Connecticut General Statutes
Chapter 208 - Corporation Business Tax
Section 12-233. - Examination of returns by commissioner. Deadlines for mailing deficiency assessments. Penalties for deficiencies. Payment by taxpayer.

(a)(1) The commissioner shall examine the tax return filed under this chapter by a taxpayer and may make such further audit or investigation as the commissioner deems necessary, and if the commissioner determines that there is a deficiency with respect to the payment of any tax due under this chapter, the commissioner shall notify the taxpayer thereof. Except as otherwise provided in this section, the commissioner shall (A) in the case of a return on which an operating loss is not reported, not later than three years after the due date for the filing of such return or not later than three years after the date on which such return was received by the commissioner, whichever period expires later, or (B) in the case of a return on which an operating loss is reported, not later than three years after the due date or the date of receipt by the commissioner, whichever period expires later, of the return on which a carry-over of such loss is fully utilized or deemed fully utilized because such loss is not available for deduction in any subsequent income year, examine it and, in case any error is disclosed by such examination, shall mail a notice of deficiency assessment to the taxpayer. Where, within the sixty-day period ending on the day on which the time prescribed in this section for mailing a notice of deficiency assessment for any income year would otherwise expire, the commissioner receives a written document signed by such taxpayer showing that such taxpayer owes an additional amount of tax for such income year, the commissioner then shall have up to sixty days after the day such written document is received in which to mail a notice of deficiency assessment.

(2) A notice of deficiency assessment may be mailed to the taxpayer at any time in the case of (A) failure to file a return, including any amended return required pursuant to section 12-226, or (B) a deficiency due to fraud or intent to evade the provisions of this chapter or regulations adopted thereunder.
(3) In the case of an omission from gross income of an amount properly includable therein that is in excess of twenty-five per cent of the amount of gross income stated in the return, a notice of deficiency assessment may be mailed to the taxpayer at any time not later than six years after the return was filed. For purposes of this subdivision, there shall not be taken into account any amount that is omitted from gross income stated in the return if such amount is disclosed in the return or in a statement attached to the return, in a manner adequate to apprise the commissioner of the nature and amount of such item.
(4) In the case of a failure to disclose a listed transaction, as defined in Section 6707A of the Internal Revenue Code, on the taxpayer's federal income tax return, a notice of deficiency assessment may be mailed to the taxpayer at any time not later than six years after the return required under this chapter for the same income year was filed.
(b) (1) When it appears that any part of the deficiency for which a deficiency assessment is made is due to negligence or intentional disregard of the provisions of this part or regulations adopted thereunder, there shall be imposed a penalty equal to ten per cent of the amount of such deficiency assessment, or fifty dollars, whichever is greater. When it appears that any part of the deficiency for which a deficiency assessment is made is due to fraud or intent to evade the provisions of this part or regulations adopted thereunder, there shall be imposed a penalty equal to twenty-five per cent of the amount of such deficiency assessment. For audits of returns commencing on or after January 1, 2006, when it appears that any part of the deficiency for which a deficiency assessment is made pursuant to this section is due to failure to disclose a listed transaction, as defined in Section 6707A of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as from time to time amended, on the taxpayer's federal tax return, there shall be imposed a penalty equal to seventy-five per cent of the amount of such deficiency assessment.
(2) No taxpayer shall be subject to more than one penalty under this section in relation to the same tax period.
(3) Any decision rendered by any federal court holding that a taxpayer has filed a fraudulent return with the Director of Internal Revenue shall subject the taxpayer to the penalty imposed by this section without the necessity of further proof thereof, except when it can be shown that the return to the state so differed from the return to the federal government as to afford a reasonable presumption that the attempt to defraud did not extend to the return to the state.
(c) Not later than thirty days after the mailing of a notice of deficiency assessment, the taxpayer shall pay to the commissioner, in cash or by check, draft or money order drawn to the order of the Commissioner of Revenue Services, any additional amount of tax shown to be due by such notice, or such taxpayer shall be paid by the State Treasurer, upon order of the Comptroller, any amount shown to be due it by the corrected return. The failure of the taxpayer to receive any timely mailed notice required by this section shall not relieve such taxpayer of the obligation to pay the tax assessed under the terms of this part or any interest or penalties thereon.
(d) When, before the expiration of the time prescribed in this section for the examination of the return or the assessment of the tax, both the commissioner and the taxpayer have consented in writing to such examination or assessment after such time, the return may be examined and the tax may be assessed at any time prior to the expiration of the period agreed upon. The period so agreed upon may be extended by subsequent agreements in writing made before the expiration of the period previously agreed upon. The commissioner may also in such a case waive the statute of limitations against a claim for refund by such taxpayer.
(e) For purposes of this section, a tax return filed under this chapter before the last day prescribed by law or by any regulation adopted pursuant to this chapter for the filing of such return, determined without regard to any extension of time for filing, shall be deemed to be filed on such last day.
(1949 Rev., S. 1913; 1951, S. 1102d; 1957, P.A. 560, S. 7; P.A. 77-380, S. 1, 2; 77-614, S. 139, 610; P.A. 86-80, S. 1, 2; P.A. 88-314, S. 6, 54; May Sp. Sess. P.A. 94-4, S. 81, 85; P.A. 95-2, S. 20, 37; P.A. 95-160, S. 64, 69; P.A. 05-116, S. 2; 05-260, S. 7; P.A. 06-196, S. 89.)
History: P.A. 77-380 added provision re examination of return by commissioner in cases of returns on which an operating loss is reported and specified “timely mailed” notice, effective June 10, 1977, and applicable to income years ending after that date; P.A. 77-614 substituted commissioner of revenue services for tax commissioner, effective July 1, 1979; P.A. 86-80 in reference to the period within which the commissioner shall examine a return on which an operating loss is carried-over, added the language that the expiration of such period is determined from the date of the return on which such loss is “fully” utilized or “deemed fully utilized”, effective May 6, 1986 and applicable to income years of corporations commencing on or after January 1, 1986; P.A. 88-314 deleted statement concerning the date when payment of tax is due, which is covered elsewhere in chapter 208, and added language concerning penalties when a deficiency assessment is made, effective July 1, 1988, and applicable to any tax which first becomes due and payable on or after said date, to any return or report due on or after said date, or in the case of any ongoing obligation imposed in accordance with said act, to the tax period next beginning on or after said date; May Sp. Sess. P.A. 94-4 made existing section a Subsec. (a) and added provision that commissioner may not make more than one assessment for a tax period and added a new Subsec. (b) re supplemental assessment, effective June 9, 1994; P.A. 95-2 deleted Subsec. (b) and provision in former Subsec. (a) that the commissioner may not make more than one assessment for a tax period, effective March 8, 1995; P.A. 95-160 revised effective date of May Sp. Sess. P.A. 94-4 but without affecting this section; P.A. 05-116 divided existing section into Subsecs. (a) to (d) and made conforming and technical changes throughout, amended Subsec. (a) to allow further audits and provide various deadlines for mailing deficiency notices, amended Subsec. (b) to provide a penalty for failure to disclose a listed transaction, and added Subsec. (e) re timing of filing of return, effective June 24, 2005, and applicable to income years commencing on or after January 1, 2005; P.A. 05-260 amended Subsec. (b)(1) to allow the 75% penalty for failure to disclose listed transaction to apply to returns audited on or after January 1, 2006, effective July 13, 2005; P.A. 06-196 made technical changes in Subsecs. (a)(1) and (2) and (b)(1), effective June 7, 2006.
See Sec. 12-30c re penalty on promoter of abusive tax shelters.
Cited. 124 C. 406; 135 C. 62. Where additional tax is determined to be due in accordance with Sec. 12-226 as result of changes, adjustments or corrections in corporation's returns to federal collector of internal revenue, tax commissioner must notify corporation of the additional taxes due “within a reasonable time” pursuant to said section and 3-year limitation set forth in this section does not apply; history discussed. 153 C. 103.
Cited. 26 CS 373; 44 CS 90.

Structure Connecticut General Statutes

Connecticut General Statutes

Title 12 - Taxation

Chapter 208 - Corporation Business Tax

Section 12-213. - Definitions.

Section 12-214. - Imposition of tax. Surcharge.

Section 12-214a and 12-215. - Effective date of subsection (7) of section 12-214. Certain gross rentals to be tax-exempt.

Section 12-216. - Payment of tax by out-of-state corporations.

Section 12-216a. - Payment of tax by companies having economic nexus with state. Applicability to companies treated as foreign corporations by the Internal Revenue Code.

Section 12-217. - Deductions from gross income. Net income and operating loss carry-over of S corporations and combined groups.

Section 12-217aa. - Order of credits.

Section 12-217aaa. - Accumulated research and development tax credits.

Section 12-217a and 12-217b. - Deduction for investment in depreciable property. Tax credit for expenditures for water pollution abatement facilities.

Section 12-217bb. - Tax credit for electric suppliers hiring displaced workers.

Section 12-217bbb. - Accumulated research and experimental expenditures tax credits and accumulated research and development tax credits. Innovation investment fund tax credit auction.

Section 12-217c and 12-217d. - Tax credit for expenditures for: Air pollution abatement facilities; industrial waste treatment facilities.

Section 12-217cc. - Tax credit for certain small businesses obtaining financing from federal Small Business Administration. For income years commencing prior to January 1, 2014.

Section 12-217dd. - Tax credit for donation of land for open space or educational use.

Section 12-217e. - Tax credits for certain manufacturing, service and eligible facilities. No credit to be first claimed for income years commencing on or after January 1, 2018.

Section 12-217ee. - Refund of unused credits under sections 12-217j and 12-217n.

Section 12-217f. - Tax credit for employers participating in certain state-approved programs combining high school study and part-time employment.

Section 12-217ff. - Tax credit for donation of land for educational use. No credit allowed on or after January 1, 2013.

Section 12-217g. - Tax credits for apprenticeship training in manufacturing, construction and plastics-related trades.

Section 12-217gg. - Tax credit for employment expansion project.

Section 12-217h. - Tax credit for expenditures to establish day care facilities for children of employees.

Section 12-217hh. - Tax credit for hiring displaced worker.

Section 12-217i. - Tax credits for investments in vehicles powered by clean alternative fuels or electricity, for construction of or improvements to alternative fuel filling stations and for converting motor vehicles to utilize alternative fuels. For...

Section 12-217ii. - Jobs creation tax credit program. No eligibility certificates issued on or after January 1, 2012.

Section 12-217j. - Tax credit for research and experimental expenditures.

Section 12-217jj. - Film production tax credit. Regulations.

Section 12-217k. - Tax credit for employee training.

Section 12-217kk. - Tax credit for infrastructure projects in the entertainment industry. Regulations.

Section 12-217l. - Tax credit for expenditures for grants to institutions of higher education for research and development related to technological advancements.

Section 12-217ll. - Tax credit for digital animation production companies. Regulations.

Section 12-217m. - Tax credit for taxpayers occupying new facilities and creating new jobs.

Section 12-217mm. - Tax credit for green buildings. No initial credit voucher issued after November 30, 2017.

Section 12-217n. - Rolling tax credit for research and development expenses. Carryforward limit.

Section 12-217nn. - Qualified small business job creation tax credit program. No credit allowed in income years commencing on or after January 1, 2013.

Section 12-217o. - Tax credit for machinery and equipment expenditures.

Section 12-217oo. - Vocational rehabilitation job creation tax credit program. No credit allowed for income years commencing on or after January 1, 2012.

Section 12-217p. - Tax credits for taxpayer providing housing for low and moderate income employees.

Section 12-217pp. - Job expansion tax credit program. No credit allowed for new jobs created on or after January 1, 2014.

Section 12-217q and 12-217r. - Tax credit for expenditures for: Construction of or improvements to alternative fuel filling stations; converting motor vehicles to utilize alternative fuels.

Section 12-217qq. - Tax credit for employers making certain student loan payments.

Section 12-217s. - Tax credit for expenditures related to traffic reduction programs.

Section 12-217t. - Tax credit for personal property taxes paid on electronic data processing equipment.

Section 12-217u. - Tax credit for financial institutions constructing new facilities and creating new jobs. For income years commencing prior to January 1, 2014.

Section 12-217v. - Tax credit for qualifying corporations in enterprise zones.

Section 12-217w. - Tax credit for investment in fixed capital.

Section 12-217x. - Tax credit for human capital investment.

Section 12-217y. - Tax credit for employing persons who are receiving benefits from the temporary family assistance program.

Section 12-217z. - Business Tax Credit and Tax Policy Review Committee.

Section 12-217zz. - Limit on credits under this chapter.

Section 12-218. - Apportionment of net income.

Section 12-218a. - Apportionment of tax on insurance company.

Section 12-218b. - Apportionment of net income of financial service companies.

Section 12-218c. - Restrictions on the deductibility of certain intangible expenses and interest expenses with a related member.

Section 12-218d. - Restriction on the deductibility of interest expenses or costs related to certain transactions with related members.

Section 12-218e. - Combined group's net income. Apportionment percentage. Net operating loss. Carryover. Additional tax base. Nexus combined base tax.

Section 12-218f. - Combined group determined on world-wide basis, affiliated group basis or water's-edge basis. Tax havens.

Section 12-218g. - Net deferred tax liability and assets. Deductions.

Section 12-219. - Capital base tax. Phase-out. Surcharge.

Section 12-219a. - Apportionment of tax base in and out of state. Insurance companies excepted.

Section 12-219b. - Election with respect to apportionment of net income.

Section 12-220 to 12-221. - Allocation of minimum tax base. Apportionment of additional tax. Allocation in special cases.

Section 12-221a. - Petition for alternative method of apportionment. Regulations.

Section 12-222. - Annual return. Designated taxable member of combined group. Duties.

Section 12-223. - Returns of affiliated corporations.

Section 12-223a. - Combined corporation business tax return.

Section 12-223b. - Intercompany rents and business receipts.

Section 12-223c. - Minimum tax in combined return.

Section 12-223d. - Assessments against one or more taxpayers in combined return.

Section 12-223e. - Readjustment of taxes on revision of combined return.

Section 12-223f. - Preference tax due from corporations filing a combined return.

Section 12-224. - Return of fiduciary.

Section 12-225. - Supplemental and amended returns. Refund claim.

Section 12-226. - Correction of returns; additional tax; refunds.

Section 12-226a. - Adjustments by the commissioner. Regulations.

Section 12-227. - Interest on refunds.

Section 12-228. - Refunds to be made from General Fund.

Section 12-229. - Failure to pay tax or make return. Penalty. Waiver of penalty authorized.

Section 12-230. - Forfeiture of corporate rights for failure to make returns.

Section 12-231. - Penalties for wilful violation of requirements related to payment of tax or delivery of documentation.

Section 12-231a. - Formation of insurance company affiliate of holding company to evade tax.

Section 12-232. - Authority to take testimony under oath; subpoenas.

Section 12-233. - Examination of returns by commissioner. Deadlines for mailing deficiency assessments. Penalties for deficiencies. Payment by taxpayer.

Section 12-234. - Settlement with Treasurer.

Section 12-235. - Delinquent taxes; interest; collection.

Section 12-235a. - Disallowance of credits if taxes due and unpaid.

Section 12-236. - Hearing by commissioner.

Section 12-237. - Appeal.

Section 12-238. - Abatement of taxes.

Section 12-239. - Abatement of taxes on motor bus company in receivership.

Section 12-240. - Publication and disclosure of information.

Section 12-241. - Tax to be in lieu of other taxes.

Section 12-241a. - Definition.

Section 12-242. - Regulations.

Section 12-242a to 12-242c. - Definitions. When declaration of estimated tax required. Installment payment on estimated tax.

Section 12-242d. - Installment payment of estimated tax. Interest on under payments.

Section 12-242e. - Disposition of installments.

Section 12-242f. - Obligations of fiduciary.

Section 12-242g. - Overpayments.

Section 12-242h. - Regulations.

Section 12-242i. - Declaration as return.