it must subsequently be reduced to writing.

(14) Petitioner, claimant, or taxpayer--Any person who files a petition seeking redetermination of a liability, a refund of monies paid, or determination of rights under any license or permit granted by the agency.

(15) Pleading--Any document filed by a party concerning the position or assertions in a contested case.

(16) Respondent or taxpayer--Any person to whom a notice of a show cause hearing for the suspension or revocation of a license has been issued.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on August 15, 2001.

TRD-200104773

Martin Cherry

Deputy General Counsel for Tax Policy and Agency Affairs

Comptroller of Public Accounts

Effective date: September 4, 2001

Proposal publication date: June 8, 2001

For further information, please call: (512) 463-4062