42-2101

42-2101. Private taxpayer rulings; request;
revocation or modification; taxpayer information ruling;
definitions

A. The department may issue private taxpayer rulings to taxpayers and potential
taxpayers on request. Each request shall be in writing and shall:

1. State the name, address and, if applicable, taxpayer identifying number of the
taxpayer or potential taxpayer who requests the ruling.

2. Describe all facts that are relevant to the requested ruling.

3. State whether, to the best knowledge of the taxpayer or potential taxpayer, the
issue or related issues are being considered by the department in connection with an
active audit, protest or appeal that involves the taxpayer or potential taxpayer and
whether the same request has been or is being submitted to another taxing authority for a
ruling.

4. Be signed by the taxpayer or potential taxpayer who makes the request or by an
authorized representative of the taxpayer or potential taxpayer.

B. A taxpayer ruling request that complies with subsection A, paragraphs 2 and 3 of
this section and that is signed by a representative of a taxpayer or potential taxpayer
shall be considered a request for a taxpayer information ruling instead of a private
taxpayer ruling.

C. A private taxpayer ruling or taxpayer information ruling may be revoked or
modified by either:

1. A change or clarification in the law that was applicable at the time the ruling
was issued, including changes or clarifications caused by legislation, adopted
administrative rules and court decisions.

2. Actual written notice by the department to the last known address of the
taxpayer or potential taxpayer of the revocation or modification of the private taxpayer
ruling or taxpayer information ruling if the taxpayer identifying information has been
disclosed to the department pursuant to subsection E of this section. If taxpayer
identifying information has not been disclosed, written notice by the department to the
last known address of the taxpayer representative who requested the ruling will
constitute notice to the taxpayer or potential taxpayer.

D. With respect to the taxpayer or prospective taxpayer to whom the private
taxpayer ruling was issued, the revocation or modification of a private taxpayer ruling
shall not be applied retroactively to tax periods or tax years before the effective date
of the revocation or modification and the department shall not assess any penalty or tax
attributable to erroneous advice that it furnished to the taxpayer or potential taxpayer
in the private taxpayer ruling if:

1. The taxpayer reasonably relied on the private taxpayer ruling.

2. The penalty or tax did not result either from a failure by the taxpayer to
provide adequate or accurate information or from a change in the information.

E. Subsection D of this section applies to a taxpayer information ruling if the
taxpayer or potential taxpayer provides its name, address, identifying number, if
applicable and authorization pursuant to section 42-2003, subsection A, paragraph 1 for
the representative of the taxpayer or potential taxpayer before the date the department
publishes the ruling. The department shall notify the representative of the taxpayer or
potential taxpayer of the proposed publication date. If the director has determined that
the taxpayer information ruling should not be published pursuant to subsection L of this
section, subsection D of this section applies if the taxpayer or potential taxpayer
provides the identifying information before the date specified by the department on
issuing the taxpayer information ruling to the representative. If the taxpayer or
potential taxpayer does not provide the department with the identifying information and
representative authorization before the proposed publication date, or for an unpublished
ruling, the date specified by the department, the taxpayer information ruling is not
binding on the department for the purpose of abating interest, penalty or tax.

F. A private taxpayer ruling or taxpayer information ruling may not be relied upon,
cited or introduced into evidence in any proceeding by a taxpayer other than the taxpayer
who has received the private taxpayer ruling.

G. A taxpayer may apply for an administrative hearing to determine the propriety of
a retroactive application of a revoked or modified private taxpayer ruling by filing a
written petition with the department pursuant to section 42-1251 within forty-five days
after receiving written notice of the department's intent to retroactively apply a
revoked or modified private taxpayer ruling. This subsection applies to a taxpayer
information ruling if the taxpayer has disclosed the taxpayer's identifying information
pursuant to subsection E of this section.

H. A private taxpayer ruling or taxpayer information ruling constitutes the
department's interpretation of the law or rules only as they apply to the taxpayer
making, and the particular facts contained in, the request.

I. A private taxpayer ruling or taxpayer information ruling may be issued only if
no tax has accrued with respect to the transactions, events or facts contained in the
request. The department may issue a private taxpayer ruling or taxpayer information
ruling addressing a taxpayer's ongoing business activities, except that the ruling
applies only to transactions that occur or tax liabilities that accrue from and after the
date the taxpayer receives the ruling.

J. The department shall attempt to issue private taxpayer rulings or taxpayer
information rulings within forty-five days after receiving the written request and on
receiving the facts that are relevant to the ruling. If the ruling is expected to be
delayed, the department shall notify the requestor of the delay and the proposed date of
issuance.

K. The department shall maintain the private taxpayer ruling or taxpayer
information as a public record and make it available at a reasonable cost for public
inspection and copying. The text of private taxpayer or taxpayer information rulings is
open to public inspection subject to the confidentiality requirements prescribed by
article 1 of this chapter.

L. At the time of making a private taxpayer or taxpayer information ruling request,
a taxpayer or potential taxpayer may submit a written request that the ruling not be
published due to concerns about confidentiality or other disclosed reasons. If the
director determines that the ruling should not be published, the ruling shall be deemed
confidential for the purpose of section 39-121.01, subsection D, paragraph 2. If the
director determines that the ruling should be published, the taxpayer may withdraw the
ruling request, and the department shall not proceed with a ruling if the request is
withdrawn. Notwithstanding section 41-1092.02, the decision of the director to publish is
not an appealable agency action as defined in section 41-1092 and is not subject to
appeal by the taxpayer.

M. For the purposes of this section:

1. "Private taxpayer ruling" means a written determination by the department issued
on or after September 21, 1991 that interprets and applies one or more statutes contained
in this title or title 43 and any applicable administrative rules that the department has
adopted to the specific prospective facts described in the request for a private taxpayer
ruling.

2. "Taxpayer information ruling" means a written determination by the department
issued on or after the effective date of this amendment to this section that interprets
and applies one or more statutes contained in this title or title 43 and any applicable
administrative rules that the department has adopted to the specific prospective facts
described in a request for a taxpayer information ruling.