PLEASE NOTE:  Publication for public comment is not, and shall not, be construed as a recommendation or approval by the Board of Trustees of the materials published.

SUBJECT:

Proposed new California Rules of Court and State Bar Rule Regarding Tax Delinquency - AB 1424 (Stats. 2011, Chapter 455)

BACKGROUND:

AB 1424 (Stats. 2011, Chapter 455) is a comprehensive bill directed at the 500 largest state tax delinquents who owe over $100,000. AB 1424 enacted new Business and Professions Code section 494.5, effective July 1, 2012. Section 494.5 provides for denying a license to or suspending the professional, occupational or driver’s license of a taxpayer who is among the 500 largest state tax delinquencies. The State Bar, its members and applicants for admission are covered by AB 1424.

Since the Supreme Court of California has inherent authority and power over admissions, discipline and regulation of attorneys in California, a new California Rule of Court on refusal of admission, a new California Rule of Court on suspension, and a new State Bar rule on suspension are proposed to complement Business and Professions Code section 494.5.

Section 494.5 contains notice and timeline provisions; conditions for reinstatement and re-suspension; and a process by which a tax payer may submit a challenge to the Franchise Tax Board or State Board of Equalization if the taxpayer contests being named on the lists.

DISCUSSION/PROPOSAL:

In light of the Supreme Court’s inherent authority over admission and suspension of members, this agenda item proposes:

  1. A new California rule of court for refusal-of-admission due to tax delinquency under section 494.5 or support delinquency under Family Code section 17520
  2. A new California rule of court for suspension due to tax delinquency under section 494.5
  3. A new State Bar rule for suspension due to tax delinquency.

In order to place the new State Bar rule with other suspension rules, it is recommended that two existing State Bar rules be renumbered.

ANY KNOWN FISCAL/PERSONNEL IMPACT:

None. Any impact will be absorbed by existing resources.

ATTACHMENT:
Regulation, Admissions and Discipline Oversight Committee - May 10, 2012 - Agenda Item
Attachment A- Proposed New California Rule of Court 9
Attachment B- Proposed New California Rule of Court 9.24
Attachment C- Proposed Additions and Amendments to the State Bar Rules Title 2, Division 3

SOURCE:
Regulation, Admissions and Discipline Oversight Committee

DEADLINE:

June 14, 2012

DIRECT COMMENTS TO:

Dina DiLoreto
Membership Records
The State Bar of California
180 Howard Street
San Francisco, CA 94105
Ph. (415) 538-2121
Fax (415) 538-2576 Fax
E-mail: dina.diloreto@calbar.ca.gov