CSSB 92(RES): "An Act establishing an income tax on certain entities producing or transporting oil or gas in the state; and providing for an effective date."
00 CS FOR SENATE BILL NO. 92(RES) 01 "An Act establishing an income tax on certain entities producing or transporting oil or 02 gas in the state; and providing for an effective date." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 * Section 1. AS 43.20 is amended by adding a new section to read: 05 Sec. 43.20.019. Tax on income attributable to a qualified entity. (a) If a 06 qualified entity has taxable income over $5,000,000 in a tax year, the qualified entity 07 shall pay a tax of 9.4 percent on the taxable income over $5,000,000. 08 (b) For purposes of calculating taxable income under this section, 09 (1) taxable income of a qualified entity is determined under 10 AS 43.20.144 as if the qualified entity were taxable as a corporation, as determined 11 under 26 U.S.C. 1361 (Internal Revenue Code), as that section read on January 1, 12 2025; 13 (2) notwithstanding AS 43.20.021 and AS 43.20.036, the taxpayer may 14 not apply as a credit or deduction against tax liability a credit or deduction allowed as
01 to federal taxes under 26 U.S.C. (Internal Revenue Code). 02 (c) The tax under this section does not apply to a corporation paying tax under 03 AS 43.20.011 or to an entity that is part of a unitary business with a corporation that 04 pays tax under AS 43.20.011. 05 (d) For the purpose of determining the tax due under this section, the 06 department shall 07 (1) aggregate the taxable income of two or more entities if the 08 department determines that, without the provisions of this section, the taxable income 09 would reasonably be expected to be attributed to a single entity; and 10 (2) except as provided in (c) of this section, include in the calculation 11 of taxable income of the qualified entity income that is attributable to an entity that is 12 part of a unitary business with the qualified entity paying tax under this section. 13 (e) In this section, 14 (1) "qualified entity" means a 15 (A) sole proprietorship; 16 (B) partnership; 17 (C) limited liability company; or 18 (D) entity that has elected to file federal returns under 26 19 U.S.C. 1361 - 1379 (Internal Revenue Code); 20 (2) "taxable income" means income from the production of oil or gas 21 from a lease or property in the state or from the transportation of oil or gas by pipeline 22 in the state. 23 * Sec. 2. AS 43.20.030(a) is amended to read: 24 (a) If a taxpayer [CORPORATION], or a partnership that has a taxpayer 25 [CORPORATION] as a partner, is required to make a return under the provisions of 26 the Internal Revenue Code, the taxpayer [IT] shall file with the department, within 30 27 days after the federal return is required to be filed, a return setting out 28 (1) the amount of tax due under this chapter, less credits claimed 29 against the tax; and 30 (2) other information for the purpose of carrying out the provisions of 31 this chapter that the department requires.
01 * Sec. 3. AS 43.20.031(i) is amended to read: 02 (i) A taxpayer that [CORPORATION WHICH] is a member of a group of 03 unitary corporations or entities that [WHICH] collectively has income from business 04 activity taxable both inside and outside the state, or income from other sources both 05 inside and outside the state, shall determine its income from sources in this state by 06 use of the combined method of accounting. 07 * Sec. 4. AS 43.20.031 is amended by adding a new subsection to read: 08 (j) For purposes of calculating income under this chapter, a taxpayer may 09 deduct from income a payment to the shareholder, owner, member, or partner of a 10 qualified entity, as that term is defined in AS 43.20.019(e), if 11 (1) the shareholder, owner, member, or partner is a taxpayer under this 12 chapter; 13 (2) the payment does not include a transfer of property; and 14 (3) the payment is included in the shareholder's, owner's, member's, or 15 partner's income for the purposes of this chapter. 16 * Sec. 5. The uncodified law of the State of Alaska is amended by adding a new section to 17 read: 18 APPLICABILITY. This Act applies to a qualified entity with taxable income over 19 $5,000,000 for a tax year beginning on or after January 1, 2025. In this section, "qualified 20 entity" and "taxable income" have the meanings given in AS 43.20.019(e). 21 * Sec. 6. The uncodified law of the State of Alaska is amended by adding a new section to 22 read: 23 TRANSITION: PAYMENT OF TAX. A person subject to tax before the effective 24 date of this Act under AS 43.20.019, added by sec. 1 of this Act, shall pay the balance of the 25 tax due for a tax year ending before January 1, 2026, by January 1, 2026. Until January 1, 26 2026, the Department of Revenue shall waive interest that would otherwise accrue under 27 AS 43.05.225 and civil and criminal penalties accruing under AS 43.05.220, 43.05.245, and 28 43.05.290 that are a result of the retroactivity of this Act. 29 * Sec. 7. The uncodified law of the State of Alaska is amended by adding a new section to 30 read: 31 RETROACTIVITY OF REGULATIONS. Notwithstanding a contrary provision of
01 AS 44.62.240, if the Department of Revenue expressly designates in the regulation that the 02 regulation applies retroactively to a specific date, a regulation adopted by the department to 03 implement, interpret, make specific, or otherwise carry out this Act applies retroactively to 04 that date. 05 * Sec. 8. The uncodified law of the State of Alaska is amended by adding a new section to 06 read: 07 RETROACTIVITY. This Act is retroactive to January 1, 2025. 08 * Sec. 9. This Act takes effect immediately under AS 01.10.070(c).