2005 Nevada Revised Statutes - Chapter 363B — Business Tax

CHAPTER 363B - BUSINESS TAX

GENERAL PROVISIONS

NRS 363B.010 Definitions.

NRS 363B.015 Businessactivity defined.

NRS 363B.020 Commissiondefined.

NRS 363B.030 Employerdefined.

NRS 363B.040 Employmentdefined.

NRS 363B.050 Taxpayerdefined.

ADMINISTRATION

NRS 363B.060 Dutiesof Department.

NRS 363B.070 Maintenanceand availability of records of taxpayer; penalty.

NRS 363B.080 Examinationof records by Department; payment of expenses of Department for examination ofrecords outside State.

NRS 363B.090 Authorityof Executive Director to request information to carry out chapter.

NRS 363B.100 Confidentialityof records and files of Department.

IMPOSITION AND COLLECTION

NRS 363B.110 Imposition,amount and payment of tax; filing of return. [Effective through June 30, 2007.]

NRS 363B.110 Imposition,amount and payment of tax; filing of return. [Effective July 1, 2007.]

NRS 363B.115 Deductionof certain amounts paid for health insurance or health benefit plan foremployees.

NRS 363B.120 Partialabatement of tax during initial period of operation of employer.

NRS 363B.130 Extensionof time for payment; payment of interest during period of extension.

OVERPAYMENTS AND REFUNDS

NRS 363B.140 Certificationof excess amount collected; credit and refund.

NRS 363B.150 Limitationson claims for refund or credit; form and contents of claim; failure to fileclaim constitutes waiver; service of notice of rejection of claim.

NRS 363B.160 Intereston overpayments; disallowance of interest.

NRS 363B.170 Injunctionor other process to prevent collection of tax prohibited; filing of claim iscondition precedent to maintaining action for refund.

NRS 363B.180 Actionfor refund: Period for commencement; venue; waiver.

NRS 363B.190 Rightsof claimant upon failure of Department to mail notice of action on claim;allocation of judgment for claimant.

NRS 363B.200 Allowanceof interest in judgment for amount illegally collected.

NRS 363B.210 Standingto recover.

NRS 363B.220 Actionfor recovery of erroneous refund: Jurisdiction; venue; prosecution.

NRS 363B.230 Cancellationof illegal determination.

MISCELLANEOUS PROVISIONS

NRS 363B.240 Prohibitedacts; penalty.

NRS 363B.250 Remediesof State are cumulative.

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GENERAL PROVISIONS

NRS 363B.010 Definitions. As used in this chapter, unless the context otherwiserequires, the words and terms defined in NRS363B.015 to 363B.050, inclusive,have the meanings ascribed to them in those sections.

(Added to NRS by 2003, 20thSpecial Session, 141; A 2005, 22ndSpecial Session, 139)

NRS 363B.015 Business activity defined. Business activity meansthe performance of a service or engagement in a trade for profit.

(Added to NRS by 2005, 22nd SpecialSession, 137)

NRS 363B.020 Commissiondefined. Commission means the Nevada TaxCommission.

(Added to NRS by 2003, 20thSpecial Session, 141)

NRS 363B.030 Employerdefined. Employer means any employer who isrequired to pay a contribution pursuant to NRS612.535 for any calendar quarter with respect to any business activity ofthe employer, except a financial institution, an Indian tribe, a nonprofitorganization, a political subdivision or any person who does not supply aproduct or service, but who only consumes a service. For the purposes of thissection:

1. Financial institution has the meaning ascribed toit in NRS 363A.050.

2. Indian tribe includes any entity described insubsection 10 of NRS 612.055.

3. Nonprofit organization means a nonprofitreligious, charitable, fraternal or other organization that qualifies as atax-exempt organization pursuant to 26 U.S.C. 501(c).

4. Political subdivision means any entity describedin subsection 9 of NRS 612.055.

(Added to NRS by 2003, 20thSpecial Session, 141; A 2005, 2480; 2005, 22ndSpecial Session, 139)

NRS 363B.040 Employmentdefined. Employment has the meaning ascribedto it in NRS 612.065 to 612.145, inclusive.

(Added to NRS by 2003, 20thSpecial Session, 141)

NRS 363B.050 Taxpayerdefined. Taxpayer means any person liablefor the tax imposed by this chapter.

(Added to NRS by 2003, 20thSpecial Session, 141)

ADMINISTRATION

NRS 363B.060 Dutiesof Department. The Department shall:

1. Administer and enforce the provisions of thischapter, and may adopt such regulations as it deems appropriate for thosepurposes.

2. Deposit all taxes, interest and penalties itreceives pursuant to this chapter in the State Treasury for credit to the StateGeneral Fund.

(Added to NRS by 2003, 20thSpecial Session, 141)

NRS 363B.070 Maintenanceand availability of records of taxpayer; penalty.

1. Each person responsible for maintaining the recordsof a taxpayer shall:

(a) Keep such records as may be necessary to determinethe amount of the liability of the taxpayer pursuant to the provisions of thischapter;

(b) Preserve those records for 4 years or until anylitigation or prosecution pursuant to this chapter is finally determined,whichever is longer; and

(c) Make the records available for inspection by theDepartment upon demand at reasonable times during regular business hours.

2. The Department may by regulation specify the typesof records which must be kept to determine the amount of the liability of ataxpayer pursuant to the provisions of this chapter.

3. Any person who violates the provisions ofsubsection 1 is guilty of a misdemeanor.

(Added to NRS by 2003, 20thSpecial Session, 141)

NRS 363B.080 Examinationof records by Department; payment of expenses of Department for examination ofrecords outside State.

1. To verify the accuracy of any return filed or, ifno return is filed by a taxpayer, to determine the amount required to be paid,the Department, or any person authorized in writing by the Department, mayexamine the books, papers and records of any person who may be liable for thetax imposed by this chapter.

2. Any person who may be liable for the tax imposed bythis chapter and who keeps outside of this State any books, papers and recordsrelating thereto shall pay to the Department an amount equal to the allowanceprovided for state officers and employees generally while traveling outside ofthe State for each day or fraction thereof during which an employee of theDepartment is engaged in examining those documents, plus any other actualexpenses incurred by the employee while he is absent from his regular place ofemployment to examine those documents.

(Added to NRS by 2003, 20thSpecial Session, 141)

NRS 363B.090 Authorityof Executive Director to request information to carry out chapter. The Executive Director may request from any other governmentalagency or officer such information as he deems necessary to carry out theprovisions of this chapter. If the Executive Director obtains any confidentialinformation pursuant to such a request, he shall maintain the confidentialityof that information in the same manner and to the same extent as provided bylaw for the agency or officer from whom the information was obtained.

(Added to NRS by 2003, 20thSpecial Session, 142)

NRS 363B.100 Confidentialityof records and files of Department.

1. Except as otherwise provided in this section and NRS 360.250, the records and files of theDepartment concerning the administration of this chapter are confidential andprivileged. The Department, and any employee engaged in the administration ofthis chapter or charged with the custody of any such records or files, shallnot disclose any information obtained from the Departments records or files orfrom any examination, investigation or hearing authorized by the provisions ofthis chapter. Neither the Department nor any employee of the Department may berequired to produce any of the records, files and information for the inspectionof any person or for use in any action or proceeding.

2. The records and files of the Department concerningthe administration of this chapter are not confidential and privileged in thefollowing cases:

(a) Testimony by a member or employee of the Departmentand production of records, files and information on behalf of the Department ora taxpayer in any action or proceeding pursuant to the provisions of thischapter if that testimony or the records, files or information, or the factsshown thereby, are directly involved in the action or proceeding.

(b) Delivery to a taxpayer or his authorizedrepresentative of a copy of any return or other document filed by the taxpayerpursuant to this chapter.

(c) Publication of statistics so classified as toprevent the identification of a particular person or document.

(d) Exchanges of information with the Internal RevenueService in accordance with compacts made and provided for in such cases.

(e) Disclosure in confidence to the Governor or hisagent in the exercise of the Governors general supervisory powers, or to anyperson authorized to audit the accounts of the Department in pursuance of anaudit, or to the Attorney General or other legal representative of the State inconnection with an action or proceeding pursuant to this chapter, or to anyagency of this or any other state charged with the administration orenforcement of laws relating to taxation.

(f) Exchanges of information pursuant to subsection 3.

3. The Commission may agree with any county fair andrecreation board or the governing body of any county, city or town for thecontinuing exchange of information concerning taxpayers.

(Added to NRS by 2003, 20thSpecial Session, 142)

IMPOSITION AND COLLECTION

NRS 363B.110 Imposition,amount and payment of tax; filing of return. [Effective through June 30, 2007.]

1. There is hereby imposed an excise tax on eachemployer at the rate of 0.63 percent of the wages, as defined in NRS 612.190, paid by the employer during acalendar quarter with respect to employment in connection with the businessactivities of the employer.

2. The tax imposed by this section:

(a) Does not apply to any person or other entity or anywages this State is prohibited from taxing under the Constitution, laws ortreaties of the United States or the Nevada Constitution.

(b) Must not be deducted, in whole or in part, from anywages of persons in the employment of the employer.

3. Each employer shall, on or before the last day ofthe month immediately following each calendar quarter for which the employer isrequired to pay a contribution pursuant to NRS612.535:

(a) File with the Department a return on a formprescribed by the Department; and

(b) Remit to the Department any tax due pursuant tothis chapter for that calendar quarter.

(Added to NRS by 2003, 20thSpecial Session, 142; A 2003, 20thSpecial Session, 230; 2005, 2081; 2005, 22ndSpecial Session, 139)

NRS 363B.110 Imposition, amount and payment oftax; filing of return. [Effective July 1, 2007.]

1. There is hereby imposed an excise tax on eachemployer at the rate of 0.65 percent of the wages, as defined in NRS 612.190, paid by the employer during acalendar quarter with respect to employment in connection with the businessactivities of the employer.

2. The tax imposed by this section:

(a) Does not apply to any person or other entity or anywages this State is prohibited from taxing under the Constitution, laws ortreaties of the United States or the Nevada Constitution.

(b) Must not be deducted, in whole or in part, from anywages of persons in the employment of the employer.

3. Each employer shall, on or before the last day ofthe month immediately following each calendar quarter for which the employer isrequired to pay a contribution pursuant to NRS612.535:

(a) File with the Department a return on a formprescribed by the Department; and

(b) Remit to the Department any tax due pursuant tothis chapter for that calendar quarter.

(Added to NRS by 2003, 20thSpecial Session, 142; A 2003, 20thSpecial Session, 230; 2005, 2081; 2005, 22ndSpecial Session, 139, effective July 1, 2007)

NRS 363B.115 Deductionof certain amounts paid for health insurance or health benefit plan foremployees.

1. Except as otherwise provided in subsection 2, anemployer may deduct from the total amount of wages reported and upon which theexcise tax is imposed pursuant to NRS363B.110 any amount authorized pursuant to this section that is paid by theemployer for health insurance or a health benefit plan for its employees in thecalendar quarter for which the tax is paid. The amounts for which the deductionis allowed include:

(a) For a self-insured employer, all amounts paidduring the calendar quarter for claims, direct administrative services costs,including such services provided by the employer, and any premiums paid forindividual or aggregate stop-loss insurance coverage. An employer is notauthorized to deduct the costs of a program of self-insurance unless theprogram is a qualified employee welfare benefit plan pursuant to the EmployeeRetirement Income Security Act of 1974, 29 U.S.C. 1001 et seq.

(b) The premiums for a policy of health insurance orreinsurance for a health benefit plan for employees.

(c) Any amounts which are:

(1) Paid by an employer to a Taft-Hartley trustwhich:

(I) Is formed pursuant to 29 U.S.C. 186(c)(5); and

(II) Qualifies as an employee welfarebenefit plan; and

(2) Considered by the Internal Revenue Serviceto be fully tax deductible pursuant to the provisions of the Internal RevenueCode.

(d) Such other similar payments for health care orinsurance for health care for employees as are authorized by the Department.

2. An employer may not deduct from the wages uponwhich the excise tax is imposed pursuant to NRS363B.110:

(a) Amounts paid for health care or premiums paid forinsurance for an industrial injury or occupational disease for which coverageis required pursuant to chapters 616A to 616D, inclusive, or 617of NRS; or

(b) Any payments made by employees for health care orhealth insurance or amounts deducted from the wages of employees for suchhealth care or insurance.

3. If the amount of the deduction allowed pursuant tothis section to an employer for a calendar quarter exceeds the amount ofreported wages for that calendar quarter, the excess amount of that deductionmay be carried forward to the following calendar quarter until the deduction isexhausted. An employer claiming the deduction allowed pursuant to this sectionshall, upon the request of the Department, explain the amount claimed to thesatisfaction of the Department and provide the Department with suchdocumentation as the Department deems appropriate for that purpose.

4. As used in this section:

(a) Claims means claims for those categories ofhealth care expenses that are generally deductible by employees on theirindividual federal income tax returns pursuant to the provisions of 26 U.S.C. 213 and any federal regulations relating thereto, if those expenses had beenborne directly by those employees.

(b) Direct administrative services costs means, ifborne directly by a self-insured employer and reasonably allocated to thedirect administration of claims:

(1) Payments for medical or office supplies thatwill be consumed in the course of the provision of medical care or the directadministration of claims;

(2) Payments to third-party administrators orindependent contractors for the provision of medical care or the directadministration of claims;

(3) Rent and utility payments for themaintenance of medical or office space used for the provision of medical careor the direct administration of claims;

(4) Payments for the maintenance, repair andupkeep of medical or office space used for the provision of medical care or thedirect administration of claims;

(5) Salaries and wages paid to medical, clericaland administrative staff and other personnel employed to provide medical careor directly to administer claims; and

(6) The depreciation of property other thanmedical or office supplies, used for the provision of medical care or thedirect administration of claims.

(c) Employee welfare benefit plan has the meaningascribed to it in 29 U.S.C. 1002.

(d) Employees means employees whose wages areincluded within the measure of the excise tax imposed upon an employer by NRS 363B.110, and their spouses, childrenand other dependents who qualify for coverage under the terms of the healthinsurance or health benefit plan provided by that employer.

(e) Health benefit plan means a health benefit planthat covers only those categories of health care expenses that are generallydeductible by employees on their individual federal income tax returns pursuantto the provisions of 26 U.S.C. 213 and any federal regulations relatingthereto, if those expenses had been borne directly by those employees.

(f) Self-insured employer means an employer thatprovides a program of self-insurance for its employees.

(Added to NRS by 2005, 22ndSpecial Session, 137)

NRS 363B.120 Partialabatement of tax during initial period of operation of employer.

1. An employer that qualifies pursuant to theprovisions of NRS 360.750 is entitled toan exemption of 50 percent of the amount of tax otherwise due pursuant to NRS 363B.110 during the first 4 years ofits operation.

2. If a partial abatement from the taxes otherwise duepursuant to NRS 363B.110 is approvedby the Commission on Economic Development pursuant to NRS 360.750, the partial abatement must beadministered and carried out in the manner set forth in NRS 360.750.

(Added to NRS by 2003, 20thSpecial Session, 144)

NRS 363B.130 Extensionof time for payment; payment of interest during period of extension. Upon written application made before the date on whichpayment must be made, the Department may for good cause extend by 30 days thetime within which a taxpayer is required to pay the tax imposed by thischapter. If the tax is paid during the period of extension, no penalty or latecharge may be imposed for failure to pay at the time required, but the taxpayershall pay interest at the rate of 1 percent per month from the date on whichthe amount would have been due without the extension until the date of payment,unless otherwise provided in NRS 360.232or 360.320.

(Added to NRS by 2003, 20thSpecial Session, 144)

OVERPAYMENTS AND REFUNDS

NRS 363B.140 Certificationof excess amount collected; credit and refund. Ifthe Department determines that any tax, penalty or interest has been paid morethan once or has been erroneously or illegally collected or computed, theDepartment shall set forth that fact in the records of the Department andcertify to the State Board of Examiners the amount collected in excess of theamount legally due and the person from whom it was collected or by whom it waspaid. If approved by the State Board of Examiners, the excess amount collectedor paid must be credited on any amounts then due from the person under thischapter, and the balance refunded to the person or his successors in interest.

(Added to NRS by 2003, 20thSpecial Session, 144)

NRS 363B.150 Limitationson claims for refund or credit; form and contents of claim; failure to fileclaim constitutes waiver; service of notice of rejection of claim.

1. Except as otherwise provided in NRS 360.235 and 360.395:

(a) No refund may be allowed unless a claim for it isfiled with the Department within 3 years after the last day of the monthfollowing the calendar quarter for which the overpayment was made.

(b) No credit may be allowed after the expiration ofthe period specified for filing claims for refund unless a claim for credit isfiled with the Department within that period.

2. Each claim must be in writing and must state the specificgrounds upon which the claim is founded.

3. Failure to file a claim within the time prescribedin this chapter constitutes a waiver of any demand against the State on accountof overpayment.

4. Within 30 days after rejecting any claim in whole orin part, the Department shall serve notice of its action on the claimant in themanner prescribed for service of notice of a deficiency determination.

(Added to NRS by 2003, 20thSpecial Session, 144)

NRS 363B.160 Intereston overpayments; disallowance of interest.

1. Except as otherwise provided in this section and NRS 360.320, interest must be paid upon anyoverpayment of any amount of the taxes imposed by this chapter at the rate of0.5 percent per month, or fraction thereof, from the last day of the calendarmonth following the calendar quarter for which the overpayment was made. Norefund or credit may be made of any interest imposed upon the person making theoverpayment with respect to the amount being refunded or credited.

2. The interest must be paid:

(a) In the case of a refund, to the last day of thecalendar month following the date upon which the person making the overpayment,if he has not already filed a claim, is notified by the Department that a claimmay be filed or the date upon which the claim is certified to the State Boardof Examiners, whichever is earlier.

(b) In the case of a credit, to the same date as thatto which interest is computed on the tax or the amount against which the creditis applied.

3. If the Department determines that any overpaymenthas been made intentionally or by reason of carelessness, the Department shallnot allow any interest on the overpayment.

(Added to NRS by 2003, 20thSpecial Session, 144)

NRS 363B.170 Injunctionor other process to prevent collection of tax prohibited; filing of claim iscondition precedent to maintaining action for refund.

1. No injunction, writ of mandate or other legal orequitable process may issue in any suit, action or proceeding in any courtagainst this state or against any officer of the State to prevent or enjoin thecollection under this chapter of the tax imposed by this chapter or any amountof tax, penalty or interest required to be collected.

2. No suit or proceeding may be maintained in anycourt for the recovery of any amount alleged to have been erroneously orillegally determined or collected unless a claim for refund or credit has beenfiled.

(Added to NRS by 2003, 20th SpecialSession, 145)

NRS 363B.180 Actionfor refund: Period for commencement; venue; waiver.

1. Within 90 days after a final decision upon a claimfiled pursuant to this chapter is rendered by the Commission, the claimant maybring an action against the Department on the grounds set forth in the claim ina court of competent jurisdiction in Carson City, the county of this statewhere the claimant resides or maintains his principal place of business or acounty in which any relevant proceedings were conducted by the Department, forthe recovery of the whole or any part of the amount with respect to which theclaim has been disallowed.

2. Failure to bring an action within the timespecified constitutes a waiver of any demand against the State on account of allegedoverpayments.

(Added to NRS by 2003, 20thSpecial Session, 145)

NRS 363B.190 Rightsof claimant upon failure of Department to mail notice of action on claim;allocation of judgment for claimant.

1. If the Department fails to mail notice of action ona claim within 6 months after the claim is filed, the claimant may consider theclaim disallowed and file an appeal with the Commission within 30 days afterthe last day of the 6-month period. If the claimant is aggrieved by thedecision of the Commission rendered on appeal, the claimant may, within 90 daysafter the decision is rendered, bring an action against the Department on thegrounds set forth in the claim for the recovery of the whole or any part of theamount claimed as an overpayment.

2. If judgment is rendered for the plaintiff, theamount of the judgment must first be credited towards any tax due from theplaintiff.

3. The balance of the judgment must be refunded to theplaintiff.

(Added to NRS by 2003, 20thSpecial Session, 145)

NRS 363B.200 Allowanceof interest in judgment for amount illegally collected. In any judgment, interest must be allowed at the rate of 6percent per annum upon the amount found to have been illegally collected fromthe date of payment of the amount to the date of allowance of credit on accountof the judgment, or to a date preceding the date of the refund warrant by notmore than 30 days. The date must be determined by the Department.

(Added to NRS by 2003, 20thSpecial Session, 145)

NRS 363B.210 Standingto recover. A judgment may not be rendered infavor of the plaintiff in any action brought against the Department to recoverany amount paid when the action is brought by or in the name of an assignee ofthe person paying the amount or by any person other than the person who paidthe amount.

(Added to NRS by 2003, 20thSpecial Session, 145)

NRS 363B.220 Actionfor recovery of erroneous refund: Jurisdiction; venue; prosecution.

1. The Department may recover a refund or any partthereof which is erroneously made and any credit or part thereof which iserroneously allowed in an action brought in a court of competent jurisdictionin Carson City or Clark County in the name of the State of Nevada.

2. The action must be tried in Carson City or ClarkCounty unless the court, with the consent of the Attorney General, orders achange of place of trial.

3. The Attorney General shall prosecute the action,and the provisions of NRS, the Nevada Rules of Civil Procedure and the NevadaRules of Appellate Procedure relating to service of summons, pleadings, proofs,trials and appeals are applicable to the proceedings.

(Added to NRS by 2003, 20thSpecial Session, 146)

NRS 363B.230 Cancellationof illegal determination.

1. If any amount in excess of $25 has been illegallydetermined, either by the Department or by the person filing the return, theDepartment shall certify this fact to the State Board of Examiners, and thelatter shall authorize the cancellation of the amount upon the records of theDepartment.

2. If an amount not exceeding $25 has been illegallydetermined, either by the Department or by the person filing the return, theDepartment, without certifying this fact to the State Board of Examiners, shallauthorize the cancellation of the amount upon the records of the Department.

(Added to NRS by 2003, 20thSpecial Session, 146)

MISCELLANEOUS PROVISIONS

NRS 363B.240 Prohibitedacts; penalty.

1. A person shall not:

(a) Make, cause to be made or permit to be made anyfalse or fraudulent return or declaration or false statement in any return ordeclaration with intent to defraud the State or to evade payment of the tax orany part of the tax imposed by this chapter.

(b) Make, cause to be made or permit to be made anyfalse entry in books, records or accounts with intent to defraud the State orto evade the payment of the tax or any part of the tax imposed by this chapter.

(c) Keep, cause to be kept or permit to be kept morethan one set of books, records or accounts with intent to defraud the State orto evade the payment of the tax or any part of the tax imposed by this chapter.

2. Any person who violates the provisions ofsubsection 1 is guilty of a gross misdemeanor.

(Added to NRS by 2003, 20thSpecial Session, 146)

NRS 363B.250 Remediesof State are cumulative. The remedies of theState provided for in this chapter are cumulative, and no action taken by theDepartment or the Attorney General constitutes an election by the State topursue any remedy to the exclusion of any other remedy for which provision ismade in this chapter.

(Added to NRS by 2003, 20thSpecial Session, 144)