ARIZONA STATE SENATE
Forty-seventh Legislature, Second Regular Session
FACT SHEET FOR H.B. 2086
taxes; payments, filings and extensions
Purpose
Allows the Arizona Department of Revenue (DOR) to impose a nonsufficient funds fee to dishonored electronic payments of transaction privilege tax (TPT), modifies the deadline for monthly TPT payments and imposes penalties for the failure to timely file a TPT return.
Background
Currently, DOR is authorized to impose a nonsufficient funds fee to dishonored traditional checks for TPT payments. As taxpayers move to electronic filing and payment of taxes, dishonored transactions not considered a traditional check or negotiable instrument are not subject to the fee.
State law allows an accounting credit for taxpayers that timely pay their TPT. The credit is one percent of the amount of tax due, limited to a maximum of $10,000. This statute does not require that the taxpayer timely file the return in order to claim the credit. According to DOR, the state is unable to properly distribute TPT revenues until a return is received, thus resulting in multiple distributions or recovery of TPT following the initial distribution.
According to DOR, there is no anticipated fiscal impact associated with this legislation.
Provisions
1. Allows DOR to impose a nonsufficient funds fee of $25 on electronic funds transfers, automated clearing house debits or automated clearing house credits that are not paid or are dishonored by the financial institution.
2. Extends the deadline for taxpayers paying TPT electronically from the 25th day of the month to the second to last business day of the month.
3. Clarifies that taxpayers paying TPT by mail must postmark the payment by the 25th day of the month or the payment must be received by the second to last business day of the month.
4. Subjects a taxpayer’s TPT liability to penalties if the TPT return is not filed at the same time as the tax payment.
5. Disqualifies a taxpayer who fails to file the TPT return at the same time as the tax payment from eligibility for the accounting tax credit.
6. Allows TPT to be paid by an electronic funds transfer.
7. Conforms withholding filing extension dates to the Internal Revenue Code if all quarterly payments are paid-in-full and are not delinquent.
8. Makes technical and conforming changes.
9. Becomes effective on the general effective date.
House Action
WM 2/13/06 DP 7-0-0-2
3rd Read 2/28/06 53-0-7-0
Prepared by Senate Research
March 7, 2006
SL/jas