Notice 04-14
Application of the 60-day and Two Month Provisions for
Interest Payments on Certain Tax Refunds
December 14, 2004
Income Tax Refunds. K.S.A. 2003 Supp. 79-32,105(e)(7) provides:
If any overpayment is refunded within two months
after the last date prescribed, or
permitted by extension of time, for filing the return of such tax,
or within two months
after the return was filed, whichever is later, no interest shall be
allowed or paid. For
the purposes of this section, an overpayment shall be deemed to have
been refunded
at the time the refund check in the amount of the overpayment, plus
any interest due
thereon, is deposited in the United States mail.
For purposes of this statute, the term “return” includes an original or amended corporate or individual income tax return filed with the department by the taxpayer. The following rules shall apply to interest on income tax refunds:
- When all taxes due are paid by the due date, the original return is filed by the due date, and the department issues the refund within two months after the due date, no interest shall be paid on the refund. When the department issues the refund more than two months after the due date, interest shall be paid on the refund from the due date.
- When all taxes due are paid by the due date, the original return is filed after the due date but within the automatic six-month extension period, no interest shall be paid if the department issues the refund within two months from the date the return was filed. When the department issues the refund more than two months after the date the return was filed, interest shall be paid on the refund from the due date.
- When all taxes due are paid by the due date and the original return is filed after the automatic six-month extension date, no interest shall be paid if the department issues a refund within two months after the date the return was filed. When the department issues the refund more than two months after the date the return was filed, interest shall be paid on the refund from the date the late return was filed.
- When an amended return seeking a refund is filed after the due date for the payment of the taxes sought to be refunded, no interest shall be paid if the department issues the refund within two months after the date the amended return was filed. When the department issues the refund more than two months after the date the amended return was filed, interest shall be paid on the refund from the date the amended return was filed.
Sales and Use Tax Refunds. K.S.A. 2003 Supp. 79-3609(d) provides:
For all taxable periods subject to assessment on January 1, 1998,
including periods
subject to an agreement to extend the statute of limitations,
and for all taxable periods
commencing after December 31, 1997, interest at the rate prescribed
by K.S.A. 79-
2968, and amendments thereto, shall be allowed on any overpayment
of tax computed
from the due date of the return if it was timely filed and accompanied
by the tax due
or, if the return was not timely filed, from the date of payment,
except that no interest
shall be allowed on any such refund if the same is paid within
60 days after the date
of the return or the date of payment, as the case requires.
For purposes of this statute, the term “return” includes an original or amended sales or use tax return filed with the department by the retailer or consumer that reported the tax for which a refund is requested. Under K.A.R. 92-19-49a(a), a complete and properly documented sales or use tax refund request is treated as an amended return: “A claim for a refund of sales or compensating tax shall be treated as an application for the adjustment or amendment of a sales or compensating tax return.” A sales tax refund request filed with the department must meet the criteria set forth in K.S.A. 79-3650, K.A.R. 92-19-49a, and any other applicable statute or regulation. The following rules shall apply to interest on sales or use tax refunds:
- When all taxes due are paid on or before the due date of a return and the taxpayer files an amended return or a complete refund request that results in a refund, no interest shall be paid on the refund if the department issues a refund check within 60 days of the receipt of the amended return or refund request. When the department issues the refund check more than 60 days after the date of the receipt of the amended return or refund request, interest shall be paid on the refund from the due date of the original return.
- When all taxes due are not paid in full until after the due date of a return and the taxpayer later files an amended return or a complete refund request that results in a refund, no interest shall be paid on the refund if the department issues a refund check within 60 days of the receipt of the amended return or refund request. When the department issues the refund check more than 60 days after the date of the receipt of the amended return or refund request, interest shall be paid on the refund from the date that payment of the tax that was due on the return was received by the department. Payment of the tax that was due on a return shall be considered to have been made when the account was first brought into zero balance after the original return's due date.
Taxpayer Assistance.
If you have questions about this guideline,
please contact the Taxpayer
Assistance Center at 1-785-368-8222. Our fax number is 1-785-291-3614.
Additional copies of
department guidelines are available by calling the department's
forms request line at 1-785-296-
4937 or by download from our website: www.ksrevenue.org. The
number for the department's
hearing impaired TTY is 1-785-296-6461.