OK
Oklahoma Senate Bill SB602

Oklahoma 2024 Regular Session

Oklahoma Senate Bill SB602 Compare Versions

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4-
5-An Act
6-ENROLLED SENATE
7-BILL NO. 602 By: Rader of the Senate
28+ENGROSSED HOUSE AMENDME NT
29+ TO
30+ENGROSSED SENATE BILL NO . 602 By: Rader of the Senate
831
932 and
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1134 Fetgatter of the House
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1336
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17-An Act relating to revenue and taxation ; amending
40+An Act relating to tax returns; amending 68 O.S.
41+2021, Sections 2373 and 2375, which relate to payment
42+of refunds, extensions, and delinquency and
43+deficiency of payments; requiring certain claims be
44+made in the form prescribed by the Oklahoma Tax
45+Commission; limiting claims made to within a period
46+of certain date; prohibiting refund for clai ms made
47+after certain period; p roviding exception; modifying
48+limitation on certain amount of refund to taxes pa id
49+in certain preceding period; deleting requirement
50+that certain informati on filed constitutes a claim;
51+prohibiting application of limitation to certain
52+claims filed; modifyin g date requiring taxpayer to
53+remit income tax due; excluding extensions from dat e
54+taxes become delinquent; updating statutory language;
55+and providing an effective date.
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62+AMENDMENT NO. 1. Strike the title, enacting clause, and entire bill
63+and insert:
64+
65+
66+
67+
68+"An Act relating to revenue and taxation ; amending
1869 Section 1, Chapter 343, O.S.L. 2022 (68 O.S . Supp.
1970 2022, Section 2358.6a), which relates to bonus
2071 depreciation; clarifying application of depreciation;
2172 clarifying procedure for claiming depreciatio n;
2273 authorizing filing of amended tax return under
2374 certain conditions; prohibiting Oklahoma Tax
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24101 Commission from assessing penalties or interes t under
25102 certain conditions; and providing an effective date.
26103
27104
28105
29106
30-SUBJECT: Income tax returns
31-
32107 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
33-
34108 SECTION 1. AMENDATORY Section 1, Chapter 343, O.S.L.
35109 2022 (68 O.S. Supp. 2022, Section 2358.6a), is amended to read as
36110 follows:
37-
38-Section 2358.6a. A. As used in this section:
39-
111+Section 2358.6a A. As used in this section:
40112 1. "Internal Revenue Code " means Title 26 of the U nited States
41113 Code also known as the federal Inte rnal Revenue Code of 1986, as
42114 amended;
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44115 2. "Tax Cuts and Jobs Act" means Public Law No. 115-97 (115th
45116 Congress Public Law 97);
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48-ENR. S. B. NO. 602 Page 2
49117 3. "Qualified property" shall have the same meaning as in
50118 Internal Revenue Code Section 168(k) as the Code existed on January
51119 1, 2021, and shall apply to property placed in service after
52120 December 31, 2021;
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54121 4. "Qualified improvement pro perty" shall have the same meaning
55122 as in Internal Revenue Code Section 168(e)(6 ) as the Code existed on
56123 January 1, 2021, and shall apply to prope rty placed in service after
57124 December 31, 2021; and
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59125 5. "Full expensing" or "one hundred percent (100%) bonus
60126 depreciation" means a method for taxpayers to recover costs for
61127 certain expenditures in research and e xperimentation and depreciable
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62154 business assets by immediately deducting the full cost of suc h
63155 expenditures in the tax year in which the cost is incurred or the
64156 property is placed in service.
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66157 B. Taxpayers shall have the option for immediate and full
67158 expensing for qualified property and qualified improvement property
68159 as follows:
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70160 1. For purposes of computing income tax for taxable years
71161 beginning after Decembe r 31, 2021, the cost of expenditures for
72162 business assets that are qualified property or qualified im provement
73163 property covered under Section 168 of the Internal Revenue Code
74164 shall be eligible for one hundred percent (100%) bonus depreciation
75165 and may be deducted as an expense incurred by the taxpayer during
76166 the taxable year during which the property is pl aced in service,
77167 notwithstanding any changes to federal law related to amortization
78168 of cost recovery beginning on or after January 1, 2023, and shall
79169 permanently remain fully and immediately deductible as an expense in
80170 the tax year in which the property is placed in service for purposes
81171 of calculating the taxpayer's income; and
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83172 2. If a taxpayer elects imm ediate and full expensing of
84173 qualified property or qualified improvement property, any
85174 depreciation calculated and claimed pursuant to this section shall
86175 in no event be a duplication of any depreciation or bonus
87176 depreciation allowed or permitted on the fed eral income tax return
88177 of the taxpayer. For income tax returns filed on or after January
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89204 1, 2023, federal taxable income shall be increased by the amount of
90205 depreciation received under the Internal Reve nue Code for the
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92-ENR. S. B. NO. 602 Page 3
93206 qualified property or qualified impr ovement property for which the
94207 election has been made to imm ediately and fully expense the asset on
95208 the Oklahoma income tax return for the year in which t he property
96209 was placed in service. A taxpayer filing a return for which federal
97210 taxable income is not increased as provided for in this section
98211 prior to October 1, 2023, shall file an amended return ref lecting
99212 such increase not later than June 30, 2024. The Tax Commission
100213 shall not assess penalties or interest with respect to the failure
101214 to reflect such increase if a correct amended return is filed as
102215 required herein; and
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104216 3. The taxpayer's decision to recover investment costs through
105217 immediate expensing in the year the investment cost is incurred, or
106218 amortized over an amortization schedule, is irrevocabl e unless
107219 specifically allowed for by the Oklahoma Tax Commission.
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109220 C. 1. To conform to Section 179 of the Internal Revenue Code,
110221 taxpayers shall be allowed to immediately deduct as an expense the
111222 cost of certain depreciable business assets in the tax year in which
112223 the property is placed in service.
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114224 2. For purposes of computing income tax fo r taxable years
115225 beginning after December 31, 2021, taxpayers may elect to treat the
116226 cost of any Section 179 of the Internal Revenue Code property as an
117227 expense which is not chargeable to the capital account. Any cost so
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118254 treated shall be allowed as a deduc tion for the taxable year in
119255 which the Section 179 Internal Revenue Code property is placed in
120256 service.
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122257 D. The Oklahoma Tax Commission shall, within sixty (60) days of
123258 the effective date of this act, promulgate rules for implementation
124259 of this act which shall conform to the Internal Revenue Code of 1986
125260 and must be consistent with the Internal Revenue Service's rules.
126261 The provisions of this section shall supersede to t he extent of any
127262 inconsistency with any administrative rule.
128-
129-SECTION 2. This act shall become effective November 1, 2023.
263+SECTION 2. This act shall become effective November 1, 2023."
264+Passed the House of Representatives the 25th day of April, 2023.
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133-Passed the Senate the 18th day of May, 2023.
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268+
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270+Presiding Officer of the House of
271+ Representatives
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273+
274+Passed the Senate the ____ day of _______ ___, 2023.
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280+Presiding Officer of the Senate
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307+ENGROSSED SENATE
308+BILL NO. 602 By: Rader of the Senate
309+
310+ and
311+
312+ Pfeiffer of the House
313+
314+
315+
316+
317+An Act relating to tax returns; amending 68 O.S.
318+2021, Sections 2373 and 2375, which relate to payment
319+of refunds, extensions, and delinquency and
320+deficiency of payments; requiring certain claims be
321+made in the form prescribed by the Oklah oma Tax
322+Commission; limiting claims made to within a period
323+of certain date; prohibiting refund for clai ms made
324+after certain period; providi ng exception; modifying
325+limitation on certain amount of refund to taxes paid
326+in certain preceding period; deleting requirement
327+that certain informati on filed constitutes a claim;
328+prohibiting application of limitation to certain
329+claims filed; modifying date requiring taxpayer to
330+remit income tax due; excluding extensions from date
331+taxes become delinquent; updating statu tory language;
332+and providing an effective date.
333+
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337+BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
338+SECTION 3. AMENDATORY 68 O.S. 202 1, Section 2373, is
339+amended to read as follows:
340+Section 2373. A. Any claim for refund fil ed pursuant to this
341+section must be made on a return, in t he form prescribed by the
342+Oklahoma Tax Commission.
343+B. Any claim for refund of an overpayment of any tax im posed by
344+Section 2355 of this title must be made within three (3) years from
345+the due date of the return, including the period of any extension of
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372+time for filing a return, or two (2) year s from the payment of the
373+tax liability, whichever period expires later, or, if no return was
374+filed by the taxpayer, within two (2) years from the time the tax
375+was paid.
376+C. Except as provided in subsection H of Sectio n 2375 of this
377+title, no refund shall be allowed or made after the expirati on of
378+the period of limitation prescribed in subsection B of this section
379+for the filing of a claim for refund . If a claim for refund is
380+filed during the period prescribed in subse ction B of this section,
381+the amount of the refund, if any, shall not exceed the amount of tax
382+paid within the period, immediately preceding the filing of the
383+claim, equal to three (3) y ears plus the period of any extension of
384+time for filing a return. If the claim was not filed within the
385+three-year period prescribed in subsecti on B of this section, the
386+refund shall not exceed the portion of the tax paid during the two
387+(2) years immediately preceding the filing of the claim.
388+D. If, upon any revision or adjustment, including overpayment
389+or illegal payment on account of income der ived from tax-exempt
390+Indian land, any refund is found to be due any taxpayer, it shall be
391+paid out of the “Income Tax Withholding Refund Account ”, created by
392+Section 2385.16 of t his title, in the same manner as refunds are
393+paid pursuant to such section. The information filed, reflecting
394+the revision or adjustment, shall constitute the claim for refund.
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421+E. Except as provided in subsection H of Section 2375 of this
422+title, the amount of the refund shall not exceed the po rtion of the
423+tax paid during the three (3) years immediately preceding the filing
424+of the claim, or, if no claim was filed, then during the three (3)
425+years immediately preceding the allowance of the refund. However,
426+this The three-year limitation set forth in subsection C of t his
427+section shall not apply to the amount of refu nds payable upon claims
428+filed by members of federally recognized Indian tri bes or the United
429+States on behalf of its Ind ian wards or former Indian wards, to
430+recover taxes illegally colle cted from tax-exempt lands. In the
431+case of any refund to a member of a federally recognized Indian
432+tribe or to the United States on behalf of it s Indian wards or
433+former Indian wards, to rec over taxes illegally colle cted on bonus
434+payments from oil and gas leases located on tax -exempt Indian lands
435+pursuant to this section, th e Tax Commission shall pay interest on
436+all refunds issued after January 1, 1996, at the rate of six percent
437+(6%) per annum from the date of paymen t by the taxpayer to the date
438+of the refund.
439+F. In cases where the Tax Commis sion and the taxpayer have
440+signed a consent, as provided by law, extending the period during
441+which the tax may be assessed, the period during which the taxp ayer
442+may file a claim for refund or during which an allowance for a
443+refund may be made shall be auto matically extended to the final date
444+fixed by such consent plus thirty (30) days.
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471+G. The Oklahoma Tax Comm ission may authorize the use of direct
472+deposit in lieu of refund checks for electronically filed income tax
473+returns.
474+SECTION 4. AMENDATORY 68 O.S. 2021, Se ction 2375, is
475+amended to read as follows:
476+Section 2375. A. At the time of transmitting the return
477+required hereunder to the Oklahoma Tax Commis sion On the original
478+due date of the return, not including any extensions , the taxpayer
479+shall remit therewith to the Tax Commission the amount of tax due
480+under the applicable provisions of Section 2351 et seq. of this
481+title. Failure to pay such tax on or before the date the return is
482+due, not including any extensions, shall cause the tax to become
483+delinquent. If the return is filed electronically, the amount of
484+the tax due pursuant to the provisions of this article shall be due
485+on or before the twentieth day of April following the close of the
486+taxable year regardless of when the re turn is electronically filed.
487+The tax shall be deemed delinquent if unpaid aft er the twentieth day
488+of April if the return is electronically filed. Provided, if the
489+Internal Revenue Code provides for a later due date for returns of
490+individuals, the Tax Co mmission shall accept payments m ade with
491+returns filed by individuals by such d ate and such payments shall be
492+considered as timely paid.
493+B. If any tax due under Section 2351 et seq. of this title,
494+except a deficiency determined under Section 221 of this t itle, is
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521+not paid on or before t he date such tax becomes delinquent, a
522+penalty of five percent (5%) of the total amount of the tax due
523+shall be added thereto, collected , and paid. However, the Tax
524+Commission shall not collect the penalty assessed if the t axpayer
525+remits the tax and inter est within sixty (60) days of the mailing of
526+a proposed assessment or volun tarily pays the tax upon the filing of
527+an amended return.
528+C. If any part of deficiency, arbitrary , or jeopardy assessment
529+made by the Tax Commission is based upon or occasioned by the
530+refusal of any taxpayer to file with the Tax Commission any return
531+as required by Section 2351 et seq. of this title, within ten (10)
532+days after a written demand for such report or r eturn has been
533+served upon any taxpaye r by the Tax Commission by regis tered letter
534+with a return receipt attached, the Tax Commission may assess and
535+collect, as a penalty, twenty-five percent (25%) of the amount of
536+the assessment. In the exercise of the a uthority granted by
537+subsection C of Section 223 and Section 224 of thi s title, the Tax
538+Commission shall assess the tax as an estimated tax on the basis of
539+its own determination of the Oklahoma taxable income of the
540+taxpayer, to be adjusted if and when Okla homa taxable income is
541+ascertained under the provisions of Section 235 1 et seq. of this
542+title.
543+D. If any part of any d eficiency was due to negli gence or
544+intentional disregard, without the intent to defraud, then ten
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571+percent (10%) of the total amount of th e deficiency, in addition to
572+such deficiency, including interest as au thorized by law, shall be
573+added, collected, and paid.
574+E. If any part of an y deficiency was due to fraud with intent
575+to evade tax, then fifty perc ent (50%) of the total amount of the
576+deficiency, in addition to such deficienc y, including interest as
577+herein provided, shall be added, collected, and paid.
578+F. The provisions in this s ection for penalties shall supersede
579+all other provisions for penalties on income taxes. The provisions
580+in this section for penalties shall supersed e the provisions in the
581+Uniform Tax Procedure Code, Section 201 et seq. of this tit le, only
582+to the extent of conflict between such provisions and the penalty
583+provisions in this s ection.
584+G. All taxes, penalties , and interest levied under Section 2351
585+et seq. of this title must be paid to the Tax Commission at Oklahoma
586+City, in the form or remittance required by and payable to it.
587+H. 1. The period of time prescribed in Section 22 3 of this
588+title, in which the procedures for the assessment of income tax may
589+be commenced by the Tax Commissi on, shall be tolled and extended
590+until the amount of taxable income for any year of a taxpayer under
591+the Internal Revenue Code has been finally de termined under
592+applicable federal law an d for the additional period of time
593+hereinafter provided in this subse ction.
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620+2. If, in such final determination, the amou nt of taxable
621+income for any year of a taxpayer under the Internal Revenue Code is
622+changed or corrected from the amounts included in t he federal return
623+of the taxpayer for such year and such change or cor rection affects
624+the Oklahoma taxable income of the t axpayer for such year, the
625+taxpayer, within one (1) year after such final determination of the
626+corrected taxable income, shall file an amended return under Section
627+2351 et seq. of this title reporting the corrected Oklahoma taxable
628+income, and the Tax Comm ission shall make asses sment or refund
629+within two (2) years from the date the return required by this
630+paragraph is filed and not there after, unless a waiver is agreed to
631+and signed by the Tax Commission a nd the taxpayer.
632+3. In the event of failure by a ta xpayer to comply with t he
633+provisions of paragraph 2 of this subsection, the statute of
634+limitations shall be tolled for a period of tim e equal to the time
635+between the date the amended return under this sub section is
636+required until such return is actually fu rnished.
637+4. In administering the provisions of this subsection, the Tax
638+Commission shall have the authority to audit each and every i tem of
639+income, deduction, credit , or any other matter related to the r eturn
640+where such items or matters relate to allocatio n or apportionment
641+between the State of Oklahoma this state and some other state or the
642+federal government even if such items or matt ers were not affected
643+by revisions made in such final determination. Where such items or
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670+matters do not relate to allocation or appor tionment between the
671+State of Oklahoma this state and some other state or the fede ral
672+government, the Tax Commission shall be bound by the revisions made
673+in such final determination.
674+5. The provisions of this subsection shall be effective on
675+September 1, 1993, and e xcept in the case of tax years which are the
676+subject of closing, settle ment, or resolution agreements entered
677+into by taxpayers and the Tax Commissio n, keep open all tax years
678+beginning after June 30, 1988, and all tax years beginning on or
679+before June 30, 1988, for which extensions of the statute of
680+limitations have been exe cuted by the taxpayer, but only to the
681+extent such extensions remain open on t he date of enactment hereof.
682+SECTION 5. This act shall become effective November 1, 2023.
683+Passed the Senate the 2nd day of March, 2023.
134684
135685
136686
137687 Presiding Officer of the Senate
138688
139689
140-Passed the House of Representatives the 25th day of April, 2023.
690+Passed the House of Representatives the ____ day of __________,
691+2023.
141692
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143694
144695 Presiding Officer of the House
145696 of Representatives
146697
147-OFFICE OF THE GOVERNOR
148-Received by the Office of the Governor this _______ _____________
149-day of _________________ __, 20_______, at _______ o'clock _______ M.
150-By: ______________________________ ___
151-Approved by the Governor of the State of Oklahoma this _____ ____
152-day of _________________ __, 20_______, at _______ o'clock _______ M.
153698
154- _________________________________
155- Governor of the State of Oklahoma
156-
157-
158-OFFICE OF THE SECRETARY OF STATE
159-Received by the Office of the Secretary of State this _______ ___
160-day of __________________, 20 _______, at _______ o'clock _______ M.
161-By: _______________________________ __