Drawing of State Library BuildingConnecticut State Library Home

Connecticut Public Acts 1996

Previous Page TOC Next Page Public Acts Listings


Substitute Senate Bill No. 512

PUBLIC ACT NO. 96-221

AN ACT CONCERNING THE ACCRUAL OF STATE TAXES, OFFERS OF COMPROMISE AND CLOSING AGREEMENTS, THE ABATEMENT OF TAXES AND VARIOUS CHANGES AND MODIFICATIONS TO THE PERSONAL INCOME TAX.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. Section 3-114c of the general statutes is repealed and the following is substituted in lieu thereof:

At the end of each fiscal year [commencing with the fiscal year ending on June 30, 1976,] the Comptroller is authorized to record as revenue for such fiscal year the amount of tax revenue received by the Commissioner of Revenue Services under the provisions of chapter 214 as payment for the sale of Connecticut cigarette tax stamps OR HEAT-APPLIED DECALS sold by said commissioner as provided under section 12-298 or 12-299 prior to the end of such fiscal year, provided payment for such stamps OR DECALS is received by said commissioner OR IS DELIVERED BY UNITED STATES MAIL TO SAID COMMISSIONER IN AN ENVELOPE BEARING A UNITED STATES POST OFFICE CANCELLATION MARK no later than (1) the last day of July immediately following the end of such fiscal year OR (2) IF SUCH LAST DAY OF JULY IS A SATURDAY, SUNDAY OR LEGAL HOLIDAY, AS DEFINED IN SECTION 12-39a, AS AMENDED, THE NEXT SUCCEEDING DAY WHICH IS NOT A SATURDAY, SUNDAY OR LEGAL HOLIDAY.

Sec. 2. Section 3-114d of the general statutes is repealed and the following is substituted in lieu thereof:

At the end of each fiscal year commencing with the fiscal year ending on June 30, 1976, the Comptroller is authorized to record as revenue for such fiscal year the amount of tax imposed under the provisions of chapter 220 on all sales of alcoholic beverages occurring in such fiscal year, provided payment of such tax is received by the Commissioner of Revenue Services OR IS DELIVERED BY UNITED STATES MAIL TO SAID COMMISSIONER IN AN ENVELOPE BEARING A UNITED STATES POST OFFICE CANCELLATION MARK no later than (1) the last day of July immediately following the end of such fiscal year OR (2) IF SUCH LAST DAY OF JULY IS A SATURDAY, SUNDAY OR LEGAL HOLIDAY, AS DEFINED IN SECTION 12-39a, AS AMENDED, THE NEXT SUCCEEDING DAY WHICH IS NOT A SATURDAY, SUNDAY OR LEGAL HOLIDAY.

Sec. 3. Section 3-114e of the general statutes is repealed and the following is substituted in lieu thereof:

At the end of each fiscal year commencing with the fiscal year ending on June 30, 1987, the Comptroller is authorized to record as revenue for such fiscal year the amount of tax [levied in accordance with section 12-458 and the applicable motor carrier road tax levied under section 12-479] IMPOSED UNDER THE PROVISIONS OF CHAPTERS 221 AND 222 on all fuel sold or used prior to the end of such fiscal year and which tax is received [by letter postmarked] BY THE COMMISSIONER OF REVENUE SERVICES OR IS DELIVERED BY UNITED STATES MAIL TO SAID COMMISSIONER IN AN ENVELOPE BEARING A UNITED STATES POST OFFICE CANCELLATION MARK no later than (1) the last day of July immediately following the end of such fiscal year OR (2) IF SUCH LAST DAY OF JULY IS A SATURDAY, SUNDAY OR LEGAL HOLIDAY, AS DEFINED IN SECTION 12-39a, AS AMENDED, THE NEXT SUCCEEDING DAY WHICH IS NOT A SATURDAY, SUNDAY OR LEGAL HOLIDAY.

Sec. 4. Section 3-114f of the general statutes is repealed and the following is substituted in lieu thereof:

At the end of each fiscal year commencing with the fiscal year ending on June 30, [1986] 1996, the Comptroller is authorized to record as revenue for such fiscal year the amount of tax [levied] IMPOSED under the provisions of chapters 212 and [212a] 227 on gross earnings in such fiscal year and which tax is received [by letter postmarked] BY THE COMMISSIONER OF REVENUE SERVICES OR IS DELIVERED BY UNITED STATES MAIL TO SAID COMMISSIONER IN AN ENVELOPE BEARING A UNITED STATES POST OFFICE CANCELLATION MARK no later than [4m(1) [0m the last day of July immediately following the end of such fiscal year, OR (2) IF SUCH LAST DAY OF JULY IS A SATURDAY, SUNDAY OR LEGAL HOLIDAY, AS DEFINED IN SECTION 12-39a, AS AMENDED, THE NEXT SUCCEEDING DAY WHICH IS NOT A SATURDAY, SUNDAY OR LEGAL HOLIDAY.

Sec. 5. Section 3-114g of the general statutes is repealed and the following is substituted in lieu thereof:

At the end of each fiscal year, commencing with the fiscal year ending on June 30, 1990, the Comptroller is authorized to record as revenue for such fiscal year, the amount of revenue related to the tax imposed under chapter 208 for such fiscal year which is received by the [Department] COMMISSIONER of Revenue Services OR IS DELIVERED BY UNITED STATES MAIL TO SAID COMMISSIONER IN AN ENVELOPE BEARING A UNITED STATES POST OFFICE CANCELLATION MARK no later than (1) the fifteenth day of August immediately following the end of such fiscal year, OR (2) IF SUCH FIFTEENTH DAY OF AUGUST IS A SATURDAY, SUNDAY OR LEGAL HOLIDAY, AS DEFINED IN SECTION 12-39a, AS AMENDED, THE NEXT SUCCEEDING DAY WHICH IS NOT A SATURDAY, SUNDAY OR LEGAL HOLIDAY.

Sec. 6. Section 3-114h of the general statutes is repealed and the following is substituted in lieu thereof:

At the end of each fiscal year commencing with the fiscal year ending on June 30, 1992, the Comptroller is authorized to record as revenue for such fiscal year the amount of tax [imposed under the provisions of chapter 229 which] THAT IS REQUIRED TO BE DEDUCTED AND WITHHELD FROM EMPLOYEE WAGES AND TO BE PAID OVER TO THE COMMISSIONER OF REVENUE SERVICES UNDER SECTION 12-707 AND THAT is received by the Commissioner of Revenue Services [from employers in accordance with section 12-707] OR IS DELIVERED BY UNITED STATES MAIL TO SAID COMMISSIONER IN AN ENVELOPE BEARING A UNITED STATES POST OFFICE CANCELLATION MARK no later than (1) the last day of July immediately following the end of such fiscal year, OR (2) IF SUCH LAST DAY OF JULY IS A SATURDAY, SUNDAY OR LEGAL HOLIDAY, AS DEFINED IN SECTION 12-39a, AS AMENDED, THE NEXT SUCCEEDING DAY WHICH IS NOT A SATURDAY, SUNDAY OR LEGAL HOLIDAY.

Sec. 7. Section 3-114i of the general statutes is repealed and the following is substituted in lieu thereof:

At the close of each fiscal year commencing with the fiscal year ending on June 30, 1994, the Comptroller is authorized to record as revenue for such fiscal year the amount of tax [levied] IMPOSED under [sections 12-263a to 12-263e, inclusive, for such fiscal year provided said tax is received by letter postmarked] THE PROVISIONS OF CHAPTER 211a WHICH IS RECEIVED BY THE COMMISSIONER OF REVENUE SERVICES OR IS DELIVERED BY UNITED STATES MAIL TO SAID COMMISSIONER IN AN ENVELOPE BEARING A UNITED STATES POST OFFICE CANCELLATION MARK no later than (1) the last day of July immediately following the end of such fiscal year, OR (2) IF SUCH LAST DAY OF JULY IS A SATURDAY, SUNDAY OR LEGAL HOLIDAY, AS DEFINED IN SECTION 12-39a, AS AMENDED, THE NEXT SUCCEEDING DAY WHICH IS NOT A SATURDAY, SUNDAY OR LEGAL HOLIDAY.

Sec. 8. Section 3-114j of the general statutes is repealed and the following is substituted in lieu thereof:

At the end of each fiscal year commencing with the fiscal year ending on June 30, 1995, the Comptroller is authorized to record as revenue for such fiscal year the amount of any payments WHICH IS received BY THE TREASURER from any Indian tribe, pursuant to a memorandum of understanding, [provided such payment is received by the Treasurer] OR IS DELIVERED BY UNITED STATES MAIL TO THE TREASURER IN AN ENVELOPE BEARING A UNITED STATES POST OFFICE CANCELLATION MARK no later than (1) the last day of July immediately following the end of such fiscal year, OR (2) IF SUCH LAST DAY OF JULY IS A SATURDAY, SUNDAY OR LEGAL HOLIDAY, AS DEFINED IN SECTION 12-39a, AS AMENDED, THE NEXT SUCCEEDING DAY WHICH IS NOT A SATURDAY, SUNDAY OR LEGAL HOLIDAY.

Sec. 9. Subsection (a) of section 12-686 of the general statutes is repealed and the following is substituted in lieu thereof:

(a) (1) Except as otherwise provided in subsection (b) of this section, the commissioner may require every person who files a tax return for any tax on a monthly or quarterly basis to pay such tax during the twelve-month period following a determination of liability under this subdivision by one of the means of electronic funds transfer approved by the department if the commissioner determines that such person's liability for such tax was more than [five] THREE hundred thousand dollars for the twelve-month period ending on the June thirtieth immediately preceding the monthly or quarterly period with respect to which the requirement to pay tax by electronic funds transfer is established. The commissioner, in determining whether tax liability is more than [five] THREE hundred thousand dollars, shall base such determination on the taxes reported to be due on the tax returns of such person related to the period under examination. If any tax return or returns of such person for such period have not been filed, the commissioner may base such determination on any information available to him. (2) Except as otherwise provided in subsection (b) of this section, the commissioner may require every person, other than a person described in subdivision (3) of this subsection, who files a tax return for any tax on an annual basis to pay such tax, or any instalment thereof, during the twelve-month period following a determination of liability under this subdivision by one of the means of electronic funds transfer approved by the department if the commissioner determines that such person's liability for such tax was more than [five] THREE hundred thousand dollars for the year immediately preceding the year with respect to which the requirement to pay tax by electronic funds transfer is established. The commissioner, in determining whether tax liability is more than [five] THREE hundred thousand dollars, [shall] MAY base the determination on the [taxes estimated to be due on the declaration of] estimated tax, if any, [as last amended,] PAID for the immediately preceding year, provided, if the tax return for such immediately preceding year has been filed, the commissioner shall base the determination on the taxes reported to be due on such tax return. If any tax return [or declaration of estimated tax] of such person for such period has not been filed OR ESTIMATED TAX HAS NOT BEEN PAID BY SUCH PERSON FOR SUCH PERIOD, the commissioner may base such determination on any information available to him. (3) Except as otherwise provided in subsection (b) of this section, the commissioner may require every employer who is deducting and withholding Connecticut income tax from employee wages to pay such tax during the twelve-month period following a determination of liability under this subdivision, by one of the means of electronic funds transfer approved by the department if the commissioner determines that the amount of Connecticut income tax deducted and withheld from employee wages by such employer was more than [five] THREE hundred thousand dollars for the twelve-month period ending on the June thirtieth immediately preceding the quarterly period with respect to which the requirement to pay over tax by electronic funds transfer is established. The commissioner, in determining whether tax liability is more than [five] THREE hundred thousand dollars, shall base such determination on the taxes reported to be due on the quarterly withholding tax returns of such employer related to the period under examination. If any such tax return of such person for such period has not been filed, the commissioner may base such determination on any information available to him.

Sec. 10. Subsection (a) of section 12-686 of the general statutes is repealed and the following is substituted in lieu thereof:

(a) (1) Except as otherwise provided in subsection (b) of this section, the commissioner may require every person who files a tax return for any tax on a monthly or quarterly basis to pay such tax during the twelve-month period following a determination of liability under this subdivision by one of the means of electronic funds transfer approved by the department if the commissioner determines that such person's liability for such tax was more than [five] ONE hundred thousand dollars for the twelve-month period ending on the June thirtieth immediately preceding the monthly or quarterly period with respect to which the requirement to pay tax by electronic funds transfer is established. The commissioner, in determining whether tax liability is more than [five] ONE hundred thousand dollars, shall base such determination on the taxes reported to be due on the tax returns of such person related to the period under examination. If any tax return or returns of such person for such period have not been filed, the commissioner may base such determination on any information available to him. (2) Except as otherwise provided in subsection (b) of this section, the commissioner may require every person, other than a person described in subdivision (3) of this subsection, who files a tax return for any tax on an annual basis to pay such tax, or any instalment thereof, during the twelve-month period following a determination of liability under this subdivision by one of the means of electronic funds transfer approved by the department if the commissioner determines that such person's liability for such tax was more than [five] ONE hundred thousand dollars for the year immediately preceding the year with respect to which the requirement to pay tax by electronic funds transfer is established. The commissioner, in determining whether tax liability is more than [five] ONE hundred thousand dollars, [shall] MAY base the determination on the [taxes estimated to be due on the declaration of] estimated tax, if any, [as last amended,] PAID for the immediately preceding year, provided, if the tax return for such immediately preceding year has been filed, the commissioner shall base the determination on the taxes reported to be due on such tax return. If any tax return [or declaration of estimated tax] of such person for such period has not been filed OR ESTIMATED TAX HAS NOT BEEN PAID BY SUCH PERSON FOR SUCH PERIOD, the commissioner may base such determination on any information available to him. (3) Except as otherwise provided in subsection (b) of this section, the commissioner may require every employer who is deducting and withholding Connecticut income tax from employee wages to pay such tax during the twelve-month period following a determination of liability under this subdivision, by one of the means of electronic funds transfer approved by the department if the commissioner determines that the amount of Connecticut income tax deducted and withheld from employee wages by such employer was more than [five] ONE hundred thousand dollars for the twelve-month period ending on the June thirtieth immediately preceding the quarterly period with respect to which the requirement to pay over tax by electronic funds transfer is established. The commissioner, in determining whether tax liability is more than [five] ONE hundred thousand dollars, shall base such determination on the taxes reported to be due on the quarterly withholding tax returns of such employer related to the period under examination. If any such tax return of such person for such period has not been filed, the commissioner may base such determination on any information available to him.

Sec. 11. (NEW) The Commissioner of Revenue Services or his authorized agent may compromise any controversy arising from the application or enforcement of any general statute over which said commissioner has authority. An offer of compromise may be made or entertained if it is based upon doubt as to the taxpayer's liability for the amount in controversy, or doubt as to the collectibility of such amount.

Sec. 12. (NEW) (a) The Commissioner of Revenue Services may enter into an agreement, in writing, with any person relating to the liability of such person, or of the person or estate for whom such person acts, in respect of any tax payable to said commissioner for any taxable period.

(b) Such agreement shall be final and conclusive and, except upon a showing of fraud or malfeasance or misrepresentation of a material fact, (1) the case shall not be reopened as to the matters agreed upon or the agreement modified by any officer, employee or agent of the state of Connecticut, and (2) in any suit, action or proceeding, such agreement, or any determination, assessment, collection, payment abatement, refund or credit made in accordance therewith, shall not be annulled, modified, set aside or disregarded.

Sec. 13. Subsection (a) of section 12-2 of the general statutes, as amended by section 31 of public act 95-283, is repealed and the following is substituted in lieu thereof:

(a) (1) The Governor shall, in the manner and for the term provided by sections 4-5 to 4-8, inclusive, AS AMENDED appoint a Commissioner of Revenue Services and the Governor shall fill any vacancy occurring during such term as provided by said sections. The commissioner shall, before entering upon the duties of his office, take the oath by law provided for executive and judicial officers and, in the performance of his duties, he shall have power to administer oaths. (2) The commissioner may prescribe regulations, to be adopted in accordance with chapter 54, and make rulings, not inconsistent with law, to carry into effect the provisions of this title, which regulations or rulings, when reasonably designed to carry out the intents and purposes of this title, shall be prima facie evidence of its proper interpretation. Each regulation shall be assigned a section number corresponding to the section of the general statutes [(1)] (A) pursuant to which such regulation is authorized or required or [(2)] (B) with respect to which such regulation pertains for purposes of implementation, procedural details or supplementary interpretation, provided whenever such section number corresponds to a section which does not include the authorization or requirement for such regulation, a reference to the section providing such authorization or requirement shall be included in the text of the regulation. (3) The commissioner shall publish for distribution all regulations prescribed hereunder and such rulings as appear in the discretion of the commissioner to be of general interest. (4) The commissioner may require any person who is or appears to be affected by the provisions of any tax law of this state to furnish to the Department of Revenue Services the Social Security account number or numbers issued to such person by the Secretary of Health and Human Services, or the employer identification number or numbers issued to such person by the Secretary of the Treasury, or both numbers. (5) [He] THE COMMISSIONER may hold meetings, conferences or schools for assessors, collectors or municipal finance officers. The expenses of those attending, including their regular wages, salaries, per diem allowances or other form of remuneration, shall be paid by the municipality for the time so spent. The commissioner, by himself or by an agent whom he may appoint, shall require compliance by assessors with all statutes concerning the assessment of real and personal property, and shall visit the towns in this state and inquire into the manner in which the laws relating to listing and assessing taxable property therein are executed by the assessors and boards of assessment appeals, and whether all persons and property taxable in such towns are in fact justly assessed and taxed; whether all taxes which are due and collectible are in fact collected and paid to the Treasurer in the manner prescribed by law; whether accounts and records of collectors and treasurers are adequate and properly kept and whether tax exemptions on property are granted in the manner and only to the extent required by law; and for such purpose he may subpoena any person to appear before him at such place in the town wherein such inquiry is being made as may be designated in such subpoena to examine him under oath, and for such purpose he may compel the attendance before him of any such witness and the production of books and papers by subpoena. No such witness shall be excused from testifying or from producing books or papers on the ground that such testimony or the production of such books or papers will tend to incriminate him, but such evidence or production of books or papers shall not be used in any criminal proceedings against him. If any person disobeys such process or, having appeared in obedience thereto, refuses to answer any pertinent question put to him by said commissioner, said commissioner may apply to the Superior Court, or to a judge of said court if the same is not in session, setting forth such disobedience to process or refusal to answer, and said court or such judge, as the case may be, thereupon shall cite such person to appear before him and shall inquire into the facts set forth in such application and, upon finding the allegations in such application to be true, shall commit such person to a community correctional center until he testifies, but not for a longer period than sixty days. (6) NO INTEREST, PENALTY OR ADDITION TO TAX SHALL BE IMPOSED ON ANY TAX OR INSTALMENT OF ESTIMATED TAX REQUIRED TO BE PAID TO THE DEPARTMENT OF REVENUE SERVICES WITH RESPECT TO ANY TAX OR INSTALMENT OF ESTIMATED TAX NOT PAID WHEN REQUIRED TO THE EXTENT THAT THE COMMISSIONER OF REVENUE SERVICES DETERMINES THAT, BY REASON OF CASUALTY OR DISASTER, THE IMPOSITION OF SUCH INTEREST, PENALTY OR ADDITION TO TAX WOULD BE AGAINST EQUITY AND GOOD CONSCIENCE. THE PROVISIONS OF THIS SUBDIVISION SHALL NOT BE CONSTRUED AS AUTHORIZING SUIT AGAINST THE STATE WHERE THE COMMISSIONER OF REVENUE SERVICES DOES NOT DETERMINE THAT THE IMPOSITION OF INTEREST, PENALTY OR ADDITION TO TAX WOULD BE AGAINST EQUITY AND GOOD CONSCIENCE AND SHALL NOT BE CONSTRUED AS A WAIVER OF SOVEREIGN IMMUNITY.

Sec. 14. Section 12-37 of the general statutes is repealed and the following is substituted in lieu thereof:

Wherever used in this section, "tax" includes not only the principal of any tax but also includes the principal of any license, permit and fee and also all interest, fees, penalties, forfeitures and other charges which may be added by law to the principal of any such tax, license, permit and fee. Each state collection agency may have a suspense tax book. Any state collection agency may, at any time, deliver to the [Attorney General] TREASURER AND COMPTROLLER a statement showing: (1) The amount of such uncollectible tax shown on the records of the agency; (2) the date when each such tax became due and payable; (3) the name and address of the person against whom each such tax was levied, and (4) the reason why the agency believes each such tax to be uncollectible. At the end of such statement, the agency head shall certify that to the best of his knowledge and belief each tax shown in such statement has not been paid and is uncollectible. [If the approval of the Attorney General is obtained, each] EACH tax so designated as uncollectible shall thereupon be [certified by the head of the collection agency to the Treasurer and Comptroller and] transferred by such state collection agency to its suspense tax book, and its records shall be written up accordingly. Each TAX so transferred shall not thereafter be included as an asset of the state. The amount of each tax so transferred during the last fiscal year and the name and address of the person against whom each such tax was levied shall be [published in the next report of such state collection agency] AVAILABLE TO THE PUBLIC FOR INSPECTION BY ANY PERSON. NOT LESS THAN SEVEN YEARS AFTER DELIVERING SUCH A STATEMENT TO THE TREASURER AND THE COMPTROLLER, THE HEAD OF THE COLLECTION AGENCY MAY REQUEST THE ABATEMENT REVIEW COMMITTEE, AS ESTABLISHED BY SECTION 17 OF THIS ACT, TO APPROVE THE ABATEMENT OF ANY TAX DESIGNATED ON SUCH STATEMENT AS UNCOLLECTIBLE. Nothing herein contained shall be construed as an abatement of any tax so transferred, but any such tax, as it has been increased by interest, penalties, fees, fines, forfeitures and other charges, may be collected by the state collection agency then or subsequently in office.

Sec. 15. Subsection (a) of section 12-39 of the general statutes, as amended by section 1 of public act 95-4, is repealed and the following is substituted in lieu thereof:

(a) When any tax payable to the Commissioner of Revenue Services by any person, as defined in section 12-1, AS AMENDED, has been found to be uncollectible, said commissioner, upon the [advice of the Attorney General] APPROVAL OF THE ABATEMENT REVIEW COMMITTEE, AS ESTABLISHED BY SECTION 17 OF THIS ACT, may, except as otherwise provided by law, abate, in whole or in part, such tax and any penalty or interest payable in connection therewith to the state by such person. Upon such approval, said commissioner shall certify such abatement to the Treasurer and Comptroller.

Sec. 16. Subsection (b) of section 12-3a of the general statutes, as amended by section 1 of public act 95-132, is repealed and the following is substituted in lieu thereof:

(b) An itemized statement of all waivers approved under this section shall be [included in the published report of the Secretary of the Office of Policy and Management required under section 4-60] AVAILABLE TO THE PUBLIC FOR INSPECTION BY ANY PERSON.

Sec. 17. (NEW) (a) There is created an Abatement Review Committee which shall consist of the State Comptroller, the Secretary of the Office of Policy and Management and the Commissioner of Revenue Services. Said committee shall meet monthly or as often as necessary to approve any abatement, in whole or in part, of tax, including any penalty or interest payable in connection therewith, which the Commissioner of Revenue Services, or the executive director of the Division of Special Revenue, is authorized to abate pursuant to any provision of the general statutes. A majority vote of the committee shall be required for approval of such abatement.

(b) An itemized statement of all abatements approved under this section shall be available to the public for inspection by any person.

(c) The Abatement Review Committee, established pursuant to subsection (a) of this section, may adopt regulations, in accordance with chapter 54 of the general statutes, establishing guidelines for the abatement of any tax.

Sec. 18. (NEW) (a) Whenever a taxpayer is eligible to claim more than one income tax credit under chapter 229 of the general statutes, the credits shall be claimed for the taxable year in the following order: (1) Any credit under section 12-703 of the general statutes; (2) any credit under section 12-704 of the general statutes; (3) any credit under subsection (e) of section 12-700a of the general statutes; (4) any other credit that may not be carried forward to a succeeding taxable year or years, in the order in which the taxpayer may receive the maximum benefit; (5) any credit that may be carried forward to a succeeding taxable year or years with any credit carryforward that will expire first being claimed before any credit carryforward that will expire later or will not expire at all or if the credit carryforwards will expire at the same time, in the order in which the taxpayer may receive the maximum benefit.

(b) In no event shall any credit be claimed more than once.

Sec. 19. (NEW) (a) If the commissioner believes that the collection of any tax imposed under chapter 229 of the general statutes, including any amount of tax required to be deducted and withheld and paid over to the commissioner, will be jeopardized by delay, he shall make a jeopardy assessment of and collect such tax. The amount assessed is immediately due and payable. He may enforce collection of such tax by using the method provided in section 12-35 of the general statutes, as amended, or by using any other method provided for in the general statutes relating to the enforced collection of taxes. If the amount of such tax has been definitely fixed, the amount so fixed shall be assessed and collected. If the amount of such tax has not been definitely fixed, the commissioner shall assess and collect such amount as, in his opinion, from the facts available to him, is sufficient.

(b) If the amount specified in the notice of jeopardy assessment is not paid within ten days after service of notice, personally or by mail, upon the person against whom such jeopardy assessment is made, the amount becomes final at the expiration of the ten days, unless a written protest is filed within such ten days, and the penalty and the interest provided in section 12-735 of the general statutes, as amended, shall attach to the amount of the tax.

(c) The person against whom the jeopardy assessment is made may file a written protest with the commissioner within ten days after the service upon him of notice of the jeopardy assessment. If a written protest is filed, the commissioner shall reconsider the jeopardy assessment and, if such person has so requested, may grant or deny such person or such person's authorized representatives an oral hearing. Such person may obtain a stay of collection of the whole or any part of the amount of such jeopardy assessment by filing with the commissioner, within said ten-day period, a bond in such an amount, not exceeding double the amount as to which the stay is desired, and with such surety as the commissioner deems necessary to ensure compliance with chapter 229 of the general statutes, conditioned upon payment of as much of the amount, the collection of which is stayed by the bond, as is found to be due from such person. At any time thereafter in respect to the whole or any part of the amount covered by such bond, the person against whom a jeopardy assessment has been made may waive such stay, and if, as the result of such waiver, any part of the amount covered by the bond is paid, the bond shall, at the request of such person, be proportionately reduced.

(d) Notice of the commissioner's determination, following his reconsideration of the jeopardy assessment, shall be served, personally or by mail, on the person against whom the jeopardy assessment was made, and such notice shall set forth the commissioner's findings of fact and the basis of decision in each case decided in whole or in part adversely to such person.

(e) The determination of the commissioner following his reconsideration of the jeopardy assessment, shall be final upon the expiration of one month from the date on which notice thereof is served, personally or by mail, on the person against whom the jeopardy assessment was made unless within such period the taxpayer seeks judicial review of the commissioner's determination under section 12-730 of the general statutes, as amended.

(f) In the case of service by mail of any notice required by this section, the service is complete at the time of deposit in the United States Post Office or mail box. If served by mail, any notice to a person against whom a jeopardy assessment is made shall be addressed to such person's address as it appears in the records of the commissioner.

Sec. 20. Section 12-36 of the general statutes is repealed and the following is substituted in lieu thereof:

If, before the due date of any state tax, EXCEPT A TAX IMPOSED UNDER CHAPTER 219 OR 229, any state collection agency believes that the collection of such tax will be jeopardized by delay, he shall, subject to the provisions of this section, collect such tax forthwith. He may enforce collection thereof by using the method provided in section 12-35 AS AMENDED or by using any other method provided for in the general statutes relating to the enforced collection of taxes. If the amount of such tax has been definitely fixed, the amount so fixed shall be collected. If the amount of such tax has not been definitely fixed, the state collection agency shall collect such amount as, in his opinion, from the facts available to him, is sufficient. If, after the payment of any tax in conformity with the provisions of this section, it is found that the amount so paid is in excess of the amount which would have been paid on the tax due date or after appeal to the courts, the excess so paid shall be returned to the taxpayer upon written application by him to the comptroller. Such written application shall contain a recital of the facts, shall show the amount of rebate to which the applicant believes he is entitled, shall be approved by the state collection agency and shall be made within the period of one year from the date of the definite determination of such tax. The person against whom jeopardy collection proceedings have been begun may obtain a stay of collection of the whole or any part of the amount of the tax so represented by such proceedings by filing with the state collection agency a bond in such an amount, not exceeding double the amount as to which the stay is desired, and with such surety as the state collection agency deems necessary, conditioned upon the payment of as much of the amount, the collection of which is stayed by the bond, as is found to be due from such person. The amount of the tax which is stayed by the bond shall be paid on notice and demand of the state collection agency at any time after the tax due date. The person subject to jeopardy collection proceedings, under the provisions of this section, who has obtained a stay of collection in whole or in part, may waive such stay at any time in respect to the whole or any part of the amount covered by the bond, and if, as the result of such waiver, any part of the amount covered by the bond is paid, the bond shall, at the request of the taxpayer, be proportionately reduced.

Sec. 21. Section 12-707 of the general statutes is repealed and the following is substituted in lieu thereof:

Each employer required to deduct and withhold tax under this chapter shall be liable for such tax and shall file a withholding return as prescribed by the Commissioner of Revenue Services and pay over to the commissioner, or to a depositary designated by the commissioner, the taxes so required to be deducted and withheld at the same times that such employer is required, under federal law and regulations, to pay over federal taxes that are required to be deducted and withheld from wages of employees, except if the amount of taxes required to be deducted and withheld in a calendar quarter is less than five hundred dollars AND IF THE EMPLOYER IS REQUIRED, UNDER FEDERAL LAW AND REGULATIONS, TO PAY OVER FEDERAL TAXES THAT ARE REQUIRED TO BE DEDUCTED AND WITHHELD FROM WAGES OF EMPLOYEES ON OR BEFORE THE LAST DAY OF THE MONTH NEXT SUCCEEDING SUCH CALENDAR QUARTER, the employer shall file a withholding return and pay over such taxes on or before the last day of the month next succeeding the calendar quarter for which the taxes were deducted and withheld. [Any] SUCH amount of tax required to be DEDUCTED AND withheld and paid over to the commissioner under this chapter, [and any additions to such tax and any penalties and interest with respect thereto] WHEN SO DEDUCTED AND WITHHELD, shall be held to be a special fund in trust for the state. No employee or other person shall have any right of action against the employer in respect to any moneys deducted and withheld from wages and paid over to the commissioner in compliance or in intended compliance with this chapter.

Sec. 22. Subdivision (10) of subsection (a) of section 12-701 of the general statutes is repealed and the following is substituted in lieu thereof: (10) "Connecticut fiduciary adjustment" means the net positive or negative total of the following items relating to income, gain, loss or deduction of a trust or estate: (A) There shall be added together [(A)] (i) any interest income from obligations issued by or on behalf of any state, political subdivision thereof, or public instrumentality, state or local authority, district or similar public entity, exclusive of such income from obligations issued by or on behalf of the state of Connecticut, any political subdivision thereof, or public instrumentality, state or local authority, district or similar public entity created under the laws of the state of Connecticut and exclusive of any such income with respect to which taxation by any state is prohibited by federal law, [(B)] (ii) any exempt-interest dividends, as defined in Section 852 (b) (5) of the Internal Revenue Code, exclusive of such exempt-interest dividends derived from obligations issued by or on behalf of the state of Connecticut, any political subdivision thereof, or public instrumentality, state or local authority, district or similar public entity created under the laws of the state of Connecticut and exclusive of such exempt-interest dividends derived from obligations, the income with respect to which taxation by any state is prohibited by federal law, [(C)] (iii) any interest or dividend income on obligations or securities of any authority, commission or instrumentality of the United States which federal law exempts from federal income tax but does not exempt from state income taxes, [(D)] (iv) to the extent properly includable in determining the net gain or loss from the sale or other disposition of capital assets for federal income tax purposes, any loss from the sale or exchange of obligations issued by or on behalf of the state of Connecticut, any political subdivision thereof, or public instrumentality, state or local authority, district or similar public entity created under the laws of the state of Connecticut, in the income year such loss was recognized, [(E)](v) to the extent deductible in determining federal taxable income prior to deductions relating to distributions to beneficiaries, any income taxes imposed by this state, [(F)] (vi) to the extent deductible in determining federal taxable income prior to deductions relating to distributions to beneficiaries, any interest on indebtedness incurred or continued to purchase or carry obligations or securities the interest on which is exempt from tax under this chapter, and [(G)] (vii) expenses paid or incurred during the taxable year for [(i)] the production or collection of income which is exempt from tax under this chapter, or [(ii)] the management, conservation or maintenance of property held for the production of such income, and the amortizable bond premium for the taxable year on any bond the interest on which is exempt from taxation under this chapter, to the extent that such expenses and premiums are deductible in determining federal taxable income prior to deductions relating to distributions to beneficiaries. (B) There shall be subtracted from the sum of such items [(a)] (i) to the extent properly includable in gross income for federal income tax purposes, any income with respect to which taxation by any state is prohibited by federal law, [(b)] (ii) to the extent allowable under section 12-718, exempt dividends paid by a regulated investment company, [(c)] (iii) with respect to any trust or estate which is a shareholder of an S corporation which is carrying on, or which has the right to carry on, business in this state, as said term is used in section 12-214, the amount of such shareholder's pro rata share of such corporation's nonseparately computed items, as defined in Section 1366 of the Internal Revenue Code, multiplied by such corporation's apportionment fraction, if any, as determined in accordance with section 12-218, [(d)] (iv) to the extent properly includable in gross income for federal income tax purposes, any interest income from obligations issued by or on behalf of the state of Connecticut, any political subdivision thereof, or public instrumentality, state or local authority, district or similar public entity created under the laws of the state of Connecticut, [(e)] (v) to the extent properly includable in determining the net gain or loss from the sale or other disposition of capital assets for federal income tax purposes, any gain from the sale or exchange of obligations issued by or on behalf of the state of Connecticut, any political subdivision thereof, or public instrumentality, state or local authority, district or similar public entity created under the laws of the state of Connecticut, in the income year such gain was recognized, [(f)](vi) any interest on indebtedness incurred or continued to purchase or carry obligations or securities the interest on which is subject to tax under this chapter, but exempt from federal income tax, to the extent that such interest on indebtedness is not deductible in determining federal taxable income prior to deductions relating to distributions to beneficiaries [and (g)] (vii) ordinary and necessary expenses paid or incurred during the taxable year for the production or collection of income which is subject to taxation under this chapter, but exempt from federal income tax, or the management, conservation or maintenance of property held for the production of such income, and the amortizable bond premium for the taxable year on any bond the interest on which is subject to tax under this chapter, but exempt from federal income tax, to the extent that such expenses and premiums are not deductible in determining federal taxable income prior to deductions relating to distributions to beneficiaries AND (viii) THE AMOUNT OF ANY REFUND OR CREDIT FOR OVERPAYMENT OF INCOME TAXES IMPOSED BY THIS STATE, TO THE EXTENT PROPERLY INCLUDABLE IN GROSS INCOME FOR FEDERAL INCOME TAX PURPOSES FOR THE TAXABLE YEAR AND TO THE EXTENT DEDUCTIBLE IN DETERMINING FEDERAL TAXABLE INCOME PRIOR TO DEDUCTIONS RELATING TO DISTRIBUTIONS TO BENEFICIARIES FOR THE PRECEDING TAXABLE YEAR.

Sec. 23. Section 12-724 of the general statutes is repealed and the following is substituted in lieu thereof:

(a)(1) In the case of an individual serving in the armed forces of the United States, or serving in support of such armed forces, in an area designated by the president of the United States by executive order as a "combat zone" at any time during the period designated by the president by executive order as the period of combatant activities in such zone, or hospitalized inside or outside the state as a result of injury received while serving in such an area during such time, the period of service in such area, plus the period of continuous hospitalization inside or outside the state attributable to such injury, and the next one hundred eighty days thereafter, shall be disregarded in determining the timeliness of actions under this chapter with respect to income tax liability, including any interest, penalty or addition to the tax, related to such individual. (2) THE PROVISIONS OF THIS SUBSECTION SHALL ALSO APPLY IN THE CASE OF AN INDIVIDUAL SERVING IN THE ARMED FORCES OF THE UNITED STATES, OR SERVING IN SUPPORT OF SUCH ARMED FORCES, IN AN AREA DESIGNATED BY CONGRESS IN A PUBLIC LAW, AND DURING A PERIOD BEGINNING ON A DATE DESIGNATED BY CONGRESS IN SUCH PUBLIC LAW AND ENDING ON A DATE DESIGNATED EITHER BY THE PRESIDENT BY EXECUTIVE ORDER OR BY CONGRESS IN A PUBLIC LAW, OR HOSPITALIZED INSIDE OR OUTSIDE THE STATE AS A RESULT OF INJURY RECEIVED WHILE SERVING IN SUCH AN AREA DURING SUCH TIME, IF SUCH PUBLIC LAW PROVIDES THAT, IN SUCH AREA AND DURING SUCH PERIOD, SUCH SERVICES BY SUCH INDIVIDUAL ARE TO BE TREATED IN THE SAME MANNER AS SERVICES AS A MEMBER OF THE ARMED FORCES OF THE UNITED STATES IN AN AREA DESIGNATED BY THE PRESIDENT OF THE UNITED STATES BY EXECUTIVE ORDER AS A "COMBAT ZONE" DURING THE PERIOD DESIGNATED BY THE PRESIDENT BY EXECUTIVE ORDER AS THE PERIOD OF COMBATANT ACTIVITIES IN SUCH ZONE.

(b) (1) In the case of any person who dies while in active service as a member of the armed forces of the United States, if such death occurred while serving in a combat zone during a period of combatant activities in such zone, as described in subsection (a) of this section, or as a result of wounds, disease or injury incurred while so serving, the tax imposed by this chapter shall not apply with respect to the taxable year in which falls the date of his or her death, or with respect to any prior taxable year ending on or after the first day so served in a combat zone, and no returns shall be required in behalf of such person or his or her estate for such year; and the tax for any such taxable year which is unpaid at the date of death, including interest, additions to tax and penalties, if any, shall not be assessed and, if assessed, the assessment shall be abated and, if collected, shall be refunded to the legal representative of such estate if one has been appointed and has qualified, or, if no legal representative has been appointed or has qualified, to the surviving spouse. (2) THE PROVISIONS OF THIS SUBSECTION SHALL ALSO APPLY IN THE CASE OF AN INDIVIDUAL WHO DIES WHILE IN ACTIVE SERVICE AS A MEMBER OF THE ARMED FORCES OF THE UNITED STATES, IF SUCH DEATH OCCURRED WHILE SERVING IN AN AREA DESIGNATED BY CONGRESS IN A PUBLIC LAW, AND DURING A PERIOD BEGINNING ON A DATE DESIGNATED BY CONGRESS IN SUCH PUBLIC LAW AND ENDING ON A DATE DESIGNATED EITHER BY THE PRESIDENT BY EXECUTIVE ORDER OR BY CONGRESS IN A PUBLIC LAW, OR, AS A RESULT OF WOUNDS, DISEASE OR INJURY INCURRED WHILE SO SERVING, IF SUCH PUBLIC LAW PROVIDES THAT, IN SUCH AREA AND DURING SUCH PERIOD, THE DEATH OF SUCH INDIVIDUAL WHILE IN ACTIVE SERVICE IN SUCH AREA AND DURING SUCH PERIOD, OR AS A RESULT OF WOUNDS, DISEASE, OR INJURY INCURRED WHILE SO SERVING, ARE TO BE TREATED IN THE SAME MANNER AS THE DEATH OF ANY INDIVIDUAL WHILE IN ACTIVE SERVICE AS A MEMBER OF THE ARMED FORCES OF THE UNITED STATES IN AN AREA DESIGNATED BY THE PRESIDENT OF THE UNITED STATES BY EXECUTIVE ORDER AS A "COMBAT ZONE" DURING THE PERIOD DESIGNATED BY THE PRESIDENT BY EXECUTIVE ORDER AS THE PERIOD OF COMBATANT ACTIVITIES IN SUCH ZONE.

Sec. 24. Section 12-598 of the general statutes is repealed.

Sec. 25. This act shall take effect from its passage, except that section 22 shall be applicable to taxable years commencing on or after January 1, 1992, section 23 shall be applicable to taxable years commencing on or after January 1, 1995, and sections 9 and 14 to 18, inclusive, shall take effect July 1, 1996, and section 10 shall take effect July 1, 1997.

Approved June 4, 1996. Effective as provided in section 25.

[footer.htm]