Credit For Dishonored Checks

(1) Credit will be given by the Commissioner or Revenue to municipal or county officers for dishonored checks or money orders tendered to such officers in payment of State taxes, licenses and fees, under the following conditions: (a) Credit will be allowed only for the amount of the check or money order which represents the state tax, license, or fee due and owing to the State regardless of the total amount of the check or money order. (b) The dishonored check must show that it was deposited by the third business day after receipt; that it was returned unpaid by the bank on which it was drawn; that it was subsequently redeposited by the third business day after its return and that it was returned unpaid for the second time. Where it is the practice of the depositor's bank to automatically redeposit a dishonored check before it is returned unpaid to the depositor, the date of such action as noted on the check by the bank will be accepted as fulfilling the time requirement for redeposit. (c) The municipal or county officer must initiate civil action to recover the amount of any dishonored check or money order within thirty (30) calendar days after the second or final return of the dishonored check or money order. If, prior to the initiation of the civil action, it is deemed advisable to send a notice to the taxpayer prior to initiating civil action, such notice must be mailed not later than the fourth business day after final return of the check or money order and the notice must include a limitation period for response not to exceed fifteen (15) days. If such notice does not result in recovery, civil action must be initiated within ten (10) calendar days after expiration of the period specified in the notice. (2) Any claim for credit submitted to the Commissioner of Revenue by a municipal or county officer must be accompanied by: (a) A copy of the tax, license, or fee document for which the dishonored check or money order was tendered. (b) A copy of the 15-day notice, if any. ADMINISTRATION CHAPTER 1320-01-01 (c) A copy of the document initiating civil action by the municipal or county officer, along with the results of the civil action. (d) A copy of the dishonored check or money order. (e) The registration plate or privilege license and/or copies of receipts for state taxes. (3) If a registration plate or license cannot be repossessed because the taxpayer cannot be located, a statement to this effect must accompany the claim. If the taxpayer resides outside the county where the dishonored check or money order was tendered, all available information known to the county or municipal officer concerning such taxpayer should be furnished with the claim. (4) In all cases the municipal or county officer is expected to make every reasonable effort to effect collection of any dishonored check or money order. If unsuccessful in this, he is expected to obtain the return of the license or registration plate if same can be found in his county and take all necessary steps to prevent the operation of any unlicensed business or unregistered motor vehicle. (5) A claim for credit will be denied unless filed with the Department of Revenue within twelve (12) months from the date civil action was initiated.