Conn. Gen. Stat. § 12-214

Current with legislation from the 2024 Regular and Special Sessions.

Section 12-214 - Imposition of tax. Surcharge

(a)

(1) Every mutual savings bank, savings and loan association and every company engaged in the business of carrying passengers for hire over the highways of this state in common carrier motor vehicles doing business in this state, and every other company carrying on, or having the right to carry on, business in this state, including a dissolved corporation which continues to conduct business, except those companies described in subdivision (2) of this subsection, shall pay, annually, a tax or excise upon its franchise for the privilege of carrying on or doing business, owning or leasing property within the state in a corporate capacity or as an unincorporated association taxable as a corporation for federal income tax purposes or maintaining an office within the state, such tax to be measured by the entire net income as herein defined received by such corporation or association from business transacted within the state during the income year and to be assessed for each income year commencing prior to January 1, 1995, at the rate of eleven and one-half per cent, for income years commencing on or after January 1, 1995, and prior to January 1, 1996, at the rate of eleven and one-quarter per cent, for income years commencing on or after January 1, 1996, and prior to January 1, 1997, at the rate of ten and three-fourths per cent, for income years commencing on or after January 1, 1997, and prior to January 1, 1998, at the rate of ten and one-half per cent, for income years commencing on or after January 1, 1998, and prior to January 1, 1999, at the rate of nine and one-half per cent, for income years commencing on or after January 1, 1999, and prior to January 1, 2000, at the rate of eight and one-half per cent, and for income years commencing on or after January 1, 2000, at the rate of seven and one-half per cent. The exemption of companies described in subparagraphs (G) and (H) of subdivision (2) of this subsection shall not be allowed with respect to any income year of any such company commencing on or after January 1, 1998, and any such company claiming such exemption for any income years commencing on or after January 1, 1985, but prior to January 1, 1998, shall be required to file a corporation business tax return in accordance with section 12-222 for each such income year.

(2) The following companies shall be exempt from the tax imposed under this chapter:

(A) Insurance companies incorporated or organized under the laws of any other state or foreign government and for income years commencing on or after January 1, 1999, domestic insurance companies;

(B) companies exempt by the federal corporation net income tax law, and any company which qualifies as a domestic international sales corporation (DISC), as defined in Section 992 of the Internal Revenue Code and as to which a valid election under subsection (b) of said Section 992 to be treated as a DISC is effective, but excluding companies, other than any company which so qualifies as, and so elects to be treated as, a DISC, which elect not to be subject to such tax under any provision of said Internal Revenue Code other than said subsection (b) of Section 992;

(C) companies subject to gross earnings taxes under chapter 210;

(D) companies all of whose properties in this state are operated by companies subject to gross earnings taxes under chapter 210;

(E) cooperative housing corporations, as defined for federal income tax purposes;

(F) any organization or association of two or more persons established and operated for the exclusive purpose of promoting the success or defeat of any candidate for public office or of any political party or question or constitutional amendment to be voted upon at any state or national election or for any other political purpose;

(G) any company which is not owned or controlled, directly or indirectly, by any other company, the gross annual revenues of which in the most recently completed year did not exceed one hundred million dollars and which engaged in the research, design, manufacture, sale or installation of alternative energy systems or motor vehicles powered in whole or in part by electricity, natural gas or solar energy including their parts and components, provided at least seventy-five per cent of the gross annual revenues of such company are derived from such research, design, manufacture, sale or installation;

(H) any company which engages in the research, design, manufacture or sale in Connecticut of aero-derived gas turbine systems in advanced industrial applications, which applications are developed after October 1, 1992, which are limited to simple-cycle systems, humid air, steam or water injection, recuperation or intercooling technologies, including their parts and components, to the extent that such company's net income is directly attributable to such purposes;

(I) any non-United States corporation, which shall be any foreign corporation, as defined in Section 7701(a)(5) of the Internal Revenue Code, whose sole activity in this state during the income year consists of the trading in stocks, securities or commodities for such corporation's own account, as defined in Section 864(b)(2)(A)(ii) of said Internal Revenue Code; and

(J) for income years commencing on or after January 1, 2001, S corporations.

(3)

(A) A company is carrying on or doing business in this state if it is a general partner of a partnership that does business, owns or leases property or maintains an office in this state.

(B) A company is carrying on or doing business in this state if it is a limited partner of a limited partnership, other than an investment partnership, that does business, owns or leases property or maintains an office in this state.

(C) A company that is not otherwise carrying on or doing business in this state, either directly or by virtue of being a partner in a partnership described in subparagraph (A) or (B) of this subdivision is not carrying on or doing business in this state solely by virtue of being a limited partner of one or more investment partnerships.

(b)

(1) With respect to income years commencing on or after January 1, 2006, and prior to January 1, 2007, any company subject to the tax imposed in accordance with subsection (a) of this section shall pay, except when the tax so calculated is equal to two hundred fifty dollars, for each such income year, an additional tax in an amount equal to twenty per cent of the tax calculated under said subsection (a) for such income year, without reduction of the tax so calculated by the amount of any credit against such tax. The additional amount of tax determined under this subsection for any income year shall constitute a part of the tax imposed by the provisions of said subsection (a) and shall become due and be paid, collected and enforced as provided in this chapter.

(2)

(A) With respect to income years commencing on or after January 1, 2009, and prior to January 1, 2012, any company subject to the tax imposed in accordance with subsection (a) of this section shall pay, for each such income year, except when the tax so calculated is equal to two hundred fifty dollars, an additional tax in an amount equal to ten per cent of the tax calculated under said subsection (a) for such income year, without reduction of the tax so calculated by the amount of any credit against such tax. The additional amount of tax determined under this subsection for any income year shall constitute a part of the tax imposed by the provisions of said subsection (a) and shall become due and be paid, collected and enforced as provided in this chapter.

(B) Any company whose gross income for the income year was less than one hundred million dollars shall not be subject to the additional tax imposed under subparagraph (A) of this subdivision. This exception shall not apply to companies filing a combined return for the income year under section 12-223a or a unitary return under subsection (d) of section 12-218d.

(3)

(A) With respect to income years commencing on or after January 1, 2012, and prior to January 1, 2018, any company subject to the tax imposed in accordance with subsection (a) of this section shall pay, for each such income year, except when the tax so calculated is equal to two hundred fifty dollars, an additional tax in an amount equal to twenty per cent of the tax calculated under said subsection (a) for such income year, without reduction of the tax so calculated by the amount of any credit against such tax. The additional amount of tax determined under this subsection for any income year shall constitute a part of the tax imposed by the provisions of said subsection (a) and shall become due and be paid, collected and enforced as provided in this chapter.

(B) Any company whose gross income for the income year was less than one hundred million dollars shall not be subject to the additional tax imposed under subparagraph (A) of this subdivision. With respect to income years commencing on or after January 1, 2012, and prior to January 1, 2016, this exception shall not apply to companies filing a combined return for the income year under section 12-223a or a unitary return under subsection (d) of section 12-218d. With respect to income years commencing on or after January 1, 2016, and prior to January 1, 2018, this exception shall not apply to taxable members of a combined group that files a combined unitary tax return.

(4)

(A) With respect to income years commencing on or after January 1, 2018, and prior to January 1, 2026, any company subject to the tax imposed in accordance with subsection (a) of this section shall pay, for such income year, except when the tax so calculated is equal to two hundred fifty dollars, an additional tax in an amount equal to ten per cent of the tax calculated under said subsection (a) for such income year, without reduction of the tax so calculated by the amount of any credit against such tax. The additional amount of tax determined under this subsection for any income year shall constitute a part of the tax imposed by the provisions of said subsection (a) and shall become due and be paid, collected and enforced as provided in this chapter.

(B) Any company whose gross income for the income year was less than one hundred million dollars shall not be subject to the additional tax imposed under subparagraph (A) of this subdivision. This exception shall not apply to taxable members of a combined group that files a combined unitary tax return.

(c) Each taxable member of a combined group required to file a combined unitary tax return pursuant to section 12-222 shall calculate such member's tax under subsection (a) of this section, by multiplying such member's net income apportioned to this state, as provided in subsection (c) of section 12-218e, by the tax rate set forth in this section.

Conn. Gen. Stat. § 12-214

(1949 Rev., S. 1897; 1951, 1953, June, 1955, S. 1089d; 1957, P.A. 515, S. 1; 649, S. 1; 1959, P.A. 394, S. 1; 510; 1961, P.A. 604, S. 2; February, 1965, P.A. 147; 461, S. 7; 1969, P.A. 674; June, 1969, P.A. 1, S. 13; 1971, P.A. 683, S. 1; June, 1971, P.A. 5, S. 111; 1972, P.A. 271, S. 1; 285, S. 6; P.A. 73-350, S. 6, 27; 73-442, S. 4; P.A. 75-101, S. 1, 2; 75-213, S. 1, 53; P.A. 77-476, S. 1, 3; 77-499, S. 1, 2; P.A. 80-406, S. 4, 5; 80-483, S. 54, 186; P.A. 81-472, S. 15, 159; June Sp. Sess. P.A. 83-1, S. 1, 15; P.A. 85-431, S. 1, 2; 85-474, S. 1, 2; P.A. 88-222, S. 1, 2; P.A. 89-16, S. 1, 31; 89-211, S. 22; 89-251, S. 20, 203; P.A. 90-28, S. 1; June Sp. Sess. P.A. 91-3 , S. 99 , 168 ; P.A. 92-152 , S. 1 ; P.A. 93-74 , S. 5 , 67 ; 93-199 , S. 4 , 6 ; P.A. 94-4 , S. 1 , 2 ; May 25 Sp. Sess. P.A. 94-1 , S. 45 , 130; P.A. 95-160 , S. 32 , 69 ; P.A. 96-139 , S. 12 , 13 ; 96-197 , S. 3 , 11 ; P.A. 98-110 , S. 13 , 27 ; 98-244 , S. 6 , 35 ; June Sp. Sess. P.A. 98-1 , S. 106 , 121 ; P.A. 03-2 , S. 32 ; June 30 Sp. Sess. P.A. 03-1, S. 87; P.A. 05-251 , S. 62 ; P.A. 06-186 , S. 66 ; June Sp. Sess. P.A. 09-3 , S. 94 ; P.A. 11-6 , S. 76 ; P.A. 13-184 , S. 73 ; P.A. 15-244 , S. 83 , 142 ; June Sp. Sess. P.A. 15-5 , S. 139 , 140 .)

Amended by P.A. 23-0204, S. 347 of the Connecticut Acts of the 2023 Regular Session, eff. 6/12/2023, app. to income years commencing on or after January 1, 2023.

Amended by P.A. 22-0110, S. 12 of the Connecticut Acts of the 2022 Regular Session, eff. 10/1/2022.

Amended by P.A. 21-0002, S. 422 of the Connecticut Acts of the 2021 Special Session, eff. 6/23/2021.

Amended by P.A. 19-0117, S. 341 of the Connecticut Acts of the 2019 Regular Session, eff. 6/26/2019, op. for taxable years commencing on or after January 1, 2019.

Amended by P.A. 15-0005, S. 140 of the Connecticut Acts of the 2015 Special Session, eff. 1/1/2016.

Amended by P.A. 15-0005, S. 139 of the Connecticut Acts of the 2015 Special Session, eff. 6/30/2016.

Amended by P.A. 15-0244, S. 142 of the Connecticut Acts of the 2015 Regular Session, eff. 1/1/2016.

Amended by P.A. 15-0244, S. 83 of the Connecticut Acts of the 2015 Regular Session, eff. 1/1/2016.

Cited. 127 C. 508 ; 129 C. 664 ; 130 Conn. 461 . Constitutionality not passed upon until Connecticut court determines extent of applicability of tax to corporation solely in interstate business. 323 U.S. 104 . Is an excise upon franchise of corporation for privilege of doing business in the state. 135 C. 37 . Cited. 142 Conn. 483 ; 151 C. 688 ; 178 Conn. 243 ; 196 C. 1 ; 202 C. 412 ; Id., 583; 203 C. 198 ; 220 Conn. 665 ; 224 Conn. 426 . Section is tax imposition statute; any ambiguity must be resolved in favor of taxpayer. 228 C. 137 . Cited. Id., 139; 232 C. 325 . Cited. 26 CS 277 ; Id., 373; 40 Conn.Supp. 77 ; 43 CS 314 ; 44 Conn.Supp. 90 .

See chapter 138c re tax credits for donations to Rental Housing Assistance Trust Fund. See Sec. 12-264 re tax on gross earnings of utility companies. See chapter 228z re affected business entity tax.