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2530-2532 Special Collection Procedures: Bulk Transfers

2530. NOTICE TO TAX COLLECTOR OF PENDING BULK TRANSFER
When a bulk transfer, as defined in California Uniform Commercial Code section 6102, is to be made, the tax collector receives a Notice to Creditors, by certified or registered mail, at least ten days prior to the time the transfer is consummated (Cal. U. Com. Code §6107). The notice is sent by the transferee (buyer) of the goods if the transfer is between private parties, or by the "auctioneer," as defined in California Uniform Commercial Code section 6108, if the transfer is to be by sale at auction (Cal. U. Com. Code §§6105 and 6108).

The tax collector should review Notices of Intended Sale published in newspapers and recorded with the county, as a precaution against failure of the buyer or the auctioneer to notify the tax collector.

2531. CONTENTS OF NOTICE
The notice must state:

1) That a bulk transfer is about to be made;

2) The name and business address of the transferor and, except in the case of a sale at auction, the transferee, and all other business names and addresses used by the transferor within the past three years so far as is known to the transferee;

3) The location and general description of the property to be transferred; and

4) The place and the date on or after which the bulk transfer is to be consummated (Cal. U. Com. Code §6107).

NOTE: If the Notice of Bulk Transfer is delivered during the period from January 1 to May 7, inclusive, the notice shall be accompanied by a completed business property statement with respect to property involved in the bulk sale, pursuant to Revenue and Taxation Code section 441 (Cal. U. Com. Code §6105(3)).

2532. DETERMINATION OF UNPAID TAX AND FILING OF CLAIM
Upon receipt of the notice of pending bulk transfer, the tax collector should determine if there are any delinquent or due and payable unsecured property taxes against the property to be transferred. If taxes are due or delinquent, file a claim for the amount of the county's lien with the person named in the notice to receive such claims or, in the absence of such a person, to the person required to send the notice. Estimate an amount for the current year if the assessor has not enrolled the assessment. Include estimated amounts for any tax liability that may accrue if escrow extends beyond January 1. The tax collector must file this demand with the transfer agent within 12 working days of the original notice date.

NOTE: If the property is transferred without payment of the county's claim, the tax collector should seek the guidance of the county legal advisor as to the proper manner of enforcing payment of the claim. The procedures to follow may differ, depending on whether the transfer was between private parties or by sale at auction.