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H0447...............................................by REVENUE AND TAXATION TAX - MINE LICENSE/INCOME - Amends existing law to make technical changes relating to returns filed for mine license tax by providing for automatic extension of time for filing, and for returns filed for income tax by allowing tax preparers to use their identification number instead of social security number; to provide that the deduction for retirement benefits may be subject to additional limitations of law and rule applicable to part-year residents or nonresident individuals; to delete the requirement to file for trusts and estates if not required to file a federal return and for partnerships and S-corporations without a resident partner or shareholder; to delete the requirement for farmers to file withholding if not required to withhold federal taxes; and to conform due date of tax returns of farmer's cooperatives to federal due date without extensions. 01/27 House intro - 1st rdg - to printing 01/28 Rpt prt - to Rev/Tax 02/01 Rpt out - rec d/p - to 2nd rdg 02/02 2nd rdg - to 3rd rdg 02/04 3rd rdg - PASSED - 68-0-2 AYES -- Alltus, Barraclough, Barrett, Bell, Bieter, Black, Boe, Bruneel, Callister, Campbell, Chase, Cheirrett, Clark, Crow, Cuddy, Deal, Denney, Ellsworth, Field(13), Field(20), Gagner, Geddes, Gould, Hadley, Hammond, Hansen(23), Hansen(29), Henbest, Hornbeck, Jaquet, Jones, Judd, Kempton, Kendell, Kunz, Lake, Linford, Loertscher, Mader, Marley, McKague, Meyer, Montgomery, Mortensen, Moss, Moyle, Pearce, Pischner, Pomeroy, Reynolds, Ridinger, Ringo, Robison, Sali, Schaefer, Sellman, Shepherd, Smith, Smylie, Stevenson, Stoicheff, Stone, Taylor, Trail(Miller), Wheeler, Wood, Zimmermann, Mr Speaker NAYS -- None Absent and excused -- Kellogg, Tilman Floor Sponsor - Linford Title apvd - to Senate 02/07 Senate intro - 1st rdg - to Loc Gov 02/10 Rpt out - rec d/p - to 2nd rdg 02/11 2nd rdg - to 3rd rdg 02/24 3rd rdg - PASSED - 30-0-5 AYES--Andreason, Boatright, Bunderson, Burtenshaw, Cameron, Crow, Darrington, Deide, Frasure, Geddes, Hawkins, Ingram, Ipsen, Keough, King-Barrutia, McLaughlin, Noh, Parry, Riggs, Risch, Sandy, Schroeder, Sorensen, Stegner, Stennett, Thorne, Walton, Wheeler, Whitworth, Williams NAYS--None Absent and excused--Danielson, Davis, Dunklin, Lee, Richardson Floor Sponsor - Ipsen Title apvd - to House 02/25 To enrol 02/28 Rpt enrol - Sp signed 02/29 Pres signed 03/01 To Governor 03/03 Governor signed Session Law Chapter 26 Effective: 01/01/00
H0447|||| LEGISLATURE OF THE STATE OF IDAHO |||| Fifty-fifth Legislature Second Regular Session - 2000IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 447 BY REVENUE AND TAXATION COMMITTEE 1 AN ACT 2 RELATING TO THE MINE LICENSE TAX AND THE IDAHO INCOME TAX; AMENDING SECTION 3 47-1203, IDAHO CODE, TO PROVIDE AN AUTOMATIC EXTENSION OF TIME FOR FILING 4 MINE LICENSE TAX RETURNS; AMENDING SECTION 48-603B, IDAHO CODE, TO PERMIT 5 TAX RETURN PREPARERS TO SUPPLY THEIR FEDERAL PREPARER IDENTIFICATION NUM- 6 BER IN LIEU OF THEIR SOCIAL SECURITY NUMBER ON STATE INCOME TAX RETURNS 7 THEY PREPARE FOR OTHERS; AMENDING SECTION 63-3022A, IDAHO CODE, TO PROVIDE 8 THAT THE DEDUCTION FOR CERTAIN RETIREMENT BENEFITS MAY BE SUBJECT TO ADDI- 9 TIONAL LIMITATIONS OF LAW AND RULE APPLICABLE TO PART-YEAR OR NONRESIDENT 10 INDIVIDUALS AND TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION 63-3027B, 11 IDAHO CODE, TO PROVIDE CORRECT CODE REFERENCES AND TO MAKE TECHNICAL COR- 12 RECTIONS; AMENDING SECTION 63-3030, IDAHO CODE, TO DELETE A REQUIREMENT TO 13 FILE AN INCOME TAX RETURN FOR TRUSTS AND ESTATES IF NOT REQUIRED TO FILE A 14 FEDERAL RETURN AND FOR PARTNERSHIPS AND S-CORPORATIONS WITHOUT A RESIDENT 15 PARTNER OR SHAREHOLDER; AMENDING SECTION 63-3032, IDAHO CODE, TO CONFORM 16 THE DUE DATE OF TAX RETURNS OF FARMER'S COOPERATIVES TO THE FEDERAL DUE 17 DATE WITHOUT EXTENSIONS AND TO MAKE TECHNICAL CORRECTIONS; AMENDING SEC- 18 TION 63-3036, IDAHO CODE, TO ELIMINATE FILING INCOME TAX WITHHOLDING BY 19 FARMERS NOT REQUIRED TO WITHHOLD FEDERAL TAXES; DECLARING AN EMERGENCY AND 20 PROVIDING A RETROACTIVE EFFECTIVE DATE. 21 Be It Enacted by the Legislature of the State of Idaho: 22 SECTION 1. That Section 47-1203, Idaho Code, be, and the same is hereby 23 amended to read as follows: 24 47-1203. STATEMENT OF NET PROCEEDS FROM MINING OR EXTRACTING ORES -- OR 25 FROM ROYALTY. (a) Every person, copartnership, company, joint stock company, 26 trust, corporation, or association mining or receiving royalties from any 27 quartz vein or lode, or placer or rock in place mining claim, containing gold, 28 silver, copper, lead, zinc, coal, phosphate, limestone, or other precious or 29 valuable minerals or metals, or mineral or metal deposits, must, on or before 30 the fifteenth day of the fourth month following the close of the taxable year 31 make a tax return to the state tax commission, stating specifically the items 32 of income and the deductions allowed by this act. For the purpose of enforcing 33 this act, the income tax returns filed in accordance with the provisions of 34 the Idaho Income Tax Act shall be open to inspection by the officer designated 35 to enforce this act. 36 (b) In the event the taxpayer is entitled to an automatic extension of 37 timeis grantedto file the income tax return under section 63-3033, Idaho 38 Code, an automatic six (6) month extension is granted to file the return 39 required under this act.if a copy of the approved extension of time is40attached to the return when filed.In all cases, where the state tax commis-41sion has grantedof an extension of time in which to file any return, interest 42 shall be paid on any tax due from due date to date of payment at the rate pro- 43 vided in section 63-3045, Idaho Code. 2 1 SECTION 2. That Section 48-603B, Idaho Code, be, and the same is hereby 2 amended to read as follows: 3 48-603B. UNFAIR TAX RETURN PREPARATION PRACTICES. (1) As used in this 4 section, unless the context otherwise requires: 5 (a) "Tax preparer" means a person who, for a fee, engages in the business 6 of assisting with, or preparing, federal, state, or local government 7 income tax returns. 8 (b) "Fee" means any moneys or valuable consideration paid or promised to 9 be paid for services rendered or to be rendered by any person or persons 10 functioning as or conducting the business of a tax preparer. 11 (2) The following acts or omissions related to the conduct of the busi- 12 ness of the tax preparer, which are done by the tax preparer or any employee, 13 partner, officer, or member of the tax preparer are unlawful: 14 (a) Making or authorizing in any manner or by any means whatever any 15 statement written or oral which is untrue or misleading. 16 (b) Causing or allowing a consumer to sign any document in blank relating 17 to a tax return thereof. 18 (c) Failing or refusing to give to a consumer a copy of any document 19 requiring his signature, as soon as the consumer signs such document. 20 (d) Failing to maintain a copy of any tax return prepared for a consumer 21 for the applicable statute of limitation period on federal tax returns and 22 state tax returns. 23 (e) Making false promises of a character likely to influence, persuade, 24 or induce a consumer to authorize the tax preparation service. 25 (3) (a) It is unlawful for any person, including an individual, firm, 26 corporation, association, partnership, joint venture, or any employee or 27 agent therefor, to use or disclose any information obtained in the busi- 28 ness of preparing federal or state income tax returns or assisting tax- 29 payers in preparing such returns unless such use or disclosure is within 30 any of the following: 31 (i) Consented to in writing by the taxpayer in a separate document. 32 (ii) Expressly authorized by state or federal law. 33 (iii) Necessary to the preparation of the return. 34 (iv) Pursuant to court order. 35 (b) For the purposes of this section, a person is engaged in the business 36 of preparing federal or state income tax returns or assisting taxpayers in 37 preparing such returns if he does either of the following: 38 (i) Advertises, or gives publicity to the effect that he prepares 39 or assists others in the preparation of state or federal income tax 40 returns. 41 (ii) Prepares or assists others in the preparation of state or fed- 42 eral income tax returns for compensation. 43 (4) (a) It is unlawful for any person, including any individual, associa- 44 tion, partnership, joint venture, or any employee or agent therefor, to 45 fail to sign any state income tax return, or to fail to include his name, 46 address, and social security number or preparer identification number 47 issued under 26 U.S.C. 6109 on any state income tax return, which he pre- 48 pares for another for compensation, or which he assists another in the 49 preparation of for compensation. 50 (b) It is unlawful for any corporation to fail to include its name and 51 address on any state income tax return which it prepares for another for 52 compensation, or which it assists another in the preparation of for com- 53 pensation. 54 (5) A person who renders mere mechanical assistance in the preparation of 3 1 a return, declaration, statement, or other document is not considered, for the 2 purposes of this section, as preparing the return, declaration, statement or 3 other document. 4 SECTION 3. That Section 63-3022A, Idaho Code, be, and the same is hereby 5 amended to read as follows: 6 63-3022A. DEDUCTION OF CERTAIN RETIREMENT BENEFITS. (a)For taxable years7commencing on or after January 1, 1973, aAn amount specified by subsection (b) 8 of this section of the following retirement benefits may be deducted by an 9Idaho residentindividual from taxable income if suchIdaho residentindivid- 10 ual has either attained age sixty-five (65) years, or has attained age sixty- 11 two (62) years and is classified as disabled: 12 (1) Retirement annuities paid by the United States of America to a 13 retired civil service employee or the unremarried widow of a retired civil 14 service employee. 15 (2) Retirement benefits paid from the firemen's retirement fund of the 16 state of Idaho to a retired fireman or the unremarried widow of a retired 17 fireman. 18 (3) Retirement benefits paid from the policemen's retirement fund of a 19 city within this state to a retired policeman or the unremarried widow of 20 a retired policeman. 21 (4) Retirement benefits paid by the United States of America to a retired 22 member of the military services of the United States or the unremarried 23 widow of such member. 24 (b) The amount of retirement benefits that may be deducted from taxable 25 income shall be an amount not in excess of maximum retirement benefits under 26 the social security act, as amended, on the date on which this act is passed 27 and approved, including adjustments to be made based upon consumer price index 28 adjustments provided in section 215 of the social security act. The state tax 29 commission shall ascertain benefit changes made in accordance with the social 30 security act and publish the appropriate deduction amounts provided by this 31 section reflecting such changes annually. Maximum retirement benefits under 32 the social security act shall mean: 33 (1) In the case of a taxpayer who files a joint return with his spouse 34 for the tax year, an amount equal to the maximum social security benefits 35 payable for the tax year to a man attaining age sixty-five (65) years in 36 the tax year who has earned the maximum earnings creditable under social 37 security for the years used in the computation of his benefits, and whose 38 spouse has no social security benefits except those payable on his record 39 of earnings. 40 (2) In the case of a taxpayer who is not married, an amount equal to max- 41 imum social security benefits payable for the tax year to a person attain- 42 ing age sixty-five (65) years in the tax year who has earned the maximum 43 earnings creditable under social security for the years used in the compu- 44 tation of his benefits. 45 (3) In the case of an unremarried widow, an amount equal to the maximum 46 social security benefits payable for the tax year to a widow attaining age 47 sixty-five (65) years in the tax year who has no social security benefits 48 except those to which she is entitled on her deceased husband's record and 49 whose husband had received no reduced retirement benefits prior to his 50 death and whose husband had earned the maximum earnings creditable under 51 social security for the years used in the computation of his benefits 52 under social security. 53 (4) Maximum retirement benefits shall, in every case, take into consider- 4 1 ation and be adjusted to reflect adjustments that would be made to such 2 amounts had they been received as social security benefits as the result 3 of the receipt of earnings in excess of earnings limitations. The terms in 4 this paragraph are those defined in the social security act. 5 (5) Taxpayers not described in paragraphs (1), (2), (3) and (4) of this 6 subsection may not deduct any amount of retirement benefits under this 7 section. 8 (c) The total deduction under this section may not exceed the total 9 amount of retirement benefits or annuities which are described in subsection 10 (a) of this section and which are included in the taxpayer's gross income in 11 the tax year. If the taxpayer or the taxpayer's spouse receives retirement 12 benefits under the federal railroad retirement act or the federal social secu- 13 rity act in the tax year, then the amount of any retirement annuities computed 14 under subsection (b) of this section shall be reduced by the amount of such 15 federal railroad retirement act and federal social security act retirement 16 benefits received by either the taxpayer or the taxpayer's spouse, and the 17 lesser of the amount so computed or the total amount of retirement benefits or 18 annuities which are described in subsection (a) of this section and which are 19 included in the taxpayer's gross income shall constitute the allowable deduc- 20 tion. Furthermore, the allowable deduction as calculated under this section 21 may be subject to additional limitations under section 63-3026A(6), Idaho 22 Code, and the rules promulgated thereunder. 23 (d) As used in this section, the word "widow" shall include a widower. 24 SECTION 4. That Section 63-3027B, Idaho Code, be, and the same is hereby 25 amended to read as follows: 26 63-3027B. WATER'S-EDGE ELECTION. (a) Notwithstanding the provisions of 27 subsections (rs) and (st) of section 63-3027, Idaho Code, a qualified tax- 28 payer, as defined in paragraph (3) of subsection (b) of this section whose 29 income is subject to the tax imposed under this chapter, may elect to deter- 30 mine its income derived from or attributable to sources within this state pur- 31 suant to a water's-edge election in accordance with the provisions of this 32 chapter, as modified by sections 63-3027B through 63-3027E, Idaho Code. A tax- 33 payer who makes a water's-edge election shall take into account the income and 34 apportionment factors of only affiliated corporations in a unitary relation- 35 ship with the taxpayer, other than corporations filing elections under section 36 936 of the Internal Revenue Code, and which either file a federal income tax 37 return under the Internal Revenue Code or are included in a federal consoli- 38 dated return. 39 (b) For purposes of this section: 40 (1) The phrase "over fiftyper centpercent (50%) of the voting stock 41 directly or indirectly owned or controlled" shall be substituted for the 42 phrase "at least eightyper centpercent (80%)" each place it appears in 43 section 1504 of the Internal Revenue Code. 44 (2) Any combined return shall include only corporations the voting stock 45 of which is more than fiftyper centpercent (50%) owned directly or indi- 46 rectly by a common owner or owners. 47 (3) A "qualified taxpayer" is a corporation which files, with the state 48 income tax return on which the water's-edge election is made, a consent to 49 the reasonable production of documents within the taxing jurisdiction. The 50 consent shall remain in effect so long as the water's-edge election is in 51 effect. 52 (4) "Water's-edge combined group" shall mean all corporations or entities 53 properly includable in the election of a taxpayer in subsection (a) of 5 1 this section. 2 (5) The only income of a foreign sales corporation to be taken into 3 account shall be the income subject to federal taxation, taking into 4 account the provisions of section 921 of the Internal Revenue Code. 5 (c) A water's-edge election may be disregarded, and the income of the 6 taxpayer determined without regard to the provisions of this section pursuant 7 to those conditions which may be required by the state tax commission under 8 subsection (b) of section 63-3027C, Idaho Code, if any corporation fails to 9 comply with: 10 (1) The domestic disclosure spreadsheet filing requirements defined in 11 section 63-3027E, Idaho Code; or 12 (2) This state's legal and procedural requirements. 13 SECTION 5. That Section 63-3030, Idaho Code, be, and the same is hereby 14 amended to read as follows: 15 63-3030. PERSONS REQUIRED TO MAKE RETURNS OF INCOME. (a) Returns with 16 respect to taxes measured by income in this chapter shall be made by the fol- 17 lowing: 18 (1) Every resident individual required to file a federal return under 19 section 6012(a)(1) of the Internal Revenue Code. 20 (2) Any nonresident individual having for the current taxable year a 21 gross income from Idaho sources in excess of two thousand five hundred 22 dollars ($2,500), or any part-year resident individual having for the cur- 23 rent taxable year a gross income from all sources while domiciled in or 24 residing in Idaho, and from Idaho sources while not domiciled in and not 25 residing in Idaho, which in total are in excess of two thousand five hun- 26 dred dollars ($2,500); 27 (3) Every corporation which is transacting business in this state, autho- 28 rized to transact business in this state or having income attributable to 29 this state, unless exempt from the tax imposed in this chapter; 30 (4) Every corporation reporting as an S corporation pursuant to Internal 31 Revenue Code sections 1361 through 1379 to the federal government, which 32 is transacting business in this state, or is authorized to transact busi- 33 ness in this state.or which has one (1) or more shareholder who is a res-34ident of this state.A corporation which is reporting as an S corporation 35 to the federal government must report to the state of Idaho as an S corpo- 36 ration for and during the same period or periods in which its election to 37 report as such a corporation is effective for federal tax purposes and 38 must identify itself as an S corporation on its income tax return filed 39 with this state; 40 (5) Every estate, the residence of which estate is in Idaho, having a 41 gross income of six hundred dollars ($600) or more for the current taxable 42 year; 43 (6) Every estate, the residence of which is in a state other than Idaho, 44 having a gross income from Idaho sources in excess of six hundred dollars 45 ($600); 46 (7) Every trust required to file a federal return under the Internal Rev- 47 enue Code, the residence of which trust is in Idaho, having gross income 48 of one hundred dollars ($100) or more for the current taxable year; 49 (8) Every trust required to file a federal return under the Internal Rev- 50 enue Code, the residence of which is in a state other than Idaho, having a 51 gross income from Idaho sources in excess of one hundred dollars ($100); 52 (9) Every partnership which transacts businessor which has one (1) or53more partner which is a resident ofin this state. Such return shall be a 6 1 supplemental information return and shall include the names and addresses 2 of the persons who would be entitled to share in the net income of the 3 partnership if distributed and the amount of the distributive share of 4 each person. Such return shall be signed by one (1) of the partners. 5 (b) Returns of fiduciaries and receivers: 6 (1) Fiduciaries and receivers shall file returns with the state tax com- 7 mission in accordance with the provisions of section 6012(b) of the Inter- 8 nal Revenue Code. 9 SECTION 6. That Section 63-3032, Idaho Code, be, and the same is hereby 10 amended to read as follows: 11 63-3032. TIME FOR FILING INCOME TAX RETURNS. (1) Except as provided in 12 section 63-3033, Idaho Code: 13 (a) Returns made on the basis of the calendar year shall be filed in the 14 office of the Idaho state tax commission on or before the15thfifteenth 15 day of April following the close of the calendar year and returns made on 16 the basis of a fiscal year shall be filed in the office of the Idaho state 17 tax commission on or before the15thfifteenth day of the fourth month 18 following the close of the fiscal year. 19 (b) In the case of a return for any period of less than one (1) year, the 20 return shall be filed on or before the date required in this section, or 21 on or before such date as required for such tax period by theiInternal 22rRevenuecCode, whichever is later. 23 (2) Returns made by farmer's cooperatives to the extent the cooperative 24 is taxable under section 63-3025B, Idaho Code, shall be due on or before Sep- 25 tember 15thfollowing the close of the calendar year or on or before the15th26 fifteenth day of the ninth month following the close of the fiscal year. The 27 provisions of section 63-3033, Idaho Code, shall not apply to returns due 28 under this subsection. 29 SECTION 7. That Section 63-3036, Idaho Code, be, and the same is hereby 30 amended to read as follows: 31 63-3036. STATE WITHHOLDING TAX FOR FARMERS. (1) Every farmer who is an 32 employer required by the provisions of the Internal Revenue Code to withhold, 33 collect, and pay income tax on wages paid by such employer to any employee 34 shall at the time of the payment of wages, salaries, bonuses or other emolu- 35 ments to an employee, deduct and retain therefrom an amount determined in 36 accordance with section 63-3035, Idaho Code, and the amount so withheld and 37 deducted shall be held by said farmer-employer in trust for the state of Idaho 38 and for the payment thereof to the state tax commission. Provided, that no tax 39 need be withheld from an employee whose wages, salaries, bonuses and other 40 emoluments total less than one thousand dollars ($1,000) for the tax year. 41 (2) The tax so withheld by a farmer-employer subject to this section 42 shall be paid to the state tax commission: 43 (a) Except as provided in paragraph (b) of this subsection, on or before 44 the last day of February of the year following the year in which such 45 deduction was made. 46 (b) In the case of an employer who is a "covered employer" paying wages 47 for "agricultural labor," as those terms are defined in the employment 48 security law in chapter 13, title 72, Idaho Code, on or before the date on 49 which contributions are due from the employer to the department of labor 50 under the employment security law. 51 (3) The farmer-employer shall deliver to the state tax commission a 7 1 return upon such form as shall be prescribed by said state tax commission 2 showing the amounts of wages, salaries, bonuses or other emoluments paid to 3 his employee, the amount deducted therefrom in accordance with this section, 4 and such other pertinent and necessary information as the state tax commission 5 may require on or before the date payments required by this section are due. 6 (4) The farmer-employer making such a deduction as provided for in this 7 section shall furnish to the employee annually, but not later than thirty (30) 8 days after the end of the calendar year, a record of the amount of the tax 9 withheld from such employee on forms to be prescribed, prepared and furnished 10 by the state tax commission and at the same time every employer shall file a 11 copy thereof with the state tax commission. The provisions of subsections (d), 12 (e), (f), (g) and (h) of section 63-3035, Idaho Code, shall be applicable to 13 the tax withheld by the farmer-employer under this section. 14 SECTION 8. An emergency existing therefor, which emergency is hereby 15 declared to exist, this act shall be in full force and effect on and after its 16 passage and approval, and retroactively to January 1, 2000.
STATEMENT OF PURPOSE RS09332C1 This bill makes technical and other minor changes to the statutes relating to the Idaho income tax and the mine license tax. These changes are: To provide automatic extension of time for filing mine license tax returns. To permit tax return preparers to supply their federal preparer identification number instead of their social security number on state income tax returns which they prepare for others. This is a change to the Consumer Protection Act. To extend the deduction for retirement benefits to part-year residents. To correct cross-references in Idaho Code Section 63-3027B. To repeal the income tax return filing requirement for trusts and estates not required to file a federal return and for partnerships and S-corporations without a resident partner or shareholder. To conform the due date of tax returns of farmer's cooperatives to the federal due date without extensions. To eliminate filing income tax withholding by farmers not required to withhold federal taxes. FISCAL NOTE Loss to Permanent Building Fund: $ 1,000 Loss to General Fund $75,000 CONTACT: Dan John / Ted Spangler Agency: State Tax Commission Phone: 334-7530 STATEMENT OF PURPOSE/ FISCAL IMPACT Bill No. H 447