(a) No tax commissioner or tax collector shall be personally liable for unpaid checks or money orders received in payment of taxes and license fees when:

(1) The county governing authority has authorized the receipt of personal, company, certified, treasurer's, or cashier's checks, or bank, postal, or express money orders in payment of taxes and license fees;

(2) The tax commissioner or tax collector has received such checks or money orders to the extent and under the conditions prescribed by the governing authority;

(3) The tax commissioner or tax collector has made written demand for payment by the taxpayer on whose account the unpaid check or money order was tendered within 30 days after the notification to the tax commissioner or tax collector of the dishonor of the check or money order; such demand shall be sent by certified mail or statutory overnight delivery to the taxpayer's last address as it appears on the latest records of the tax commissioner or tax collector; and

(4) In all cases where payment is not received within 20 days after the mailing of the demand specified in paragraph (3) of this subsection, the tax commissioner or tax collector has initiated within 40 days after such mailing at least one of the rights and remedies allowed him by law for the enforcement of the collection and payment of taxes and license fees.

(b) A check or money order, when authorized, shall be deemed to be payment as of the time it is received by the tax commissioner or tax collector, provided the check or money order is duly paid upon presentation to the drawee. The time of receipt as shown by the records of the tax commissioner or tax collector shall be prima facie correct as to the time of actual receipt.

(c) If a check or money order so received is not duly paid, the person on whose account the check or money order was tendered shall remain liable for the payment of the tax or license fee and for all legal penalties and additions to the same extent as if the check or money order had not been tendered. Delay in the presentation of a check or money order for payment shall not remove this liability.

(d) If any certified check, treasurer's check, cashier's check, or money order so received is not duly paid, the tax commissioner or tax collector, in addition to the right to exact payment from the party originally obligated for the payment, shall have a lien for the amount of the check or money order upon all assets of the bank or trust company on which drawn or for the amount of the money order upon all the assets of the issuer of the money order. The amount of the lien shall be paid out of the assets of the bank, trust company, or issuer in preference to any other claims whatsoever against the bank, trust company, or issuer.

(e) If any check or money order tendered to the tax commissioner or tax collector as payment of any tax or license fee is not duly paid when presented to the drawee or issuer for payment, in addition to any other penalties provided by law, there shall be paid as a penalty by the person who tendered the check or money order upon notice and demand of the tax commissioner or tax collector, in the same manner as tax, an amount equal to 1 percent of the amount of the check or money order, except that, if the amount of the check or money order is less than $500.00, the penalty under this Code section shall be the lesser of $5.00 or the amount of the check or money order. This subsection shall not apply if the person who tendered the check or money order shows to the satisfaction of the tax commissioner or tax collector that it was tendered in good faith and with reasonable cause to believe it would be duly paid.