§231-23  Adjustments and refunds.  (a) This subsection shall apply to all taxes except those collected under chapter247 and those collected under a chapter containing a provision for credit andrefund of the amount of tax paid in excess of the tax imposed by such chapter. As to all tax payments for which a refund or credit is not authorized by thissubsection (including without prejudice to the generality of the cases ofunconstitutionality hereinafter mentioned in (1)(C)) the remedies provided byappeal or under section 40-35 are exclusive.

(1)  If the amount already paid exceeds that whichshould have been paid under the chapter imposing a particular tax, or if theamount already paid results in duplication of payment in whole or in part, theexcess so paid shall be refunded in the manner provided in subsection (c)subject however to the following limitations:

(A)  No refund shall be made unless anapplication for the refund shall have been made within five years after theamount to be refunded was paid;

(B)  No recourse may be had except undersection 40-35 or by appeal for refunds of taxes paid pursuant to an assessmentby the director of taxation, provided that if the assessment by the directorshall contain clerical errors, transposition of figures, typographical errors,and errors in calculation or if there shall be an illegal or erroneousassessment, the usual refund procedures shall apply; or

(C)  No refund or overpayment credit shall bemade unless the original payment of the tax was due to the law having beeninterpreted or applied in respect of the taxpayer concerned differently than inrespect of taxpayers generally.

(2)  In any case where a taxpayer is entitled to arefund, the taxpayer, at the taxpayer's election, may apply the amount of therefund as an overpayment credit to taxes subsequently accruing under the samechapter as that under which the refundable amount was collected.

(b)  This subsection shall apply to the taxescollected under chapter 247.

There may be refunded in the manner provided insubsection (c) such conveyance tax as has been erroneously or unjustly paid.

(c)  This subsection shall apply to all taxes.

(1)  All refunds shall be paid only upon a form to beknown as a "refund voucher" prepared by the collector.  The refundvouchers shall set forth all the details of each transaction, shall be approvedby the director, and shall be forwarded to the comptroller from time to time. The comptroller shall issue a warrant, in the form prescribed by section 40-52,for the payment of any such refund out of the tax reserve fund hereinaftercreated; provided that if the person entitled to the refund is delinquent inthe payment of any tax, the comptroller, upon demand of the collector and afternotice to the delinquent taxpayer, shall withhold the amount of the delinquenttaxes, together with penalties and interest thereon, from the amount of therefund and pay the same to the collector.

(2)  There is hereby appropriated, from the generalrevenues of the State not otherwise appropriated, the sum of $25,000 whichshall be set aside as a trust fund to be known as the tax reserve fund.  Allrefunds of taxes collected by the department under chapters of the law undertitle 14 administered by the department shall be made out of the tax reservefund.  The director of taxation, from time to time, may deposit taxes collectedunder chapters of the law under title 14 administered by the department in thestate treasury to the credit of the tax reserve fund so that there may bemaintained at all times a fund not exceeding $25,000.  The amounts depositedshall be made from the taxes with respect to which a particular refund is made.

(d)  This subsection shall apply to a refundfor an overpayment of a tax.

(1)  If the tax return as filed by a taxpayer showsthe amount already paid, whether or not on the basis of installments, exceedsthe amount determined to be the correct amount of the tax due, and the taxpayerrequests a refund of the overpayment, the amount of overpayment together withinterest, if any, shall be refunded in the manner provided in subsection (c). The interest shall be allowed and paid at the rate of one-third of one per centfor each month or fraction thereof, beginning with the first calendar day afterthe due date of the return or, if the return is filed after the prescribed duedate, the first month following the month the return is received, andcontinuing until the date that the director approves the refund voucher.  Ifthe director approves the refund voucher within ninety days from the due dateor the date the return is received, whichever is later, and the comptroller ofthe State sends the taxpayer a refund warrant within forty-five days from thedate of the director's approval, no interest on the overpayment shall be allowedor paid.  However, if either the director or the comptroller exceeds the timeallowed herein, interest will be computed from the first calendar day after thedue date of the return or from the first month following the month the returnis received by the director if the return is filed after the prescribed duedate, until the date that the comptroller sends the refund warrant to thetaxpayer.

(2)  If any overpayment of taxes results or arisesfrom (A) the taxpayer filing an amended return, or from (B) a determinationmade by the director and the overpayment is not shown on the original return asfiled by the taxpayer, interest on the overpayment shall be allowed and paidfrom the first calendar day after the due date of the original return or, ifthe original return is filed after the prescribed due date, the first monthfollowing the month the return is received, to the date that the director signsthe refund voucher.  If the comptroller does not send the refund warrant to thetaxpayer within forty-five days after the director's approval, interest willcontinue until the date that the comptroller sends the refund warrant to thetaxpayer.

(3)  For purposes of a net income tax return, if anyoverpayment of any taxes results from a carryback of a net operating loss, theoverpayment shall be deemed to have been made at the close of the taxable yearin which the net operating loss arises.  To the extent that the carryback ofnet operating loss results in reducing the amount of underpayment of taxes forprior taxable year or years, interest that would be chargeable because of theunderpayment shall not be applicable with respect to that amount or amounts thatare carried back.

(4)  In the case of credit, interest shall be allowedand paid from the first calendar day after the due date of the return, thefirst month following the month the return is received by the director, or thedate of payment, whichever is later, to the date the credit is taken; providedthat the director may make a refund of any credit to a taxpayer where thetaxpayer has no underpayment against which to apply the credit. [L 1939, c 213,§1; RL 1945, §5130; am L 1949, c 205, §1; RL 1955, §115-28; am L 1957, c 152,§1; am L Sp 1959 2d, c 1, §16; am L 1963, c 45, §1(c); am L 1966, c 10, §3; amL 1967, c 134, §2; HRS §231-23; am L 1968, c 32, §3; am L 1971, c 10, §1; am L1972, c 200, §5; am L 1974, c 12, §1; am L 1983, c 217, §6; am L 1985, c 16,§5; gen ch 1985; am L 1986, c 340, §5; am L 1989, c 14, §4(4); am L 1991, c136, §1 and c 263, §8; am L 1992, c 102, §1; am L 1995, c 66, §8; am L 2003, c135, §2; am L 2009, c 40, §1]

 

Note

 

  The 2009 amendment applies to claims for refund made on orafter January 1, 2009.  L 2009, c 40, §3.

 

Case Notes

 

  Mentioned with respect to applicable period for bringingaction for refund of general excise taxes.  53 H. 1, 486 P.2d 396.

  Prohibits original actions by insurers to recover moneys paidto State without protest under §431-318.  5 H. App. 122, 678 P.2d 1101.