42-2078. New interpretation or application of
law; affirmative defense; definition
A. Unless expressly authorized by law, the department shall not apply any newly
enacted law retroactively or in a manner that will penalize a taxpayer for complying with
prior law.
B. If the department adopts a new interpretation or application of any provision of
this title or title 43 or determines that any of those provisions applies to a new or
additional category or type of taxpayer, and the change in interpretation or application
is not due to a change in the law:
1. The change in interpretation or application applies prospectively unless it is
favorable to taxpayers.
2. The department shall not assess any tax, penalty or interest retroactively based
on the change in interpretation or application.
3. The change is an affirmative defense in any administrative or judicial action
for retroactive assessment of tax, interest and penalties to taxable periods before the
new interpretation or application was adopted.
C. Tax liabilities, penalties and interest paid before a new interpretation or
application of chapter 5 of this title by the department shall not be refunded unless the
taxpayer requesting the refund provides evidence satisfactory to the department that the
amounts will be refunded to the person who paid an added charge to cover the tax.
D. For the purposes of this section, "new interpretation or application" includes
policies and procedures adopted by administrative rule, tax ruling, tax procedure or
instructions to a tax return.
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