First Substitute H.B. 190

Representative Gordon E. Snow proposes the following substitute bill:

1 INDIVIDUAL INCOME TAX - ELECTRONIC
2 FILING REQUIREMENTS
3 2005 GENERAL SESSION
4 STATE OF UTAH
5 Sponsor: Stephen D. Clark
6
7 LONG TITLE
8 General Description:
9 This bill modifies the Individual Income Tax Act relating to filing returns.
10 Highlighted Provisions:
11 This bill:
12 . defines terms;
13 . requires an income tax return preparer to file returns required to be filed under the
14 Individual Income Tax Act using scan technology or by electronic means under
15 certain circumstances;
16 . provides exceptions to the requirement to file returns using scan technology or by
17 electronic means; and
18 . grants rulemaking authority to the State Tax Commission.
19 Monies Appropriated in this Bill:
20 None
21 Other Special Clauses:
22 This bill has retrospective operation to January 1, 2005.
23 Utah Code Sections Affected:
24 ENACTS:
25 59-10-514.1, Utah Code Annotated 1953

26
27 Be it enacted by the Legislature of the state of Utah:
28 Section 1. Section 59-10-514.1 is enacted to read:
29 59-10-514.1. Definitions -- Requirement to file returns using scan technology or by
30 electronic means -- Exceptions -- Waiver.
31 (1) As used in this section:
32 (a) (i) "electronic" means using a technology other than scan technology; and
33 (ii) in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
34 commission may make rules defining "technology";
35 (b) (i) except as provided in Subsection (1)(b)(ii), "income tax return preparer" means
36 an individual that prepares for compensation a return required to be filed by this chapter;
37 (ii) notwithstanding Subsection (1)(b)(i), "income tax return preparer" does not include
38 an individual who:
39 (A) performs only one or more of the following relating to a return required to be filed
40 by this chapter:
41 (I) types the return;
42 (II) reproduces the return; or
43 (III) performs an action similar to Subsection (1)(b)(ii)(A)(I) or (II) as determined by
44 the commission by rule, made in accordance with Title 63, Chapter 46a, Utah Administrative
45 Rulemaking Act; or
46 (B) prepares a return required to be filed by this chapter:
47 (I) of the individual's employer or an officer or employee of the employer if the
48 individual is regularly and continuously employed by that employer;
49 (II) of any person if that individual is a fiduciary for that person; or
50 (III) for a taxpayer in response to a tax order issued to that taxpayer;
51 (c) "prepare" means to prepare a substantial portion or more of a return required to be
52 filed by this chapter;
53 (d) (i) except as provided in Subsection (1)(d)(ii), "qualifying return" means a return
54 required to be filed by this chapter for any taxable year that begins on or after the January 1
55 described in Subsection (2)(c)(i); and
56 (ii) notwithstanding Subsection (1)(d)(i), "qualifying return" does not include:

57 (A) an amended return; or
58 (B) (I) a return filed for any taxable year that begins before the first day of the current
59 taxable year; and
60 (II) in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act,
61 the commission may make rules defining "current taxable year"; and
62 (e) (i) "scan technology" means technology that:
63 (A) allows a return to be scanned; and
64 (B) is approved by the commission; and
65 (ii) in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
66 commission may by rule specify what types of technology constitute scan technology.
67 (2) (a) Subject to Subsections (2)(b) and (c) and except as provided in Subsection (3),
68 an income tax return preparer shall file all qualifying returns using scan technology or by
69 electronic means if the income tax return preparer prepares in any calendar year beginning on
70 or after January 1, 2005, a total of 101 or more returns required to be filed by this chapter.
71 (b) (i) For purposes of Subsection (2)(a), if two or more income tax return preparers are
72 affiliated with the same establishment, the total number of returns required to be filed by this
73 chapter that are prepared in a calendar year beginning on or after January 1, 2005, by all of the
74 income tax return preparers that are affiliated with that establishment shall be included in
75 determining whether an income tax return preparer prepares in a calendar year beginning on or
76 after January 1, 2005, a total of 101 or more returns required to be filed by this chapter.
77 (ii) For purposes of Subsection (2)(b)(i), in accordance with Title 63, Chapter 46a,
78 Utah Administrative Rulemaking Act, the commission may by rule determine the
79 circumstances under which two or more income tax return preparers are affiliated with the
80 same establishment.
81 (c) If an income tax return preparer is required by this Subsection (2) to file all
82 qualifying returns using scan technology or by electronic means, the income tax return preparer
83 shall file those qualifying returns using scan technology or by electronic means:
84 (i) beginning on January 1 of the first calendar year immediately following the day on
85 which the income tax return preparer meets the requirements of this Subsection (2); and
86 (ii) for all calendar years after the calendar year described in Subsection (2)(c)(i).
87 (3) Notwithstanding Subsection (2), an income tax return preparer is not required to

88 file a qualifying return using scan technology or by electronic means if:
89 (a) a schedule required to be attached to the qualifying return cannot be filed using scan
90 technology or by electronic means;
91 (b) the taxpayer for which the qualifying return is prepared requests in writing that the
92 income tax return preparer not file the qualifying return using scan technology or by electronic
93 means; or
94 (c) subject to Subsection (4), the commission waives for one or more qualifying returns
95 filed by the income tax return preparer the requirement imposed by this section to file the
96 qualifying returns using scan technology or by electronic means.
97 (4) (a) For purposes of Subsection (3)(c), the commission may waive for one or more
98 qualifying returns filed by an income tax return preparer the requirement imposed by this
99 section to file the qualifying returns using scan technology or by electronic means if the income
100 tax return preparer demonstrates to the commission that it would be an undue hardship to file
101 the qualifying returns using scan technology or by electronic means.
102 (b) For purposes of Subsection (4)(a) and in accordance with Title 63, Chapter 46a,
103 Utah Administrative Rulemaking Act, the commission shall by rule define the circumstances
104 that constitute an undue hardship to file a qualifying return using scan technology or by
105 electronic means.
106 Section 2. Retrospective operation.
107 This bill has retrospective operation to January 1, 2005.