What does the Amended Tax Commissioners Rule 5703-04 change regarding a corporations accounting period that is more than one year in length?
As a result of the amendment to the franchise tax rule 5703-5-04, if the taxpayer’s franchise tax taxable year is greater than one year in length, the taxpayer may no longer “annualize” its income (and is no longer required to annualize its net operating losses) for the taxable year to effectively reduce the annual accounting period to one year in length. This rule is effective for taxable years ending on or after the Jan. 1, 2004 effective date. Therefore, this portion of the rule will first apply to the 2005 Ohio report and the subsequent tax years.
As a result of the amendment to the franchise tax rule 5703-5-04, if the taxpayer’s franchise tax taxable year is greater than one year in length, the taxpayer may no longer “annualize” its income (and is no longer required to annualize its net operating losses) for the taxable year to effectively reduce the annual accounting period to one year in length. This rule is effective for taxable years ending on or after the Jan. 1, 2004 effective date. Therefore, this portion of the rule will first apply to the 2005 Ohio report and the subsequent tax years.
