An Administrative Law Judge (ALJ) for the Alaska Office of Administrative Hearings recently upheld a penalty imposed on a taxpayer for not filing an amended corporate return electronically. In 2015, a regulation was adopted stating that electronic filling is not required when a taxpayer is not required to electronically file its federal return. However, in 2016, a statute was enacted providing that a taxpayer must submit its return electronically. A civil penalty of $25 or one percent of the total tax before any payment, whichever is greater, is imposed for failing to file a return electronically. The taxpayer at issue amended its 2016 federal and Alaska corporate income tax returns; the amended returns were filed on paper. On its amended Alaska return, the taxpayer claimed a refund of $36,627. However, because the taxpayer had not filed its amended return electronically. the Department assessed a penalty of almost $12,000 based on the amount of tax reported on the original return for the tax year.
Source KPMG
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