Rep. Norm Thurston — Voting Record

Bill

Number

H.B. 3003 (2020S3)

Sponsor

Rep. Spendlove, R.

Final action

House/ to Governor 4/22/2020

Outcome

House/ to Governor

Summary

What it does

• This bill:
• modifies the due date for an installment payment of the tax on deferred foreign income;
• modifies the payment of the corporate estimated income tax due dates;
• modifies the corporate and individual return filing dates, extension dates and periods, and the return and extension requirements;
• provides for when interest accrues on a late payment;
• adds and modifies definitions;
• creates a subtraction from adjusted gross income for certain distributions from a qualified retirement plan; and
• provides the circumstances under which the State Tax Commission shall extend the time to pay an income tax for the 2019 taxable year.

Every vote on this bill

Bill text

INCOME TAX REVISIONS
THIRD SPECIAL SESSION
STATE OF UTAH
Chief Sponsor: Robert M. Spendlove
Senate Sponsor: 
Curtis S. Bramble
LONG TITLE
General Description:
This bill modifies income tax provisions.
Highlighted Provisions:
This bill:
▸ modifies the due date for an installment payment of the tax on deferred foreign
income;
▸ modifies the payment of the corporate estimated income tax due dates;
▸ modifies the corporate and individual return filing dates, extension dates and
periods, and the return and extension requirements;
▸ provides for when interest accrues on a late payment;
▸ adds and modifies definitions;
▸ creates a subtraction from adjusted gross income for certain distributions from a
qualified retirement plan; and
▸ provides the circumstances under which the State Tax Commission shall extend the
time to pay an income tax for the 2019 taxable year.
Money Appropriated in this Bill:
None
Other Special Clauses:
This bill provides a special effective date.
This bill provides retrospective operation.
Utah Code Sections Affected:
ENACTS:
59-7-118.1
, Utah Code Annotated 1953
59-7-504.1
, Utah Code Annotated 1953
59-7-505.1
, Utah Code Annotated 1953
59-7-507.1
, Utah Code Annotated 1953
59-10-103.2
, Utah Code Annotated 1953
59-10-114.1
, Utah Code Annotated 1953
59-10-514.2
, Utah Code Annotated 1953
59-10-516.1
, Utah Code Annotated 1953
59-10-522.1
, Utah Code Annotated 1953
59-10-1403.4
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
59-7-118.1
 is enacted to read:
 59-7-118.1.
Modification of installment due date for deferred foreign income tax.
(1) The Legislature intends that:
(a) Subsection (2) replace Subsection 
59-7-118
(3)(b); and
(b) the remaining subsections of Section 
59-7-118
 apply as written.
(2) A corporation shall make:
(a) the first installment of a tax described in Section 
59-7-118
 on or before the due date
of the tax return filed under this chapter for the first taxable year in which the corporation
reports deferred foreign income described in Section 965, Internal Revenue Code; and
(b) a subsequent installment of a tax described in Section 
59-7-118
 on or before the
due date of the tax return filed under this chapter in each of the following seven years.
(3) This section supersedes any conflicting provisions of Utah law.
Section 2. Section 
59-7-504.1
 is enacted to read:
 59-7-504.1.
Modification of estimated payment due date.
(1) The Legislature intends that:
(a) Subsection (2) replace Subsection 
59-7-504
(1);
(b) Subsection (3) replace Subsection 
59-7-504
(2); and
(c) the remaining subsections of Section 
59-7-504
 apply as written.
(2) Except as provided in Subsection (3), a corporation subject to taxation under this
chapter that has a tax liability of $3,000 or more in either the current taxable year or the
previous taxable year shall make a payment of an estimated tax on or before the day on which
the corporation is required to make a payment of an estimated tax for the same time period to
the federal government.
(3) The provisions of Section 6655, Internal Revenue Code, shall govern the payment
described in Subsection (2), except that:
(a) for the first year that a corporation is required to file a return in Utah, the
corporation is not subject to Subsection (2) if the corporation makes a payment on or before the
due date of the return, without extensions, equal to or greater than the minimum tax required
under Section 
59-7-104
 or 
59-7-201
;
(b) the applicable percentage of the required annual payment, as defined in Section
6655, Internal Revenue Code, for annualized income installments, adjusted seasonal
installments, and those estimated tax payments based on the current year tax liability shall be:
Installment
Percentage
1st
22.5
2nd
45.0
3rd
67.5
4th
90.0
(c) a large corporation shall be treated as any other corporation for purposes of this
section and Section 
59-7-504
;
(d) if a taxpayer elects a different annualization period than the one used for federal
purposes, the taxpayer shall make an election with the commission at the same time as
provided under Section 6655, Internal Revenue Code; and
(e) the due date shall be superseded by the due date for federal estimated payments if
modified by other federal action.
(4) This section supersedes any conflicting provisions of Utah law.
Section 3. Section 
59-7-505.1
 is enacted to read:
 59-7-505.1.
Modification of return due date and extension period.
(1) The Legislature intends that:
(a) Subsection (2) replace Subsection 
59-7-505
(2);
(b) Subsection (3) replace Subsection 
59-7-505
(3); and
(c) the remaining subsections of Section 
59-7-505
 apply as written.
(2) (a) A corporation shall make a return on or before the later of:
(i) the 15th day of the fourth month following the close of the taxable year; or
(ii) the day on which a corporation required to make a return under this chapter is
required to file a federal income tax return.
(b) Interest accrues from the day on which a return is due under this Subsection (2).
(3) (a) The commission shall allow a taxpayer an extension of the time for filing a
return.
(b) Except as provided in Subsection (3)(c), the extension described in Subsection
(3)(a) may be for up to six months.
(c) For a taxable year beginning on or after January 1, 2019, but beginning on or before
December 31, 2019, a taxpayer may receive an extension described in Subsection (3)(a) for the
time period that ends on the last day of the extension to file the taxpayer's federal income tax
return.
(4) This section supersedes any conflicting provisions of Utah law.
Section 4. Section 
59-7-507.1
 is enacted to read:
 59-7-507.1.
Modification of time for payment of tax.
(1) The Legislature intends that:
(a) Subsection (2) replace Subsection 
59-7-507
(1)(a);
(b) (i) Subsection (3)(a) replace Subsection 
59-7-507
(1)(b); and
(ii) Subsection (3)(b) replace Subsection 
59-7-507
(1)(c);
(c) Subsection (4) replace Subsection 
59-7-507
(2)(a) for a taxable year beginning on or
after January 1, 2019, but beginning on or before December 31, 2019; and
(d) the remaining subsections of Section 
59-7-507
 apply as written.
(2) If an estimated payment is not made as provided in Section 
59-7-504.1
, the amount
of the tax imposed by this chapter shall be paid no later than the due date of the return
described in Subsection 
59-7-505.1
(2).
(3) (a) If a taxpayer needs an extension of time to file a return, as provided in Section
59-7-505.1
 or 
59-7-803
, a taxpayer shall pay, no later than the due date of the return described
in Subsection 
59-7-505.1
(2), an amount equal to the lesser of:
(i) the greater of:
(A) 90% of the total tax reported on the return for the current taxable year; or
(B) 100% of the minimum tax described in Section 
59-7-104
; or
(ii) 100% of the total tax liability for the taxable year immediately preceding the
current taxable year.
(b) If payment is not made as provided in Subsection (3)(a), the commission shall add
an extension penalty as provided in Section 
59-1-401
, until the tax is paid during the period of
extension.
(4) A taxpayer shall receive an extension of the time for the payment of the amount
determined as the tax of the taxpayer, or any part of that amount, for the time period that ends
on the last day of the extension to pay the taxpayer's federal income tax.
(5) This section supersedes any conflicting provisions of Utah law.
Section 5. Section 
59-10-103.2
 is enacted to read:
 59-10-103.2.
Additional chapter definitions.
(1) The Legislature intends:
(a) that the definitions in Subsections (2) and (3) supplement the definitions in Section
59-10-103
;
(b) the definition in Subsection (4) replace the definition of "taxpayer" in Section
59-10-103
; and
(c) the remaining subsections of Section 
59-10-103
 apply as written.
(2) "Pass-through entity" means the same as that term is defined in Section
59-10-1402
.
(3) "Pass-through entity taxpayer" means the same as that term is defined in Section
59-10-1402
.
(4) "Taxpayer" means any of the following that has income subject in whole or in part
to the tax imposed by this chapter:
(a) an individual;
(b) an estate, a trust, or a beneficiary of an estate or a trust that is not a pass-through
entity or a pass-through entity taxpayer;
(c) a pass-through entity; or
(d) a pass-through entity taxpayer.
(5) This section supersedes any conflicting provisions of Utah law.
Section 6. Section 
59-10-114.1
 is enacted to read:
 59-10-114.1.
Additional subtraction from income.
(1) The Legislature intends that the subtraction described in Subsection (2) be in
addition to the subtractions described in Section 
59-10-114
.
(2) There shall be subtracted from adjusted gross income of a resident or nonresident
individual an amount of a distribution from a qualified retirement plan under Section 401(a),
Internal Revenue Code, if:
(a) the amount of the distribution is included in adjusted gross income on the resident
or nonresident individual's federal individual income tax return for the taxable year; and
(b) for the taxable year when the amount of the distribution was contributed to the
qualified retirement plan, the amount of the distribution:
(i) was not included in adjusted gross income on the resident or nonresident
individual's federal individual income tax return for the taxable year; and
(ii) was taxed by another state of the United States, the District of Columbia, or a
possession of the United States.
(3) This section supersedes any conflicting provisions of Utah law.
Section 7. Section 
59-10-514.2
 is enacted to read:
 59-10-514.2.
Modification of return due date.
(1) The Legislature intends that:
(a) Subsection (2) replace Subsection 
59-10-514
(1); and
(b) the remaining subsections of Section 
59-10-514
 apply as written.
(2) (a) Subject to Subsection 
59-10-514
(3) and Section 
59-10-518
:
(i) an individual income tax return filed for a tax imposed in accordance with Part 1,
Determination and Reporting of Tax Liability and Information, shall be filed with the
commission on or before the day on which a federal individual income tax return is due;
(ii) a fiduciary income tax return filed for a tax imposed in accordance with Part 2,
Trusts and Estates, shall be filed with the commission on or before the day on which a federal
return for estates and trusts is due; and
(iii) a return filed in accordance with Section 
59-10-507
 shall be filed with the
commission on or before the later of:
(A) the 15th day of the fourth month following the last day of the taxpayer's taxable
year; or
(B) the day on which the taxpayer is required to file a federal income tax return.
(b) Interest accrues from the day on which a return is due under this Subsection (2).
(3) This section supersedes any conflicting provisions of Utah law.
Section 8. Section 
59-10-516.1
 is enacted to read:
 59-10-516.1.
Modification of extension dates.
(1) The Legislature intends that:
(a) Subsection (2) replace Subsection 
59-10-516
(1);
(b) Subsections (3) and (4) replace Subsection 
59-10-516
(2); and
(c) the remaining subsections of Section 
59-10-516
 apply as written.
(2) (a) The commission shall allow a taxpayer an extension of the time for filing a
return.
(b) Except as provided in Subsection (2)(c):
(i) for a return filed by a taxpayer other than a partnership, the extension described in
Subsection (2)(a) may be for up to six months; and
(ii) for a return filed by a taxpayer that is a partnership, the extension described in
Subsection (2)(a) may be for up to five months.
(c) For a taxable year beginning on or after January 1, 2019, but beginning on or before
December 31, 2019, a taxpayer may receive an extension described in Subsection (2)(a) for the
time period that ends on the last day of the extension to file the taxpayer's federal income tax
return.
(3) Except as provided in Subsection (4), the commission may not impose a penalty
under Section 
59-1-401
 on:
(a) a pass-through entity during the extension period described under Subsection (2) if
the pass-through entity, on or before the return due date, pays or withholds the tax on behalf of
a pass-through entity taxpayer; or
(b) a taxpayer other than a taxpayer described in Subsection (3)(a) during the extension
period described in Subsection (2) if the taxpayer pays, on or before the return due date
described in Section 
59-10-514.2
, an amount equal to the lesser of:
(i) 90% of the total tax reported on the return for the current taxable year; or
(ii) 100% of the total tax liability for the taxable year immediately preceding the
current taxable year.
(4) If a taxpayer fails to meet the requirements of Subsection (3), the commission may
apply to the total balance due a penalty as provided in Section 
59-1-401
.
(5) This section supersedes any conflicting provisions of Utah law.
Section 9. Section 
59-10-522.1
 is enacted to read:
 59-10-522.1.
Limitation on commission authority to extend the time for payment
of tax.
(1) The Legislature intends that Subsection (2) replace Subsection 
59-10-522
(1) for a
taxable year beginning on or after January 1, 2019, but beginning on or before December 31,
2019.
(2) A taxpayer shall receive an extension of the time for the payment of the amount
determined as the tax of the taxpayer, or any part of that amount, for the time period that ends
on the last day of the extension to pay the taxpayer's federal income tax.
(3) This section supersedes any conflicting provisions of Utah law.
Section 10. Section 
59-10-1403.4
 is enacted to read:
 59-10-1403.4.
Modification of return filing requirements for pass-through entity.
(1) The Legislature intends that:
(a) Subsection (2) replace Subsection 
59-10-1403
(3); and
(b) the remaining subsections of Section 
59-10-1403
 apply as written.
(2) A pass-through entity is subject to the return filing requirements of Sections
59-10-507
, 
59-10-514
, 
59-10-514.2
, 
59-10-516
, and 
59-10-516.1
.
(3) This section supersedes any conflicting provisions of Utah law.
Section 11. 
Effective date.
If approved by two-thirds of all the members elected to each house, this bill takes effect
upon approval by the governor, or the day following the constitutional time limit of Utah
Constitution, Article VII, Section 8, without the governor's signature, or in the case of a veto,
the date of veto override.
Section 12. 
Retrospective operation.
(1) Except as provided in Subsections (2) and (3), this bill has retrospective operation
for a taxable year beginning on or after January 1, 2019.
(2) The changes to Section 
59-10-114.1
 have retrospective operation for a taxable year
beginning on or after January 1, 2020.
(3) The changes to Section 
59-7-118.1
 have retrospective operation for:
(a) the last taxable year of a taxpayer beginning on or before December 31, 2017; and
(b) a taxable year beginning on or after January 1, 2018.