1999 Minnesota Statutes

     60A.199 Examinations; payment of taxes. 

    Subdivision 1.    Examination of books and records.  If 
 the commissioner considers it necessary, the commissioner may 
 examine the books and records of a surplus lines licensee to 
 determine whether the licensee is conducting business in 
 accordance with sections 60A.195 to 60A.209.  For the purposes 
 of facilitating examinations, the licensee shall allow the 
 commissioner free access at reasonable times to all of the 
 licensee's books and records relating to the transactions to 
 which sections 60A.195 to 60A.209 apply.  If an examination is 
 conducted, the cost of the examination shall be paid by the 
 surplus line agent or agency. 

    Subd. 2.    Examination of returns; assessment; refunds. 
  The commissioner of revenue shall, as soon as practicable 
 after a return required by section 60A.198 is filed, examine it 
 and make any investigation or examination of the licensee's 
 records and accounts that the commissioner deems necessary for 
 determining the correctness of the return.  The tax computed by 
 the commissioner on the basis of the examination and 
 investigation is the tax to be paid by the licensee.  If the tax 
 found due is greater than the amount reported due on the 
 licensee's return, the commissioner shall assess a tax in the 
 amount of the excess and the whole amount of the excess shall be 
 paid to the commissioner within 60 days after notice of the 
 amount and demand for its payment is mailed to the licensee by 
 the commissioner.  If the amount of the tax found due by the 
 commissioner is less than that reported due on the licensee's 
 return, the excess shall be refunded to the licensee in the 
 manner provided by this section.  No refund shall be made except 
 as provided in this section after the expiration of 3-1/2 years 
 after the filing of the return.  

    If the commissioner examines returns of a licensee for more 
 than one year, the commissioner may issue one order covering the 
 several years under consideration reflecting the aggregate 
 refund or additional tax due.  

    The notices and demands provided for by this section shall 
 be in the form the commissioner determines, including a 
 statement, and shall contain a brief explanation of the 
 computation of the tax and shall be sent by mail to the licensee 
 at the address given on the return.  If the address is not 
 given, then they will be sent to the last known address. 

    At the request of the commissioner of revenue, the 
 commissioner of commerce may examine and investigate the returns 
 under section 60A.198 that the commissioner of revenue 
 designates.  The commissioner of commerce shall report to the 
 commissioner of revenue the results of the examination in the 
 manner required by the commissioner of revenue. 

    Subd. 3.    Failure to file; false or fraudulent return. 
  If any licensee required by section 60A.198 to file any 
 return fails to do so within the time prescribed or makes, 
 willfully or otherwise, an incorrect, false, or fraudulent 
 return, the licensee must, on the written demand of the 
 commissioner of revenue, file the return, or corrected return, 
 within 60 days after the mailing of the written demand and at 
 the same time pay the whole tax, or additional tax, due on the 
 basis thereof.  If the licensee fails within that time to file 
 the return, or corrected return, the commissioner shall make a 
 return, or corrected return, from personal knowledge and from 
 the information obtainable through testimony, or otherwise, and 
 assess a tax on the basis thereof.  The tax assessed, less any 
 payments theretofore made on account of the tax for the taxable 
 year covered by the return, must be paid within 60 days after 
 the commissioner has mailed to the licensee a written notice of 
 the amount thereof and demand for payment.  Any return or 
 assessment made by the commissioner on account of the failure of 
 the licensee to make a return, or a corrected return, is prima 
 facie correct and valid, and the licensee has the burden of 
 establishing its incorrectness or invalidity in any action or 
 proceeding in respect thereto.  

    Subd. 4.    Failure to file; penalties and interest.  In 
 case of any failure to make and file a return as required by 
 this chapter within the time prescribed by law or prescribed by 
 the commissioner in pursuance of law there shall be added to the 
 tax penalties as provided in section 289A.60, subdivision 2, as 
 it relates to withholding and sales or use taxes.  

    Subd. 5.    Intent to evade tax; penalty.  If any 
 licensee with intent to evade the tax imposed by this chapter, 
 fails to file any return required by this chapter or with such 
 intent files a false or fraudulent return there shall also be 
 imposed on it a penalty as provided in section 289A.60, 
 subdivision 6.  

    Subd. 6.    Negligence or intentional disregard; penalty. 
  If any part of any additional assessment is due to negligence 
 or intentional disregard of the statute or a rule (but without 
 intent to defraud), there shall be added to the tax a penalty as 
 provided in section 289A.60, subdivision 5.  

    Subd. 6a.    Penalty for repeated failures to file returns 
 or pay taxes.  If there is a pattern by a person of repeated 
 failures to timely file returns or timely pay taxes, and written 
 notice is given that a penalty will be imposed if such failures 
 continue, a penalty of 25 percent of the amount of tax not 
 timely paid as a result of each such subsequent failure is added 
 to the tax.  The penalty can be abated under the abatement 
 authority in section 270.07, subdivisions 1, paragraph (e), and 
 6. 

    Subd. 7.    Collection of tax.  The tax required to be 
 paid by section 60A.198 may be collected in any ordinary action 
 at law by the commissioner of revenue against the licensee.  In 
 any action commenced pursuant to this section, upon the filing 
 of an affidavit of default, the court administrator of the 
 district court wherein the action was commenced shall enter 
 judgment for the state for the amount demanded in the complaint 
 together with costs and disbursements. 

    Subd. 8.    Refund procedure; time limit; appropriation. 
  A licensee which has paid, voluntarily or otherwise, or from 
 which there was collected an amount of tax for any year in 
 excess of the amount legally due for that year, may file with 
 the commissioner of revenue a claim for a refund of the excess. 
 Except as provided in subdivision 3, no claim or refund shall be 
 allowed or made after the period prescribed in section 289A.40, 
 subdivision 1.  For this purpose, a return or amended return 
 claiming an overpayment constitutes a claim for refund.  

    Upon the filing of a claim the commissioner shall examine 
 it, shall make written findings thereon denying or allowing the 
 claim in whole or in part, and shall mail a notice thereof to 
 the licensee at the address stated upon the return.  If the 
 claim is allowed in whole or in part, the commissioner shall 
 issue a certificate for a refund of the excess paid by the 
 licensee, with interest at the rate specified in section 270.76 
 computed from the date of the payment of the tax until the date 
 the refund is paid or credit is made to the licensee.  The 
 commissioner of finance shall cause the refund to be paid as 
 other state moneys are expended.  So much of the proceeds of the 
 taxes as is necessary are appropriated for that purpose.  

    Subd. 9.    Denial of claim; court proceedings.  If the 
 claim is denied in whole or in part, the commissioner shall mail 
 an order of denial to the licensee in the manner prescribed in 
 this section.  An appeal from this order may be taken to the 
 Minnesota tax court in the manner prescribed in section 271.06, 
 or the licensee may commence an action against the commissioner 
 to recover the denied overpayment.  The action may be brought in 
 the district court of the district in which lies the county of 
 its principal place of business, or in the district court for 
 Ramsey county.  The action in the district court shall be 
 commenced within 18 months following the mailing of the order of 
 denial to the licensee.  If a claim for refund is filed by a 
 licensee and no order of denial is issued within six months of 
 the filing, the licensee may commence an action in the district 
 court as in the case of a denial, but the action must be 
 commenced within two years of the date that the claim for refund 
 was filed.  

    Subd. 10.    Consent to extend time.  If the 
 commissioner and the licensee have, within the periods 
 prescribed by this section, consented in writing to any 
 extension of time for the assessment of the tax, the period 
 within which a claim for refund may be filed, or a refund may be 
 made or allowed, if no claim is filed, is the period within 
 which the commissioner and the licensee have consented to an 
 extension for the assessment of the tax and six months 
 thereafter. 

    Subd. 11.    Overpayment; refunds.  If the amount 
 determined to be an overpayment exceeds the taxes imposed by 
 section 60A.198, the amount of excess shall be considered an 
 overpayment.  An amount paid as tax shall constitute an 
 overpayment even if in fact there was no tax liability with 
 respect to which the amount was paid.  

    Notwithstanding any other provision of law to the contrary, 
 in the case of any overpayment the commissioner, within the 
 applicable period of limitations, shall refund any balance of 
 more than $10 if the licensee so requests.  

    HIST: 1981 c 221 s 5; 1984 c 592 s 41; 1Sp1985 c 14 art 15 s 
 2; 1986 c 444; 1Sp1986 c 3 art 1 s 82; 1987 c 268 art 2 s 2-10; 
 art 17 s 41; 1990 c 480 art 1 s 46; 1993 c 375 art 10 s 5,6; 
 1995 c 264 art 13 s 2,3