Arkansas Code of 1987 (2023) › Title 26 - TAXATION (§§ 26-1-101 — 26-82-119) › Subtitle 2 - ADMINISTRATION OF STATE TAXES (§§ 26-17-201 — 26-21-115) › Chapter 18 - STATE TAX PROCEDURE GENERALLY (§§ 26-18-101 — 26-18-1120) › Subchapter 4 - ASSESSMENTS (§§ 26-18-401 — 26-18-406) › Section 26-18-402 - Jeopardy assessment

(a)
Regardless of the date on which a return or payment is due or a taxable period of a taxpayer closes, the Secretary of the Department of Finance and Administration shall declare the taxable period of any state tax terminated for that person and shall issue a jeopardy assessment and assess the tax from any information in his or her possession, notify the taxpayer, and demand immediate payment if the secretary believes that:
(1)
The tax liability of any person who has a bond on file with the secretary to indemnify the state for the payment of any state tax is in excess of the amount of the bond;
(2)
A taxpayer intends to depart from the state, to remove his or her property therefrom, or to conceal himself or herself or any of his or her property therein;
(3)
A taxpayer intends to discontinue business without making adequate provisions for payment of all state tax; or
(4)
A taxpayer intends to do any other act tending to prejudice, jeopardize, or render wholly or partially ineffectual proceedings to compute, assess, or collect any state tax.
(b)
(1)
Within five (5) days after the date on which a notice and demand for payment is made under subsection (a) of this section, the secretary shall provide the taxpayer with a written statement of the information upon which the secretary relies in making such assessment.
(2)
A taxpayer may seek relief from a jeopardy assessment issued by the secretary under this section by filing an administrative protest of the assessment under the Arkansas Tax Procedure Act, §
26-18-101
et seq., or by filing a petition under the Independent Tax Appeals Commission Act, §
26-18-1101
et seq., within five (5) business days of the issuance of a statement under subdivision (b)(1) of this section.
(c)
(1)
(A)
When the taxpayer requests a hearing, the secretary or the Tax Appeals Commission, as applicable, shall hold the hearing within five (5) business days of receipt of the request.
(B)
After a hearing, the secretary or the commission shall determine whether the making of the assessment under subsection (a) of this section is reasonable under the circumstances and shall render a written decision.
(2)
The taxpayer has three (3) days after the receipt of the written decision by the secretary or the commission under this section either to pay the tax and applicable penalty and interest due or to seek judicial relief from the decision under §
26-18-406
prior to the secretary's issuing a certificate of indebtedness.
(3)
The secretary may seek judicial relief from a decision of the commission under §
26-18-406(c)
or §
26-18-1117
by filing suit in the Pulaski County Circuit Court or in the circuit court of the county in which the taxpayer resides or has its principal place of business in the state within three (3) days after the date of the written decision.
(d)
Whenever the secretary issues a jeopardy assessment, he or she shall have the burden of proving the reasonableness of the assessment.
Amended by Act 2021, No. 593,§ 9, eff. 1/1/2023.
Acts 1979, No. 401, § 13; A.S.A. 1947, § 84-4713; Acts 1989, No. 590, §§ 4, 5.