SLS 18RS-572 ENGROSSED
2018 Regular Session
SENATE BILL NO. 238
BY SENATOR MORRELL
REVENUE DEPARTMENT. Authorizes the Department of Revenue to seek to enjoin
preparers who engage in certain conduct. (7/1/18)
1 AN ACT
2 To enact R.S. 47:1574.2, relative to tax administration; to authorize the secretary of revenue
3 to bring suit to enjoin preparers who engage in certain conduct; to provide a list of
4 the conduct that may be enjoined; to authorize the enjoining of preparers who engage
5 in prohibited conduct from preparing returns for this state; to provide for definitions;
6 and to provide for related matters.
7 Be it enacted by the Legislature of Louisiana:
8 Section 1. R.S. 47:1574.2 is hereby enacted to read as follows:
9 ยง1574.2. Suit to enjoin certain preparers
10 A. In a court of competent jurisdiction, the secretary may commence suit
11 to enjoin any preparer from further engaging in any conduct described in
12 Subsection B of this Section or from further action as a preparer.
13 B. In any action under Subsection A of this Section, the court may enjoin
14 the preparer from further engaging in any conduct specified in this Subsection
15 if the court finds that injunctive relief is appropriate to prevent the recurrence
16 of this conduct. The court may enjoin conduct when a preparer has done any
17 of the following:
Page 1 of 5
Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions. SB NO. 238
SLS 18RS-572 ENGROSSED
1 (1) Prepared any return, report, claim for refund, or other claim that
2 includes an understatement of a taxpayer's liability due to an unreasonable
3 position. For purposes of this Subsection, "unreasonable position" shall have
4 the same meaning as provided by Section 6694 of the Internal Revenue Code.
5 (2) Prepared any return, report, claim for refund, or other claim that
6 includes an understatement of a taxpayer's liability due to willful or reckless
7 conduct. For purposes of this Subsection, "willful or reckless conduct" shall
8 have the same meaning as provided by Section 6694 of the Internal Revenue
9 Code.
10 (3) Where required, failed to furnish copy of return, report, claim for
11 refund, or other claim.
12 (4) Where required, failed to sign return, report, claim for refund, or
13 other claim.
14 (5) Where required, failed to furnish identifying number.
15 (6) Where required, failed to retain copy of records.
16 (7) Where required, failed to file correct information returns.
17 (8) Where required, failed to be diligent in determining eligibility for tax
18 benefits.
19 (9) Negotiated a check issued to a taxpayer by the Department of
20 Revenue without the permission of the taxpayer.
21 (10) Engaged in any conduct subject to any criminal penalty provided in
22 Title 47 of the Louisiana Revised Statutes of 1950.
23 (11) Misrepresented the preparer's eligibility to practice before the
24 Department of Revenue or otherwise misrepresented the preparer's experience
25 or education.
26 (12) Guaranteed the payment of any tax refund or the allowance of any
27 tax credit or rebate.
28 (13) Engaged in any other fraudulent or deceptive conduct that
29 substantially interferes with the proper administration of the tax laws of the
Page 2 of 5
Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions. SB NO. 238
SLS 18RS-572 ENGROSSED
1 state of Louisiana.
2 C.(1) If the court finds that a preparer has engaged in any conduct
3 described in Paragraphs (2), (9), (10), (11), (12), or (13) of Subsection B of this
4 Section and that an injunction prohibiting the conduct would not be sufficient
5 to prevent the person's interference with the proper administration of the tax
6 laws of Louisiana, the court may enjoin the person from acting as a preparer in
7 the state of Louisiana.
8 (2) If the court finds that a preparer has continually or repeatedly
9 engaged in any conduct described in Paragraphs (1), (3), (4), (5), (6), (7), or (8)
10 of Subsection B of this Section and that an injunction prohibiting the conduct
11 would not be sufficient to prevent the person's interference with the proper
12 administration of the tax laws of Louisiana, the court may enjoin the person
13 from acting as a preparer in the state of Louisiana.
14 (3) The fact that the person has been enjoined from preparing tax
15 returns or claims for refund for the United States or any other state, in the five
16 years preceding the petition for an injunction shall establish a prima facie case
17 for an injunction to be issued pursuant to this Section. For purposes of this
18 Section, "state" shall mean a state of the United States, the District of
19 Columbia, Puerto Rico, the United States Virgin Islands, or any territory or
20 insular possession subject to the jurisdiction of the United States.
21 D. The term "preparer" means any person who prepares or who
22 employs one or more persons to prepare any return, report, claim for refund,
23 or other claim that is filed with the secretary of the Department of Revenue. The
24 preparation of a substantial portion of a return, report, claim for refund, or
25 other claim shall be considered the preparation of the return, report, claim for
26 refund, or other claim for purposes of this Section.
27 Section 2. This Act shall become effective on July 1, 2018.
Page 3 of 5
Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions. SB NO. 238
SLS 18RS-572 ENGROSSED
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Leonore Heavey.
DIGEST
SB 238 Engrossed 2018 Regular Session Morrell
Proposed law authorizes the secretary of revenue to file suit to enjoin a preparer from further
engaging in any prohibited conduct.
Proposed law provides a list of prohibited conduct for preparers.
(1)Preparation of any return or claim for refund that includes an understatement of a
taxpayer's liability due to an unreasonable position.
(2) Preparation of any return or claim for refund that includes an understatement of a
taxpayer's liability due to willful or reckless conduct.
(3)Failure to furnish copy of return or claim for refund, where required.
(4)Failure to sign return or claim for refund, where required.
(5)Failure to furnish an identifying number, where required.
(6)Failure to retain copies of records, where required.
(7)Failure to file correct information returns, where required.
(8)Failure to be diligent in determining eligibility for tax benefits, where required.
(9)Negotiation of a check issued to a taxpayer by the Department of Revenue without
the permission of the taxpayer.
(10)Engagement in any conduct subject to any criminal penalty provided by Title 47 of
the Louisiana Revised Statutes of 1950.
(11)Misrepresentation of the preparer's eligibility to practice before the Department of
Revenue or otherwise misrepresented the preparer's experience or education.
(12)Guaranteeing the payment of any tax refund or the allowance of any tax credit.
(13)Engagement in any other fraudulent or deceptive conduct that substantially interferes
with the proper administration of the tax laws of the state of Louisiana.
Proposed law authorizes a court to enjoin a paid preparer from preparing any return, report,
claim for refund, or other claim for this state if the court finds that a preparer has continually
or repeatedly engaged in any conduct and that an injunction to enjoin the conduct will not
be sufficient to prevent the preparer from interfering with the administration of the state's
tax laws.
Proposed law provides that suspension from practice before the IRS or another state
establishes a prima facie case for a court to enjoin a paid preparer from preparing tax returns
for this state.
Proposed law defines "preparer" as a person who prepares all or a substantial portion of a
return, report, claim for refund or other claim or who employs others to prepare tax returns
or claims for refund that is filed with the secretary of the Dept. of Revenue.
Page 4 of 5
Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions. SB NO. 238
SLS 18RS-572 ENGROSSED
Effective July 1, 2018.
(Adds R.S. 47:1574.2)
Summary of Amendments Adopted by Senate
Committee Amendments Proposed by Senate Committee on Revenue and Fiscal
Affairs to the original bill
1. Applies to preparers of any return, report, claim for refund, or other claim.
2. Provides definition of "preparer".
3. Changes effective date to July 1, 2018.
Page 5 of 5
Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.