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2310-2313 Delinquent Payment Enforcement: Enforcement Techniques Information

2310. COLLECTION ACTIONS
When an unsecured tax becomes delinquent, the tax collector should initiate involuntary collection action. The type and timing of the action necessary depends on many variables, including the dollar amount of the bill, whether the assessee owns the real estate, his/her ability to pay, future reliability of bill collection, and prior payment record.

Collection personnel should know how to locate assessees and assets and which legal means are available to enforce collection of delinquencies. Actions a tax collector may take include liens on real estate located in any county, summary judgments or other court action, Federal Aviation Administration liens, California Department of Alcoholic Beverage Control liens, claims in a bulk transfer of assets, and claims in bankruptcy. Many counties have established guidelines for collection procedures. For tax collectors who have not established policies, the following may offer some collection guidance.

Liens - Liens on all delinquent bills over a certain dollar amount and liens on an individual basis can be filed shortly after the delinquent date. The low-dollar amount used by counties ranges from $20 to $100. Liens are filed approximately two weeks after delinquency. These liens are a very helpful tool, since they appear on title reports and credit reports.

Small Claims Court - Actions filed in small claims court are time-consuming. In some cases, the judgments have been unsatisfactory. While this option remains open to counties, most tax collectors no longer use small claims court. A summary judgment procedure may be more effective.

Municipal or Superior Court - Like filings made in small claims court, these cases are very time-consuming. They should be used only when the summary judgment procedure is impractical.

Summary Judgment - These superior court filings are an excellent way to obtain an enforceable judgment. They have the same force and effect as any other judgment in superior court and can be used to attach wages, bank accounts, and other assets. Penalties continue to accrue at the allowable rate within the Revenue and Taxation Code rather than being modified to the lower legal interest rate that may apply to other judgments.

A summary judgment maximizes the return and avoids the additional bookkeeping required with other types of judgments. Some counties use summary judgment for all tax delinquencies over $10, some restrict their use to delinquencies over $50, others to delinquencies over $500. The cost to the county is mainly in the mailing of a certified notice.

Summary judgments and all other court judgments appear on credit reports.

Writ of Execution - Once a summary judgment is obtained, a county can attach any assets of the assessee by writ of execution. Once the writ is completed, it is filed with the clerk and delivered to the sheriff in the county in which the asset is located. This avoids the tax collector's involvement in the actual attaching of the asset. A writ can be used for attaching bank accounts, wages, boats, cars, equipment, tills, etc.

Seizure and Sale - Seizure is an extremely useful collection method. In most cases, this is usually the last action necessary to enforce collection. The decision to seize an item of personal property is also the decision by the county to expend keepers fees, locksmith fees, and time to inventory the property. These fees, of course, are added into the seizure total and collected along with the tax payment. Failure to collect the bill will result in a loss of these costs.

Sales generally occur very rarely, but every seizure should be approached as if a sale will be required. Most tax collectors reserve seizures for delinquencies over $100; others will not seize unless the delinquency is at least $500.

Seizure of Checking Accounts - This is usually the easiest way to enforce collection. If a copy of the assessee's check is available, verify the account information with the bank, and serve the bank with the seizure notice. Make every attempt to have the notice served on the bank at a time when there are funds available in the account.

Checking account seizures avoid direct conflict with the assessee and the costs involved in keepers, inventories, etc., but they generally occur only when tax bills exceed $50 or $100.

2311. AVAILABILITY OF ASSESSEE
The type of enforcement technique selected may depend on locating the assessee or his/her assets. If the assessee is located within the county, collection enforcement is usually easier and most of the legal steps to enforce collection may be effective. If the assessee and all his/her assets are out of the county but within California, collection instruments may be recorded in the county of domicile and assistance obtained from officials of that county. Seizures, by mail, of funds in bank accounts are available for bank branches located in California.

Similarly, writs of execution served to county sheriff departments can assist in attaching assets. Out-of-state assessees can pose the greatest impediment to collections, particularly if the assets are also moved. Assessors' offices may be able to provide additional information on the assessee's location.

NOTE: There are various sources of information, such as DataQuick and Experian, that provide statewide property ownership information, and online companies such as Infoquest, a people-finding service, can be used to locate assessees. Other resources include DMV records and court records.

2312. ASSETS OF ASSESSEE FOR COLLECTION ENFORCEMENT
The type of assets available often determines the most effective collection technique to implement. A known bank account may be easier to collect against than certain physical assets. The mobility of an asset may impede collections. The assessor may provide additional information on the makes, models and identification of assets. DMV can provide ownership records and lienholder information for all vehicles and boats registered in California.

2313. ASSETS SUBJECT TO SPECIAL COLLECTION PROCEDURES 
M-2500 et seq. is devoted to special collection procedures against certain assets. The procedures may be used in conjunction with other collection techniques or may require certain recorded collection instruments. For instance, the California Interagency Offset Program (M-2610) requires a recorded lien before an offset will be made by the Franchise Tax Board. A review of the special collection requirements should be made so that needed instruments can be obtained in a timely manner.