ASK THE EDD LAWYER – Can I Lose My Driver’s License If I Owe The EDD?
by Robert S. Schriebman
Can you lose your driver’s license if you owe the EDD? If you review the list of articles on this web site you will find several that deal with the EDD’s ability to engage in harsh collection methods known as enforced collection. Most common collection tools are the filing of a Notice of State Tax Lien and a bank account levy. But can you lose your driver’s license, too?
Nothing is certain in life but change. We are all familiar with Bob Dylan’s song about the times – they are a-changin’. From what I see it is only a matter of time before California enacts stiff legislation suspending your license if you owe taxes – California has already made a start in this direction. Before discussing what Jerry Brown might do, let us take a look at a nation-wide trend.
In early August 2013, New York Governor Andrew M. Cuomo announced a new initiative suspending New York State driver’s licenses if a taxpayer owes more than $10,000. An EDD assessment can get up to this figure very fast! It is estimated that the New York Governor’s action will bring in a cool $26 million in the current fiscal year.
At least 19 states including Wisconsin, Florida, New Jersey, and even Montana are passing similar legislation as well as publishing the names of tax delinquents online.
How about California? On October 4, 2012, Governor Jerry Brown signed a bill requiring the DMV to suspend the driver’s licenses of California’s worst tax delinquents. The California driver’s license suspensions will affect the state’s top 1,000 tax dead-beats. Their names will be published online in two lists of 500 each. One list will consist of individuals who owe income taxes (FTB). The second list will contain the names of individuals who owe sales tax (SBE) and possibly the EDD as well.
What about due process? All the taxpayers listed in California have had state tax liens filed against them. Once their driver’s licenses are suspended, and they are notified, they will have only 90 days to pay up or find a designated driver.
We have seen the beginning of what is believed to be a trend towards public shaming of tax debtors and raising revenue as well. There is money to be made. The top 250 individuals owe California over $152 million. New York revenue projections are very small when compared to California.
The suspension of your driving privileges when you owe the FTB, SBE, and EDD now has its foot in the door. It is foreseeable that California will watch this legislation very carefully. If it gets the tax debtor’s attention, it is a safe bet that we soon may see a list of 10,000 of California’s worst tax dead-beats on the internet. Who knows, maybe the 405 freeway will become a pleasant place to travel after all!
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An EDD attorney, Robert Schriebman has a successful practice in the Rolling Hills Estates area of Los Angeles County serving clients throughout California and the United States.
As a trusted EDD lawyer, Robert S. Schriebman has successfully dedicated more than 30 years to helping individual taxpayers, business owners, CPAs, Enrolled Agents, and tax attorneys navigate the complicated tax systems of the federal and state governments.
Robert Schriebman has written over 20 books including the major manual used nationally by practitioners and the IRS, “IRS Tax Collection Procedures – A Manual for Practitioners” published by Commerce Clearing House and the only 2 books ever published dealing with how California Employment Development Department (EDD) operates. See “California Tax Collection Practice and Procedures” and “California Taxation Practice and Procedure”, both published by Commerce Clearing House.