"IOU" A Tax Payment

Katy Grimes: Should the state of California accept its own IOU’s as tax and fee payments?

AB 1506 authored by Assemblyman Joel Anderson, R-El Cajon, would, require a state agency to accept, from a person or entity, a state IOU or registered warrant (or other similar evidence of indebtedness issued by the Controller) for the payment of any obligations owed by that payee to that state agency.

In short, this bill will allow anyone who has received an IOU from the state, to pay taxes, DMV fees, and the like, with the IOU.

At a Governmental Organization committee hearing yesterday, Anderson said that the state issues IOU’s in lieu of paychecks, or payments to vendors, but then insists taxpayers and businesses pay taxes and fees on time or risk hefty penalties. Anderson said that taxpayers and businesses cannot pay taxes or fees to the state when they haven’t been paid what is owed to them by the state.

He’s giving the state a taste of its own medicine.

The bill passed out of the committee 9-0. This should be interesting to follow.

IOU Franchise tax board…