AN ACT
Relating to the payment of refunds for overpaid taxes; amending RCW 82.32.050,
82.32.060, and 82.32.100; and providing an effective date.
BE IT ENACTED BY THE LEGISLATURE
OF THE STATE OF WASHINGTON:
Sec.
1. RCW
82.32.050 and 1991 c 142 s 9 are each amended to read as follows:
(1) If
upon examination of any returns or from other information obtained by the
department it appears that a tax or penalty has been paid less than that
properly due, the department shall assess against the taxpayer such additional
amount found to be due and shall add thereto interest at the rate of nine
percent per annum from the last day of the year in which the deficiency is
incurred until the date of payment for tax liabilities arising before
January 1, 1992. For tax liabilities arising after December 31, 1991, until
the date of payment, the rate of interest shall be variable and computed as
provided in subsection (2) of this section. The rate so computed shall be
adjusted on the first day of January of each year. The department shall notify
the taxpayer by mail of the additional amount and the same shall become due and
shall be paid within thirty days from the date of the notice, or within such
further time as the department may provide.
(2)
For the purposes of this section, the rate of interest to be charged to the
taxpayer shall be an average of the federal short-term rate as defined in 26
U.S.C. Sec. 1274(d) plus two percentage points. The rate shall be computed by
taking an arithmetical average to the nearest percentage point of the federal
short-term rate, compounded annually, for the months of January, April, July,
and October of the immediately preceding calendar year as published by the
United States secretary of the treasury.
(3) No
assessment or correction of an assessment for additional taxes, penalties,
or interest due may be made by the department more than four years after
the close of the tax year, except (a) against a taxpayer who has not registered
as required by this chapter, (b) upon a showing of fraud or of
misrepresentation of a material fact by the taxpayer, or (c) where a taxpayer
has executed a written waiver of such limitation. The execution of a
written waiver shall also extend the period for making a refund or credit as
provided in RCW 82.32.060(2).
Sec.
2. RCW
82.32.060 and 1991 c 142 s 10 are each amended to read as follows:
(1)
If, upon receipt of an application by a taxpayer for a refund or for an audit
of the taxpayer's records, or upon an examination of the returns or records of
any taxpayer, it is determined by the department that within the statutory
period for assessment of taxes, penalties, or interest prescribed by RCW
82.32.050 ((a)) any amount of tax, penalty, or interest
has been paid in excess of that properly due, the excess amount paid within,
or attributable to, such period shall be credited to the taxpayer's account
or shall be refunded to the taxpayer, at the taxpayer's option. Except as
provided in subsections (2) and (3) of this section, no refund or credit
shall be made for taxes, penalties, or interest paid more than four
years prior to the beginning of the calendar year in which the refund
application is made or examination of records is completed.
(2)
The execution of a written waiver under RCW 82.32.050 or 82.32.100 shall extend
the time for making a refund or credit of any taxes paid during, or
attributable to, the years covered by the waiver if, prior to the expiration of
the waiver period, an application for refund of such taxes is made by the
taxpayer or the department discovers a refund or credit is due.
(3)
Notwithstanding the foregoing limitations there shall be refunded or credited
to taxpayers engaged in the performance of United States government contracts
or subcontracts the amount of any tax paid, measured by that portion of the
amounts received from the United States, which the taxpayer is required by
contract or applicable federal statute to refund or credit to the United
States, if claim for such refund is filed by the taxpayer with the department
within one year of the date that the amount of the refund or credit due to the
United States is finally determined and filed within four years of the date on
which the tax was paid: PROVIDED, That no interest shall be allowed on such
refund.
(4)
Any such refunds shall be made by means of vouchers approved by the department
and by the issuance of state warrants drawn upon and payable from such funds as
the legislature may provide. However, taxpayers who are required to pay taxes
by electronic funds transfer under RCW 82.32.080 shall have any refunds paid by
electronic funds transfer.
(5)
Any judgment for which a recovery is granted by any court of competent
jurisdiction, not appealed from, for tax, penalties, and interest which were
paid by the taxpayer, and costs, in a suit by any taxpayer shall be paid in ((like))
the same manner, as provided in subsection (4) of this section,
upon the filing with the department of a certified copy of the order or
judgment of the court. Except as to the credits in computing tax authorized by
RCW 82.04.435, interest at the rate of three percent per annum shall be allowed
by the department and by any court on the amount of any refund, credit,
or other recovery allowed to a taxpayer for taxes, penalties, or
interest paid by the taxpayer before January 1, 1992. For refunds or
credits of amounts paid or other recovery allowed to a taxpayer after
December 31, 1991, the rate of interest shall be the rate as computed for
assessments under RCW 82.32.050(2), less one percentage point.
Sec.
3. RCW
82.32.100 and 1989 c 378 s 21 are each amended to read as follows:
(1)
If any person fails or refuses to make any return or to make available for
examination the records required by this chapter, the department shall proceed,
in such manner as it may deem best, to obtain facts and information on which to
base its estimate of the tax; and to this end the department may examine the ((books,))
records((, and papers)) of any such person ((and may take evidence,
on oath, of any person, relating to the subject of inquiry)) as provided
in RCW 82.32.110.
(2)
As soon as the department procures such facts and information as it is able to
obtain upon which to base the assessment of any tax payable by any person who
has failed or refused to make a return, it shall proceed to determine and
assess against such person the tax and any applicable penalties or
interest due, but such action shall not deprive such person from appealing
((to the superior court as hereinafter provided. To the assessment the
department shall add the penalties provided in RCW 82.32.090)) the
assessment as provided in this chapter. The department shall notify the
taxpayer by mail of the total amount of such tax, penalties, and interest, and
the total amount shall become due and shall be paid within thirty days from the
date of such notice.
(3)
No assessment or correction of an assessment may be made by the department more
than four years after the close of the tax year, except (((1))) (a)
against a taxpayer who has not registered as required by this chapter, (((2)))
(b) upon a showing of fraud or of misrepresentation of a material fact
by the taxpayer, or (((3))) (c) where a taxpayer has executed a
written waiver of such limitation. The execution of a written waiver shall
also extend the period for making a refund or credit as provided in RCW
82.32.060(2).
NEW
SECTION. Sec. 4. (1)
This act shall take effect July 1, 1992.
(2)
This act is effective for all written waivers that remain enforceable as of
July 1, 1992.
