LSN 90-1

Special Notice Concerning Corporation Business Tax

Effective for the Installments of Estimated Corporation Business Tax due on or after May 15, 1990, the Department of Revenue Services will not credit an overpayment of tax liability for a preceding tax year against the current estimated tax liability unless a completed tax return (and not a tentative tax return) disclosing the overpayment has been filed. Pursuant to Sec. 12-242g of the Connecticut General Statutes, an overpayment cannot be determined to exist until a completed return is filed.

This policy will not affect the payment of the Installment of Estimated Tax due on March 15, 1990 or April 15, 1990, provided a timely Declaration of Estimated Taxes was filed. However, only overpayments that have been established by the filing of a completed return may be credited against the payment of Installments of Estimated Tax due on or after May 15, 1990.

Example 1: A calendar year taxpayer has an estimated tax liability for 1990 equaling $10,000. The taxpayer has filed a tentative tax return but has not yet filed a completed tax return for 1989. The taxpayer has filed a Declaration of Estimated Tax on March 15, 1990, paying $1000 and crediting an overpayment for 1989 of $2000 against the Installment of Estimated Tax due on March 15, 1990. If the taxpayer has not filed a completed tax return for 1989 on or before June 15, 1990, the taxpayer must pay a Second Installment on June 15, 1990 equaling $5000 (which together with the prior payment of $1000 will equal 60% of the $10,000 estimated tax).