TAX NEWS - January 2010

California: Luxury Auto Pilot Program

Each year, we receive and process millions of income information records. Our nonfiler program uses federal tax return information, information from other California state agencies, third-party data, and income estimates from self-employed activities to determine if a taxpayer has a filing requirement.

We are conducting a pilot program using luxury vehicle registration information from the Department of Motor Vehicles (DMV). We are evaluating the use of DMV data to:

- Determine the taxpayer's ability to pay outstanding tax debts where the taxpayer was previously determined to have a limited ability to pay, or the cases were determined uncollectible or cost-prohibitive.
- Obtain better addresses.
- Evaluate asset information.
- Analyze existing collection strategies.
- Identify nonfilers.

The pilot is primarily focused on vehicles valued at $40,000 or more at the time of purchase. We are using DMV vehicle registration data for the years 2004 through 2008.