§241-1.5  Time of application of tax andother provisions.  (a)  The tax imposed by this chapter applies to everybank, building and loan association, development company, financialcorporation, financial services loan company, trust company, mortgage loancompany, financial holding company, small business investment company, orsubsidiary as defined in section 241-1:

(1)  Which is in business at the commencement of acalendar year, as of January 1 of that year;

(2)  Which begins business after the commencement of acalendar year, as of the commencement of business.

(b)  The measure of the tax for the year inwhich the taxpayer begins business is an estimate of the net income of thetaxpayer for that year or for the part of that year in which it is in business.

The tax for the year in which the taxpayerbegins business shall be at the tax rate provided in section 241-4.

The estimate shall be made on forms provided bythe department and shall be subject to adjustment by the filing of an amendedreturn as provided in subsection (e).  The tax shall be paid on or before thetwentieth day of the third month after the month in which the taxpayer beginsbusiness.  Payment of the tax shall accompany the return unless time for thepayment is extended by the director of taxation.  The extension may be grantedby the director in order to provide for payment of the tax in installmentsduring the remainder of the calendar year.

(c)  The measure of the tax for the yearfollowing the year in which the taxpayer began business is an estimate,utilizing the average monthly net income of the first taxable year of doingbusiness multiplied by twelve.  The tax shall be at the rate provided bysection 241-4.  A return shall be made and the tax returned and paid on orbefore the twentieth day of the fourth month following the close of the firsttaxable year of doing business and shall be subject to adjustment by the filingof an amended return as provided in subsection (e).

(d)  If the taxpayer is in business at thecommencement of the calendar year, and was in business during the whole of thepreceding year and prior thereto, the tax shall be returned and paid asprovided in section 241-4.

(e)  An amended return shall be filed after theclose of the applicable taxable year for each year for which an estimated taxreturn was filed under subsection (b) or (c).

If subsection (b) or (c) applies, any variancebetween the estimate and the actual net income for that year shall be adjustedand a credit or refund made, or payment of additional tax due, depending uponwhether the estimate was in excess of, or less than, the actual net income ofthe taxpayer for the year.

The amended return shall be made and filed andany additional tax due paid on or before the twentieth day of the fourth monthfollowing the close of the taxable year in which the taxpayer commencedbusiness.

The adjustment of the tax imposed under thischapter and the making of an amended return as provided under this sectionshall apply only to the first and second taxable years of doing business.

(f)  Whenever any taxpayer subject for any yearto the tax imposed by this chapter shall have acquired by purchase or otherwiseduring the preceding year the business or any part thereof of another taxpayerliable to tax under this chapter for such preceding year but not liable for theyear following such sale or disposition, and the acquiring taxpayer continuesthe operation of the business so acquired, the net income to be reported by theacquiring taxpayer for the purpose of determining the amount of its tax underthis chapter for the year following the year in which the business was soacquired shall include, in addition to the net income of the acquiring taxpayerduring the year ending December 31 or fiscal year preceding, whichever isapplicable, the net income of the business or part thereof so acquired for suchportion of such preceding year as such business was not operated by theacquiring company.

This subsection shall not apply to any taxpayerwhose tax for the year involved is measured under subsection (b) by an estimateof gross income for such year subject to adjustment after the close of theyear.

If the first paragraph of this subsectionapplies but the tax of the acquiring taxpayer for the year is governed by subsection(c) and adjusted under subsection (e), then in determining the average monthlynet income for that purpose there shall be included in addition to the netincome of the acquiring taxpayer for the period involved in the determinationof the average, the net income of the business or part thereof acquired by thetaxpayer for the portion of that period in which the business was not operatedby the acquiring taxpayer.

(g)  Whenever there is a consolidation ormerger of taxpayers subject to the tax imposed by this chapter, the tax shallattach to the taxpayer thus formed and the net income which shall be used formeasuring the tax of the taxpayer thus formed shall include the net income ofthe taxpayers which were consolidated or merged.

(h)  If a taxpayer subject to the tax imposedby this chapter terminates business operations during the calendar or fiscalyear and other than in an acquisition by another company, or merger, orconsolidation, the tax shall apply to the actual net income for the taxable yearor part of the taxable year the taxpayer continued business operations.

If a taxpayer subject to the tax imposed bythis chapter terminates business operations during the taxable year:

(1)  Before the tax return is filed as required undersection 241-5, a short year return shall be made and filed and the tax shallapply to the actual net income for the taxable year or part of the taxable yearduring which the taxpayer continued business operations; or

(2)  After the return has been made and filed as providedin section 241-5, an amended return shall be made and filed to show the actualnet income for the taxable year or part of the taxable year during which thetaxpayer continued business operations.  Any variance between the tax computedand paid on the basis of the entire net income of the preceding calendar orfiscal year and the actual net income for the final year or part of a year ofbusiness operations shall be adjusted and a credit or refund made, or thepayment of additional tax shall be made.

The return made under paragraph (1) or (2)shall be filed and the tax imposed by this chapter shall be paid on or beforethe twentieth day of the fourth month following the month business operationsceased or the close of the taxable year, whichever is earlier.

The tax computed under this subsection shallnot be duplicated with respect to the tax of an acquiring taxpayer asdetermined under subsection (f) or (g). [L 1988, c 69, §1; am L 1989, c 266,§3; am L 1992, c 106, §11]