REPORT TITLE:
Income Tax


DESCRIPTION:
Requires organizations that file a Form 990 with the Internal
Revenue Service to file a copy of the form with the department of
taxation.  Appropriates funds to the department of taxation for
filing and tracking the information contained in Form 990.


 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        
HOUSE OF REPRESENTATIVES                H.B. NO.1682       
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                   A  BILL  FOR  AN  ACT

RELATING TO INCOME TAX.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  Section 235-101, Hawaii Revised Statutes, is
 
 2 amended to read as follows:
 
 3      "§235-101  Federal returns and assessments, when copies are
 
 4 required.(a)  In prescribing the form of return the department
 
 5 of taxation may require that a person who is required to file a
 
 6 federal income tax return include in the person's return a
 
 7 reconciliation of the return with the person's federal return, or
 
 8 that the person furnish with the return and as a part thereof a
 
 9 copy of the federal return.
 
10      (b)  It shall be the duty of every person who is required by
 
11 section 235-92 to make a return, to report to the department, as
 
12 to any taxable year governed by this chapter, if:
 
13      (1)  [the] The amount of taxable income as returned to the
 
14           United States is changed, corrected, or adjusted by an
 
15           officer of the United States or other competent
 
16           authority[, or];
 
17      (2)  [a] A change in taxable income results from a
 
18           renegotiation of a contract with the United States or a
 
19           subcontract thereunder[, or];
 

 
Page 2                                                     
                                     H.B. NO.1682       
                                                        
                                                        

 
 1      (3)  [a] A recomputation of the income tax imposed by the
 
 2           United States under the Internal Revenue Code results
 
 3           from any cause[,]; or
 
 4      (4)  [an] An amended income tax return is made to the United
 
 5           States.
 
 6 The report shall be made within ninety days after the change,
 
 7 correction, adjustment, or recomputation is finally determined or
 
 8 the amended return is filed, as the case may be.  The report
 
 9 required by this subsection shall be made in the form of an
 
10 amendment of the person's return filed under this chapter.  The
 
11 amended return shall be accompanied by a copy of the document
 
12 issued by the United States under (1) to (3).  The statutory
 
13 period for the assessment of any deficiency or the determination
 
14 of any refund attributable to this report shall not expire before
 
15 the expiration of one year from the date the department is
 
16 notified by the taxpayer or the Internal Revenue Service,
 
17 whichever is earlier, of such a report in writing.  Before the
 
18 expiration of this one-year period, the department and the
 
19 taxpayer may agree in writing to the extension of this period.
 
20 The period so agreed upon may be further extended by subsequent
 
21 agreements in writing made before the expiration of the period
 
22 previously agreed upon.
 

 
 
 
Page 3                                                     
                                     H.B. NO.1682       
                                                        
                                                        

 
 1      (c)  Whenever, in the opinion of the department, it is
 
 2 necessary to examine any federal income tax return of any
 
 3 taxpayer or any determination, assessment, or report related
 
 4 thereto, the department may compel the taxpayer to produce for
 
 5 inspection a copy of any federal return, copies of all statements
 
 6 and schedules in support thereof, and copies of all
 
 7 determinations, assessments, and reports related thereto. 
 
 8      (d)  Any person who is required to file federal form 990
 
 9 under section 6033 of the Internal Revenue Code shall file a copy
 
10 of the completed and filed form 990 with the department."
 
11      SECTION 2.  There is appropriated out of the general
 
12 revenues of the State of Hawaii the sum of $           or so much
 
13 thereof as may be necessary for fiscal year 1999-2000 to file and
 
14 track the information contained in federal form 990.
 
15      SECTION 3.  The sum appropriated shall be expended by the
 
16 department of taxation for the purposes of this Act.
 
17      SECTION 4.  Statutory material to be repealed is bracketed.
 
18 New statutory material is underscored.
 
19      SECTION 5.  This Act, upon its approval, shall apply to
 
20 taxable years beginning after December 31, 1998.
 
21 
 
22                           INTRODUCED BY:  _______________________