Minnesota Legislature
HF 4162
as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am
Current Version - as introduced
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A bill for an act
relating to taxation; modifying penalties; extending the time to file certain
partnership returns; extending the time for filing certain refund claims; amending
Minnesota Statutes 2006, sections 270C.56, subdivisions 1, as amended, 2, 3, by
adding subdivisions; 289A.19, subdivision 1; 289A.40, subdivision 1.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2006, section 270C.56, subdivision 1, as amended by
Laws 2008, chapter 154, article 15, section 7, is amended to read:
Subdivision 1.
deleted text begin Liabilitydeleted text end new text begin Penaltynew text end imposed.
A person deleted text begin who, either singly or jointly
with others, has the control of, supervision of, or responsibility for filing returns or
reports, paying taxes, or collecting or withholding and remitting taxes and who fails to
do so, or a person who is liable under any other law, is liable for the payment of taxes,
penalties, and interest arising under chapters 295, 296A, 297A, 297F, and 297G, or
sections 290.92 and 297E.02, and, for the taxes listed in this subdivision, the applicable
penalties for nonpayment under section 289A.60deleted text end new text begin required to collect, truthfully account for,
and pay over any trust tax who willfully fails to collect the tax, or willfully attempts in any
manner to evade or defeat a trust tax or payment of the tax, is liable, in addition to other
penalties, for a penalty equal to the total amount of the tax evaded, not collected, or not
accounted for and paidnew text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for personal liability assessments
made with respect to taxes due and payable after July 1, 2000.
new text end
Sec. 2.
Minnesota Statutes 2006, section 270C.56, subdivision 2, is amended to read:
Subd. 2.
deleted text begin Person defineddeleted text end new text begin Definitionsnew text end .
new text begin (a) new text end The term "person" includes, but is not
limited to, a corporation, estate, trust, organization, or association, whether organized
for profit or not, an officer or director of a corporation, a member of a partnership, an
employee, a third party (including, but not limited to, a financial institution, lender, or
surety), and any other individual or entity. "Person" does not include an unpaid, volunteer
member of a board of trustees or directors of an organization exempt from taxation
under section 290.05, if the member is solely serving in an honorary capacity, does not
participate in the day-to-day or financial operations of the organization, and has no actual
knowledge of deleted text begin the failure to file returns or remit taxesdeleted text end new text begin facts sufficient to warrant assessment
of the trust tax penaltynew text end .
new text begin
(b) The term "trust tax" includes tax under section 290.92 and any other Minnesota
tax collected from customers of the business which the person assessed was required to
collect, truthfully account for, and pay over.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for personal liability assessments
made with respect to taxes due and payable after July 1, 2000.
new text end
Sec. 3.
Minnesota Statutes 2006, section 270C.56, subdivision 3, is amended to read:
Subd. 3.
Procedure for assessment.
The commissioner may assess liability for
the deleted text begin taxes described in subdivision 1deleted text end new text begin trust tax recovery penaltynew text end against a person liable
under this section. The assessment may be based upon information available to the
commissioner. It must be made within the prescribed period of limitations for assessing
the underlying tax, or within one year after the date of an order assessing underlying tax,
whichever period expires later. deleted text begin An order assessing personal liability under this section is
reviewable under section 270C.35 and is appealable to Tax Court.
deleted text end
deleted text begin
If a person has been assessed under this section for an amount for a given period
and the time for appeal has expired or there has been a final determination that the person
is liable, collection action is not stayed pursuant to section 270C.33, subdivision 5, for
subsequent assessments of additional amounts for the same person for the same period
and tax type.
deleted text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for personal liability assessments
made with respect to taxes due and payable after July 1, 2000.
new text end
Sec. 4.
Minnesota Statutes 2006, section 270C.56, is amended by adding a subdivision
to read:
new text begin Subd. 3a. new text end
new text begin Procedure to contest assessment. new text end
new text begin
(a) An order assessing the trust tax
recovery penalty is reviewable under section 270C.35 and is appealable to Tax Court.
new text end
new text begin
(b) If an assessment of the trust tax recovery penalty becomes final without an
appeal to Tax Court, the person assessed may contest the penalty by filing a refund claim
at any time within two years after any payment with respect to the penalty, if the aggregate
amount paid with respect to the penalty equals or exceeds the amount equal to the smallest
divisible portion of the tax underlying the penalty, including, but not limited to, income
tax withholding for one employee for one quarter or the sales tax on one sale. A denial of
the refund claim is reviewable under section 270C.35 and may be appealed to Tax Court.
Upon an appeal to Tax Court, the commissioner may counterclaim for the excess of the
amount contended to be owing over what was paid.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for personal liability assessments
made with respect to taxes due and payable after July 1, 2000. Payments made after July
1, 2000, but before May 1, 2008, are deemed to have been made on April 30, 2008, for
purposes of determining whether a refund claim has been filed within two years after
the date of payment.
new text end
Sec. 5.
Minnesota Statutes 2006, section 270C.56, is amended by adding a subdivision
to read:
new text begin Subd. 3b. new text end
new text begin Collection procedure. new text end
new text begin
(a) After assessment of the trust tax recovery
penalty is final, the normal collection procedures under this chapter apply to collection of
the penalty. If a person is assessed under this section for an amount for a given period
and the time for appeal expires or there is a final determination that the person is liable,
collection action is not stayed under section 270C.33, subdivision 5, for subsequent
assessments of additional amounts for the same person for the same period and the same
tax type. The jeopardy assessment and collection procedures of section 270C.36 apply to
the trust tax recovery penalty as to other liability.
new text end
new text begin
(b) If an assessed person files a refund claim after having paid only a portion of
the assessment, the commissioner may forgo an enforced collection action and file a
counterclaim in any refund suit brought by the assessed person.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 6.
Minnesota Statutes 2006, section 289A.19, subdivision 1, is amended to read:
Subdivision 1.
Fiduciary income, entertainment tax, and information returns.
When, in the commissioner's judgment, good cause exists, the commissioner may
extend the time for filing entertainment tax returns for not more than six months. The
commissioner shall grant an automatic extension of six months to file a partnership, "S"
corporation, or fiduciary income tax return if all of the taxes imposed on the entity for
the year by chapter 290 and section 289A.08, subdivision 7, have been paid by the
date prescribed by section 289A.18, subdivision 1.new text begin When an extension of time to file a
partnership return is granted by the Internal Revenue Service or automatically under
federal law, the commissioner shall grant an extension to file the Minnesota return for
that period.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for extensions applying after the
day following final enactment.
new text end
Sec. 7.
Minnesota Statutes 2006, section 289A.40, subdivision 1, is amended to read:
Subdivision 1.
Time limit; generally.
Unless otherwise provided in this chapter, a
claim for a refund of an overpayment of state tax must be filed within 3-1/2 years from
the date prescribed for filing the return, plus any extension of time granted for filing the
return, but only if filed within the extended time, or deleted text begin one year from the date of an order
assessing tax under section 270C.33 or an order determining an appeal under section
270C.35, subdivision 8, or one year from the date of a return made by the commissioner
under section 270C.33, subdivision 3, upon payment in full of the tax, penalties, and
interest shown on the order or return made by the commissionerdeleted text end new text begin two years from the time
the tax was paidnew text end , whichever period expires later. Claims for refund, except for taxes under
chapter 297A, filed after the 3-1/2 year period but within the deleted text begin one-yeardeleted text end new text begin two-yearnew text end period are
limited to the amount of the tax, penalties, and interest deleted text begin on the order or return made by the
commissioner and to issues determined by the order or return made by the commissionerdeleted text end new text begin
paid during the two years immediately preceding the filing of the claimnew text end .
In the case of assessments under section 289A.38, subdivision 5 or 6, claims for
refund under chapter 297A filed after the 3-1/2 year period but within the deleted text begin one-yeardeleted text end new text begin
two-yearnew text end period are limited to the amount of the tax, penalties, and interest deleted text begin on the order or
return made by the commissionerdeleted text end that are due for the period before the 3-1/2 year period.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for refund claims filed after the
day following final enactment.
new text end