Corporation Tax FAQs
Q. How do I obtain an extension of time to file my corporate tax return?
A. Your corporation is given an automatic extension of time of six months beyond the original due date to file the return. You are not required to file any form to get this six-month extension. However, please note that interest and late payment penalty do accrue from the original due date of the return up until the date the tax is paid. If you wish to avoid any accrual of interest and late payment penalty, you can submit a tentative payment on or before the original due date of the return.
The tentative payment must be submitted with the Form CT (Estimated Tax Coupon). A coupon is included in the Montana Corporation License Tax return booklet or one may be requested from the department. Please include on the coupon the following: a notation that the payment is attributable to Montana Corporation License Tax, the Federal Employers Identification Number (FEIN) and the tax year for which the payment is to be applied.
Please refer to Section 15-31-111(3), Montana Code Annotated for additional information.
Q. Do I file a return if my corporation had no activity in Montana during the year?
A. A corporation must either file a Montana Corporation License Tax Return or the Form INA-CT (Affidavit of Corporate Inactivity). However, if the corporation had no property, payroll and sales in the state, please state so on the front of the tax return and have it signed by an officer of the corporation. The minimum tax is not due if there was no business activity conducted in Montana during the taxable period.
Q. What are the net operating loss carryback and carryforward provisions?
A. Unless an election is made to forego the net operating loss carryback, the net operating loss must be carried back three (3) years and is available to be carried forward for seven (7) years. This differs from the federal provisions.
Please refer to Section 15-31-119, Montana Code Annotated and Administrative Rules of Montana 42.23.801 through 42.23.805 for more information regarding the net operating loss provisions.
Q. How do I obtain a "tax clearance certificate" for the purpose of withdrawing or dissolving my corporation?
A. Form CR-T needs to be completed and the "Tax Clearance" box needs to be checked in question 3. Once your request is received, you will be informed of any additional information you will need to submit. In order to expedite your request you will want to check your records to see that all tax returns up to the date of withdrawal or dissolution have been filed and all taxes have been paid. Send requests via fax to (406) 444-6642 or mail to:
Montana Department of Revenue
P.O. Box 5805
Helena, MT 59604-5805Questions? Please email us at DORTaxCertificates@mt.gov.
Q. How do I get my corporation back into good standing with the Secretary of State's office?
A. If you were involuntarily dissolved by the Secretary of State, the Form CR-T needs to be completed and the "Title 15" box needs to be checked in question 3. Your corporation must be current in filing their corporate tax returns and have no outstanding corporation tax owing.
If you were suspended by the Secretary of State at the request of the Department of Revenue, the “Reviver” box also needs to be check in question 3 of the Form CR-T. Both the “Title 15” and the “Reviver” certificates need to be submitted to the Secretary of State.
Send requests via fax to (406) 444-6642 or mail to:
Montana Department of Revenue
P.O. Box 5805
Helena, MT 59604-5805Questions? Please email us at DORTaxCertificates@mt.gov.
Q. My corporation has gone out of business. What do I need to do for your department?
A. You will need to file all corporation tax returns up to the date your corporation went out of business. The last return filed should be clearly marked "Final" in the box near the top of page 1 of the CLT-4. Any tax, interest or penalties should be paid at the time your return(s) are filed.
Q. How do I obtain a tax-exempt status with the State of Montana?
A. You will need to complete Form EXPT. In addition, you will need to provide the department with a copy of the corporation's articles of incorporation, a copy of the by-laws, and copies of the latest financial statements. You will also need to include an affidavit showing the character of the organization, the purpose for which it was organized, its actual activities, the source and disposition of its income, and whether or not any of its income may inure to the benefit of any private shareholder or individual. In addition, if the Internal Revenue Service has granted the organization exemption from the federal income tax, a certified copy of the exemption certificate or letter should be filed. The department will review this information and will determine whether the corporation's activities are exempt under Section 15-31-102, Montana Code Annotated.
Please refer to Administrative Rule of Montana 42.23.103 for more information.
Q. How and when can I make a water’s edge election for my corporation?
A. To perfect a water’s edge election, you are required to file the Form WE-ELECT with us within the first 90 days of the tax period for which the election is to become effective. This election is binding for a three year renewable period and may only be revoked upon written permission of the department.
If you wish to continue filing on a water’s edge basis at the end of the three year period, you will need to file the Form WE-ELECT again with us within the first 90 days of the tax period for which your renewed election is to become effective.
Please note that for tax years beginning after December 31, 2003, you are required to include the income and apportionment factors of all unitary corporation incorporated in a tax haven country. The list of tax haven countries can be found in 15-31-322(1)(f), Montana Code Annotated. This list was updated and the updated list is effective for tax years beginning after December 31, 2008.
Please refer to Section 15-31-324, Montana Code Annotated and Administrative Rules of Montana, 42.26.301 through 42.26.311 for additional information regarding the water’s edge election.
Questions? Please email us at DORWatersEdgeElection@mt.gov.
Q. When am I required to file an amended Montana return for my corporation?
A. You are required to file an amended Montana return when the information on your original return was reported incorrectly or to report changes made to your federal income tax return, including any changes made by the Internal Revenue Service (IRS).
If the IRS changes your federal taxable income or if you voluntarily change your federal taxable income, you are required to file an amended Montana return within 90 days of receiving notification of the change from the IRS or within 90 days of filing your amended federal income tax return.
For additional information, please refer to Sections 15-31-506 and 15-31-509, Montana Code Annotated.
Q. How do I amend my Montana return?
A. You need to complete a new Montana corporate return that reflects the corrections that you are making to your previously filed return. For example, if you are amending your 2009 tax year, use the 2009 income tax forms and complete a new tax return using the corrected information. Check the “Amended Return” in the box near the top of page 1 of the CLT-4. The “Amended Return” box is not included on tax returns prior to tax year 2004. Instead, clearly write the word “Amended” on the top of the first page of the return for years prior to 2004.
You need to include any supporting documentation, schedules and/or explanation for your adjustments.
Please note we do not accept schedules in lieu of amended returns. If we receive schedules in lieu of amended returns, they will be returned to you to be submitted in proper format.
Late payment penalty and interest are assessed on any unpaid tax from the prescribed due date of the original return until the tax is paid. You may have the late payment penalty waived provided that you pay the tax and applicable interest in full. Simply check the “Amended Return” box on the tax return. By doing so, you are requesting a waiver of the late payment penalty.
If your amended return results in a refund, interest is paid on the overpayment of tax at the same rate as charged on delinquent taxes. Interest is not paid on a refund which results from a net operating loss carryover or credit. (Administrative Rules of Montana 42.23.605)
Q. How long do I have to amend my Montana income tax return to request a refund?
A. For refund purposes, you have 3 years from the original due date of the tax return to file an amended Montana income tax return.
For additional information, please refer to Section 15-31-509(2), Montana Code Annotated.
Last updated 12/14/2011 10:43:43 AM