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S.B. 100 Enrolled

             1     

INCOME TAX CREDIT OR REFUND
             2      AMENDMENTS
             3      2010 GENERAL SESSION
             4      STATE OF UTAH
             5      Chief Sponsor: Curtis S. Bramble
             6      House Sponsor: Wayne A. Harper
             7     
             8      LONG TITLE
             9      General Description:
             10          This bill amends the Corporate Franchise and Income Taxes chapter and the Individual
             11      Income Tax Act to repeal limits on the amount of an income tax credit or refund.
             12      Highlighted Provisions:
             13          This bill:
             14          .    repeals limits on the amount of an income tax credit or refund; and
             15          .    makes technical and conforming changes.
             16      Monies Appropriated in this Bill:
             17          None
             18      Other Special Clauses:
             19          None
             20      Utah Code Sections Affected:
             21      AMENDS:
             22          59-7-522, as last amended by Laws of Utah 2009, Chapter 212
             23          59-10-529, as last amended by Laws of Utah 2009, Chapter 212
             24     
             25      Be it enacted by the Legislature of the state of Utah:
             26          Section 1. Section 59-7-522 is amended to read:
             27           59-7-522. Overpayments.
             28          (1) (a) Subject to Subsection (1)(b), a claim for credit or refund of an overpayment
             29      that is attributable to a Utah net loss carry back or carry forward shall be filed within three

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             30      years from the due date of the return for the taxable year of the Utah net loss.
             31          (b) The three-year period described in Subsection (1)(a) shall be extended by any
             32      extension of time provided in statute for filing the return described in Subsection (1)(a).
             33          (2) If an overpayment relates to a change in or correction of federal taxable income
             34      described in Section 59-7-519 , a credit may be allowed or a refund paid any time before the
             35      expiration of the period within which a deficiency may be assessed.
             36          [(3) The amount of the credit or refund described in Subsection (2) may not exceed:]
             37          [(a) if a taxpayer files a claim for a credit or refund, the portion of the tax paid during
             38      the three years immediately preceding the filing of the claim; or]
             39          [(b) if a taxpayer does not file a claim for a credit or refund, the portion of the tax paid
             40      during the two years immediately preceding the allowance of the credit or refund.]
             41          [(4)] (3) The commission shall make a credit or refund within a 30-day period after the
             42      day on which a court's decision to require the commission to credit or refund the amount of an
             43      overpayment to a taxpayer is final.
             44          Section 2. Section 59-10-529 is amended to read:
             45           59-10-529. Overpayment of tax -- Credits -- Refunds.
             46          (1) If there has been an overpayment of any tax imposed by this chapter, the amount of
             47      overpayment is credited as follows:
             48          (a) against [any] an income tax [then] due from [the] a taxpayer;
             49          (b) against:
             50          (i) the amount of [any] a judgment against [the] a taxpayer, including [one] a
             51      judgment ordering the payment of a fine or of restitution to a victim under Title 77, Chapter
             52      38a, Crime Victims Restitution Act, obtained through due process of law by [any] an entity of
             53      state government; or
             54          (ii) subject to Subsection (3), [any] a child support obligation that is due or past due,
             55      as determined by the Office of Recovery Services in the Department of Human Services and
             56      after notice and an opportunity for an adjudicative proceeding, as provided in Subsection (2);
             57      or

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             58          (c) subject to Subsection (3), (5), (6), or (7), as bail, to ensure the appearance of [the]
             59      a taxpayer before the appropriate authority to resolve an outstanding warrant against the
             60      taxpayer for which bail is due, if a court of competent jurisdiction has not approved an
             61      alternative form of payment.
             62          (2) If a balance remains after an overpayment is credited in accordance with
             63      Subsection (1), the balance shall be refunded to the taxpayer.
             64          (3) Bail described in Subsection (1)(c) may be applied to any fine or forfeiture:
             65          (a) that is due and related to a warrant that is outstanding on or after February 16,
             66      1984; and
             67          (b) in accordance with Subsections (5) and (6).
             68          (4) (a) The amount of an overpayment may be credited against an obligation described
             69      in Subsection (1)(b)(ii) if the Office of Recovery Services has sent written notice to the
             70      taxpayer's last-known address or the address on file under Section 62A-11-304.4 , stating:
             71          (i) the amount of child support that is due or past due as of the date of the notice or
             72      other specified date;
             73          (ii) that any overpayment shall be applied to reduce the amount of due or past-due
             74      child support specified in the notice; and
             75          (iii) that the taxpayer may contest the amount of past-due child support specified in
             76      the notice by filing a written request for an adjudicative proceeding with the office within 15
             77      days of the notice being sent.
             78          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
             79      the Office of Recovery Services shall establish rules to implement this Subsection (4),
             80      including procedures, in accordance with the other provisions of this section, to ensure:
             81          (i) prompt reimbursement to [the] a taxpayer of any amount of an overpayment that
             82      was credited against a child support obligation in error; and
             83          (ii) prompt distribution of properly credited funds to the obligee parent.
             84          (5) The amount of an overpayment may be credited against bail described in
             85      Subsection (1)(c) if:

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             86          (a) a court has issued a warrant for the arrest of the taxpayer for failure to post bail,
             87      appear, or otherwise satisfy the terms of a citation, summons, or court order; and
             88          (b) a notice of intent to apply the overpayment as bail on the issued warrant has been
             89      sent to the [person's] taxpayer's current address on file with the commission.
             90          (6) (a) (i) The commission shall deliver an overpayment applied as bail to the court
             91      that issued the warrant of arrest.
             92          (ii) The clerk of the court is authorized to endorse the check or commission warrant of
             93      payment on behalf of the payees and deposit the monies in the court treasury.
             94          (b) (i) The court receiving an overpayment applied as bail shall order withdrawal of
             95      the warrant for arrest of the taxpayer if:
             96          (A) the case is a case for which a personal appearance of the taxpayer is not required;
             97      and
             98          (B) the dollar amount of the overpayment represents the full dollar amount of bail.
             99          (ii) In a case except for a case described in Subsection (6)(b)(i):
             100          (A) the court receiving the overpayment applied as bail is not required to order the
             101      withdrawal of the warrant of arrest of the taxpayer during the 40-day period; and
             102          (B) the taxpayer may be arrested on the warrant.
             103          (c) (i) If a taxpayer fails to respond to the notice required by Subsection (5)(b), or to
             104      resolve the warrant within 40 days after the notice is sent under Subsection (5)(b):
             105          (A) the overpayment applied as bail is forfeited; and
             106          (B) notice of the forfeiture shall be mailed to the taxpayer at the current address on file
             107      with the commission.
             108          (ii) A court may issue another warrant or allow the original warrant to remain in force
             109      if:
             110          (A) the taxpayer has not complied with an order of the court;
             111          (B) the taxpayer has failed to appear and respond to a criminal charge for which a
             112      personal appearance is required; or
             113          (C) the taxpayer has paid partial but not full bail in a case for which a personal

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             114      appearance is not required.
             115          (d) If the alleged violations named in a warrant are later resolved in favor of the
             116      taxpayer, the bail amount shall be remitted to the taxpayer.
             117          (7) The fine and bail forfeiture provisions of this section apply to all warrants and
             118      fines issued in cases charging a taxpayer with a felony, a misdemeanor, or an infraction
             119      described in this section, which are outstanding on or after February 16, 1984.
             120          (8) If the amount allowable as a credit for tax withheld from a taxpayer exceeds the tax
             121      to which the credit relates, the excess is considered an overpayment.
             122          (9) (a) Subject to Subsection (9)(b), a claim for credit or refund of an overpayment
             123      that is attributable to a net operating loss carry back or carry forward shall be filed within three
             124      years from the due date of the return for the taxable year of the net operating loss.
             125          (b) The three-year period described in Subsection (9)(a) shall be extended by any
             126      extension of time provided in statute for filing the return described in Subsection (9)(a).
             127          [(10) If there has been an overpayment of a tax that is required to be deducted and
             128      withheld under Section 59-10-402 , a refund shall be made to the employer only to the extent
             129      that the amount of overpayment is not deducted and withheld by the employer.]
             130          [(11)] (10) If there is no tax liability for a period in which an amount is paid under this
             131      chapter, the amount is an overpayment.
             132          [(12)] (11) If a tax under this chapter is assessed or collected after the expiration of the
             133      applicable period of limitation, that amount is an overpayment.
             134          [(13)] (12) (a) A taxpayer may file a claim for a credit or refund of an overpayment
             135      within two years from the date a notice of change, notice of correction, or amended return is
             136      required to be filed with the commission if the taxpayer is required to:
             137          (i) report a change or correction in income reported on the taxpayer's federal income
             138      tax return;
             139          (ii) report a change or correction that is treated in the same manner as if the change or
             140      correction were an overpayment for federal income tax purposes; or
             141          (iii) file an amended return with the commission.

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             142          (b) If a report or amended return is not filed within 90 days, interest on any resulting
             143      refund or credit ceases to accrue after the 90-day period.
             144          (c) The amount of the credit or refund may not exceed the amount of the reduction in
             145      tax attributable to the federal change, correction, or items amended on the taxpayer's amended
             146      federal income tax return.
             147          (d) Except as provided in Subsection [(13)] (12)(a), this Subsection [(13)] (12) does
             148      not affect the amount or the time within which a claim for credit or refund may be filed.
             149          [(14)] (13) A credit or refund may not be allowed or made if an overpayment is less
             150      than $1.
             151          [(15) The amount of a credit or refund may not exceed the tax paid during the three
             152      years immediately preceding the filing of the claim, or if no claim is filed, then during the
             153      three years immediately preceding the allowance of the credit or refund.]
             154          [(16)] (14) In the case of an overpayment of tax by an employer under Part 4,
             155      Withholding of Tax, a refund or credit shall be made to the employer only to the extent that the
             156      amount of the overpayment is not deducted and withheld from wages under this chapter.
             157          [(17)] (15) (a) If a taxpayer that is allowed a refund under this chapter dies, the
             158      commission may make payment to the personal representative of the taxpayer's estate.
             159          (b) If there is no personal representative of the taxpayer's estate, payment may be made
             160      to those persons who establish entitlement to inherit the property of the decedent in the
             161      proportions established in Title 75, Utah Uniform Probate Code.
             162          [(18)] (16) If an overpayment relates to a change in net income described in
             163      Subsection 59-10-536 (2)(a), a credit may be allowed or a refund paid any time before the
             164      expiration of the period within which a deficiency may be assessed.
             165          [(19)] (17) An overpayment of a tax imposed by this chapter shall accrue interest at
             166      the rate and in the manner prescribed in Section 59-1-402 .

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