Revenue Ruling

Ruling Number:19-2009-02
Tax Type:Kansas Compensating Tax; Kansas Retailers' Sales Tax
Brief Description:Application of Senate Substitute for House Bill 2365 Statute of Limitations for Sales and Use Tax Refunds During Field Audits
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Approval Date:06/26/2009


Body:
KANSAS DEPARTMENT OF REVENUE
OFFICE OF THE SECRETARY
Revenue Ruling 19-2009-02

June 26, 2009

Application of Senate Substitute for House Bill 2365 Statute of Limitations for Sales and Use Tax Refunds During Field Audits

This Revenue Ruling provides guidance concerning the manner in which the Department of Revenue will implement certain provisions contained in 2009 Senate Substitute for House Bill 2365, which was enacted by the Kansas Legislature in the final hours of the veto session to help balance the State General Fund.

Section 9 of Senate Substitute for House Bill 2365 shortened from three years to one year the statute of limitations on the filing of claims for sales and compensating (use) tax refunds and credits. This amendment was projected to generate $13.7 million in additional net revenue in fiscal year 2010.

The statute of limitations on sales and use tax assessments remains at three years from the date the return is filed for the tax period in question and is unaffected by this legislation.

Questions have been asked concerning the manner in which the Department of Revenue will allow sales and use tax refunds and credits identified during the course of a field audit. Consistent with the discussions that took place during the legislative process leading up to the enactment of the bill, effective as of June 16, 2009, the Department of Revenue will allow overpayments of sales and use tax made during the audit period to offset any tax assessment, not to exceed the amount of such assessment. To receive a refund, the taxpayer under audit must file a refund claim pursuant to K.S.A. 2008 Supp. 79-3693 within the one-year statute of limitations applicable under Section 9 of Senate Substitute for House Bill 2365.

This revenue ruling replaces and supersedes all prior advice, revenue rulings and rulings that have been issued regarding the statute of limitations concerning sales and use tax refunds in the context of an audit.

Secretary of Revenue


Joan Wagnon


Date Composed: 06/25/2009 Date Modified: 06/25/2009