Section 15 AAC 20.540 - Calculation of tax for taxpayers subject to AS 43.20.144 and 43.20.145 in a tax yearA taxpayer, whose unitary business begins or ceases the oil and gas activities described in AS 43.20.144(a) in a tax year, is subject to both AS 43.20.144 and AS 43.20.145 during the transition year and shall calculate tax for that year as follows:
(1) the taxpayer shall determine income that is subject to tax at ordinary rates before any net operating loss deduction by adding (A) taxable income under AS 43.20.145, for the entire tax year, multiplied by a ratio, the numerator of which is the number of days the taxpayer was subject to AS 43.20.145 and the denominator of which is the number of days in the tax year; and(B) taxable income under AS 43.20.144 for the entire tax year, multiplied by a ratio, the numerator of which is the number of days the taxpayer was subject to AS 43.20.144 and the denominator of which is the number of days in the tax year;(2) the taxpayer shall determine its charitable contribution limitation by applying 26 U.S.C. 170 (Internal Revenue Code) based upon the taxable income calculated under (1) of this section;(3) the taxpayer shall determine capital gains subject to the alternative rate under AS 43.20.021(c) by adding (A) capital gains calculated under AS 43.20.145, for the entire tax year, multiplied by a ratio, the numerator of which is the number of days the taxpayer was subject to AS 43.20.145 and the denominator of which is the number of days in the tax year; and(B) capital gains calculated under AS 43.20.144 for the entire tax year, multiplied by a ratio, the numerator of which is the number of days the taxpayer was subject to AS 43.20.144 and the denominator of which is the number of days in the tax year;(4) the taxpayer shall apportion allowable federal credits and taxes imposed under AS 43.20.021 by using an apportionment factor that is the sum of (A) the entire tax year's apportionment factor calculated under AS 43.19.010 (Multistate Tax Compact), Article IX. 9, multiplied by a ratio, the numerator of which is the number of days the taxpayer was subject to AS 43.20.145 and the denominator of which is the number of days in the tax year;(B) the entire tax year's apportionment factor calculated under AS 43.20.144, multiplied by a ratio, the numerator of which is the number of days the taxpayer was subject to AS 43.20.144 and the denominator of which is the number of days in the tax year;(5) the taxpayer shall apply the following depreciation rules: (A) a taxpayer that ceases to be subject to AS 43.20.144 and that becomes subject to AS 43.20.145 shall use the (i) taxpayer's federal depreciation expense in determining federal taxable income under (1)(A) of this section; and(ii) the depreciation methods used in the prior year's return in determining federal taxable income under (1)(B) of this section;(B) a taxpayer that ceases to be subject to AS 43.20.145 and that becomes subject to AS 43.20.144 shall use the (i) depreciation methods used in the prior year's return in determining federal taxable income under (1)(A) of this section; and(ii) depreciation methods under 15 AAC 20.480 as if those methods had been in place on the date of acquisition of each asset in determining federal taxable income under (1)(B) of this section;(C) the new depreciation methods that the taxpayer uses under this section are the taxpayer's depreciation methods for future tax periods;(D) a change in depreciation method resulting from a taxpayer's change between AS 43.20.144 and 43.20.145 is not a change in accounting method.Eff. 7/1/2004, Register 170In 2012 the revisor of statutes, acting under AS 01.05.031, renumbered former AS 43.20.072 as AS 43.20.144 and former AS 43.20.073 as AS 43.20.145. As of Register 204 (January 2013), the regulations attorney made conforming technical revisions under AS 44.62.125(b)(6), to 15 AAC 20.540, so that cross-references to former AS 43.20.072 and 43.20.073 now refer to the renumbered statutes, AS 43.20.144 and 43.20.145. In addition, the regulations attorney made conforming technical revisions to the authority citation that follows 15 AAC 20.540, so that citations to former AS 43.20.072 and 43.20.073 now refer to the renumbered statutes, AS 43.20.144 and 43.20.145.
Authority:AS 43.05.080
AS 43.19.010
AS 43.20.144
AS 43.20.145