Substitute House Bill No. 5679
Substitute House Bill No. 5679
PUBLIC ACT NO. 98-244
AN ACT CONCERNING SIMPLIFICATION, ENFORCEMENT AND
MINOR CHANGES TO VARIOUS TAX STATUTES.
Be it enacted by the Senate and House of
Representatives in General Assembly convened:
Section 1. Section 12-15 of the general
statutes, as amended by section 6 of public act
97-165, section 4 of public act 97-193, section 1
of public act 97-200 and section 4 of public act
97-243, is repealed and the following is
substituted in lieu thereof:
(a) No officer or employee, including any
former officer or former employee, of the state or
of any other person who has or had access to
returns or return information in accordance with
subdivision (2) of subsection (c) of this section
shall disclose OR INSPECT any return or return
information, except as [hereinafter] provided IN
THIS SECTION.
(b) The commissioner may disclose (1) returns
or return information to (A) an authorized
representative of another state agency or office,
upon written request by the head of such agency or
office, when required in the course of duty or
when there is reasonable cause to believe that any
state law is being violated, OR (B) AN AUTHORIZED
REPRESENTATIVE OF AN AGENCY OR OFFICE OF THE
UNITED STATES, UPON WRITTEN REQUEST BY THE HEAD OF
SUCH AGENCY OR OFFICE, WHEN REQUIRED IN THE COURSE
OF DUTY OR WHEN THERE IS REASONABLE CAUSE TO
BELIEVE THAT ANY FEDERAL LAW IS BEING VIOLATED,
provided no such agency or office shall disclose
such returns or return information, other than in
a judicial or administrative proceeding to which
such agency or office is a party pertaining to the
enforcement of state OR FEDERAL law, AS THE CASE
MAY BE, in a form which can be associated with, or
otherwise identify, directly or indirectly, a
particular taxpayer except that the names and
addresses of jurors or potential jurors and the
fact that the names were derived from the list of
taxpayers pursuant to chapter 884 may be disclosed
by the judicial branch; (2) returns or return
information to the Auditors of Public Accounts,
when required in the course of duty under chapter
23; (3) returns or return information to tax
officers of another state or of a Canadian
province or of a political subdivision of such
other state or province or of the District of
Columbia or to any officer of the United States
Treasury Department or the United States
Department of Health and Human Services,
authorized for such purpose in accordance with an
agreement between this state and such other state,
province, political subdivision, the District of
Columbia or department, respectively, when
required in the administration of taxes imposed
under the laws of such other state, province,
political subdivision, the District of Columbia or
the United States, respectively, and when a
reciprocal arrangement exists; (4) returns or
return information in any action, case or
proceeding in any court of competent jurisdiction,
when the commissioner or any other state
department or agency is a party, and when such
information is directly involved in such action,
case or proceeding; (5) returns or return
information to a taxpayer or its authorized
representative, upon written request for a return
filed by or return information on such taxpayer;
(6) returns to a successor, receiver, trustee,
executor, administrator, assignee, guardian or
guarantor of a taxpayer, when such person
establishes, to the satisfaction of the
commissioner, that he has a material interest
which will be affected by information contained in
such return; (7) information to THE ASSESSOR OR AN
AUTHORIZED REPRESENTATIVE OF the chief executive
officer of a Connecticut municipality, when the
information disclosed is limited to (A) a list of
real or personal property that is or may be
subject to property taxes in such municipality or
(B) a list containing the name of each person who
is issued any license, permit or certificate which
is required, under the provisions of this title,
to be conspicuously displayed and whose address is
in such municipality; (8) real estate conveyance
tax return information or controlling interest
transfer tax return information to THE TOWN CLERK
OR AN AUTHORIZED REPRESENTATIVE OF the chief
executive officer of a Connecticut municipality to
which the information relates; (9) estate tax
returns and estate tax return information to the
Probate Court Administrator or to the court of
probate for the district within which a decedent
resided at the date of his death, or within which
the commissioner contends that a decedent resided
at the date of his death or, if a decedent died a
nonresident of this state, in the court of probate
for the district within which real estate or
tangible personal property of the decedent is
situated, or within which the commissioner
contends that real estate or tangible personal
property of the decedent is situated; (10) returns
or return information to the Secretary of the
Office of Policy and Management for purposes of
subsection (b) of section 12-7a, AS AMENDED; [and]
(11) return information to the Jury Administrator,
when the information disclosed is limited to the
names, addresses, federal Social Security numbers
and dates of birth, if available, of residents of
this state, as defined in subdivision (1) of
subsection (a) of section 12-701, AS AMENDED; (12)
PURSUANT TO REGULATIONS ADOPTED BY THE
COMMISSIONER, RETURNS OR RETURN INFORMATION TO ANY
PERSON TO THE EXTENT NECESSARY IN CONNECTION WITH
THE PROCESSING, STORAGE, TRANSMISSION OR
REPRODUCTION OF SUCH RETURNS OR RETURN
INFORMATION, AND THE PROGRAMMING, MAINTENANCE,
REPAIR, TESTING OR PROCUREMENT OF EQUIPMENT, OR
THE PROVIDING OF OTHER SERVICES, FOR PURPOSES OF
TAX ADMINISTRATION; AND (13) WITHOUT WRITTEN
REQUEST AND UNLESS HE DETERMINES THAT DISCLOSURE
WOULD IDENTIFY A CONFIDENTIAL INFORMANT OR
SERIOUSLY IMPAIR A CIVIL OR CRIMINAL TAX
INVESTIGATION, RETURNS AND RETURN INFORMATION
WHICH MAY CONSTITUTE EVIDENCE OF A VIOLATION OF
ANY CIVIL OR CRIMINAL LAW OF THIS STATE OR THE
UNITED STATES TO THE EXTENT NECESSARY TO APPRISE
THE HEAD OF SUCH AGENCY OR OFFICE CHARGED WITH THE
RESPONSIBILITY OF ENFORCING SUCH LAW, IN WHICH
EVENT THE HEAD OF SUCH AGENCY OR OFFICE MAY
DISCLOSE SUCH RETURN INFORMATION TO OFFICERS AND
EMPLOYEES OF SUCH AGENCY OR OFFICE TO THE EXTENT
NECESSARY TO ENFORCE SUCH LAW. [Any person who
violates any provision of this section shall be
fined not more than one thousand dollars or
imprisoned not more than one year or both.]
[(b) Notwithstanding the provisions of
subsection (a) of this section or any other
provision of the general statutes, any]
(c) ANY federal returns or return information
made available to the commissioner in accordance
with a written agreement between the commissioner
and the Internal Revenue Service concerning
exchange of information for tax administration
purposes, shall not be open to inspection by or
disclosed to any individual or disclosed in any
manner other than as permitted under the
provisions of Section 6103 of the Internal Revenue
Code of 1986, or any subsequent corresponding
internal revenue code of the United States, as
from time to time amended.
[(c) Notwithstanding the provisions of
subsection (a) of this section, the]
(d) THE commissioner may [(1)] upon request,
verify whether or not any license, permit or
certificate required under the provisions of this
title to be conspicuously displayed has been
issued by him to any particular person. [; (2)
pursuant to regulations promulgated by him,
disclose returns or return information to any
person to the extent necessary in connection with
the processing, storage, transmission, or
reproduction of such returns or return
information, and the programming, maintenance,
repair, testing, or procurement of equipment, or
the providing of other services, for purposes of
tax administration; (3) refuse to open to
inspection or disclose to any person any returns
or return information made available to the
commissioner by any tax officer of another state,
a Canadian province or political subdivision of
such other state or province or of the District of
Columbia or by any officer of the United States
Treasury Department or the United States
Department of Health and Human Services in
accordance with a written agreement between this
state and such other state, province, political
subdivision, the District of Columbia or
department, respectively, which agreement provides
that the disclosure of such returns or return
information by the commissioner is prohibited; (4)
without written request and unless he determines
that disclosure would identify a confidential
information or seriously impair a civil or
criminal tax investigation, disclose returns and
return information which may constitute evidence
of a violation of any civil or criminal law of
this state or the United States to the extent
necessary to apprise the head of such agency or
office charged with the responsibility of
enforcing such law, in which event the head of
such agency or office may disclose such return
information to officers and employees of such
agency or office to the extent necessary to
enforce such law.]
[(d) Notwithstanding the provisions of
subsection (a) of this section, the commissioner]
(e) THE COMMISSIONER MAY REFUSE TO OPEN TO
INSPECTION OR DISCLOSE TO ANY PERSON ANY RETURNS
OR RETURN INFORMATION MADE AVAILABLE TO THE
COMMISSIONER BY ANY TAX OFFICER OF ANOTHER STATE,
A CANADIAN PROVINCE OR POLITICAL SUBDIVISION OF
SUCH OTHER STATE OR PROVINCE OR OF THE DISTRICT OF
COLUMBIA OR BY ANY OFFICER OF THE UNITED STATES
TREASURY DEPARTMENT OR THE UNITED STATES
DEPARTMENT OF HEALTH AND HUMAN SERVICES IN
ACCORDANCE WITH A WRITTEN AGREEMENT BETWEEN THIS
STATE AND SUCH OTHER STATE, PROVINCE, POLITICAL
SUBDIVISION, THE DISTRICT OF COLUMBIA OR
DEPARTMENT, RESPECTIVELY, WHICH AGREEMENT PROVIDES
THAT THE DISCLOSURE OF SUCH RETURNS OR RETURN
INFORMATION BY THE COMMISSIONER IS PROHIBITED. IN
ADDITION, HE may refuse to open to inspection or
disclosure to any state OR UNITED STATES agency or
office described in subdivision (1) of subsection
[(a)] (b) of this section, returns or return
information unless such agency or office shall
have: (1) Established and maintained, to the
satisfaction of the commissioner, a permanent
system of standardized records with respect to any
request, the reason for such request, and the date
of such request made by or of it and any
disclosure OR INSPECTION of returns or return
information made by or to it; (2) established and
maintained, to the satisfaction of the
commissioner, a secure area or place in which such
returns or return information shall be stored; (3)
restricted, to the satisfaction of the
commissioner, access to the returns or return
information only to persons whose duties or
responsibilities require access and to whom
disclosure may be made under this section OR BY
WHOM INSPECTION MAY BE MADE UNDER THIS SECTION;
(4) provided such other safeguards which the
commissioner prescribes as necessary or
appropriate to protect the confidentiality of the
returns or return information; (5) furnished a
report to the commissioner, at such time and
containing such information as the commissioner
may prescribe, which describes the procedures
established and utilized by such agency or office
for ensuring the confidentiality of returns and
return information required by this subsection;
and (6) upon completion of use of such returns or
return information, returned to the commissioner
such returns or return information, along with any
copies made therefrom, or makes such returns or
return information undisclosable in such manner as
the commissioner may prescribe and furnishes a
written report to the commissioner identifying the
returns or return information that were made
undisclosable.
(f) RETURNS AND RETURN INFORMATION SHALL,
WITHOUT WRITTEN REQUEST, BE OPEN TO INSPECTION BY
OR DISCLOSURE TO: (1) OFFICERS AND EMPLOYEES OF
THE DEPARTMENT OF REVENUE SERVICES WHOSE OFFICIAL
DUTIES REQUIRE SUCH INSPECTION OR DISCLOSURE FOR
TAX ADMINISTRATION PURPOSES; (2) OFFICERS OR
EMPLOYEES OF AN AGENCY OR OFFICE IN ACCORDANCE
WITH SUBDIVISION (1) OR (13) OF SUBSECTION (b) OF
THIS SECTION WHOSE OFFICIAL DUTIES REQUIRE SUCH
INSPECTION; AND (3) OFFICERS OR EMPLOYEES OF ANY
PERSON IN ACCORDANCE WITH SUBDIVISION (12) OF
SUBSECTION (b) OF THIS SECTION, WHOSE DUTIES
REQUIRE SUCH INSPECTION OR DISCLOSURE.
(g) ANY PERSON WHO VIOLATES ANY PROVISION OF
THIS SECTION SHALL BE FINED NOT MORE THAN ONE
THOUSAND DOLLARS OR IMPRISONED NOT MORE THAN ONE
YEAR, OR BOTH.
[(e)] (h) For purposes of this section:
(1) "Return" means any tax or information
return, declaration of estimated tax, claim for
refund, license application, permit application,
registration application or other application
required by, or provided for or permitted under,
the provisions of this or any other title which is
filed with the commissioner by, on behalf of, or
with respect to any person, and any amendment or
supplement thereto, including supporting
schedules, attachments, or lists which are
supplemental to, or part of, the return so filed.
(2) "Return information" means a taxpayer's
identity, the nature, source, or amount of the
taxpayer's income, payments, receipts, deductions,
exemptions, credits, assets, liabilities, net
worth, tax liability, tax collected or withheld,
tax underreportings, tax overreportings, or tax
payments, whether the taxpayer's return was, is
being, or will be examined or subjected to other
investigation or processing, or any other data
received by, recorded by, prepared by, furnished
to, or collected by the commissioner with respect
to a return or with respect to the determination
of the existence, or possible existence, of
liability of any person for any tax, penalty,
interest, fine, forfeiture, or other imposition,
or offense. "Return information" does not include
data in a form which cannot be associated with, or
otherwise identify, directly or indirectly, a
particular taxpayer. Nothing in the preceding
sentence, or in any other provision of law, shall
be construed to require the disclosure of
standards used or to be used for the selection of
returns for examination, or data used or to be
used for determining such standards or the
disclosure of the identity of a confidential
informant, whether or not a civil or criminal tax
investigation has been undertaken or completed.
(3) "Disclosure" means the making known to any
person, in any manner whatever, a return or return
information.
(4) "INSPECTION" MEANS ANY EXAMINATION OF A
RETURN OR RETURN INFORMATION.
(5) "TAX ADMINISTRATION" MEANS THE
ADMINISTRATION, MANAGEMENT, CONDUCT, DIRECTION AND
SUPERVISION OF THE EXECUTION AND APPLICATION OF
THE TAX LAWS OF THIS STATE, AND THE DEVELOPMENT
AND FORMULATION OF TAX POLICY RELATING TO EXISTING
OR PROPOSED TAX LAWS OF THIS STATE, AND INCLUDES
ASSESSMENT, COLLECTION, ENFORCEMENT, LITIGATION,
PUBLICATION AND STATISTICAL GATHERING FUNCTIONS
UNDER SUCH LAWS.
Sec. 2. (NEW) (a) For purposes of this
section:
(1) "Taxpayer" means any person identified by
a claimant state to the Commissioner of Revenue
Services under this section as owing taxes to such
claimant state, including, in the case of a refund
of any tax imposed upon the income of individuals,
the spouse of the taxpayer, where such taxpayer
filed a joint return with such spouse;
(2) "Claimant state" means any other state or
the District of Columbia which extends a like
comity for the collection of taxes owned to this
state;
(3) "Taxes" means any amount of tax imposed
under the laws of the claimant state, including
additions to tax for penalties and interest, which
is finally due and payable to the claimant state,
and with respect to which any administrative or
judicial remedies, or both, have been exhausted or
have lapsed, and which is legally enforceable
under the laws of the claimant state, whether or
not there is an outstanding judgment for such sum;
(4) "Refund" means any taxpayer's claim to
repayment of an overpayment of a tax determined by
this state to be owed to the taxpayer by this
state; and
(5) "Tax officer" means a unit or official of
a claimant state, or the duly authorized agent of
such unit or official, charged with the
imposition, assessment or collection of taxes of
that state.
(b) (1) Upon the request and certification of
the tax officer of a claimant state to the
Commissioner of Revenue Services that a taxpayer
owes taxes to such claimant state, the
commissioner may withhold all or a portion of any
refund to which such taxpayer would otherwise be
entitled and pay over such withheld amount to the
claimant state in accordance with the provisions
of this section. The commissioner shall not
withhold a refund unless the laws of the claimant
state allow the Commissioner of Revenue Services
to certify that a taxpayer owes taxes to this
state and to request the tax officer of the
claimant state to withhold all or a portion of any
refund to which such taxpayer would otherwise be
entitled, and provide for the payment over of such
withheld amount to this state.
(2) Such certification shall include the full
name and address of the taxpayer; the taxpayer's
Social Security number or federal employer
identification number; the amount of taxes owed to
such state, including a detailed statement for
each taxable period showing tax, interest and
penalty; and a statement that any administrative
or judicial remedies, or both, have been exhausted
or have lapsed and that the amount of taxes is
legally enforceable under the laws of such state.
(3) Upon receipt by the commissioner of the
required certification, he shall notify the
taxpayer that he has received a request from the
claimant state to withhold all or a portion of any
refund, that the taxpayer has the right to protest
the withholding of the refund, that failure to
file a protest in accordance with subdivision (4)
of this subsection shall constitute a waiver of
any demand against this state on account of such
withheld amount and the withheld amount will be
paid over to the claimant state. The notice shall
include a copy of the certification by the tax
officer of such claimant state. Thirty days after
the date on which it is mailed, a notice under
this subdivision shall be final except only for
such amounts as to which the taxpayer has filed,
as provided in subdivision (4) of this subsection,
a written protest with the Commissioner of Revenue
Services.
(4) Any taxpayer notified in accordance with
subdivision (3) of this subsection may, on or
before the thirtieth day after the mailing of such
notice by the Commissioner of Revenue Services,
protest the withholding of all or a portion of a
refund by filing with the commissioner a written
protest in which the taxpayer shall set forth the
grounds on which the protest is based. If a timely
protest is filed, the commissioner shall impound
the claimed amount of the refund, pay to the
taxpayer the unclaimed amount, if any, of the
refund, send a copy of the protest to the claimant
state for determination of the protest on its
merits in accordance with the laws of that state,
and pay over to the taxpayer the impounded amount
if the claimant state shall fail on or before the
forty-fifth day after the sending of the copy of
the protest by the commissioner to such claimant
state to recertify to the commissioner that the
claimant state has reviewed the stated grounds on
which the protest is based, and to recertify the
amount of taxes which is finally due and payable
to the claimant state, which is legally
enforceable under the laws of the claimant state
against the taxpayer, and with respect to which
any administrative or judicial remedies, or both,
have been exhausted or have lapsed.
(5) Where the amount withheld in accordance
with this subsection is a refund of any tax
imposed upon the income of individuals and in
connection with which the taxpayer filed a joint
return with his or her spouse, and the spouse is
not a taxpayer, the spouse shall have the right to
be paid his or her portion of the refund by
establishing his or her share of such refund. The
amount of such spouse's share of such refund shall
be established by recomputing the spouse's share
of the joint liability and subtracting that amount
from the taxpayer's contribution toward the joint
liability, provided the amount of the overpayment
refunded to the spouse shall not exceed the amount
of the joint overpayment.
(6) Subject to the provisions of subdivisions
(3), (4) and (5) of this subsection, the
commissioner shall pay over to the claimant state
the entire amount withheld or the amount
certified, whichever is less; pay any refund in
excess of the certified amount to the taxpayer;
and, if the amount certified exceeds the amount
withheld, withhold amounts from subsequent refunds
due to the taxpayer, provided the claimant state
agrees to withhold subsequent refunds due to
taxpayers certified to the claimant state by the
commissioner.
(c) The commissioner may enter into agreements
with the tax officers of claimant states relating
to procedures and methods to be employed by a
claimant state with respect to the operation of
this section; safeguards against the disclosure or
inappropriate use of any information that
identifies, directly or indirectly, a particular
taxpayer obtained or maintained pursuant to this
subsection; and a minimum amount of taxes owed by
a taxpayer to a claimant state, so that, if a
taxpayer owes less than such amount to such
claimant state, the claimant state will not avail
itself of the provisions of this section with
respect to that taxpayer.
(d) The collection procedures prescribed by
this section shall not be construed as a
substitute for any other remedy available by law
to the Commissioner of Revenue Services.
Sec. 3. Subsections (a) and (b) of section
12-39m of the general statutes are repealed and
the following is substituted in lieu thereof:
(a) A taxpayer, objecting to the assessment of
any tax due the state or interest thereon, may at
any time ON OR BEFORE THE MAKING OF SUCH
ASSESSMENT BUT prior to the expiration of the
later of (1) the time period for contesting such
tax, or (2) the entry of an order by the Superior
Court upholding such assessment, make a remittance
that is designated in writing as a deposit in the
nature of a cash bond. Such remittance shall not
be deemed to be a concession by the taxpayer of
the liability therefor and shall not diminish or
abrogate the taxpayer's right to contest the
applicability of the tax, interest or penalty,
prior to the time otherwise available for
contesting the tax or penalty.
(b) Notwithstanding the provisions of section
12-39h, at the time of the application of the cash
bond upon the final resolution of the controversy,
there shall be applied first to the payment of the
tax finally determined to be due so much of the
cash bond as is represented by the ratio,
determined as of the date of receipt of the cash
bond OR THE DATE OF THE ASSESSMENT, WHICHEVER IS
LATER, of the tax assessed over the total of the
tax assessed and the interest accrued as of such
date, and the balance shall be treated as interest
paid on the tax assessed as of such date. Interest
on the outstanding balance of the tax due and not
deemed satisfied by the cash bond shall be
determined as if the cash bond so applied to the
payment of tax had been a tax payment as of the
date of receipt of the cash bond OR THE DATE OF
THE ASSESSMENT, WHICHEVER IS LATER, such that the
deposit stops the further accrual or compounding
of interest with respect to the portion of the
assessment deemed paid as of such [earlier] date.
The balance of the cash bond, if any, shall be
applied to the payment of interest as of the date
of receipt of the cash bond, with any excess
applied in accordance with said section 12-39h.
Sec. 4. Section 12-205 of the general
statutes, as amended by section 8 of public act
97-243, is repealed and the following is
substituted in lieu thereof:
Each domestic insurance company doing business
in this state shall, on or before the first day of
March, annually, render to the Commissioner of
Revenue Services [, under oath or affirmation of
at least one of its principal officers,] an annual
return, on forms prescribed or furnished by the
commissioner AND SIGNED BY ONE OF THE PRINCIPAL
OFFICERS OF SUCH COMPANY, stating specifically the
name of the company and the location of its
principal office, the names and locations of any
subsidiary domestic insurance companies or
insurance holding companies, the interest,
dividends, premiums and other items of gross
income received by such company and by each of the
departments of such company during the next
preceding calendar year, the deductions from such
items of gross income as specified in this chapter
and such other information as the commissioner may
require for the purpose of making any computations
required by this chapter and for the enforcement
of this chapter. The amount of tax reported to be
due on such return shall be due and payable on or
before said first day of March. Payments shall be
made in cash or by check, draft or money order
drawn to the order of the Commissioner of Revenue
Services. The commissioner may, for good cause
shown, extend the time for making the return and
paying the tax, if a written request is filed with
the commissioner together with a tentative return
which must be accompanied by a payment of the tax
reported to be due thereon on or before said first
day of March. Any company to which an extension is
granted shall pay, in addition to the tax,
interest at the rate of one per cent per month or
fraction thereof from the date on which the tax
would have been due without the extension until
the date of payment.
Sec. 5. Subdivision (22) of subsection (a) of
section 12-213 of the general statutes, as amended
by section 3 of public act 97-295, is repealed and
the following is substituted in lieu thereof:
(22) "S corporation" means any corporation
which is an S corporation for federal income tax
purposes AND INCLUDES ANY SUBSIDIARY OF SUCH S
CORPORATION THAT IS A QUALIFIED SUBCHAPTER S
SUBSIDIARY, AS DEFINED IN SECTION 1361(b)(3)(B) OF
THE INTERNAL REVENUE CODE, ALL OF WHOSE ASSETS,
LIABILITIES AND ITEMS OF INCOME, DEDUCTION AND
CREDIT ARE TREATED UNDER THE INTERNAL REVENUE
CODE, AND SHALL BE TREATED UNDER THIS CHAPTER, AS
ASSETS, LIABILITIES AND SUCH ITEMS, AS THE CASE
MAY BE, OF SUCH S CORPORATION.
Sec. 6. Subdivision (2) of subsection (a) of
section 12-214 of the general statutes is repealed
and the following is substituted in lieu thereof:
(2) The following companies shall be exempt
from the tax imposed under this chapter: (A)
Insurance companies incorporated or organized
under the laws of any other state or foreign
government, (B) companies exempt by the federal
corporation net income tax law, and any company
which qualifies as a domestic international sales
corporation (DISC), as defined in Section 992 of
the Internal Revenue Code of 1986, or any
subsequent corresponding internal revenue code of
the United States, as from time to time amended,
and as to which a valid election under subsection
(b) of said Section 992 to be treated as a DISC is
effective, but excluding companies, other than any
company which so qualifies as, and so elects to be
treated as, a DISC, which elect not to be subject
to such tax under any provision of said Internal
Revenue Code other than said subsection (b) of
Section 992; (C) companies subject to gross
earnings taxes under chapter 210; (D) companies
all of whose properties in this state are operated
by companies subject to gross earnings taxes under
chapter 210; (E) cooperative housing corporations,
as defined for federal income tax purposes; (F)
any organization or association of two or more
persons established and operated for the exclusive
purpose of promoting the success or defeat of any
candidate for public office or of any political
party or question or constitutional amendment to
be voted upon at any state or national election or
for any other political purpose; (G) any company
which is not owned or controlled, directly or
indirectly, by any other company, the gross annual
revenues of which in the most recently completed
year did not exceed one hundred million dollars
and which engaged in the research, design,
manufacture, sale or installation of alternative
energy systems or motor vehicles powered in whole
or in part by electricity, natural gas or solar
energy including their parts and components,
provided at least seventy-five per cent of the
gross annual revenues of such company are derived
from such research, design, manufacture, sale or
installation; [and] (H) any company which engages
in the research, design, manufacture or sale in
Connecticut of aero-derived gas turbine systems in
advanced industrial applications, which
applications are developed after October 1, 1992,
which are limited to simply-cycle systems, humid
air, steam or water injection, recuperation or
intercooling technologies, including their parts
and components, to the extent that such company's
net income is directly attributable to such
purposes; (I) ANY NONUNITED STATES CORPORATION,
WHICH SHALL BE ANY FOREIGN CORPORATION, AS DEFINED
IN SECTION 7701(a)(5) OF THE INTERNAL REVENUE
CODE, WHOSE SOLE ACTIVITY IN THIS STATE DURING THE
INCOME YEAR CONSISTS OF THE TRADING IN STOCKS OR
SECURITIES FOR SUCH CORPORATION'S OWN ACCOUNT, AS
DEFINED IN SECTION 864(b)(2)(A)(ii) OF SAID
INTERNAL REVENUE CODE; AND (J) FOR INCOME YEARS
COMMENCING ON OR AFTER JANUARY 1, 2001, S
CORPORATIONS.
Sec. 7. Section 12-222 of the general statutes
is repealed and the following is substituted in
lieu thereof:
(a) Each company subject to the tax imposed
under this part shall render to the commissioner
an annual return, signed by one of its principal
officers, on forms prescribed or furnished by the
commissioner, stating specifically the name of the
company and the location of its principal office,
the state where organized and the date of
organization, the names and locations of all
subsidiaries, the amount of its paid-up capital
and surplus at the end of the income year, the
amount of its undivided profits and reserves at
the end of such year, the par value of all
indebtedness at the end of such year, the items of
gross income received during such year, the
deductions permitted by law, the interest and
rental payments during such year, the dividend
payments and changes in capital, surplus and
undivided profits during such year, complete
balance sheets at the beginning and end of such
year or period and such other facts as the
commissioner may require for the purpose of making
any computation required by this part.
(b) Such return shall be due on or before the
first day of the fourth month next succeeding the
end of the income year, OR, IN THE CASE OF AN S
CORPORATION, ON OR BEFORE THE FIFTEENTH DAY OF THE
FOURTH MONTH NEXT SUCCEEDING THE END OF THE INCOME
YEAR.
(c) The commissioner may grant a reasonable
extension of time for filing a completed return,
if the company files a tentative return and
application for extension of time in which to file
a completed return, on forms furnished or
prescribed by the commissioner, on or before the
first day of the fourth month next succeeding the
end of the income year, OR, IN THE CASE OF AN S
CORPORATION, ON OR BEFORE THE FIFTEENTH DAY OF THE
FOURTH MONTH NEXT SUCCEEDING THE END OF THE INCOME
YEAR.
(d) In any case in which the commissioner
believes that it would be advantageous to him in
the computation of the tax as imposed by this
part, such state return shall be accompanied by a
true copy of the last income tax return, if any,
made to the Internal Revenue Service.
(e) The amount of tax reported to be due on
such return or tentative return shall be due and
payable on or before the first day of the fourth
month next succeeding the end of the income year,
OR, IN THE CASE OF AN S CORPORATION, ON OR BEFORE
THE FIFTEENTH DAY OF THE FOURTH MONTH NEXT
SUCCEEDING THE END OF THE INCOME YEAR.
(f) Payment shall be made in cash or by check,
draft or money order drawn to the order of the
Commissioner of Revenue Services.
Sec. 8. Section 12-223a of the general
statutes is repealed and the following is
substituted in lieu thereof:
[(1)] (a) Any taxpayer included in a
consolidated return with one or more other
corporations for federal income tax purposes may
elect to file a combined return under this chapter
together with such other companies subject to the
tax imposed thereunder as are included in the
federal consolidated corporation income tax return
and such combined return shall be filed in such
form and setting forth such information as the
Commissioner of Revenue Services may require.
Notice of an election made pursuant to the
provisions of this subsection and consent to such
election must be submitted in written form to the
Commissioner of Revenue Services by each
corporation so electing not later than the due
date, [of] OR IF AN EXTENSION OF TIME TO FILE HAS
BEEN REQUESTED AND GRANTED, THE EXTENDED DUE DATE
OF THE returns due from the electing corporations
for the initial income year for which the election
to file a combined return is made. SUCH ELECTION
SHALL BE IN EFFECT FOR SUCH INITIAL INCOME YEAR
AND FOR EACH SUCCEEDING INCOME YEARS UNLESS AND
UNTIL SUCH ELECTION IS REVOKED IN ACCORDANCE WITH
THE PROVISIONS OF SUBSECTION (d) OF THIS SECTION.
[(2)] (b) Any taxpayer, other than a
corporation filing a combined return with one or
more other corporations under subsection [(1)] (a)
of this section, which owns or controls either
directly or indirectly substantially all the
capital stock of one or more corporations, or
substantially all the capital stock of which is
owned or controlled either directly or indirectly
by one or more other corporations or by interests
which own or control either directly or indirectly
substantially all the capital stock of one or more
other corporations, may, in the discretion of the
Commissioner of Revenue Services, be required or
permitted by written approval of the Commissioner
of Revenue Services to make a return on a combined
basis covering any such other corporations and
setting forth such information as the Commissioner
of Revenue Services may require, provided no
combined return covering any corporation not [a
taxpayer] SUBJECT TO TAX UNDER THIS CHAPTER shall
be required unless the Commissioner of Revenue
Services deems such a return necessary, because of
intercompany transactions or some agreement,
understanding, arrangement or transaction referred
to in section 12-226a, in order properly to
reflect the tax liability under this part.
[(3)] (c) (1) In the case of a combined
return, the tax shall be measured by the sum of
the separate net income or loss of each
corporation included or the minimum tax base of
the included corporations but only to the extent
that said income, loss or minimum tax base of any
included corporation is separately apportioned to
Connecticut in accordance with the provisions of
section 12-218, AS AMENDED, 12-219a or 12-244,
whichever is applicable. In computing said net
income or loss, intercorporate dividends shall be
eliminated, and in computing the combined
additional tax base, intercorporate stockholdings
shall be eliminated.
(2) If the method of determining the combined
measure of such tax in accordance with this
subsection for two or more affiliated companies
validly electing to file a combined return under
the provisions of subsection [(1)] (a) of this
section is deemed by such companies to unfairly
attribute an undue proportion of their total
income or minimum tax base to this state, said
companies may submit a petition in writing to the
Commissioner of Revenue Services for approval of
an alternate method of determining the combined
measure of their tax not later than sixty days
prior to the due date of the combined return to
which the petition applies and said commissioner
shall grant or deny such approval before said due
date. In deciding whether or not the companies
included in such combined return should be granted
approval to employ the alternate method proposed
in such petition, the Commissioner of Revenue
Services shall consider approval only in the event
that the petitioners have clearly established to
the satisfaction of said commissioner that all the
companies included in such combined return are, in
substance, parts of a unitary business engaged in
a single business enterprise and further that
there are substantial intercorporate business
transactions among such included companies.
(3) Upon the filing of a combined return under
[subsections (1) and (2)] SUBSECTION (a) OR (b) of
this section, combined returns shall be filed for
all succeeding income years or periods for those
corporations reporting therein, provided, IN THE
CASE OF CORPORATIONS FILING UNDER SUBSECTION (a)
OF THIS SECTION, such corporations are included in
a federal consolidated corporation income tax
return filed for the succeeding income years and,
in the case of a corporation filing under
subsection [(2)] (b) OF THIS SECTION, the
aforesaid ownership or control continues in full
force and effect and is not extended to other
corporations, and further, provided no substantial
change is made in the nature or locations of the
operations of such corporations.
[(4)] (d) Notwithstanding the provisions of
subsections [(1)] (a) and [(3)] (c) of this
section, any taxpayer which has elected to file a
combined return under this chapter as provided in
said subsection [(1)] (a), may subsequently REVOKE
ITS ELECTION TO FILE A COMBINED CORPORATION
BUSINESS TAX RETURN AND elect to file a separate
corporation business tax return under this
chapter, although continuing to be included in a
federal consolidated corporation income tax return
with other companies subject to tax under this
chapter, provided [notice of intent to file such
separate return is filed with the Commissioner of
Revenue Services prior to the beginning of the
income year with respect to which such taxpayer
elects to file such separate return and all other
companies included in such combined return under
this chapter also elect to file separate returns,
and provided further, such notice of intent may
not be revoked subsequent to the beginning of such
income year] SUCH ELECTION SHALL NOT BE EFFECTIVE
BEFORE THE FIFTH INCOME YEAR IMMEDIATELY FOLLOWING
THE INITIAL INCOME YEAR IN WHICH THE CORPORATION
ELECTED TO FILE A COMBINED RETURN UNDER THIS
CHAPTER. NOTICE OF AN ELECTION MADE PURSUANT TO
THE PROVISIONS OF THIS SUBSECTION AND CONSENT TO
SUCH ELECTION MUST BE SUBMITTED IN WRITTEN FORM TO
THE COMMISSIONER OF REVENUE SERVICES BY EACH
CORPORATION THAT HAD BEEN INCLUDED IN SUCH
COMBINED RETURN NOT LATER THAN THE DUE DATE, OR IF
AN EXTENSION OF TIME TO FILE HAS BEEN REQUESTED
AND GRANTED, EXTENDED DUE DATE OF THE SEPARATE
RETURNS DUE FROM THE ELECTING CORPORATIONS FOR THE
INITIAL INCOME YEAR FOR WHICH THE ELECTION TO FILE
SEPARATE RETURNS IS MADE. THE ELECTION TO FILE
SEPARATE RETURNS SHALL BE IRREVOCABLE FOR AND
APPLICABLE FOR FIVE SUCCESSIVE INCOME YEARS.
Sec. 9. Section 12-242d of the general
statutes, as amended by section 1 of public act
97-163, is repealed and the following is
substituted in lieu thereof:
(a) For purposes of this section, there shall
be four required instalments for each income year.
The due date for the first required instalment is
the fifteenth day of the third month of the income
year. The due date for the second required
instalment is the fifteenth day of the sixth month
of the income year. The due date for the third
required instalment is the fifteenth day of the
ninth month of the income year. The due date for
the fourth required instalment is the fifteenth
day of the twelfth month of the income year.
(b) The amount of the first required
instalment shall be thirty per cent of the
required annual payment, as defined in subsection
(e) of this section. The amount of the second
required instalment shall be forty per cent of the
required annual payment, as defined in subsection
(e) of this section. The amount of the third
required instalment shall be ten per cent of the
required annual payment, as defined in subsection
(e) of this section. The amount of the fourth
required instalment shall be twenty per cent of
the required annual payment, as defined in
subsection (e) of this section.
(c) Except as otherwise provided in this
section, in the case of any underpayment of
estimated tax by a company, there shall be added
to the tax an amount determined by applying
interest (1) at the rate of one per cent per month
or fraction thereof, (2) to the amount of the
underpayment, (3) for the period of the
underpayment.
(d) For purposes of this section, the amount
of the underpayment shall be the excess of the
required instalment, over the amount, if any, of
the instalment paid on or before the due date for
the instalment. The period of the underpayment
shall run from the due date for the instalment to
whichever of the following dates is earlier: (1)
The first day of the fourth month of the next
succeeding income year, or (2) with respect to any
portion of the underpayment, the date on which
such portion is paid. For purposes of this
subsection, a payment of estimated tax shall be
credited against unpaid required instalments in
the order in which such instalments are required
to be paid.
(e) [(1) Except as otherwise provided in
subdivision (2) of this subsection, "required
annual payment"] "REQUIRED ANNUAL PAYMENT" means
the lesser of [(A)] (1) ninety per cent of the tax
shown on the return for the income year, or, if no
return is filed, ninety per cent of the tax for
such year, or [(B) for the income year commencing
in 1996, two hundred per cent of the tax shown on
the return for the next preceding income year
without regard to any credit under this chapter;
for the income year commencing in 1997, one
hundred fifty per cent of the tax shown on the
return for the next preceding income year without
regard to any credit under this chapter; for the
income year commencing in 1998, and thereafter]
(2) IF THE PRECEDING INCOME YEAR WAS AN INCOME
YEAR OF TWELVE MONTHS AND IF THE COMPANY FILED A
RETURN FOR THE PRECEDING INCOME YEAR SHOWING A
LIABILITY FOR TAX, one hundred per cent of the tax
shown on the return for the next preceding income
year without regard to any credit under this
chapter.
[(2) Any credit that may otherwise be taken
under section 12-217n shall be disregarded in
determining the tax due for any income years
commencing prior to January 1, 1997.]
(f) (1) IN THE CASE OF ANY REQUIRED
INSTALMENT, IF THE COMPANY ESTABLISHES THAT THE
ANNUALIZED INCOME INSTALMENT IS LESS THAN THE
AMOUNT DETERMINED UNDER SUBSECTION (b) OF THIS
SECTION, THE AMOUNT OF SUCH REQUIRED INSTALMENT
SHALL BE THE ANNUALIZED INCOME INSTALMENT. ANY
REDUCTION IN A REQUIRED INSTALMENT RESULTING FROM
THE APPLICATION OF THIS SUBSECTION SHALL BE
RECAPTURED BY INCREASING THE AMOUNT OF THE NEXT
REQUIRED INSTALMENT BY THE AMOUNT OF SUCH
REDUCTION AND BY INCREASING SUBSEQUENT REQUIRED
INSTALMENTS TO THE EXTENT THAT THE REDUCTION HAS
NOT PREVIOUSLY BEEN RECAPTURED UNDER THIS
SUBDIVISION.
(2) IN THE CASE OF ANY REQUIRED INSTALMENT,
THE ANNUALIZED INCOME INSTALMENT IS THE EXCESS, IF
ANY, OF (A) AN AMOUNT EQUAL TO THE APPLICABLE
PERCENTAGE OF THE TAX FOR THE INCOME YEAR COMPUTED
BY PLACING ON AN ANNUALIZED BASIS ITS NET INCOME
OR ITS MINIMUM TAX BASE, AS THE CASE MAY BE, FOR
MONTHS IN THE INCOME YEAR ENDING BEFORE THE DUE
DATE FOR THE INSTALMENT, OVER (B) THE AGGREGATE
AMOUNT OF ANY PRIOR REQUIRED INSTALMENTS FOR THE
TAXABLE YEAR.
(3) FOR PURPOSES OF THIS SUBSECTION, THE
APPLICABLE PERCENTAGE FOR THE FIRST REQUIRED
INSTALMENT IS TWENTY-SEVEN, THE APPLICABLE
PERCENTAGE FOR THE SECOND REQUIRED INSTALMENT IS
SIXTY-THREE, THE APPLICABLE PERCENTAGE FOR THE
THIRD REQUIRED INSTALMENT IS SEVENTY-TWO AND THE
APPLICABLE PERCENTAGE FOR THE FOURTH REQUIRED
INSTALMENT IS NINETY.
[(f)] (g) The application of this section to
income years of less than twelve months shall be
in accordance with regulations adopted by the
commissioner.
[(g)] (h) No addition to tax shall be imposed
under subsection (c) of this section for any
income year if the tax shown on the return for
such income year, or, if no return is filed, the
tax, is one thousand dollars or less.
Sec. 10. (NEW) (a) Whenever a company is
eligible to claim more than one corporation
business tax credit, the credits shall be claimed
for the income year in the following order: (1)
Any credit that may be carried backward to a
preceding income year or years shall first be
claimed (A) with any credit carryback that will
expire first being claimed before any credit
carryback that will expire later or will not
expire at all, and (B) if the credit carrybacks
will expire at the same time, in the order in
which the company may receive the maximum benefit;
(2) any credit that may not be carried backward to
a preceding income year or years and that may not
be carried forward to a succeeding income year or
years shall next be claimed, in the order in which
the company may receive the maximum benefit; and
(3) any credit that may be carried forward to a
succeeding income year or years shall next be
claimed (A) with any credit carryforward that will
expire first being claimed before any credit
carryforward that will expire later or will not
expire at all, and (B) if the credit carryforwards
will expire at the same time, in the order in
which the company may receive the maximum benefit.
(b) In no event shall any credit be claimed
more than once.
Sec. 11. Section 12-250 of the general
statutes is repealed and the following is
substituted in lieu thereof:
"Authorized agent or officer", as used in this
chapter, includes any trustee, mortgagee or
receiver in possession of or operating any such
railroad in the state, and "net railway operating
income" means railway operating revenues less
railway operating expenses, railway tax accruals
and uncollectible railway revenue, including in
the computation thereof debits and credits arising
from equipment rents and joint facility rents.
Each such corporation, on or before the first day
of July in each year, shall make a return to the
Commissioner of Revenue Services, in such form as
the commissioner may prescribe [, under the oath
of] AND SIGNED BY its treasurer or an authorized
agent or officer, specifying: (1) The name of each
railroad operated by such corporation during the
year ended the thirty-first day of December next
preceding; (2) the number of miles of all railroad
tracks, including yard tracks, sidings, branches
and spurs, which were operated by such corporation
at any time during the year ended said
thirty-first day of December, and the number of
miles within this state of all such railroad
tracks, including yard tracks, sidings, branches
and spurs so operated; (3) the amount of gross
earnings of such corporation from all sources from
its operation, and the amount of net railway
operating income of such railroad during the year
ended said thirty-first day of December, or the
portion of such year that such corporation has
carried on business in this state; AND (4) the
assessed value of all real estate in this state
assessed in the name of such corporation, or of a
corporation all of whose property is operated by
it, with a specific list of the same and the
amount of taxes paid upon any such real estate in
any town, in the year ended said thirty-first day
of December.
Sec. 12. Section 12-263b of the general
statutes is repealed and the following is
substituted in lieu thereof:
There is hereby imposed on the hospital gross
earnings of each hospital in this state a tax (1)
at the rate of eleven per cent of its hospital
gross earnings in each taxable quarter for taxable
quarters commencing prior to October 1, 1996; (2)
at the rate of nine and one-fourth per cent of its
hospital gross earnings in each taxable quarter
commencing on or after October 1, 1996, and prior
to October 1, 1997; (3) at the rate of eight and
one-fourth per cent of its hospital gross earnings
in each taxable quarter commencing on or after
October 1, 1997, and prior to October 1, 1998; (4)
at the rate of seven and one-fourth per cent of
its hospital gross earnings in each taxable
quarter commencing on or after October 1, 1998,
and prior to October 1, 1999; AND (5) at the rate
of six and one-fourth per cent of its hospital
gross earnings in each taxable quarter commencing
on or after October 1, 1999. Each hospital shall,
on or before the last day of January, April, July
and October of each year, render to the
Commissioner of Revenue Services [under oath or
affirmation of at least one of its principal
officers,] a return, on forms prescribed or
furnished by the Commissioner of Revenue Services
AND SIGNED BY ONE OF ITS PRINCIPAL OFFICERS,
stating specifically the name and location of such
hospital, and the amounts of its hospital gross
earnings, its net revenue and its gross revenue
for the calendar quarter ending the last day of
the preceding month. Payment shall be made with
such return.
Sec. 13. Subsection (b) of section 12-264 of
the general statutes is repealed and the following
is substituted in lieu thereof:
(b) Each such company and municipal utility
shall, on or before the last day of January,
April, July and October of each year, render to
the Commissioner of Revenue Services [under oath
of its treasurer, or the person performing the
duties of treasurer, or of an authorized agent or
officer,] a return on forms prescribed or
furnished by the commissioner AND SIGNED BY ITS
TREASURER OR THE PERSON PERFORMING THE DUTIES OF
TREASURER, OR BY AN AUTHORIZED AGENT OR OFFICER,
specifying (1) the name and location of such
company or municipal utility, (2) the amount of
gross earnings from operations for the quarter
ending with the last day of the preceding month,
(3) the gross earnings from the sale or rental of
appliances using water, steam, gas or electricity
and the cost of such appliances sold, cost to be
interpreted as net invoice price plus
transportation costs of such appliances, (4) the
gross earnings from all sales for resale of water,
steam, gas and electricity, whether or not the
purchasers are public service corporations,
municipal utilities, located in the state or
subject to the tax imposed by this chapter, (5)
the number of miles of water or steam pipes, gas
mains or electric wires operated by such company
or municipal utility within this state on the
first day and on the last day of the calendar year
immediately preceding, and (6) the number of miles
of water or steam pipes, gas mains or electric
wires wherever operated by such company or
municipal utility on said dates. Gas pipeline and
gas transmission companies which do not
manufacture or buy gas in this state for resale in
this state shall be subject to the provisions of
chapter 208 and shall not be subject to the
provisions of this chapter and chapter 212a.
Sec. 14. Section 12-349 of the general
statutes is repealed and the following is
substituted in lieu thereof:
(a) (1) The gross estate for the purpose of
the tax imposed by the provisions of this chapter
shall be the total of the fair market value of all
the property transferred subject to tax under the
provisions of part I, except that the value of any
real property in the gross estate classified as
farm land in accordance with section 12-107c at
the time of the decedent's death shall be
determined for purposes of said tax in accordance
with the provisions applicable to farm land in
section 12-63, provided [(1)] (A) such farm land
is transferred to any of the beneficiaries or
distributees included in the list of beneficiaries
or distributees in classes AA, A and B as provided
in section 12-344, [(2)] (B) such farm land was
owned by the decedent or any of the beneficiaries
or distributees in classes AA, A and B as provided
in section 12-344 for an aggregate of no less than
five years during the eight years immediately
preceding the decedent's death, and [(3)] (C) the
decedent or any such beneficiary or distributee
shall have engaged in active and substantial
participation in farming or agricultural
operations directly related to such farm land, as
determined by the assessor, for an aggregate of no
less than five years during the eight years
immediately preceding the decedent's death.
(2) WHERE REAL PROPERTY CLASSIFIED AT THE TIME
OF THE DECEDENT'S DEATH AS FARM LAND IN ACCORDANCE
WITH SECTION 12-107c IS OWNED BY A PARTNERSHIP,
CORPORATION OR TRUST ENGAGED IN FARMING OR
AGRICULTURAL OPERATIONS, AND, AT THE TIME OF THE
DECEDENT'S DEATH, (A) THE SOLE PARTNERS,
SHAREHOLDERS OR BENEFICIARIES, AS THE CASE MAY BE,
OF SUCH PARTNERSHIP, CORPORATION OR TRUST ARE THE
DECEDENT AND ANY PERSONS WHO WOULD BE CLASSIFIED
AS TRANSFEREES UNDER CLASS AA, A OR B AS PROVIDED
IN SECTION 12-344, WHETHER OR NOT SUCH PERSONS ARE
IN FACT BENEFICIARIES OR DISTRIBUTEES OF THE
DECEDENT, AND (B) ALL OF THE DECEDENT'S INTEREST
IN SUCH PARTNERSHIP, CORPORATION OR TRUST PASSES
TO TRANSFEREES UNDER CLASS AA, A OR B AS PROVIDED
IN SECTION 12-344, THE INTEREST OF THE DECEDENT
AND OF SUCH BENEFICIARIES AND DISTRIBUTEES IN SUCH
PARTNERSHIP, CORPORATION OR TRUST SHALL BE TREATED
IN THE SAME MANNER FOR PURPOSES OF THIS CHAPTER AS
IF THE INTEREST OF THE DECEDENT AND SUCH
BENEFICIARIES AND DISTRIBUTEES WAS IN REAL
PROPERTY IN THE GROSS ESTATE CLASSIFIED AS FARM
LAND IN ACCORDANCE WITH SECTION 12-107c.
(b) There shall be excluded from the gross
estate the value of an annuity or other payment
receivable after the death of the decedent by any
beneficiary, other than the decedent's estate,
under an employees' trust or plan, or under a
contract purchased by an employees' trust or plan,
forming part of a pension, stock bonus or
profit-sharing plan, or under a retirement annuity
contract purchased by an employer pursuant to a
plan, provided at the time of decedent's
separation from employment, by death or otherwise,
or at the time of termination of the plan, if
earlier, payments to or in respect of such trust,
plan or annuity were exempt from federal income
taxation under the United States Internal Revenue
Code. If such amounts payable after the death of
the decedent under a plan above described are
attributable to any extent to payments or
contributions made by the decedent, no exclusion
shall be allowed for that part of the value of
such amounts in the proportion that the total
payments or contributions made by the decedent
bears to the total payments or contributions made.
For purposes of the preceding sentence,
contributions or payments made by the decedent's
employer or former employer shall not be
considered to be contributed by the decedent, if
made to or in respect to a trust, plan or annuity
exempt from federal income taxation under the
United States Internal Revenue Code.
(c) There shall be excluded from the gross
taxable estate the value of any payments
receivable after the death of the decedent by
other persons under the provisions of the Federal
Social Security Act and the Railroad Retirement
Act of 1937, as the same have been and may be
amended from time to time, and with respect to
persons dying on or after June 8, 1978, the value
of any annuity payments receivable by an eligible
survivor, upon the death of a retired serviceman,
under the "Retired Serviceman's Family Protection
Plan" or the "Survivor Benefit Plan" for retired
servicemen as provided in Chapter 73 of Title 10
of the United States Code, irrespective of whether
such annuity payments are attributable to any
extent to payments or contributions made by the
decedent.
(d) There shall be excluded from the gross
taxable estate the value of any payments
receivable after the death of the decedent by any
beneficiary, other than the decedent's estate,
under a pension plan for self-employed individuals
as may be established pursuant to Section 401(c)
of the Internal Revenue Code and regulations
related thereto, and with respect to which
payments to the credit of such plan were exempt
from federal income tax.
(e) (1) If, within ten years immediately
following the death of the decedent, real property
in the gross estate of the decedent, classified as
farm land in accordance with section 12-107c and
the value of which, for purposes of the tax
imposed under this chapter, was determined in
accordance with provisions applicable to farm land
in section 12-63 as provided in subsection (a) of
this section, is transferred to anyone other than
a beneficiary or distributee in [classes AA, A and
B] CLASS AA, A OR B AS PROVIDED in section 12-344
or is no longer classified as farm land in
accordance with section 12-107c, such beneficiary
or distributee shall be liable for a tax
applicable to such transfer or change in
classification. Said tax shall be in an amount
equal to the difference between the amount of tax
paid under this chapter with respect to such farm
land and the amount of tax which would have been
paid if such farm land had been assessed at fair
market value for purposes of determining the
amount of tax under this chapter, and accordingly,
the succession tax return of the decedent shall
include, in such manner as required by the
Commissioner of Revenue Services for purposes of
this section, a sworn statement as to the fair
market value of such farm land, based on its
highest and best use value, as of the date of
death of the decedent. Said tax shall be paid to
the Commissioner of Revenue Services within sixty
days following the date of such transfer or change
in classification, and if not so paid shall bear
interest at the rate of twelve per cent per annum,
commencing at the expiration of such sixty days,
until paid. The Commissioner of Revenue Services
may, for cause shown, on written application of
the beneficiary or distributee, filed with said
commissioner at or before the expiration of such
sixty days, extend the time for payment of said
tax or any part thereof.
(2) Said tax imposed under the provisions of
subdivision (1) of this subsection shall be a lien
in favor of the state of Connecticut upon such
real property so valued as farm land for purposes
of determining the gross estate of the decedent as
provided in subsection (a) of this section and,
following the death of the decedent, transferred
or changed in respect to use, resulting in a
change in the classification of such property as
farm land so as to be subject to said tax, from
the date on which such transfer or change in
classification becomes effective until (A) the
expiration of ten years immediately following the
death of the decedent, if there has been no such
transfer or change in classification during said
period of ten years or (B) in the event of such a
transfer or change in classification resulting in
the imposition of tax as provided in said
subdivision (1), payment of any tax due in
accordance with this subdivision plus interest and
costs that may accrue in addition thereto,
provided such lien shall not be valid as against
any lienor, mortgagee, judgment creditor or bona
fide purchaser, when they have no notice, unless
and until notice of such lien is filed or recorded
in the town clerk's office or place where
mortgages, liens and conveyances of such property
are required by statute to be filed or recorded.
(3) WHERE REAL PROPERTY CLASSIFIED AT THE TIME
OF THE DECEDENT'S DEATH AS FARM LAND IN ACCORDANCE
WITH SECTION 12-107c IS OWNED BY A PARTNERSHIP,
CORPORATION OR TRUST ENGAGED IN FARMING OR
AGRICULTURAL OPERATIONS, AND, AT THE TIME OF THE
DECEDENT'S DEATH, THE SOLE PARTNERS, SHAREHOLDERS
OR BENEFICIARIES, AS THE CASE MAY BE, OF SUCH
PARTNERSHIP, CORPORATION OR TRUST, ARE THE
DECEDENT AND ANY PERSONS WHO WOULD BE CLASSIFIED
AS TRANSFEREES UNDER CLASS AA, A OR B AS PROVIDED
IN SECTION 12-344, WHETHER OR NOT SUCH PERSONS ARE
IN FACT BENEFICIARIES OR DISTRIBUTEES OF THE
DECEDENT, ANY TRANSFER OF AN INTEREST IN SUCH
PARTNERSHIP, CORPORATION OR TRUST TO ANYONE OTHER
THAN A BENEFICIARY OR DISTRIBUTEE IN CLASS AA, A
OR B AS PROVIDED IN SECTION 12-344 SHALL BE
TREATED IN THE SAME MANNER FOR PURPOSES OF THIS
CHAPTER AS A TRANSFER OF REAL PROPERTY IN THE
GROSS ESTATE CLASSIFIED AS FARM LAND IN ACCORDANCE
WITH SECTION 12-107c TO ANYONE OTHER THAN A
BENEFICIARY OR DISTRIBUTEE IN CLASS AA, A OR B AS
PROVIDED IN SECTION 12-344. ANY CHANGE IN THE USE
OF SUCH FARM LAND, BY SUCH PARTNERSHIP,
CORPORATION OR TRUST, SO THAT IT IS NO LONGER
CLASSIFIED AS FARM LAND IN ACCORDANCE WITH SECTION
12-107c SHALL BE TREATED IN THE SAME MANNER FOR
PURPOSES OF THIS CHAPTER AS A CHANGE IN THE USE OF
REAL PROPERTY IN THE GROSS ESTATE CLASSIFIED AS
FARM LAND IN ACCORDANCE WITH SECTION 12-107c, BY
THE DECEDENT'S BENEFICIARIES OR DISTRIBUTEES IN
CLASS AA, A OR B AS PROVIDED IN SECTION 12-344, SO
THAT IT IS NO LONGER SO CLASSIFIED.
Sec. 15. Subsection (12) of section 12-407 of
the general statutes, as amended by section 14 of
public act 97-243, is repealed and the following
is substituted in lieu thereof:
(12) "Retailer" includes: (A) Every person
engaged in the business of making sales at retail
or in the business of making retail sales at
auction of tangible personal property owned by the
person or others; (B) every person engaged in the
business of making sales for storage, use or other
consumption or in the business of making sales at
auction of tangible personal property owned by the
person or others for storage, use or other
consumption; (C) every operator as defined in
subsection (18) of this section; (D) every seller
rendering any service described in subsection (2)
of this section; (E) every person under whom any
salesman, representative, peddler or canvasser
operates in this state, or from whom such
salesman, representative, peddler or canvasser
obtains the tangible personal property that is
sold; (F) every person with whose assistance any
seller is enabled to solicit orders within this
state; (G) every person making retail sales from
outside this state to a destination within this
state and not maintaining a place of business in
this state who engages in regular or systematic
solicitation of sales of tangible personal
property in this state (i) by the display of
advertisements on billboards or other outdoor
advertising in this state, (ii) by the
distribution of catalogs, periodicals, advertising
flyers or other advertising by means of print,
radio or television media, or (iii) by mail,
telegraphy, telephone, computer data base, cable,
optic, microwave or other communication system,
for the purpose of effecting retail sales of
tangible personal property, provided such person
has made one hundred or more retail sales from
outside this state to destinations within this
state during the twelve-month period ended on the
September thirtieth immediately preceding the
monthly or quarterly period with respect to which
such person's liability for tax under this chapter
is determined; (H) any person owned or controlled,
either directly or indirectly, by a retailer
engaged in business in this state which is the
same as or similar to the line of business in
which such person so owned or controlled is
engaged; (I) any person owned or controlled,
either directly or indirectly, by the same
interests that own or control, either directly or
indirectly, a retailer engaged in business in this
state which is the same as or similar to the line
of business in which such person so owned or
controlled is engaged; (J) any assignee of a
person engaged in the business of leasing tangible
personal property to others, where leased property
of such person which is subject to taxation under
this chapter is situated within this state and
such assignee has a security interest, as defined
in subsection (37) of section 42a-1-201, in such
property; AND (K) EVERY PERSON MAKING RETAIL SALES
OF ITEMS OF TANGIBLE PERSONAL PROPERTY FROM
OUTSIDE THIS STATE TO A DESTINATION WITHIN THIS
STATE AND NOT MAINTAINING A PLACE OF BUSINESS IN
THIS STATE WHO REPAIRS OR SERVICES SUCH ITEMS,
UNDER A WARRANTY, IN THIS STATE, EITHER DIRECTLY
OR INDIRECTLY THROUGH AN AGENT, INDEPENDENT
CONTRACTOR OR SUBSIDIARY.
Sec. 16. Subsection (15) of section 12-407 of
the general statutes is repealed and the following
is substituted in lieu thereof:
(15) "Engaged in business in the state" means
and includes but shall not be limited to the
following acts or methods of transacting business:
(A) Selling in this state, or any activity in this
state in connection with selling in this state,
tangible personal property for use, storage or
consumption within the state; (B) engaging in the
transfer for a consideration of the occupancy of
any room or rooms in a hotel or lodging house for
a period of thirty consecutive calendar days or
less; (C) rendering in this state any service
described in any of the subdivisions of subsection
(2) of this section; (D) maintaining, occupying or
using, permanently or temporarily, directly or
indirectly, through a subsidiary or agent, by
whatever name called, of any office, place of
distribution, sales or sample room or place,
warehouse or storage point or other place of
business or having any representative, agent,
salesman, canvasser or solicitor operating in this
state for the purpose of selling, delivering or
taking orders; (E) notwithstanding the fact that
retail sales are made from outside this state to a
destination within this state and that a place of
business is not maintained in this state, engaging
in regular or systematic solicitation of sales of
tangible personal property in this state (i) by
the display of advertisements on billboards or
other outdoor advertising in this state, (ii) by
the distribution of catalogs, periodicals,
advertising flyers or other advertising by means
of print, radio or television media, or (iii) by
mail, telegraphy, telephone, computer data base,
cable, optic, microwave or other communication
system, for the purpose of effecting retail sales
of tangible personal property, provided one
hundred or more retail sales from outside this
state to destinations within this state are made
during the twelve-month period ended on the
September thirtieth immediately preceding the
monthly or quarterly period with respect to which
liability for tax under this chapter is
determined; (F) being owned or controlled, either
directly or indirectly, by a retailer engaged in
business in this state which is the same as or
similar to the line of business in which the
retailer so owned or controlled is engaged; (G)
being owned or controlled, either directly or
indirectly, by the same interests that own or
control, either directly or indirectly, a retailer
engaged in business in this state which is the
same as or similar to the line of business in
which the retailer so owned or controlled is
engaged; (H) being the assignee of a person
engaged in the business of leasing tangible
personal property to others, where leased property
of such person is situated within this state and
such assignee has a security interest, as defined
in subsection (37) of section 42a-1-201, in such
property; AND (I) NOTWITHSTANDING THE FACT THAT
RETAIL SALES OF ITEMS OF TANGIBLE PERSONAL
PROPERTY ARE MADE FROM OUTSIDE THIS STATE TO A
DESTINATION WITHIN THIS STATE AND THAT A PLACE OF
BUSINESS IS NOT MAINTAINED IN THIS STATE,
REPAIRING OR SERVICING SUCH ITEMS, UNDER A
WARRANTY, IN THIS STATE, EITHER DIRECTLY OR
INDIRECTLY THROUGH AN AGENT, INDEPENDENT
CONTRACTOR OR SUBSIDIARY. A retailer who has
contracted with a commercial printer for printing
and distribution of printed material shall not be
deemed to be engaged in business in this state
because of the ownership or leasing by the
retailer of tangible or intangible personal
property located at the premises of the commercial
printer in this state, the sale by the retailer of
property of any kind produced or processed at and
shipped or distributed from the premises of the
commercial printer in this state, the activities
of the retailer's employees or agents at the
premises of the commercial printer in this state,
which activities relate to quality control,
distribution or printing services performed by the
printer, or the activities of any kind performed
by the commercial printer in this state for or on
behalf of the retailer.
Sec. 17. Subsection (1) of section 12-408 of
the general statutes, as amended by section 17 of
public act 97-243, is repealed and the following
is substituted in lieu thereof:
(1) For the privilege of making any sales as
defined in subsection (2) of section 12-407, AS
AMENDED, at retail, in this state for a
consideration, a tax is hereby imposed on all
retailers at the rate of six per cent of the gross
receipts of any retailer from the sale of all
tangible personal property sold at retail or from
the rendering of any services constituting a sale
in accordance with subsection (2) of section
12-407, AS AMENDED, except, in lieu of said rate
of six per cent, (A) at a rate of five and
one-half per cent of the gross receipts of any
retailer from the sale of any repair or
replacement parts exclusively for use in
machinery, as defined in subsection (34) of
section 12-412, used directly in a manufacturing
production process, (B) at a rate of twelve per
cent with respect to each transfer of occupancy,
from the total amount of rent received for such
occupancy of any room or rooms in a hotel or
lodging house for the first period not exceeding
thirty consecutive calendar days, (C) with respect
to the sale of a motor vehicle to any individual
who is a member of the armed forces of the United
States and is on full-time active duty in
Connecticut and who is considered, under 50 App
USC 574, a resident of another state, OR TO ANY
SUCH INDIVIDUAL AND THE SPOUSE THEREOF, at a rate
of four and one-half per cent of the gross
receipts of any retailer from such sales, provided
such retailer requires and maintains an affidavit
or other evidence, satisfactory to the
commissioner, concerning the purchaser's state of
residence under 50 App USC 574, (D) with respect
to the sale of a vessel to any individual who does
not maintain a permanent place of abode in this
state and who is a resident of another state and
who does not present such vessel for registration
with the Department of Motor Vehicles in this
state, at a rate which is the lesser of: (i) Six
per cent of the gross receipts of any retailer
from such sales; or (ii) the percentage of such
gross receipts that is payable as a state sales
tax by retailers engaged in business in the
purchaser's state of residence, provided such
retailer requires and maintains an affidavit or
other evidence, satisfactory to the commissioner,
concerning the purchaser's state of residence, (E)
with respect to the sales of computer and data
processing services occurring on or after July 1,
1997, and prior to July 1, 1998, at the rate of
five per cent, on or after July 1, 1998, and prior
to July 1, 1999, at the rate of four per cent, on
or after July 1, 1999, and prior to July 1, 2000,
at the rate of three per cent, on or after July 1,
2000, and prior to July 1, 2001, at the rate of
two per cent, on and after July 1, 2001, and prior
to July 1, 2002, at the rate of one per cent and
on and after July 1, 2002, such services shall be
exempt from such tax, and (F) with respect to the
sales of repair or maintenance services on vessels
as defined in section 15-127, occurring on or
after July 1, 1997, and prior to July 1, 1998, at
the rate of four per cent, on or after July 1,
1998, and prior to July 1, 1999, at the rate of
two per cent and on and after July 1, 1999, such
services shall be exempt from such tax. The rate
of tax imposed by this chapter shall be applicable
to all retail sales upon the effective date of
such rate, except that a new rate which represents
an increase in the rate applicable to the sale
shall not apply to any sales transaction wherein a
binding sales contract without an escalator clause
has been entered into prior to the effective date
of the new rate and delivery is made within ninety
days after the effective date of the new rate. For
the purposes of payment of the tax imposed under
this section, any retailer of services taxable
under subdivision (i) of subsection (2) of section
12-407, AS AMENDED, who computes taxable income,
for purposes of taxation under the Internal
Revenue Code of 1986, or any subsequent
corresponding internal revenue code of the United
States, as from time to time amended, on an
accounting basis which recognizes only cash or
other valuable consideration actually received as
income and who is liable for such tax only due to
the rendering of such services may make payments
related to such tax for the period during which
such income is received, without penalty or
interest, without regard to when such service is
rendered. Information about the state sales tax
rate of other states shall, upon request, be
furnished by the commissioner.
Sec. 18. Subsection (1) of section 12-411 of
the general statutes, as amended by section 19 of
public act 97-243, is repealed and the following
is substituted in lieu thereof:
(1) An excise tax is hereby imposed on the
storage, acceptance, consumption or any other use
in this state of tangible personal property
purchased from any retailer for storage,
acceptance, consumption or any other use in this
state, the acceptance or receipt of any services
constituting a sale in accordance with subsection
(2) of section 12-407, AS AMENDED, purchased from
any retailer for consumption or use in this state,
or the storage, acceptance, consumption or any
other use in this state of tangible personal
property which has been manufactured, fabricated,
assembled or processed from materials by a person,
either within or without this state, for storage,
acceptance, consumption or any other use by such
person in this state, to be measured by the sales
price of materials, at the rate of six per cent of
the sales price of such property or services,
except, in lieu of said rate of six per cent, (A)
with respect to the storage, acceptance,
consumption or use of any repair or replacement
parts purchased from any retailer for storage,
acceptance, consumption or use in this state, at
the rate of five and one-half per cent of the
sales price of such parts, provided such parts are
exclusively for use in machinery, as defined in
subsection (34) of section 12-412, that is used
directly in a manufacturing production process,
(B) at a rate of twelve per cent of the rent paid
for occupancy of any room or rooms in a hotel or
lodging house for the first period of not
exceeding thirty consecutive calendar days, (C)
with respect to the storage, acceptance,
consumption or use in this state of a motor
vehicle purchased from any retailer for storage,
acceptance, consumption or use in this state by
any individual who is a member of the armed forces
of the United States and is on full-time active
duty in Connecticut and who is considered, under
50 App USC 574, a resident of another state, OR TO
ANY SUCH INDIVIDUAL AND THE SPOUSE OF SUCH
INDIVIDUAL at a rate of four and one-half per cent
of the sales price of such vehicle provided such
retailer requires and maintains an affidavit or
other evidence, satisfactory to the commissioner,
concerning the purchaser's state of residence
under 50 App USC 574, (D) with respect to the
storage, acceptance, consumption or use in this
state of a vessel purchased from any retailer for
storage, acceptance, consumption or any other use
in this state by any individual who does not
maintain a permanent place of abode in this state
and who is a resident of another state and who
does not present such vessel for registration with
the Department of Motor Vehicles in this state, at
a rate which is the lesser of: (i) Six per cent of
the sales price of such vessel; or (ii) the
percentage of such sales price that is payable as
a state use tax by purchasers making purchases in
the purchaser's state of residence, provided the
retailer requires and maintains an affidavit or
other evidence, satisfactory to the commissioner,
concerning the purchaser's state of residence, (E)
with respect to the sales of repair or maintenance
services on vessels as defined in section 15-127,
occurring on or after July 1, 1997, and prior to
July 1, 1998, at the rate of four per cent, on or
after July 1, 1998, and prior to July 1, 1999, at
the rate of two per cent and on and after July 1,
1999, such services shall be exempt from such tax,
and (F) with respect to the acceptance or receipt
in this state of computer and data processing
services purchased from any retailer for
consumption or use in this state occurring on or
after July 1, 1997, and prior to July 1, 1998, at
the rate of five per cent of such services, on or
after July 1, 1998, and prior to July 1, 1999, at
the rate of four per cent of such services, on or
after July 1, 1999, and prior to July 1, 2000, at
the rate of three per cent of such services, on or
after July 1, 2000, and prior to July 1, 2001, at
the rate of two per cent of such services, on and
after July 1, 2001, and prior to July 1, 2002, at
the rate of one per cent of such services and on
and after July 1, 2002, such services shall be
exempt from such tax. Information about the state
use tax rate of other states shall, upon request,
be furnished by the commissioner.
Sec. 19. (NEW) The Commissioner of Revenue
Services is authorized to pay to a revenue agency
of another state an amount not to exceed fifty per
cent of the tax actually collected as the result
of an assessment made under section 12-416 of the
general statutes, as amended, against any
purchaser of tangible personal property or
services described in subsection (2) of section
12-407 of the general statutes, as amended, if
said commissioner, in his sole discretion,
determines that information provided by such
agency was instrumental in the making of such
assessment.
Sec. 20. Section 12-458b of the general
statutes is repealed and the following is
substituted in lieu thereof:
Any person who receives fuels from an
unlicensed distributor or in such form and under
such circumstances as to preclude collection from
a distributor of the tax imposed in section 12-458
and who thereafter sells or uses any such fuels in
such manner or under such circumstances as to
render such sale or use subject to said tax, is
considered to be a distributor and shall make the
same report, pay the same tax and be subject to
all provisions of this chapter applicable to a
distributor of such fuels except the surety bond
requirement of section 12-456, PROVIDED ANY SUCH
PERSON WHO IS A CONTRACTOR PERFORMING A SERVICE
FOR A MUNICIPALITY OR SCHOOL DISTRICT OF THIS
STATE IN ACCORDANCE WITH A CONTRACT SHALL, IN LIEU
OF FILING TAX RETURNS MONTHLY AND PAYING TAXES
MONTHLY, FILE A QUARTERLY TAX RETURN ON OR BEFORE
THE LAST DAY OF THE MONTH NEXT SUCCEEDING THE END
OF EACH CALENDAR QUARTER AND SHALL PAY THE TAXES
DUE WITH SUCH RETURN ON OR BEFORE THE LAST DAY OF
THE MONTH NEXT SUCCEEDING THE END OF EACH CALENDAR
QUARTER. Such person may, at the discretion of the
commissioner, be required to file a surety bond or
other security acceptable to the commissioner in
an amount set by the commissioner.
Sec. 21. Subsection (b) of section 12-459 of
the general statutes is repealed and the following
is substituted in lieu thereof:
(b) All claims for refund shall be accompanied
by original invoices or sales receipts or other
statements of fact, under penalty of false
statement, showing, to the satisfaction of the
commissioner, that the tax has been paid on the
fuel involved in such refund, and any other
information which is deemed necessary by the
commissioner for the determination of such claims.
Any claim for refund of said tax for fuel used
during any calendar year shall be filed with the
commissioner on or before [March] MAY thirty-first
of the succeeding year. Such claim shall be on a
form prescribed by the commissioner which shall
contain such information as he deems necessary for
the determination of such claim.
Sec. 22. Subsection (a) of section 12-498 of
the general statutes is repealed and the following
is substituted in lieu thereof:
(a) The tax imposed by section 12-494 shall
not apply to: (1) Deeds which this state is
prohibited from taxing under the constitution or
laws of the United States; (2) deeds which secure
a debt or other obligation; (3) deeds to which
this state or any of its political subdivisions or
its or their respective agencies is a party; (4)
tax deeds; (5) deeds of release of property which
is security for a debt or other obligation; (6)
deeds of partition; (7) deeds made pursuant to
mergers of corporations; (8) deeds made by a
subsidiary corporation to its parent corporation
for no consideration other than the cancellation
or surrender of the subsidiary's stock; (9)
[conveyance of an interest in real property] DEEDS
MADE pursuant to a decree of the Superior Court
under section 46b-81, 49-24 or 52-495; [(10)
certificates of devise or distribution; (11)
transfers for no consideration between parents and
children; (12) an assignment, with no
consideration, of any interests, present or
future, vested or contingent, in real property
which endure for a period of time and the
termination of which is not fixed or ascertained
by a specific number of years; (13) an assignment,
with no consideration, of the unexpired portion of
a term or estate for life or of a term or estate
for years; (14) transfers made by a corporation
affiliated with the corporation to which such
transfer is made] (10) DEEDS, WHEN THE
CONSIDERATION FOR THE INTEREST OR PROPERTY
CONVEYED IS LESS THAN TWO THOUSAND DOLLARS; (11)
DEEDS BETWEEN AFFILIATED CORPORATIONS, provided
both of such corporations are exempt from taxation
pursuant to paragraph (2), (3) or (25) of Section
501(c) of the Internal Revenue Code of 1986, or
any subsequent corresponding internal revenue code
of the United States, as from time to time
amended; [, and provided further such corporations
are affiliated in such manner that (A) either
corporation in such transaction owns or controls
either directly or indirectly not less than one
hundred per cent of the capital stock of the other
corporation or (B) either corporation in such
transaction is owned or controlled either directly
or indirectly by interests which own or control
either directly or indirectly not less than one
hundred per cent of the capital stock of the other
corporation; (15) transfers] (12) DEEDS made by a
corporation which is exempt from taxation pursuant
to paragraph (3) of Section 501(c) of the Internal
Revenue Code of 1986, or any subsequent
corresponding internal revenue code of the United
States, as from time to time amended, to any
corporation which is exempt from taxation pursuant
to said paragraph (3) of said Section 501(c);
[(16) transfers made on or after July 1, 1992,]
(13) DEEDS MADE to any nonprofit organization
which is organized for the purpose of holding
undeveloped land in trust for conservation or
recreation purposes; [(17) transfers] (14) DEEDS
between spouses; and [(18) transfers] (15) DEEDS
of property for the stadium facility site, as
defined in section 32-381 or the practice facility
site, as defined in section 32-381.
Sec. 23. (NEW) When the Commissioner of
Revenue Services makes a deficiency assessment for
any taxes payable under chapter 223 of the general
statutes to the state, the commissioner is
authorized to make a deficiency assessment for any
taxes payable under said chapter 223 to a
municipality and to hold a hearing, when requested
in writing by any person aggrieved by the action
of the commissioner or his authorized agent in
fixing the amount of any tax, penalty or interest
provided for by said chapter 223 on or before the
sixtieth day after notice of such action is
delivered or mailed to such person. The deficiency
assessment for any taxes payable under said
chapter 223 to a municipality shall bear interest
at the rate of one per cent per month or fraction
thereof from the date when the original tax was
due and payable. When it appears that any part of
the deficiency for which a deficiency assessment
is made is due to negligence or intentional
disregard of the provisions of said chapter 223 or
regulations adopted under said chapter 223, there
shall be imposed a penalty equal to ten per cent
of the amount of such deficiency assessment, or
fifty dollars, whichever is greater. When it
appears that any part of the deficiency for which
a deficiency assessment is made is due to fraud or
intent to evade the provisions of said chapter 223
or regulations adopted under said chapter 223,
there shall be imposed a penalty equal to
twenty-five per cent of the amount of such
deficiency assessment. No taxpayer shall be
subject to more than one penalty under this
section in relation to the same tax period. Once a
deficiency assessment for any taxes payable under
said chapter 223 to a municipality is no longer
the subject of a timely filed administrative
appeal to the commissioner or of a timely filed
appeal pending before any court of competent
jurisdiction, the commissioner may collect, on
behalf of such municipality, such taxes, and all
interest and penalties added thereto by law, under
the provisions of section 12-35 of the general
statutes as if such taxes, penalties or interest
due such municipality were "tax due the state", as
such term is defined in said section 12-35, and as
if such term expressly included taxes, penalties
or interest due to such municipality. Such taxes,
and all interest and penalties added thereto by
law, shall be treated, for purposes of subsection
(a) of section 12-39g of the general statutes, as
amended, and for purposes of subsection (a) of
section 12-739 of the general statutes, as
amended, as if they were taxes due to the state.
Sec. 24. Subsection (4) of section 12-540 of
the general statutes is repealed and the following
is substituted in lieu thereof:
(4) "Cabaret or other similar place" means any
room in any hotel, restaurant, hall or other
public place where music, dancing privileges or
any other entertainment, except mechanical music
alone or the music of a single performer alone OR
KARAOKE ALONE WITHOUT A PAID KARAOKE ENTERTAINER,
are afforded the patrons in connection with the
serving or selling of alcoholic beverages even
though the charge made for admission, refreshment,
service or merchandise is not increased by reason
of the furnishing of such entertainment. "CABARET
OR OTHER SIMILAR PLACE" DOES NOT INCLUDE ANY ROOM
IN ANY RESTAURANT, AS DEFINED IN SUBSECTION (e) OF
SECTION 30-22, FOR WHICH ONLY A RESTAURANT PERMIT
FOR BEER, AS PROVIDED IN SUBSECTION (b) OF SECTION
30-22, OR ONLY A RESTAURANT PERMIT FOR WINE AND
BEER, AS PROVIDED IN SUBSECTION (c) OF SECTION
30-22 HAS BEEN ISSUED.
Sec. 25. Section 12-587 of the general
statutes, as amended by section 1 of public act
97-281, is repealed and the following is
substituted in lieu thereof:
(a) As used in this chapter: (1) "Company"
includes a corporation, partnership, limited
partnership, LIMITED LIABILITY COMPANY, LIMITED
LIABILITY PARTNERSHIP, association, individual or
any fiduciary thereof; (2) "quarterly period"
means a period of three calendar months commencing
on the first day of January, April, July or
October and ending on the last day of March, June,
September or December, respectively; (3) "gross
earnings" means [those earnings derived] ALL
CONSIDERATION RECEIVED from the first sale within
this state of a petroleum product; [, but does not
include earnings in a taxable year commencing
prior to January 1, 2000, from the sale of propane
gas as a fuel for a motor vehicle and] (4)
"petroleum products" means those products which
contain or are made from petroleum or a petroleum
derivative; [, but does not mean (A) the product
designated by the American Society for Testing and
Materials as "Specification for Heating Oil
D396-69", commonly known as number 2 heating oil,
to be used exclusively for heating purposes or to
be used in a commercial fishing vessel which
vessel qualifies for an exemption pursuant to
section 12-412, (B) kerosene, commonly known as
number 1 oil, used exclusively for heating
purposes, provided delivery is of both number 1
and number 2 oil, and via a truck with a metered
delivery ticket to a residential dwelling or to a
centrally metered system serving a group of
residential dwellings, (C) the product identified
as propane gas to be used exclusively for heating
purposes, or (D) bunker fuel oil, intermediate
fuel, marine diesel oil and marine gas oil for use
in any vessel having a displacement exceeding four
thousand dead weight tons. For calendar quarters
commencing on or after July 1, 2002, petroleum
products shall not include grade number 6 fuel
oil, as defined in regulations adopted pursuant to
section 16a-22c, to be used exclusively by a
company which, in accordance with census data
contained in the Standard Industrial
Classification Manual, United States Office of
Management and Budget, 1987 edition, is included
in code classifications 2000 to 3999, inclusive,
or number 2 heating oil used exclusively in a
vessel primarily engaged in interstate commerce,
which vessel qualifies for an exemption under
12-412] (5) "FIRST SALE OF PETROLEUM PRODUCTS
WITHIN THIS STATE" MEANS THE INITIAL SALE OF A
PETROLEUM PRODUCT DELIVERED TO A LOCATION IN THIS
STATE; (6) "EXPORT" OR "EXPORTATION" MEANS THE
CONVEYANCE OF PETROLEUM PRODUCTS FROM WITHIN THIS
STATE TO A LOCATION OUTSIDE THIS STATE FOR THE
PURPOSE OF SALE OR USE OUTSIDE THIS STATE; AND (7)
"SALE FOR EXPORTATION" MEANS A SALE OF PETROLEUM
PRODUCTS TO A PURCHASER WHICH ITSELF EXPORTS SUCH
PRODUCTS.
(b) (1) Except as OTHERWISE provided in
subdivision (2) of this subsection, any company
which is engaged in the refining or distribution,
or both, of petroleum products and which
distributes such products in this state shall pay
a quarterly tax [at the rate of five per cent of]
ON its gross earnings derived from the FIRST sale
of petroleum products within this state. Each
company shall on or before the last day of the
month next succeeding each quarterly period render
to the commissioner [, under oath of its treasurer
or the person performing the duties of treasurer
or of an authorized agent or officer,] a return on
forms prescribed or furnished by the commissioner
AND SIGNED BY THE PERSON PERFORMING THE DUTIES OF
TREASURER OR AN AUTHORIZED AGENT OR OFFICER,
including the amount of gross earnings derived
from the FIRST sale of petroleum products within
this state for the quarterly period and such other
facts as the commissioner may require for the
purpose of making any computation required by this
chapter. EXCEPT AS OTHERWISE PROVIDED IN
SUBDIVISION (3) OF THIS SUBSECTION, THE RATE OF
TAX SHALL BE FIVE PER CENT.
(2) GROSS EARNINGS DERIVED FROM THE FIRST SALE
OF THE FOLLOWING PETROLEUM PRODUCTS WITHIN THIS
STATE SHALL BE EXEMPT FROM TAX: (A) ANY PETROLEUM
PRODUCTS SOLD FOR EXPORTATION FROM THIS STATE FOR
SALE OR USE OUTSIDE THIS STATE; (B) THE PRODUCT
DESIGNATED BY THE AMERICAN SOCIETY FOR TESTING AND
MATERIALS AS "SPECIFICATION FOR HEATING OIL
D396-69", COMMONLY KNOWN AS NUMBER 2 HEATING OIL,
TO BE USED EXCLUSIVELY FOR HEATING PURPOSES OR TO
BE USED IN A COMMERCIAL FISHING VESSEL, WHICH
VESSEL QUALIFIES FOR AN EXEMPTION PURSUANT TO
SECTION 12-412, AS AMENDED; (C) KEROSENE, COMMONLY
KNOWN AS NUMBER 1 OIL, TO BE USED EXCLUSIVELY FOR
HEATING PURPOSES, PROVIDED DELIVERY IS OF BOTH
NUMBER 1 AND NUMBER 2 OIL, AND VIA A TRUCK WITH A
METERED DELIVERY TICKET TO A RESIDENTIAL DWELLING
OR TO A CENTRALLY METERED SYSTEM SERVING A GROUP
OF RESIDENTIAL DWELLINGS; (D) THE PRODUCT
IDENTIFIED AS PROPANE GAS, TO BE USED EXCLUSIVELY
FOR HEATING PURPOSES; (E) BUNKER FUEL OIL,
INTERMEDIATE FUEL, MARINE DIESEL OIL AND MARINE
GAS OIL TO BE USED IN ANY VESSEL HAVING A
DISPLACEMENT EXCEEDING FOUR THOUSAND DEAD WEIGHT
TONS; (F) FOR ANY FIRST SALE OCCURRING PRIOR TO
JANUARY 1, 2000, PROPANE GAS TO BE USED AS A FUEL
FOR A MOTOR VEHICLE; (G) FOR ANY FIRST SALE
OCCURRING ON OR AFTER JULY 1, 2002, GRADE NUMBER 6
FUEL OIL, AS DEFINED IN REGULATIONS ADOPTED
PURSUANT TO SECTION 16a-22c, TO BE USED
EXCLUSIVELY BY A COMPANY WHICH, IN ACCORDANCE WITH
CENSUS DATA CONTAINED IN THE STANDARD INDUSTRIAL
CLASSIFICATION MANUAL, UNITED STATES OFFICE OF
MANAGEMENT AND BUDGET, 1987 EDITION, IS INCLUDED
IN CODE CLASSIFICATIONS 2000 TO 3999, INCLUSIVE;
OR (H) FOR ANY FIRST SALE OCCURRING ON OR AFTER
JULY 1, 2002, NUMBER 2 HEATING OIL TO BE USED
EXCLUSIVELY IN A VESSEL PRIMARILY ENGAGED IN
INTERSTATE COMMERCE, WHICH VESSEL QUALIFIES FOR AN
EXEMPTION UNDER SECTION 12-412, AS AMENDED.
[(2)] (3) The rate of tax ON GROSS EARNINGS
derived from the FIRST sale of grade number 6 fuel
oil, as defined in regulations adopted pursuant to
section 16a-22c, to be used exclusively by a
company which, in accordance with census data
contained in the Standard Industrial
Classification Manual, United States Office of
Management and Budget, 1987 edition, is included
in code classifications 2000 to 3999, inclusive,
or number 2 heating oil used exclusively in a
vessel primarily engaged in interstate commerce,
which vessel qualifies for an exemption under
SECTION 12-412, AS AMENDED, shall be: (A) Four per
cent with respect to calendar quarters commencing
on or after July 1, 1998, and prior to July 1,
1999; (B) three per cent with respect to calendar
quarters commencing on or after July 1, 1999, and
prior to July 1, 2000; (C) two per cent with
respect to calendar quarters commencing on or
after July 1, 2000, and prior to July 1, 2001; and
(D) one per cent with respect to calendar quarters
commencing on or after July 1, 2001, and prior to
July 1, 2002. [Gross earnings from sales as
provided in this subdivision shall not be subject
to the provisions of this chapter with respect to
calendar quarters commencing on or after July 1,
2002.]
(c) (1) Any company which imports or causes to
be imported into this state petroleum products for
its use and consumption, other than a company
[which is] subject to and [which has] HAVING paid
the tax on such COMPANY'S GROSS EARNINGS FROM
FIRST SALES OF petroleum products WITHIN THIS
STATE, WHICH EARNINGS INCLUDE GROSS EARNINGS
ATTRIBUTABLE TO SUCH IMPORTED OR CAUSED TO BE
IMPORTED PETROLEUM PRODUCTS, in accordance with
subsection (b) of this section, shall pay a
quarterly tax [at the rate of five per cent of] ON
the consideration given or contracted to be given
for such petroleum product if the consideration
given or contracted to be given for all such
deliveries during the quarterly period for which
such tax is to be paid exceeds one hundred
thousand dollars. [For the purposes of this
subsection, "use" includes the sale of imported
petroleum products in the regular course of
business.] EXCEPT AS OTHERWISE PROVIDED IN
SUBDIVISION (3) OF THIS SUBSECTION, THE RATE OF
TAX SHALL BE FIVE PER CENT. Fuel in the fuel
supply tanks of a motor vehicle, which fuel tanks
are directly connected to the engine, shall not be
considered a delivery for the purposes of this
subsection.
(2) CONSIDERATION GIVEN OR CONTRACTED TO BE
GIVEN FOR PETROLEUM PRODUCTS, GROSS EARNINGS FROM
THE FIRST SALE OF WHICH ARE EXEMPT FROM TAX UNDER
SUBDIVISION (2) OF SUBSECTION (b) OF THIS SECTION,
SHALL BE EXEMPT FROM TAX.
(3) THE RATE OF TAX ON CONSIDERATION GIVEN OR
CONTRACTED TO BE GIVEN FOR GRADE NUMBER 6 FUEL
OIL, AS DEFINED IN REGULATIONS ADOPTED PURSUANT TO
SECTION 16a-22c, TO BE USED EXCLUSIVELY BY A
COMPANY WHICH, IN ACCORDANCE WITH CENSUS DATA
CONTAINED IN THE STANDARD INDUSTRIAL
CLASSIFICATION MANUAL, UNITED STATES OFFICE OF
MANAGEMENT AND BUDGET, 1987 EDITION, IS INCLUDED
IN CODE CLASSIFICATIONS 2000 TO 3999, INCLUSIVE,
OR NUMBER 2 HEATING OIL USED EXCLUSIVELY IN A
VESSEL PRIMARILY ENGAGED IN INTERSTATE COMMERCE,
WHICH VESSEL QUALIFIES FOR AN EXEMPTION UNDER
SECTION 12-412, AS AMENDED, SHALL BE: (A) FOUR PER
CENT WITH RESPECT TO CALENDAR QUARTERS COMMENCING
ON OR AFTER JULY 1, 1998, AND PRIOR TO JULY 1,
1999; (B) THREE PER CENT WITH RESPECT TO CALENDAR
QUARTERS COMMENCING ON OR AFTER JULY 1, 1999, AND
PRIOR TO JULY 1, 2000; (C) TWO PER CENT WITH
RESPECT TO CALENDAR QUARTERS COMMENCING ON OR
AFTER JULY 1, 2000, AND PRIOR TO JULY 1, 2001; AND
(D) ONE PER CENT WITH RESPECT TO CALENDAR QUARTERS
COMMENCING ON OR AFTER JULY 1, 2001, AND PRIOR TO
JULY 1, 2002.
(d) The amount of tax reported to be due on
such return shall be due and payable on or before
the last day of the month next succeeding the
quarterly period. The tax imposed under the
provisions of this chapter shall be in addition to
any other tax imposed by this state on such
company.
(e) For the purposes of this chapter, the
gross earnings of any producer or refiner of
petroleum products operating a service station
along the highways or interstate highways within
the state pursuant to a contract with the
Department of Transportation or operating a
service station which is used as a training or
test marketing center under the provisions of
subsection (b) of section 14-344d, shall be
calculated by multiplying the volume of petroleum
products delivered by any producer or refiner to
any such station by such producer's or refiner's
dealer tank wagon price or dealer wholesale price
in the area of the service station.
Sec. 26. Section 12-587a of the general
statutes is repealed and the following is
substituted in lieu thereof:
(a) Any company, as such term is used in
section 12-587, AS AMENDED BY THIS ACT, liable for
the tax imposed under [said] SUBSECTION (b) OF
SAID section 12-587 on gross earnings from [sales]
THE FIRST SALE of petroleum products WITHIN THIS
STATE, which products the purchaser thereof
subsequently sells FOR EXPORTATION AND SALE OF USE
outside [the] THIS state, shall be allowed a
credit against any tax for which such company is
liable in accordance with [said] SUBSECTION (b) OF
SAID section 12-587, in the amount of tax paid to
the state with respect to the sale of such
products, provided (1) such purchaser has
submitted certification to such company, in such
form as prescribed by the Commissioner of Revenue
Services, that such products were sold OR USED
outside [the] THIS state, (2) such certification
and any additional information related to such
sale OR USE BY SUCH PURCHASER, which said
commissioner may request, have been submitted to
said commissioner and (3) such company makes a
payment to such purchaser, related to such
products sold OR USED outside [the] THIS state, in
the amount [of that portion of the total sales
price therefor representing] EQUAL TO the tax
imposed under said section 12-587 ON GROSS
EARNINGS FROM THE FIRST SALE TO SUCH PURCHASER
WITHIN THE STATE. In addition, such company shall
be allowed such credit when there has been any
sale of such products subsequent to THE sale by
such company but prior to sale OR USE outside
[the] THIS state, provided (1) each purchaser
receives payment, related to [the inclusion of the
amount of such tax in the total sales price paid
by the purchaser] SUCH PRODUCTS SOLD OR USED
OUTSIDE THIS STATE, EQUAL TO THE TAX IMPOSED UNDER
SAID SECTION 12-587, ON GROSS EARNINGS FROM THE
FIRST SALE OF SUCH PRODUCTS WITHIN THIS STATE, and
(2) the purchaser [consummating the sale] SELLING
OR USING SUCH PRODUCTS outside [the] THIS state
complies with the requirements in this section
related to a purchaser of such products from the
company liable for such tax.
(b) ANY COMPANY WHICH IMPORTS OR CAUSES TO BE
IMPORTED PETROLEUM PRODUCTS INTO THIS STATE FOR
ITS OWN USE OR CONSUMPTION SHALL BE ALLOWED A
CREDIT AGAINST TAX UNDER SUBSECTION (c) OF SECTION
12-587, AS AMENDED BY THIS ACT, ON THE
CONSIDERATION GIVEN OR CONTRACTED TO BE GIVEN FOR
ALL DELIVERIES IF THE COMPANY SUBSEQUENTLY EXPORTS
SUCH PETROLEUM PRODUCTS FOR SALE OR USE OUTSIDE
THIS STATE.
Sec. 27. Section 12-687 of the general
statutes is repealed and the following is
substituted in lieu thereof:
(a) Any electronic funds transfer shall be
initiated in a timely fashion in order to ensure
that the bank account designated by the department
is credited BY ELECTRONIC FUNDS TRANSFER for the
amount of the tax payment required to be made by
such method on or before the due date thereof,
[provided with respect to any transfer by
electronic funds transfer by any employer who is
required to pay over Connecticut income tax that
has been deducted and withheld from employee
wages, an electronic funds transfer will be deemed
to have been initiated in a timely fashion if the
bank account designated by the department is
credited for the amount of such tax payment
required to be made by such method on or before
the business day next succeeding the due date
thereof] OR, IN THE CASE OF THE PAYMENT OVER BY AN
EMPLOYER OF INCOME TAX DEDUCTED AND WITHHELD FROM
EMPLOYEE WAGES, THE NEXT SUCCEEDING DAY THAT IS
NOT A SATURDAY, SUNDAY OR LEGAL HOLIDAY, AS
DEFINED IN SECTION 12-39a, AS AMENDED.
(b) [If the bank account designated by the
department is not credited for the amount of the
tax payment on or before the due date thereof,
such payment shall be considered a failure to pay
the tax required to be so paid in a timely manner
and] (1) WHERE A TAX PAYMENT IS REQUIRED TO BE
MADE BY ELECTRONIC FUNDS TRANSFER, ANY PAYMENT
MADE BY OTHER THAN ELECTRONIC FUNDS TRANSFER SHALL
BE TREATED AS A TAX PAYMENT NOT MADE IN A TIMELY
MANNER, AND ANY PAYMENT MADE BY ELECTRONIC FUNDS
TRANSFER, WHERE THE BANK ACCOUNT DESIGNATED BY THE
DEPARTMENT IS NOT CREDITED FOR THE AMOUNT OF THE
TAX PAYMENT ON OR BEFORE THE DUE DATE THEREOF, OR
IN THE CASE OF THE PAYMENT OVER BY AN EMPLOYER OF
INCOME TAX DEDUCTED AND WITHHELD FROM EMPLOYEE
WAGES, THE NEXT SUCCEEDING DAY THAT IS NOT A
SATURDAY, SUNDAY OR LEGAL HOLIDAY, AS DEFINED IN
SECTION 12-39a, AS AMENDED, SHALL BE TREATED AS A
TAX PAYMENT NOT MADE IN A TIMELY MANNER. ANY TAX
PAYMENT TREATED UNDER THIS SUBSECTION AS A TAX
PAYMENT NOT MADE IN A TIMELY MANNER shall be
subject to penalty and interest in accordance with
the applicable provisions of the general statutes.
[, provided with respect to any transfer by
electronic funds transfer by any employer who is
required to pay over Connecticut income tax that
has been deducted and withheld from employee
wages, if the bank account designated by the
department is not credited for the amount of such
tax payment on or before the business day next
succeeding the due date thereof, such payment
shall be considered a failure to pay the tax
required to be so paid in a timely manner and
shall be subject to penalty and interest in
accordance with the applicable provisions of the
general statutes.]
(2) WHERE ANY TAX PAYMENT IS TREATED UNDER
THIS SUBSECTION AS A TAX PAYMENT NOT MADE IN A
TIMELY MANNER BECAUSE IT IS MADE BY OTHER THAN
ELECTRONIC FUNDS TRANSFER, THERE SHALL BE IMPOSED
A PENALTY EQUAL TO TEN PER CENT OF THE TAX PAYMENT
REQUIRED TO BE MADE BY ELECTRONIC FUNDS TRANSFER.
WHERE ANY TAX PAYMENT MADE BY ELECTRONIC FUNDS
TRANSFER IS TREATED UNDER THIS SUBSECTION AS A TAX
PAYMENT NOT MADE IN A TIMELY MANNER BECAUSE THE
BANK ACCOUNT DESIGNATED BY THE DEPARTMENT IS NOT
CREDITED BY ELECTRONIC FUNDS TRANSFER FOR THE
AMOUNT OF THE TAX PAYMENT ON OR BEFORE THE DUE
DATE THEREOF, THERE SHALL BE IMPOSED A PENALTY
EQUAL TO TWO PER CENT OF THE TAX PAYMENT REQUIRED
TO BE MADE BY ELECTRONIC FUNDS TRANSFER, IF SUCH
FAILURE TO PAY BY ELECTRONIC FUNDS TRANSFER IS FOR
NOT MORE THAN FIVE DAYS, FIVE PER CENT OF THE TAX
PAYMENT REQUIRED TO BE MADE BY ELECTRONIC FUNDS
TRANSFER, IF SUCH FAILURE TO PAY BY ELECTRONIC
FUNDS TRANSFER IS FOR MORE THAN FIVE DAYS BUT NOT
MORE THAN FIFTEEN DAYS, AND TEN PER CENT OF THE
TAX PAYMENT REQUIRED TO BE MADE BY ELECTRONIC
FUNDS TRANSFER, IF SUCH FAILURE TO PAY BY
ELECTRONIC FUNDS TRANSFER IS FOR MORE THAN FIFTEEN
DAYS.
Sec. 28. Section 12-704 of the general
statutes, as amended by section 4 of public act
97-286, is repealed and the following is
substituted in lieu thereof:
(a) Any resident or part-year resident of this
state shall be allowed a credit against the tax
otherwise due under this chapter in the amount of
any income tax imposed on such resident or
part-year resident for the taxable year by another
state of the United States or a political
subdivision thereof or the District of Columbia
[or any province of Canada] on income derived from
sources therein and which is also subject to tax
under this chapter. In the case of a resident, the
credit provided under this section shall not
exceed the proportion of the tax otherwise due
under this chapter that the amount of the
taxpayer's Connecticut adjusted gross income
derived from or connected with sources in the
other taxing jurisdiction bears to such taxpayer's
Connecticut adjusted gross income under this
chapter. In the case of a part-year resident, the
credit provided under this section shall not
exceed the proportion of the tax otherwise due
during the period of residency under this chapter
that the amount of the taxpayer's Connecticut
adjusted gross income derived from or connected
with sources in the other jurisdiction during the
period of residency bears to such taxpayer's
Connecticut adjusted gross income during the
period of residency under this chapter, nor shall
the allowance of the credit provided under this
section reduce the tax otherwise due under this
chapter to an amount less than what would have
been due if the income subject to taxation by such
other jurisdiction were excluded from Connecticut
adjusted gross income.
(b) (1) If, AS A DIRECT RESULT OF THE CHANGE
TO OR CORRECTION OF A TAXPAYER'S INCOME TAX RETURN
FILED WITH ANOTHER STATE OF THE UNITED STATES OR A
POLITICAL SUBDIVISION THEREOF OR THE DISTRICT OF
COLUMBIA BY THE TAX OFFICERS OR OTHER COMPETENT
AUTHORITY OF SUCH JURISDICTION, the amount of tax
of [another] SUCH OTHER jurisdiction that the
taxpayer is finally required to pay is different
than the amount used to determine the credit
allowed to any taxpayer under this section for any
taxable year, [commencing on or after January 1,
1991,] the taxpayer shall [send] PROVIDE notice of
such difference to the commissioner [within thirty
days of] BY FILING, ON OR BEFORE THE DATE THAT IS
NINETY DAYS AFTER the final determination of such
amount, [except that for the income year
commencing January 1, 1991, only, the taxpayer
shall send notice of such difference to the
commissioner within thirty days of May 8, 1996,
and the commissioner shall] AN AMENDED RETURN
UNDER THIS CHAPTER, AND SHALL CONCEDE THE ACCURACY
OF SUCH DETERMINATION OR STATE WHEREIN IT IS
ERRONEOUS. THE COMMISSIONER MAY redetermine, and
the taxpayer shall be required to pay, the tax for
any taxable year affected, regardless of any
otherwise applicable statute of limitations.
(2) IF, AS A DIRECT RESULT OF A TAXPAYER
FILING AN AMENDED INCOME TAX RETURN WITH ANOTHER
STATE OF THE UNITED STATES OR A POLITICAL
SUBDIVISION THEREOF OR THE DISTRICT OF COLUMBIA,
THE AMOUNT OF TAX OF SUCH OTHER JURISDICTION THAT
THE TAXPAYER IS REQUIRED TO PAY IS DIFFERENT THAN
THE AMOUNT USED TO DETERMINE THE CREDIT ALLOWED TO
ANY TAXPAYER UNDER THIS SECTION FOR ANY TAXABLE
YEAR, THE TAXPAYER SHALL PROVIDE NOTICE OF SUCH
DIFFERENCE TO THE COMMISSIONER BY FILING, ON OR
BEFORE THE DATE THAT IS NINETY DAYS AFTER THE DATE
OF FILING OF SUCH AMENDED RETURN, AN AMENDED
RETURN UNDER THIS CHAPTER AND SHALL GIVE SUCH
INFORMATION AS THE COMMISSIONER MAY REQUIRE. THE
COMMISSIONER MAY REDETERMINE AND THE TAXPAYER
SHALL BE REQUIRED TO PAY THE TAX FOR ANY TAXABLE
YEAR AFFECTED, REGARDLESS OF ANY OTHERWISE
APPLICABLE STATUTE OF LIMITATIONS.
(3) THE COMMISSIONER MAY BY REGULATION
PRESCRIBE SUCH EXCEPTIONS TO THE REQUIREMENTS OF
THIS SUBSECTION AS HE DEEMS APPROPRIATE.
[(c) In the case of a taxpayer who elects to
claim the foreign tax credit pursuant to the
Internal Revenue Code for federal income tax
purposes, the credit under this section for income
tax imposed by a province of Canada shall be
allowed for that portion of the provincial tax not
claimed for federal income tax purposes for the
taxable year or a preceding taxable year,
provided, to the extent the provincial tax is
claimed for federal income tax purposes for a
succeeding taxable year, the credit allowed under
this section shall be added back to the amount of
tax for such succeeding taxable year. Credit for
the provincial tax shall be deemed to be claimed
last for federal income tax purposes and for
purposes of this subsection.]
[(d)] (c) A taxpayer shall not be allowed
credit under this section if such taxpayer has
claimed or will claim a credit against the income
tax imposed by such other jurisdiction for the tax
paid or payable under this chapter.
[(e)] (d) Notwithstanding the provisions of
subsection [(d)] (c) of this section, if an
individual is not domiciled in this state but
maintains a permanent place of abode in this state
and is in this state for an aggregate of more than
one hundred eighty-three days of a taxable year
and such individual is domiciled in another state
of the United States, a political subdivision of
such state, or the District of Columbia for the
taxable year, such individual shall be allowed a
credit under this section against the tax
otherwise due under this chapter for income tax
imposed by and paid to the qualifying jurisdiction
in which such individual is domiciled on such
individual's income from intangible personal
property, to the extent such income is from
property not employed in a business, trade,
profession or occupation carried on in this state,
and on such individual's income derived from or
connected with sources within another state of the
United States or the District of Columbia that
does not impose an income tax on such income. This
subsection shall apply only where the jurisdiction
in which such individual is domiciled allows an
income tax credit for the tax imposed by this
state to an individual who is domiciled in this
state for a taxable year but maintains a permanent
place of abode in such jurisdiction and is in such
jurisdiction for an aggregate of more than one
hundred eighty-three days of the taxable year that
is analogous to that provided in this subsection.
Sec. 29. Subsection (b) of section 12-711 of
the general statutes is amended by adding
subdivision (4) as follows:
(NEW) (4) Income directly or indirectly
derived by an athlete, entertainer or performing
artist from closed-circuit and cable television
transmissions of an event, other than events
occurring on a regularly scheduled basis, taking
place within this state as a result of the
rendition of services by such athlete, entertainer
or performing artist shall constitute income
derived from or connected with sources within this
state only to the extent that such transmissions
were received or exhibited within this state.
Sec. 30. Section 12-723 of the general
statutes is repealed and the following is
substituted in lieu thereof:
The commissioner may for reasonable cause
extend the time for the filing of any return,
[declaration,] statement or other document due or
required under this chapter and the payment of tax
due pursuant to this chapter in accordance with
regulations adopted in accordance with chapter 54.
Said commissioner may require the filing of a
tentative return and the payment of the tax
reported to be due thereon in connection with such
extension. Any additional tax which may be found
to be due on the filing of a return,
[declaration,] statement or other document as
allowed by such extension shall bear interest at
the rate of one per cent per month or fraction
thereof from the original due date of such tax to
the date of actual payment. NOTWITHSTANDING THE
PROVISIONS OF SECTION 12-735, NO PENALTY SHALL BE
IMPOSED ON ACCOUNT OF ANY FAILURE TO PAY THE
AMOUNT OF TAX REPORTED TO BE DUE ON A RETURN,
STATEMENT OR OTHER DOCUMENT WITHIN THE TIME
SPECIFIED UNDER THE PROVISIONS OF THIS CHAPTER IF
THE EXCESS OF THE AMOUNT OF TAX SHOWN ON THE
RETURN, STATEMENT OR OTHER DOCUMENT OVER THE
AMOUNT OF TAX PAID ON OR BEFORE THE ORIGINAL DUE
DATE OF SUCH RETURN, STATEMENT OR OTHER DOCUMENT
IS NO GREATER THAN TEN PER CENT OF THE AMOUNT OF
TAX SHOWN ON SUCH RETURN, STATEMENT OR OTHER
DOCUMENT, AND ANY BALANCE DUE SHOWN ON SUCH
RETURN, STATEMENT OR OTHER DOCUMENT IS PAID ON OR
BEFORE THE EXTENDED DUE DATE OF SUCH RETURN,
STATEMENT OR OTHER DOCUMENT.
Sec. 31. Subsection (b) of section 12-727 of
the general statutes is repealed and the following
is substituted in lieu thereof:
(b) (1) If the amount of a taxpayer's federal
taxable income reported on such taxpayer's federal
income tax return for any taxable year is changed
or corrected by the United States Internal Revenue
Service or other competent authority, or as the
result of a renegotiation of a contract or
subcontract with the United States, the taxpayer
shall [report] PROVIDE NOTICE OF such change or
correction in federal taxable income [within] TO
THE COMMISSIONER BY FILING, ON OR BEFORE THE DATE
THAT IS ninety days after the final determination
of such change, correction or renegotiation, or as
otherwise required by the commissioner, AN AMENDED
RETURN UNDER THIS CHAPTER and shall concede the
accuracy of such determination or state wherein it
is erroneous. THE COMMISSIONER MAY REDETERMINE AND
THE TAXPAYER SHALL BE REQUIRED TO PAY THE TAX FOR
ANY TAXABLE YEAR AFFECTED, REGARDLESS OF ANY
OTHERWISE APPLICABLE STATUTE OF LIMITATIONS.
(2) Any taxpayer filing an amended federal
income tax return shall also file, [within] ON OR
BEFORE THE DATE THAT IS ninety days [thereafter]
AFTER THE DATE OF FILING OF SUCH AMENDED RETURN,
an amended return under this chapter and shall
give such information as the commissioner may
require. THE COMMISSIONER MAY REDETERMINE, AND THE
TAXPAYER SHALL BE REQUIRED TO PAY THE TAX FOR ANY
TAXABLE YEAR AFFECTED, REGARDLESS OF ANY OTHERWISE
APPLICABLE STATUTE OF LIMITATIONS.
(3) The commissioner may by regulation
prescribe such exceptions to the requirements of
this [section] SUBSECTION as he deems appropriate.
Sec. 32. Subsection (b) of section 12-732 of
the general statutes is repealed and the following
is substituted in lieu thereof:
(b) (1) Notwithstanding the three-year
limitation provided by subsection (a) of this
section, if a taxpayer has timely complied with
the requirements of subsection (b) of section
12-727, AS AMENDED BY THIS ACT, and, as a direct
result of the change to [, correction of or
amendment] OR CORRECTION OF THE TAXPAYER'S FEDERAL
INCOME TAX RETURN BY THE UNITED STATES INTERNAL
REVENUE SERVICE OR OTHER COMPETENT AUTHORITY, OR
AS A DIRECT RESULT OF A RENEGOTIATION OF A
CONTRACT OR SUBCONTRACT WITH THE UNITED STATES,
THE TAX THAT HAS PREVIOUSLY BEEN REPORTED TO BE
DUE ON A TAX RETURN UNDER THIS CHAPTER HAS BEEN
OVERPAID, OR AS A DIRECT RESULT OF AN AMENDMENT BY
THE TAXPAYER of the taxpayer's federal income tax
return, the tax that has previously been reported
to be due on a tax return under this chapter has
been overpaid, any claim for refund subsequently
filed by such taxpayer will be deemed to be timely
filed.
(2) NOTWITHSTANDING THE THREE-YEAR LIMITATION
PROVIDED BY SUBSECTION (a) OF THIS SECTION, IF A
TAXPAYER HAS TIMELY COMPLIED WITH THE REQUIREMENTS
OF SUBSECTION (b) OF SECTION 12-704, AS AMENDED BY
THIS ACT, AND AS A DIRECT RESULT OF THE CHANGE TO
OR CORRECTION OF TAXPAYER'S INCOME TAX RETURN BY
THE TAX OFFICERS OR OTHER COMPETENT AUTHORITY OF
ANOTHER STATE OF THE UNITED STATES OR A POLITICAL
SUBDIVISION THEREOF OR THE DISTRICT OF COLUMBIA,
THE TAX THAT HAS PREVIOUSLY BEEN REPORTED TO BE
DUE ON A TAX RETURN UNDER THIS CHAPTER HAS BEEN
OVERPAID, OR AS A DIRECT RESULT OF AN AMENDMENT BY
THE TAXPAYER OF THE TAXPAYER'S INCOME TAX RETURN
TO ANOTHER STATE OF THE UNITED STATES OR A
POLITICAL SUBDIVISION THEREOF OR THE DISTRICT OF
COLUMBIA, THE TAX THAT HAS PREVIOUSLY BEEN
REPORTED TO BE DUE ON A TAX RETURN UNDER THIS
CHAPTER HAS BEEN OVERPAID, ANY CLAIM FOR REFUND
SUBSEQUENTLY FILED BY SUCH TAXPAYER WILL BE DEEMED
TO BE TIMELY FILED.
Sec. 33. Subsection (b) of section 12-733 of
the general statutes, as amended by section 43 of
public act 97-243, is repealed and the following
is substituted in lieu thereof:
(b) (1) If the taxpayer omits from Connecticut
adjusted gross income, in the case of an
individual, or from Connecticut taxable income, in
the case of a trust or estate, an amount properly
includable therein which is in excess of
twenty-five per cent of the amount of Connecticut
adjusted gross income or Connecticut taxable
income, as the case may be, stated in the return,
a notice of a proposed deficiency assessment may
be mailed to the taxpayer within six years after
the return is filed. For purposes of this
subsection, there shall not be taken into account
any amount which is omitted in the return if such
amount is disclosed in the return, or in a
statement attached to the return, in a manner
adequate to apprise the Commissioner of Revenue
Services of the nature and the amount of such
item.
(2) IF THE TAXPAYER OMITS FROM THE CONNECTICUT
ADJUSTED GROSS INCOME DERIVED FROM OR CONNECTED
WITH SOURCES WITHIN THIS STATE, IN THE CASE OF A
NONRESIDENT INDIVIDUAL OR PART-YEAR RESIDENT
INDIVIDUAL, OR FROM CONNECTICUT TAXABLE INCOME
DERIVED FROM OR CONNECTED WITH SOURCES WITHIN THIS
STATE, IN THE CASE OF A NONRESIDENT TRUST OR
ESTATE OF PART-YEAR RESIDENT TRUST, AN AMOUNT
PROPERLY INCLUDABLE THEREIN WHICH IS IN EXCESS OF
TWENTY-FIVE PER CENT OF THE AMOUNT OF CONNECTICUT
ADJUSTED GROSS INCOME DERIVED FROM OR CONNECTED
WITH SOURCES WITHIN THIS STATE OR CONNECTICUT
TAXABLE INCOME DERIVED FROM OR CONNECTED WITH
SOURCES WITHIN THIS STATE, AS THE CASE MAY BE,
STATED IN THE RETURN, A NOTICE OF A PROPOSED
DEFICIENCY ASSESSMENT MAY BE MAILED TO THE
TAXPAYER WITHIN SIX YEARS AFTER THE RETURN IS
FILED. FOR PURPOSES OF THIS SUBSECTION, THERE
SHALL NOT BE TAKEN INTO ACCOUNT ANY AMOUNT WHICH
IS OMITTED IN THE RETURN IF SUCH AMOUNT IS
DISCLOSED IN THE RETURN, OR IN A STATEMENT
ATTACHED TO THE RETURN, IN A MANNER ADEQUATE TO
APPRISE THE COMMISSIONER OF REVENUE SERVICES OF
THE NATURE AND THE AMOUNT OF SUCH ITEM.
Sec. 34. Section 3-55j of the general
statutes, as amended by section 2 of public act
97-274 and section 2 of public act 97-11 of the
June 18 special session, is amended by adding
subsection (i) as follows:
(NEW) (i) For the fiscal year ending June 30,
1999, and each fiscal year thereafter, if the
amount of grant payable to a municipality in
accordance with this section is increased as the
result of an appropriation to the Mashantucket
Pequot and Mohegan Fund for such fiscal year which
exceeds eighty-five million dollars, the portion
of the grant payable to each eligible service
district, in accordance with subsections (a) and
(c) of this section shall be increased by the same
proportion as the grant payable to such
municipality under this section as a result of
said increased appropriation.
Sec. 35. This act shall take effect from its
passage, except that (1) section 14 shall be
applicable to estates of persons dying on or after
June 20, 1996, (2) sections 4 and 11 shall be
applicable to calendar years commencing on or
after January 1, 1998, (3) sections 5 to 8,
inclusive, and section 10 shall be applicable to
income years commencing on or after January 1,
1998, (4) sections 28 to 33, inclusive, shall be
applicable to taxable years commencing on or after
January 1, 1998, (5) sections 22 and 23 shall take
effect October 1, 1998, (6) sections 12, 13, 25
and 26 shall be applicable to calendar quarters
commencing on or after October 1, 1998, (7)
section 17, 18 and 24 shall be applicable to sales
occurring on or after October 1, 1998, (8) section
20 shall be applicable to sales or use of fuel
commencing on or after October 1, 1998, (9)
section 27 shall be applicable to payments first
due and payable on or after October 1, 1998, (10)
section 9 shall be applicable to income years
commencing on or after January 1, 1999, and (11)
section 21 shall be applicable to claims for
refund filed on or after January 1, 1999.
Approved June 8, 1998