Arkansas Administrative Code
Agency 006 - Department of Finance and Administration
Division 05 - Division of Revenues
1998-1 - Comprehensive Corporation Income Tax Regulations
Rule 26-51-102 - CORPORATION INCOME TAX DEFINITIONS
Rule 2.26-51-102(17)(A) - Tax Year
Current through Register Vol. 49, No. 9, September, 2024
A taxpayer may elect to compute his taxable income on the basis of an annual period which varies from 52 or 53 weeks. A 52 or 53 week tax year means the annual period which varies from 52 or 53 weeks and always ends on the same day of the week and always ends:
(1) on whatever date such same day of the week last occurs in a calendar month; or
(2) on whatever date such same day of the week falls which is nearest to the last day of a calendar month.
For example, if the taxpayer elects a tax year which always ends on the last Saturday in November, then for the year 1994, the tax year would end on November 26, 1994. On the other hand, if the taxpayer had elected a tax year which always ends on the Saturday nearest to the end of November, then for the year 1994, the tax year would end on December 3, 1994. Thus, in the case of a tax year described in subparagraph (1) of this regulation, the year will always end within the month and may end on the last day of the month, or as many as six days before the end of the month. In the case of a tax year described in subparagraph (2) of this regulation, the year may end on the last day of the month, or as many as three days before or three days after the last day of the month.
For the purpose of determining the effective date or the applicability of any corporate income tax statute which is expressed in terms of tax years beginning, including, or ending on the first or last day of a specified calendar month, a 52 or 53 week tax year is deemed to begin on the first day of the calendar month beginning nearest to the first day of the 52 or 53 week tax year, and is deemed to end or close on the last day of the calendar month ending nearest to the last day of the 52 or 53 week tax year. This is illustrated by the following examples:
Example (1). Assume that an income tax provision applies to tax years beginning on or after January 1, 1994. For that purpose, a 52 or 53 week tax year beginning on any day within the period December 26, 1993, to January 1, 1994, shall be treated as beginning on January 1, 1994.
Example (2). Assume that an income tax provision requires that a return must be filed on or before the 15th day of the fifth month following the close of the tax year. For that purpose, a 52 or 53 week tax year ending on any day during the period May 25 to June 3, shall be treated as ending on May 31, the last day of the month ending nearest to the last day of the tax year, and the return, therefore, must be made on or before October 15.
Example (3). X, a corporation created on January 1, 1994, elects a 52 or 53 week tax year ending on the Friday nearest the end of December. Thus, X's first tax year begins on Saturday, January 1, 1994, and ends on Friday, December 30, 1994; its next tax year begins on Saturday, December 31, 1994, and ends on Friday, December 29, 1995; and its next tax year begins on Saturday, December 30, 1995, and ends on Friday, January 3, 1997. X's first tax year is deemed to begin on January 1, 1994, and end on December 31, 1994; its next tax year is deemed to begin on January 1, 1995, and end on December 31, 1995. Accordingly, each such tax year is treated as including one and only one December 31st.
