In regard to the excise tax component of its quarterly estimated Tennessee franchise and excise tax payments, a taxpayer may elect to calculate that excise tax component in the manner provided by Internal Revenue Code (IRC) Sec. 6655(e)(2) (i.e., regarding determination of annualized income installment). For those taxpayers that elect to calculate the excise tax component of their quarterly estimated franchise and excise tax payments in this way, the franchise tax component of each quarterly estimated payment will be the lesser of: (1) 25% of the franchise tax shown on the tax return for the preceding tax year, annualized if the preceding tax year was for less than 12 months; or (2) 25% of 80% of the franchise tax liability for the current tax year.
Moreover, the deadline for timely application for exemption from taxation under the Excise Tax Law is on or before the 15th day of the fourth month following the close of the first tax year for which the person claims the exemption (formerly, within 60 days of the beginning of the first tax year for which the person claims the exemption). Also, a person who fails to timely file such an application for exemption must pay a penalty in the amount of $200 (formerly, $1,000) per occurrence.
H.B. 320, Laws 2017, effective April 19, 2017, and applicable to tax years beginning on or after January 1, 2017