Taxpayer is a business with Indiana operations. The Indiana Department of Revenue ("Department") determined that Taxpayer had not filed an Indiana adjusted gross income tax composite return for 2010, 2011, and 2012 and so imposed penalties for each year.
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Taxpayer protests the imposition of penalties for 2010-12. The Department imposed a $500 penalty for each year for failure to file 2010, 2011, and 2012 composite Indiana income tax returns. Taxpayer protests that it was unaware of the requirement to file a composite return and that Indiana did get the income tax in question via the individual shareholders' returns. Taxpayer also explained that, now that it is aware of the requirement to file a composite return, it will file the proper return on an ongoing basis.
In this case, the Department determined that Taxpayer did not file Indiana adjusted gross income tax composite returns for 2010-12. The Department imposed penalty under IC § 6-8.1-10-2.1(j). As a result of the protest process, Taxpayer has affirmatively established that it acted reasonably, as required by IC § 6-8.1-10-2.1(d) and 45 IAC 15-11-2 (b). The $500 penalty for 2010, 2011, and 2012 will be waived. However, the Department takes this opportunity to notify Taxpayer that since it is now aware of its filing duties, such a waiver may not be warranted for other years.
