Connecticut General Statutes 12-242d – Installment payment of estimated tax. Interest on under payments
(a) For purposes of this section, there shall be four required installments for each income year. The due date for the first required installment is the fifteenth day of the third month of the income year. The due date for the second required installment is the fifteenth day of the sixth month of the income year. The due date for the third required installment is the fifteenth day of the ninth month of the income year. The due date for the fourth required installment is the fifteenth day of the twelfth month of the income year.
Terms Used In Connecticut General Statutes 12-242d
- Combined group: means the group of all companies that have common ownership and are engaged in a unitary business, where at least one company is subject to tax under this chapter. See Connecticut General Statutes 12-213
- Commissioner: means the Commissioner of Revenue Services. See Connecticut General Statutes 12-213
- company: means any person, partnership, association, company, limited liability company or corporation, except an incorporated municipality. See Connecticut General Statutes 12-1
- Designated taxable member: means , if the combined group has a common parent corporation and that common parent corporation is a taxable member, the common parent corporation and, in all other cases, the taxable member of the combined group that such group selects, in the manner prescribed by section 12-222, as its designated taxable member or, in the discretion of the commissioner or upon the failure of such group to select its designated taxable member in the manner prescribed by section 12-222, the taxable member of the combined group selected by the commissioner as the designated taxable member. See Connecticut General Statutes 12-213
- Income year: means the calendar year upon the basis of which net income is computed under this part, unless a fiscal year other than the calendar year has been established for federal income tax purposes, in which case it means the fiscal year so established or a period of less than twelve months ending as of the date on which liability under this chapter ceases to accrue by reason of dissolution, forfeiture, withdrawal, merger or consolidation. See Connecticut General Statutes 12-213
- month: means a calendar month, and the word "year" means a calendar year, unless otherwise expressed. See Connecticut General Statutes 1-1
- Net income: means net earnings received during the income year and available for contributors of capital, whether they are creditors or stockholders, computed by subtracting from gross income the deductions allowed by the terms of section 12-217, except that in the case of a domestic insurance company which is a life insurance company, "net income" means life insurance company taxable income (A) increased by any amount or amounts which have been deducted in the computation of gain or loss from operations in respect of (i) the life insurance company's share of tax-exempt interest, (ii) operations loss carry-backs and capital loss carry-backs, and (iii) operations loss carry-overs and capital loss carry-overs arising in any taxable year commencing prior to January 1, 1973, and (B) reduced by any amount or amounts which have been deducted as operations loss carry-backs or capital loss carry-backs in the computation of gain or loss from operations for any taxable year commencing on or after January 1, 1973, but only to the extent that such amount or amounts would, for federal tax purposes, have been deductible in the taxable year as operations loss carry-overs or capital loss carry-overs if they had not been deducted in a previous taxable year as carry-backs, and provided no expense related to income, the taxation of which by the state of Connecticut is prohibited by the law or . See Connecticut General Statutes 12-213
- Paid: means "paid or accrued" or "paid or incurred" construed according to the method of accounting upon the basis of which net income is computed under this part. See Connecticut General Statutes 12-213
- succeeding: when used by way of reference to any section or sections, mean the section or sections next preceding, next following or next succeeding, unless some other section is expressly designated in such reference. See Connecticut General Statutes 1-1
(b) The amount of the first required installment shall be thirty per cent of the required annual payment, as defined in subsection (e) of this section. The amount of the second required installment shall be forty per cent of the required annual payment, as defined in subsection (e) of this section. The amount of the third required installment shall be ten per cent of the required annual payment, as defined in subsection (e) of this section. The amount of the fourth required installment shall be twenty per cent of the required annual payment, as defined in subsection (e) of this section.
(c) Except as otherwise provided in this section, in the case of any underpayment of estimated tax by a company, there shall be added to the tax an amount determined by applying interest (1) at the rate of one per cent per month or fraction thereof, (2) to the amount of the underpayment, (3) for the period of the underpayment.
(d) For purposes of this section, the amount of the underpayment shall be the excess of the required installment, over the amount, if any, of the installment paid on or before the due date for the installment. The period of the underpayment shall run from the due date for the installment to whichever of the following dates is earlier: (1) The fifteenth day of the fifth month of the next succeeding income year; or (2) with respect to any portion of the underpayment, the date on which such portion is paid. For purposes of this subsection, a payment of estimated tax shall be credited against unpaid required installments in the order in which such installments are required to be paid.
(e) “Required annual payment” means the lesser of (1) ninety per cent of the tax shown on the return for the income year, or, if no return is filed, ninety per cent of the tax for such year, or (2) if the preceding income year was an income year of twelve months and if the company filed a return for the preceding income year showing a liability for tax, one hundred per cent of the tax shown on the return for the next preceding income year without regard to any credit under this chapter.
(f) (1) In the case of any required installment, if the company establishes that the annualized income installment is less than the amount determined under subsection (b) of this section, the amount of such required installment shall be the annualized income installment. Any reduction in a required installment resulting from the application of this subsection shall be recaptured by increasing the amount of the next required installment by the amount of such reduction and by increasing subsequent required installments to the extent that the reduction has not previously been recaptured under this subdivision.
(2) In the case of any required installment, the annualized income installment is the excess, if any, of (A) an amount equal to the applicable percentage of the tax for the income year computed by placing on an annualized basis its net income for months in the income year ending before the due date for the installment, over (B) the aggregate amount of any prior required installments for the taxable year.
(3) For purposes of this subsection, the applicable percentage for the first required installment is twenty-seven, the applicable percentage for the second required installment is sixty-three, the applicable percentage for the third required installment is seventy-two and the applicable percentage for the fourth required installment is ninety.
(g) The application of this section to income years of less than twelve months shall be in accordance with regulations adopted by the commissioner.
(h) No addition to tax shall be imposed under subsection (c) of this section for any income year if the tax shown on the return for such income year, or, if no return is filed, the tax, is one thousand dollars or less.
(i) For income years commencing on or after January 1, 2003, and prior to January 1, 2005, no addition to tax shall be imposed under subsection (c) of this section to the extent such underpayment was created or increased by section 12-218d.
(j) (1) The provisions of this section shall apply to taxable members of a combined group required to file a combined unitary tax return pursuant to section 12-222.
(2) The designated taxable member of a combined group shall be responsible for paying estimated tax installments, at the times and in the amounts specified in this section, on behalf of the taxable members of the combined group and in the form and manner prescribed by the Commissioner of Revenue Services.