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H0012...............................................by REVENUE AND TAXATION
INCOME TAX - Amends existing law to make various technical corrections to
the income tax statutes.
01/16 House intro - 1st rdg - to printing
01/17 Rpt prt - to Rev/Tax
01/18 Rpt out - rec d/p - to 2nd rdg
01/19 2nd rdg - to 3rd rdg
01/23 3rd rdg - PASSED - 66-0-4
AYES -- Anderson, Andrus, Barrett, Bayer, Bedke, Bell, Bilbao, Black,
Block, Bock, Boe, Brackett, Bradford, Chadderdon, Chavez, Chew,
Collins, Crane, Durst, Edmunson, Eskridge, Hagedorn, Hart, Harwood,
Henbest(Wallace), Henderson, Jaquet, Killen, King, Kren, Labrador,
Lake, LeFavour, Loertscher, Luker, Marriott, Mathews, McGeachin,
Mortimer, Moyle, Nielsen, Nonini, Pasley-Stuart, Patrick, Pence,
Raybould, Ring, Ringo, Roberts, Ruchti, Rusche, Sayler, Schaefer,
Shepherd(2), Shepherd(8), Shirley, Shively, Smith(30), Snodgrass,
Stevenson, Thayn, Trail, Vander Woude, Wills, Wood(27), Wood(35)
NAYS -- None
Absent and excused -- Bolz, Clark, Smith(24), Mr. Speaker
Floor Sponsor - Barrett
Title apvd - to Senate
01/24 Senate intro - 1st rdg - to Loc Gov
02/02 Rpt out - rec d/p - to 2nd rdg
02/05 2nd rdg - to 3rd rdg
02/06 3rd rdg - PASSED - 35-0-0
AYES -- Andreason, Bair, Bastian, Bilyeu, Broadsword, Burkett,
Cameron, Coiner, Corder, Darrington, Davis, Fulcher, Gannon, Geddes,
Goedde, Hammond, Heinrich, Hill, Jorgenson, Kelly, Keough, Langhorst,
Little, Lodge, Malepeai, McGee, McKague, McKenzie, Pearce,
Richardson, Schroeder, Siddoway, Stegner, Stennett, Werk
NAYS -- None
Absent and excused -- None
Floor Sponsor - Langhorst
Title apvd - to House
02/07 To enrol
02/08 Rpt enrol - Sp signed
02/09 Pres signed
02/12 To Governor
02/14 Governor signed
Session Law Chapter 10
Effective: 07/01/07
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-ninth Legislature First Regular Session - 2007
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 12
BY REVENUE AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO THE INCOME TAX; AMENDING SECTION 63-3025A, IDAHO CODE, TO PROVIDE
3 A CORRECT REFERENCE TO THE IDAHO NATIONAL LABORATORY; AMENDING SECTION
4 63-3027, IDAHO CODE, TO PROVIDE A CORRECT REFERENCE TO THE IDAHO NATIONAL
5 LABORATORY AND TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION 63-3067A,
6 IDAHO CODE, TO DELETE THE REQUIREMENT THAT DONATIONS TO THE AMERICAN RED
7 CROSS MADE BY CHECKOFF MUST BE TEN DOLLARS AND TO MAKE TECHNICAL CORREC-
8 TIONS; AMENDING SECTION 63-3072, IDAHO CODE, TO CLARIFY THAT THE TIME FOR
9 CLAIMING A REFUND OR CREDIT OF INCOME TAX ATTRIBUTABLE TO CAPITAL LOSS
10 CARRYBACKS IS THE FIFTEENTH DAY OF THE FORTIETH MONTH FOLLOWING THE END OF
11 THE TAXABLE YEAR OF THE CAPITAL LOSS WHICH RESULTS IN THE CARRYBACK;
12 AMENDING SECTION 63-4407, IDAHO CODE, TO REVISE RECAPTURE PROVISIONS IN
13 THE SMALL EMPLOYER INCENTIVE ACT; AMENDING SECTION 63-3087, IDAHO CODE, TO
14 PROVIDE A CORRECT CODE REFERENCE; AMENDING SECTION 63-2516, IDAHO CODE, TO
15 DELETE A CODE REFERENCE; AMENDING SECTION 63-2563, IDAHO CODE, TO PROVIDE
16 A CORRECT CODE REFERENCE; AMENDING SECTION 23-1050A, IDAHO CODE, TO PRO-
17 VIDE A CORRECT CODE REFERENCE; AND AMENDING SECTION 23-1322A, IDAHO CODE,
18 TO PROVIDE A CORRECT CODE REFERENCE AND TO MAKE A TECHNICAL CORRECTION.
19 Be It Enacted by the Legislature of the State of Idaho:
20 SECTION 1. That Section 63-3025A, Idaho Code, be, and the same is hereby
21 amended to read as follows:
22 63-3025A. FRANCHISE TAX. For taxable years commencing on and after Janu-
23 ary 1, 2001, a franchise tax shall be imposed upon any corporation for the
24 privilege of exercising its corporate franchise within the state during such
25 taxable year including, but not limited to, corporations engaged in business
26 in Idaho for the exclusive purpose of performing contracts with the United
27 States department of energy at the Idaho national engineering and environmen-
28 tal laboratory or any successor organization, which tax shall be measured by
29 income which is attributable to this state under the provisions of this chap-
30 ter and which tax shall be at the rate provided in section 63-3025, Idaho
31 Code; provided, however, that the tax shall not be less than twenty dollars
32 ($20.00); provided further that the twenty dollar ($20.00) minimum payment
33 shall not be collected from nonproductive mining corporations; but the twenty
34 dollar ($20.00) minimum tax shall apply to corporations qualified to file
35 returns and actually filing returns under the provisions of subchapter "S" of
36 the Internal Revenue Code.
37 SECTION 2. That Section 63-3027, Idaho Code, be, and the same is hereby
38 amended to read as follows:
39 63-3027. COMPUTING IDAHO TAXABLE INCOME OF MULTISTATE OR UNITARY CORPORA-
40 TIONS. The Idaho taxable income of any multistate or unitary corporation
41 transacting business both within and without this state shall be computed in
2
1 accordance with the rules set forth in this section:
2 (a) As used in this section, unless the context otherwise requires:
3 (1) "Business income" means income arising from transactions and activity
4 in the regular course of the taxpayer's trade or business and includes
5 income from the acquisition, management, or disposition of tangible and
6 intangible property when such acquisition, management, or disposition con-
7 stitutes integral or necessary parts of the taxpayer's trade or business
8 operations. Gains or losses and dividend and interest income from stock
9 and securities of any foreign or domestic corporation shall be presumed to
10 be income from intangible property, the acquisition, management, or dispo-
11 sition of which constitutes an integral part of the taxpayer's trade or
12 business; such presumption may only be overcome by clear and convincing
13 evidence to the contrary.
14 (2) "Commercial domicile" means the principal place from which the trade
15 or business of the taxpayer is directed or managed.
16 (3) "Compensation" means wages, salaries, commissions and any other form
17 of remuneration paid to employees for personal services.
18 (4) "Nonbusiness income" means all income other than business income.
19 (5) "Sales" means all gross receipts of the taxpayer not allocated under
20 subsections (d) through (h) of this section.
21 (6) "State" means any state of the United States, the District of Colum-
22 bia, the Commonwealth of Puerto Rico, any territory or possession of the
23 United States, and any foreign country or political subdivision thereof.
24 (b) Any taxpayer having income from business activity which is taxable
25 both within and without this state shall allocate and apportion such net
26 income as provided in this section.
27 (c) For purposes of allocation and apportionment of income under this
28 section, a taxpayer is taxable in another state if:
29 (1) In that state he is subject to a net income tax, a franchise tax mea-
30 sured by net income, a franchise tax for the privilege of doing business,
31 or a corporate stock tax; or
32 (2) That state has jurisdiction to subject the taxpayer to a net income
33 tax regardless of whether, in fact, the state does or does not.
34 (d) Rents and royalties from real or tangible personal property, capital
35 gains interest, dividends, or patent or copyright royalties, to the extent
36 that they constitute nonbusiness income, shall be allocated as provided in
37 subsections (e) through (h) of this section. Allocable nonbusiness income
38 shall be limited to the total nonbusiness income received which is in excess
39 of any related expenses which have been allowed as a deduction during the tax-
40 able year. In the case of allocable nonbusiness interest or dividends, related
41 expenses include interest on indebtedness incurred or continued to purchase or
42 carry assets on which the interest or dividends are nonbusiness income.
43 (e) (1) Net rents and royalties from real property located in this state
44 are allocable to this state.
45 (2) Net rents and royalties from tangible personal property are allocable
46 to this state:
47 (i) iIf and to the extent that the property is utilized in this
48 state, or
49 (ii) iIn their entirety if the taxpayer's commercial domicile is in
50 this state and the taxpayer is not organized under the laws of or
51 taxable in the state in which the property is utilized.
52 (3) The extent of utilization of tangible personal property in a state is
53 determined by multiplying the rents and royalties by a fraction, the
54 numerator of which is the number of days of physical location of the prop-
55 erty in the state during the rental or royalty period in the taxable year
3
1 and the denominator of which is the number of days of physical location of
2 the property everywhere during all rental or royalty periods in the tax-
3 able year. If the physical location of the property during the rental or
4 royalty period is unknown or unascertainable by the taxpayer, tangible
5 personal property is utilized in the state in which the property was
6 located at the time the rental or royalty payer obtained possession.
7 (f) (1) Capital gains and losses from sales of real property located in
8 this state are allocable to this state.
9 (2) Capital gains and losses from sales of tangible personal property are
10 allocable to this state if:
11 (i) tThe property had a situs in this state at the time of the sale,
12 or
13 (ii) tThe taxpayer's commercial domicile is in this state and the
14 taxpayer is not taxable in the state in which the property had a
15 situs.
16 (3) Capital gains and losses from sales of intangible personal property
17 are allocable to this state if the taxpayer's commercial domicile is in
18 this state, unless such gains and losses constitute business income as
19 defined in this section.
20 (g) Interest and dividends are allocable to this state if the taxpayer's
21 commercial domicile is in this state unless such interest or dividends consti-
22 tute business income as defined in this section.
23 (h) (1) Patent and copyright royalties are allocable to this state:
24 (i) iIf and to the extent that the patent or copyright is utilized
25 by the payer in this state, or
26 (ii) iIf and to the extent that the patent or copyright is utilized
27 by the payer in a state in which the taxpayer is not taxable and the
28 taxpayer's commercial domicile is in this state.
29 (2) A patent is utilized in a state to the extent that it is employed in
30 production, fabrication, manufacturing, or other processing in the state
31 or to the extent that a patent product is produced in the state. If the
32 basis of receipts from patent royalties does not permit allocation to
33 states or if the accounting procedures do not reflect states of utiliza-
34 tion, the patent is utilized in the state in which the taxpayer's commer-
35 cial domicile is located.
36 (3) A copyright is utilized in a state to the extent that printing or
37 other publication originates in the state. If the basis of receipts from
38 copyright royalties does not permit allocation to states or if the
39 accounting procedures do not reflect states of utilization, the copyright
40 is utilized in the state in which the taxpayer's commercial domicile is
41 located.
42 (i) (1) Notwithstanding the election allowed in Aarticle III.1 of the
43 multistate tax compact enacted as section 63-3701, Idaho Code, all busi-
44 ness income shall be apportioned to this state under subsection (j) of
45 this section by multiplying the income by a fraction, the numerator of
46 which is the property factor plus the payroll factor plus two (2) times
47 the sales factor, and the denominator of which is four (4), except as pro-
48 vided in paragraph (2) of this subsection.
49 (2) If a corporation, or a parent corporation of a combined group filing
50 a combined report under sections 63-3027 and 63-3701, Idaho Code, is an
51 electrical corporation as defined in section 61-119, Idaho Code, or is a
52 telephone corporation as defined in section 62-603, Idaho Code, all busi-
53 ness income of the corporation shall be apportioned to this state by mul-
54 tiplying the income by a fraction, the numerator of which is the property
55 factor plus the payroll factor plus the sales factor, and the denominator
4
1 of which is three (3).
2 (j) (1) In the case of a corporation or group of corporations combined
3 under subsection (t) of this section, Idaho taxable income or loss of the
4 corporation or combined group shall be determined as follows:
5 (i) fFrom the income or loss of the corporation or combined group
6 of corporations, subtract any nonbusiness income, and add any
7 nonbusiness loss, included in the total,
8 (ii) mMultiply the amounts determined under paragraph (1)(i) of this
9 subsection by the Idaho apportionment percentage defined in subsec-
10 tion (i) of this section, taking into account, where applicable, the
11 property, payroll and sales of all corporations, wherever incorpo-
12 rated, which are included in the combined group. The resulting prod-
13 uct shall be the amount of business income or loss apportioned to
14 Idaho.
15 (2) To the amount determined as apportioned business income or loss under
16 paragraph (1)(ii) of this subsection, add nonbusiness income allocable
17 entirely to Idaho under the provisions of this section or subtract
18 nonbusiness loss allocable entirely to Idaho under this section. The
19 resulting sum is the Idaho taxable income or loss of the corporation.
20 (3) In the case of a corporation not subject to subsection (t) of this
21 section, the income or loss referred to in paragraph (1)(i) of this sub-
22 section, shall be the taxable income of the corporation after making
23 appropriate adjustments under the provisions of section 63-3022, Idaho
24 Code.
25 (k) The property factor is a fraction, the numerator of which is the
26 average value of the taxpayer's real and tangible personal property owned or
27 rented and used in this state during the tax period and the denominator of
28 which is the average value of all the taxpayer's real and tangible personal
29 property owned or rented and used during the tax period.
30 (l) Property owned by the taxpayer is valued at its original cost. Prop-
31 erty rented by the taxpayer is valued at eight (8) times the net annual rental
32 rate. Net annual rental rate is the annual rental rate paid by the taxpayer
33 less any annual rental rate received by the taxpayer from subrentals.
34 (m) The average value of property shall be determined by averaging the
35 values at the beginning and ending of the tax period, but the state tax com-
36 mission may require the averaging of monthly values during the tax period if
37 reasonably required to reflect properly the average value of the taxpayer's
38 property.
39 (n) The payroll factor is a fraction, the numerator of which is the total
40 amount paid in this state during the tax period by the taxpayer for compensa-
41 tion, and the denominator of which is the total compensation paid everywhere
42 during the tax period.
43 (o) Compensation is paid in this state if:
44 (1) The individual's service is performed entirely within the state; or
45 (2) The individual's service is performed both within and without the
46 state, but the service performed without the state is incidental to the
47 individual's service within the state; or
48 (3) Some of the service is performed in the state and:
49 (i) tThe base of operations or, if there is no base of operations,
50 the place from which the service is directed or controlled is in the
51 state, or
52 (ii) tThe base of operations or the place from which the service is
53 directed or controlled is not in any state in which some part of the
54 service is performed, but the individual's residence is in this
55 state.
5
1 (p) The sales factor is a fraction, the numerator of which is the total
2 sales of the taxpayer in this state during the tax period, and the denominator
3 of which is the total sales of the taxpayer everywhere during the tax period.
4 (q) Sales of tangible personal property are in this state if:
5 (1) The property is delivered or shipped to a purchaser, other than the
6 United States government, within this state regardless of the f.o.b. point
7 or other conditions of the sale, or
8 (2) The property is shipped from an office, store, warehouse, factory, or
9 other place of storage in this state and:
10 (i) tThe purchaser is the United States government, or
11 (ii) tThe taxpayer is not taxable in the state of the purchaser.
12 (r) Sales, other than sales of tangible property, are in this state, if:
13 (1) The income-producing activity is performed in this state; or
14 (2) The income-producing activity is performed both in and outside this
15 state and a greater proportion of the income-producing activity is per-
16 formed in this state than in any other state, based on costs of perfor-
17 mance.
18 (s) If the allocation and apportionment provisions of this section do not
19 fairly represent the extent of the taxpayer's business activity in this state,
20 the taxpayer may petition for or the state tax commission may require, in
21 respect to all or any part of the taxpayer's business activity, if reasonable:
22 (1) Separate accounting, provided that only that portion of general
23 expenses clearly identifiable with Idaho business operations shall be
24 allowed as a deduction;
25 (2) The exclusion of any one (1) or more of the factors;
26 (3) The inclusion of one (1) or more additional factors which will fairly
27 represent the taxpayer's business activity in this state; or
28 (4) The employment of any other method to effectuate an equitable alloca-
29 tion and apportionment of the taxpayer's income.
30 (t) For purposes of this section and sections 63-3027B through 63-3027E,
31 Idaho Code, the income of two (2) or more corporations, wherever incorporated,
32 the voting stock of which is more than fifty percent (50%) owned directly or
33 indirectly by a common owner or owners, when necessary to accurately reflect
34 income, shall be allocated or apportioned as if the group of corporations were
35 a single corporation, in which event:
36 (1) The Idaho taxable income of any corporation subject to taxation in
37 this state shall be determined by use of a combined report which includes
38 the income, determined under subparagraph (2) of this subsection, of all
39 corporations which are members of a unitary business, allocated and appor-
40 tioned using apportionment factors for all corporations included in the
41 combined report and methods set out in this section. The use of a combined
42 report does not disregard the separate corporate identities of the members
43 of the unitary group. Each corporation which is transacting business in
44 this state is responsible for its apportioned share of the combined busi-
45 ness income plus its nonbusiness income or loss allocated to Idaho, minus
46 its net operating loss carryover or carryback.
47 (2) The income of a corporation to be included in a combined report shall
48 be determined as follows:
49 (i) fFor a corporation incorporated in the United States or
50 included in a consolidated federal corporation income tax return, the
51 income to be included in the combined report shall be the taxable
52 income for the corporation after making appropriate adjustments under
53 the provisions of section 63-3022, Idaho Code;
54 (ii) fFor a corporation incorporated outside the United States, but
55 not included in subsection (t)(2)(i) of this section, the income to
6
1 be included in the combined report shall be the net income before
2 income taxes of such corporation stated on the profit and loss state-
3 ments of such corporation which are included within the consolidated
4 profit and loss statement prepared for the group of related corpora-
5 tions of which the corporation is a member, which statement is pre-
6 pared for filing with the United States securities and exchange com-
7 mission. If the group of related companies is not required to file
8 such profit and loss statement with the United States securities and
9 exchange commission, the profit and loss statement prepared for
10 reporting to shareholders and subject to review by an independent
11 auditor may be used to obtain net income before income taxes. In the
12 alternative, and subject to reasonable substantiation and consistent
13 application by the group of related companies, adjustments may be
14 made to the profit and loss statements of the corporation incorpo-
15 rated outside the United States, if necessary, to conform such state-
16 ments to tax accounting standards as required by the Internal Revenue
17 Code as if such corporation were incorporated in the United States
18 and required to file a federal income tax return, subject to appro-
19 priate adjustments under the provisions of section 63-3022, Idaho
20 Code; and
21 (iii) iIf the income computation for a group under paragraphs (i) and
22 (ii) of this subsection results in a loss, such loss shall be taken
23 into account in other years, subject to the provisions of subsections
24 (b) and (c) of section 63-3022, Idaho Code.
25 (u) If compensation is paid in the form of a reasonable cash fee for the
26 performance of management services directly for the United States government
27 at the Idaho national engineering laboratory or any successor organization,
28 separate accounting for that part of the business activity without regard to
29 other activity of the taxpayer in the state of Idaho or elsewhere shall be
30 required; provided that only that portion of general expenses clearly identi-
31 fiable with Idaho business operations of that activity shall be allowed as a
32 deduction.
33 SECTION 3. That Section 63-3067A, Idaho Code, be, and the same is hereby
34 amended to read as follows:
35 63-3067A. DESIGNATION BY INDIVIDUALS -- TRUST ACCOUNTS. (a) Every indi-
36 vidual who:
37 (i) Has a refund due and payable for overpayment of taxes under this act
38 may designate all or any portion thereof to be deposited in a trust
39 account specified in subsection (c) below of this section; or
40 (ii) Has an income tax liability may, in addition to his tax obligation,
41 include a donation to be deposited in a trust account specified in subsec-
42 tion (c) of this section.
43 (b) A designation under subsection (a) of this section may be made in any
44 taxable year in such manner and form as prescribed by the state tax commis-
45 sion. The manner and form so prescribed shall be a conspicuous portion of the
46 principal form provided for the purpose of individual taxation.
47 (c) The trust accounts authorized to receive moneys designated under sub-
48 section (a) of this section are:
49 (i) The fish and game set-aside account created by section 36-111, Idaho
50 Code;
51 (ii) The Idaho ag in the classroom account created by section 57-815,
52 Idaho Code;
53 (iii) The drug enforcement donation account created by section 57-816,
7
1 Idaho Code;
2 (iv) The children's trust fund created by section 39-6007, Idaho Code;
3 (v) The United States olympic account created by section 57-817, Idaho
4 Code, but no donation shall exceed five dollars ($5.00);
5 (vi) The Idaho guard and reserve family support fund created by section
6 57-820, Idaho Code; and
7 (vii) The American red cross of greater Idaho fund created in section
8 57-821, Idaho Code, which donation shall be ten dollars ($10.00) if made.
9 (d) Prior to the distribution of funds into any of the trust accounts
10 specified in subsection (c) of this section from the refund account, the
11 state tax commission shall retain funds for the commission's costs for col-
12 lecting and administering the moneys in the accounts as follows: three thou-
13 sand dollars ($3,000) from each account for start-up costs during the first
14 year of collections, and three thousand dollars ($3,000) or twenty percent
15 (20%) of the moneys remitted to each account during the fiscal year, whichever
16 is less, from each account during each fiscal year thereafter, which amounts
17 are hereby appropriated to the tax commission.
18 SECTION 4. That Section 63-3072, Idaho Code, be, and the same is hereby
19 amended to read as follows:
20 63-3072. CREDITS AND REFUNDS. (a) Subject to the provisions of subsec-
21 tions (b), (c) and (h) of this section, where there has been an overpayment of
22 the tax imposed by the provisions of this chapter, the amount of such overpay-
23 ment shall be credited against any tax administered by the state tax commis-
24 sion which tax is then due from the taxpayer, and any balance of such excess
25 shall be refunded to the taxpayer.
26 (b) Except in regard to amounts withheld as provided in section 63-3035,
27 63-3035A or 63-3036, Idaho Code, or amounts paid as estimated payments under
28 section 63-3036A, Idaho Code, a claim for credit or refund of tax, penalties,
29 or interest paid shall be made within the later of three (3) years of the due
30 date of the return, without regard to extensions, or three (3) years from the
31 date the return was filed. However, with regard to remittances received with
32 an extension of time to file, or a tentative return, a claim for credit or
33 refund of such remittances shall be made within three (3) years from the due
34 date of the return without regard to extensions.
35 (c) With regard to amounts withheld as provided in section 63-3035,
36 63-3035A or 63-3036, Idaho Code, or amounts paid as estimated payments under
37 section 63-3036A, Idaho Code, a claim for credit or refund shall be made
38 within three (3) years from the due date of the return, without regard to
39 extensions, for the taxable year in respect to which the tax was withheld or
40 paid.
41 (d) Notwithstanding any other provisions of this section, when Idaho tax-
42 able income and/or tax credits for any taxable year have been adjusted as a
43 result of a final federal determination, the period of limitations for claim-
44 ing a refund or credit of tax, penalties, or interest shall be reopened and
45 shall not expire until the later of one (1) year from the date of delivery of
46 the final federal determination to the taxpayer by the internal revenue ser-
47 vice, three (3) years from the due date of the return, without regard to
48 extensions, or three (3) years from the date the return was filed. For pur-
49 poses of this subsection, the term "final federal determination" shall mean
50 the final resolution of all issues which were adjusted by the internal revenue
51 service. When the final federal determination is submitted, the taxpayer shall
52 also submit copies of all schedules and written explanations provided by the
53 internal revenue service. Upon the expiration of the period of limitations as
8
1 provided in subsections (b) and (h) of this section, only those specific items
2 of income, deductions, gains, losses or credits which were adjusted in the
3 final federal determination shall be subject to adjustment for purposes of
4 recomputing Idaho income, deductions, gains, losses, credits, and the effect
5 of such adjustments on Idaho allocations and apportionments.
6 (e) If a claim for credit or refund relates to an overpayment attribut-
7 able to a net operating loss carryback or a capital loss carryback, in lieu of
8 the period of limitations prescribed in subsection (b) of this section, the
9 period shall be that period which ends with the expiration of the fifteenth
10 day of the fortieth month following the end of the taxable year of the net
11 operating loss or capital loss which results in such carryback.
12 (f) If an adjustment, which was made within the period of limitations as
13 provided in this section, affects the amount of tax credit, net operating
14 loss, or capital loss, claimed in a taxable year other than the tax year in
15 which the adjustment is made, then adjustments to the credit, net operating
16 loss, or capital loss, claimed in such other tax year may be made and a claim
17 for credit or refund of tax, penalties or interest may be made even though
18 such claim would otherwise be barred under the provisions of this section.
19 (g) In the case of a duplicate return filed under section 63-217(1)(b),
20 Idaho Code, the limitations under this section shall be the later of one (1)
21 year from the filing of the duplicate return or the date otherwise applicable
22 under this section.
23 (h) Prior to the expiration of the time prescribed in this section for
24 credit or refund of any tax imposed by the provisions of this chapter, both
25 the state tax commission or its delegate or deputy and the taxpayer may con-
26 sent in writing to extend such period of time. The period so agreed upon may
27 be extended by subsequent agreements in writing made before the expiration of
28 the period previously agreed upon. When a pass-through entity extends the
29 period of limitations in accordance with the provisions of this subsection the
30 period of limitations for the other taxpayers is automatically extended for
31 the same period for the purpose of claiming a credit or refund of tax, penal-
32 ties or interest by the other taxpayers reflecting the pass-through entity
33 adjustments.
34 (i) The expiration of the period of limitations as provided in this sec-
35 tion shall be suspended for the time period between the issuance by the state
36 tax commission of a notice under either section 63-3045 or 63-3065, Idaho
37 Code, and the final resolution of any proceeding resulting from the notice.
38 (j) Appeal of a state tax commission decision denying in whole or in part
39 a claim for credit or refund shall be made in accordance with and within the
40 time limits prescribed in section 63-3049, Idaho Code.
41 (k) For purposes of this section, "return" includes a notice of defi-
42 ciency determination issued by the state tax commission when no return was
43 filed by the taxpayer. Such a return is deemed filed on the date the taxes
44 determined by the state tax commission are assessed.
45 SECTION 5. That Section 63-4407, Idaho Code, be, and the same is hereby
46 amended to read as follows:
47 63-4407. RECAPTURE. (1) In the event that any person to whom a tax credit
48 allowed by section 63-4403, 63-4404 or 63-4405, Idaho Code, fails to meet the
49 tax incentive criteria, the full amount of the credit shall be subject to
50 recapture by the commission.
51 (2) If, during any taxable year, an investment in new plant is disposed
52 of, or otherwise ceases to qualify with respect to the taxpayer, prior to the
53 close of the recapture period, recapture of the credit allowed by sections
9
1 63-4403 and 63-4404, Idaho Code, shall be determined for such taxable year in
2 the same proportion and subject to the same provisions as an amount of credit
3 required to be recaptured under section 63-3029B, Idaho Code.
4 (3) In the event that the employment required level for which the credit
5 allowed in section 63-4402(2)(j) 63-4405, Idaho Code, is not maintained for
6 the entire recapture period, recapture of the credit allowed in section
7 63-4405, Idaho Code, shall be determined for such taxable year in the same
8 proportion as an amount of credit required to be recaptured under section
9 63-3029B, Idaho Code. This subsection shall not be construed to require that
10 the required level of employment must be met by the same individual employees.
11 (4) Any amount subject to recapture is a deficiency in tax for the amount
12 of the credit in the taxable year in which the disqualification first occurs
13 and may be enforced and collected in the manner provided by the Idaho income
14 tax act, provided however, that in lieu of the provisions of section
15 63-3068(a), Idaho Code, the period of time within which the commission may
16 issue a notice under section 63-3045, Idaho Code, in regard to an amount sub-
17 ject to recapture shall be the later of five (5) years after the end of the
18 taxable year in which the project period ends or three (3) years after the end
19 of the taxable year in which any amounts carried forward under section
20 63-4406, Idaho Code, expire.
21 SECTION 6. That Section 63-3087, Idaho Code, be, and the same is hereby
22 amended to read as follows:
23 63-3087. COLLECTION AND ENFORCEMENT. The collection and enforcement pro-
24 cedures provided by the Idaho Income Tax Act, sections 63-3038 through
25 63-3040, 63-3042 through 63-3065A, 63-3070, 63-3071, 63-3075 and 63-3078,
26 Idaho Code, shall apply and be available to the state tax commission for
27 enforcement of the provisions of this act and collection of any amounts due
28 under this act, and said sections shall, for this purpose, be considered part
29 of this act and wherever liens or any other proceedings are defined as income
30 tax liens or proceedings, they shall, when applied in enforcement or collec-
31 tion under this act, be described as permanent building fund tax liens and
32 proceedings.
33 SECTION 7. That Section 63-2516, Idaho Code, be, and the same is hereby
34 amended to read as follows:
35 63-2516. COLLECTION AND ENFORCEMENT -- ACTIONS AGAINST STATE OF IDAHO. In
36 addition to the enforcement and penalty provisions in this act otherwise pro-
37 vided, the deficiency in tax and notice of deficiency as well as the collec-
38 tion and enforcement procedures provided by the Idaho income tax act, sections
39 63-3030A, 63-3038, 63-3039, 63-3040, 63-3042, 63-3043, 63-3044, 63-3045,
40 63-3045A, 63-3046, 63-3047, 63-3048 through 63-3065, 63-3068, 63-3070,
41 63-3071, 63-3073, 63-3075 and 63-3078, Idaho Code, shall apply and be avail-
42 able to the state tax commission for enforcement of the provisions of this act
43 and the assessment and collection of any amounts due, and said sections shall
44 for this purpose be considered a part of this act and wherever liens or any
45 other proceedings are defined as income tax liens or proceedings they shall,
46 when applied in enforcement or collection under this act, be described as cig-
47 arette tax liens and proceedings.
48 The state tax commission may be made a party defendant in an action at law
49 or in equity by any person aggrieved by the unlawful seizure or sale of his
50 property, or in any suit for refund or to recover an overpayment, but only the
51 state of Idaho shall be responsible for any final judgment secured against the
10
1 state tax commission, and said judgment shall be paid as provided for payment
2 of cigarette tax refunds.
3 SECTION 8. That Section 63-2563, Idaho Code, be, and the same is hereby
4 amended to read as follows:
5 63-2563. COLLECTION AND ENFORCEMENT. The collection and enforcement pro-
6 cedures provided by the Idaho income tax act, sections 63-3038, 63-3039,
7 63-3042 through 63-3045A, 63-3047 through 63-3065A, 63-3068, 63-3070, 63-3071,
8 63-3075 and 63-3078, Idaho Code, shall apply and be available to the commis-
9 sion for the enforcement of this act and collection of any amounts due under
10 this act and said sections shall, for this purpose, be considered part of this
11 act and wherever liens or any other proceedings are defined as income tax
12 liens or proceedings, they shall, when applied in enforcement or collection
13 under this act, be described as tobacco products tax liens and proceedings.
14 The state tax commission may be made a party defendant in an action at law
15 or in equity by any person aggrieved by the unlawful seizure or sale of his
16 property, or in any suit for refund or to recover an overpayment, but only the
17 state of Idaho shall be responsible for any final judgment secured against the
18 state tax commission, and said judgment shall be paid or satisfied out of the
19 tobacco products tax refund fund.
20 SECTION 9. That Section 23-1050A, Idaho Code, be, and the same is hereby
21 amended to read as follows:
22 23-1050A. COLLECTION AND ENFORCEMENT. The collection and enforcement pro-
23 cedures provided by the Idaho income tax act, sections 63-3042 through
24 63-3065A, inclusive, and sections 63-3068 and 63-3070 63-3075, Idaho Code,
25 shall apply and be available to the state tax commission for enforcement and
26 collection of the tax imposed by this chapter, and said sections shall, for
27 this purpose, be considered part of this act. Any reference to taxable year in
28 the income tax act shall be, for the purposes of this act, considered a tax-
29 able period.
30 SECTION 10. That Section 23-1322A, Idaho Code, be, and the same is hereby
31 amended to read as follows:
32 23-1322A. COLLECTION AND ENFORCEMENT. The collection and enforcement pro-
33 cedures provided by the Idaho income tax act, sections 63-3042 through
34 63-3065A, inclusive, and sections 63-3068 and 63-3070 63-3075, Idaho Code,
35 shall apply and be available to the state tax commission for enforcement and
36 collection of the tax imposed by this chapter, and said sections shall, for
37 this purpose, be considered part of this act. Any reference to taxable year in
38 the income tax act shall, for the purposes of this act, be considered as a
39 taxable period.
STATEMENT OF PURPOSE
RS 16525C1
This bill makes several updates and technical corrections to the
Idaho Income Tax Act.
Sections 1 and 2 correct references to the Idaho engineering
laboratory.
Section 3 strikes the requirement that donations to the American
Red Cross by “check-off” on the Idaho income tax return must
equal ten dollars.
Section 4 clarifies that time for claiming refund or credit of
income tax attributable to capital loss carrybacks is the same
as that for refunds from carrybacks of net operating losses.
Section 5 corrects the level of employment required for
recapture of the new jobs credit under the Small Employer
Incentive Act.
Sections 6 through 10 correct cross references to reflect the
previous repeal of section 63-3070, Idaho Code, which was a
section of the Income Tax Act incorporated into other statutes
imposing state level taxes.
FISCAL NOTE
None.
CONTACT
Name: Dan John/Ted Spangler
Agency: State Tax Commission
Phone: (208) 334-7500
STATEMENT OF PURPOSE/FISCAL NOTE H 12