May 24, 2000
Journal of the Senate
SIXTY-SIXTH DAY
______
| Senate Chamber, Topeka, Kansas |
| Wednesday, May 24, 2000--10:00 a.m. |
As provided by SR 1645, the sine die session of the regular 2000 Kansas Senate was
called to order by President Dick Bond.
The roll was called with thirty-seven senators present.
Senators Biggs, Hardenburger and Vratil were excused.
Invocation by Chaplain Fred S. Hollomon:
Heavenly Father,
Most of us did not expect
To return for Sine Die.
And the ones who did assumed they'd say,
``Hello'' and then ``Goodbye''.
Since I live here in Topeka,
It's no big deal for me;
I'm only ten minutes from my house,
It's as easy as A B C.
But most of these people had to drive
Lots and lots of miles.
So the trip from home to the old green dome
Always takes a while.
Help them do what has to be done,
And bring them safely home.
Where seldom is heard a discouraging word,
And a few buffalo are seen to roam.
But before I close this prayer, O God,
And make sure the last line rhymes;
I have to admit I'm glad they're back
So I can see them one more time!
I pray in the Name of Christ,
AMEN
REPORT ON ENGROSSED BILLS
SB 447 reported correctly re-engrossed April 29, 2000.
H Sub for SB 323; SB 410, 471 correctly re-engrossed May 2, 2000.
SB 481 reported engrossed May 2, 2000.
Sub SB 599 correctly re-engrossed May 3, 2000.
SB 483 correctly re-engrossed May 3, 2000.
H Sub for SB 40; SB 316 reported correctly engrossed May 4, 2000.
Also, SB 92, 430; SB 470 correctly re-engrossed May 4, 2000.
REPORT ON ENROLLED BILLS
SR 1856, 1862, 1863 reported correctly enrolled, properly signed and presented to the
Secretary of the Senate on May 1, 2000.
SB 432, 555 reported correctly enrolled, properly signed and presented to the Governor
on May 1, 2000.
SB 12, 59, 190, 366, 380, 393, 447, 471 reported correctly enrolled, properly signed
and presented to the Governor on May 5, 2000.
H Sub for SB 219; SB 510, 574 reported correctly enrolled, properly signed and
presented to the Governor on May 8, 2000.
H Sub for SB 40; SB 92, 316; H Sub for SB 323; SB 410, 430; SB 470, 481 reported
correctly enrolled, properly signed and presented to the Governor on May 8, 2000.
H Sub for SB 150; SB 483, H Sub for SB 504; Sub SB 599 reported correctly enrolled,
properly signed and presented to the Governor on May 9, 2000.
CHANGE OF CONFERENCE
The President announced the appointment of Senator Corbin as a member of the
Conference Committee on SB 226 to replace Senator Bond.
MESSAGE FROM THE GOVERNOR
May 8, 2000
To the Senate of the State of Kansas:
Submitted herewith for confirmation by the Senate are appointments made by me as
Governor of the State of Kansas as of May 8, 2000, pursuant to law.
Bill Graves
Governor
Member, Public Employee Relations Board, C. Anne Brunt, pursuant to the authority vested
in me by KSA 75-4323, effective upon the date of confirmation by the Senate to serve a
four-year term expiring March 15, 2002.
Member, Kansas Technology Enterprise Corporation, Richard Danforth, pursuant to the
authority vested in me by KSA 74-8101, effective upon the date of confirmation by the
Senate to serve a four-year term expiring January 15, 2004.
Member, Kansas Technology Enterprise Corporation, Edmond (Ted) Q. Haggart, pursuant
to the authority vested in me by KSA 74-8101, effective upon the date of confirmation by
the Senate to serve a four-year term expiring January 15, 2003.
Member, Kansas Technology Enterprise Corporation, Doyle D. Rahjes, pursuant to the
authority vested in me by KSA 74-8101, effective upon the date of confirmation by the
Senate to serve a four-year term expiring January 15, 2003.
Member, Kansas Racing and Gaming Commission, Leslie A. Hess, pursuant to the authority
vested in me by KSA 74-8803, effective upon the date of confirmation by the Senate to
serve a four-year term expiring January 15, 2004.
Member, Kansas Racing and Gaming Commission, Randall K. Rathbun, pursuant to the
authority vested in me by KSA 74-8803, effective upon the date of confirmation by the
Senate to serve a four-year term expiring January 15, 2004.
May 15, 2000
To the Senate of the State of Kansas:
Submitted herewith for confirmation by the Senate are appointments made by me as
Governor of the State of Kansas as of May 15, 2000, pursuant to law.
Bill Graves
Governor
Member, Kansas Parole Board, Benjamin L. Burgess, pursuant to the authority vested in
me by KSA 22-3707, effective upon the date of confirmation by the Senate to serve a four-
year term expiring January 15, 2003.
Message to the Senate of the State of Kansas:
Pursuant to Article 2, Section 14 of the Constitution of the State of Kansas, I am vetoing
Senate Bill Number 410.
Senate Bill 410 contains many important policy changes in the state's income tax laws
and I fully support the intent of this bill's provisions.
Unfortunately, the provisions of the bill in section 32 do not reflect the intent of the
legislature and have a significant negative impact on the state budget. The intent of the
legislature was to limit the carry back provisions for net operating losses to farm income.
The version of the bill I am presented with, however, would allow the net income operating
losses to be carried back for all corporate taxpayers.
It is estimated that the provisions in this section would reduce State General Fund receipts
by $5.9 million in FY 2001 and in subsequent years. The clear intent of the legislature was
for this section to have a negative impact on receipts of only $400,000 on an annual basis.
If this bill were to become law the state would not have the required State General Fund
ending balance requirement of 7.5 percent. Maintaining the required ending balance
continues to be one of my priorities.
The reduction in receipts that would occur in FY 2001 and FY 2002 if this bill were to
become law as is would total $12.4 million. This would make it extremely difficult to fund
education and other priorities for the state.
I encourage the legislature to pass the provisions of Senate Bill 410 in another measure
during sine die which accurately reflect the intent of the legislature, and I stand ready to
approve such a measure if it reaches my desk.
Bill Graves, Governor of Kansas
Dated: May 18, 2000
SB 555 approved on May 5, 2000.
SB 432 approved on May 9, 2000.
SB 12, 59, 190, 366, 380, 393, 447, 471 approved May 15, 2000.
H Sub for SB 40; SB 92; H Sub for SB 150, H Sub for SB 219; SB 316; 430; SB
470, 481, 483; H Sub for SB 504; SB 510, 574; Sub SB 599 approved on May 16, 2000.
H Sub for SB 323 approved on May 17, 2000.
COMMUNICATION FROM STATE OFFICERS
KANSAS SENTENCING COMMISSION
May 5, 2000
Barbara Tombs, Executive Director, submitted the 1999 Annual Report for the Kansas
Sentencing Commission.
DEPARTMENT OF ADMINISTRATION
Division of Accounts and Reports
May 15, 2000
Dale Brunton, Acting Director, Division of Accounts and Reports, submitted a copy of
the State of Kansas Monthly Financial Perspective for the month of April, 2000.
The April Monthly Financial Perspective is available on the Internet at the Financial
Reporting Section of the Division of Accounts and Reports web site under Monthly
Financial Perspective.
The President announced the above reports are on file in the office of the Secretary of
the Senate and are available for review at any time.
MESSAGE FROM THE HOUSE
Announcing the House adopts the conference committee report on SB 226.
ORIGINAL MOTION
Senator Emert moved that subsection 4(k) of the Joint Rules of the Senate and House
of Representatives be suspended for the purpose of considering the following bill: SB 226.
CONFERENCE COMMITTEE REPORT
Mr. President and Mr. Speaker: Your committee on conference on House
amendments to SB 226, submits the following report:
The Senate accedes to all House amendments to the bill, and your committee on
conference further agrees to amend the bill, as printed with House Committee of the Whole
amendments, as follows:
On page 1, by striking all in lines 20 through 43;
On page 2, by striking all in lines 1 through 33; after line 33, by inserting the following:
``New Section 1. For purposes of sections 1 through 5 of this act:
(a) ``Eligible taxpayer'' means any person who is required to file any return or to pay or
remit any tax under the provisions of K.S.A. 79-3601 et seq., and amendments thereto, or
79-3701 et seq., and amendments thereto, and who, in the opinion of the director has
demonstrated a willingness and ability to comply with the tax laws of this state and has
maintained an acceptable system of business records;
(b) ``Managed audit agreement'' means an agreement between the director and an
eligible taxpayer consisting of an audit plan developed by the director and the eligible
taxpayer wherein the eligible taxpayer agrees to review selected sales and purchase records
and to calculate and determine its liability for sales and use taxes; and
(c) ``Director'' means the director of taxation.
New Sec. 2. The director of taxation may enter into a managed audit agreement with
an eligible taxpayer. Under a managed audit agreement, the director shall:
(a) Agree to accept, upon verification and subject to the provisions of section 4, and
amendments thereto, the eligible taxpayer's determinations for purposes of making a
deficiency assessment or otherwise determining the taxpayer's liability for the audit period
under review;
(b) provide written procedural guidelines to be included as part of the managed audit
agreement, including, but not limited to: (1) The audit period covered by the managed
audit; (2) the general scope of the managed audit; (3) what records will be examined and
what types of sampling techniques will be used; (4) the specific procedures the taxpayer is
to follow in determining any liability; (5) the time period for completion of the managed
audit; and (6) the time period for payment of the tax, penalty and interest;
(c) review the results of the managed audit with the eligible taxpayer and issue a final
determination of tax liability in the manner prescribed by K.S.A. 79-3226, and amendments
thereto; and
(d) recognize the taxpayer's right to request an informal conference in accordance with
the provisions of K.S.A. 79-3610, and amendments thereto.
New Sec. 3. The director shall determine, consistent with the efficient use of audit
resources, which accounts are to be selected for the managed audit program, except that
no taxpayer shall be required to participate in the managed audit program. If a taxpayer's
account is selected for a managed audit, the taxpayer shall review and examine its books
and records to determine any unreported liability for the audit period, and shall make
available all computations and records reviewed for verification by the director.
New Sec. 4. Information provided by the taxpayer as part of the managed audit shall
be the same information that is required for the completion of any other audit the director
may conduct. The director may terminate a managed audit agreement and conduct an audit
of an eligible taxpayer under K.S.A. 79-3609, and amendments thereto, if the eligible
taxpayer fails to fulfill any of the terms of a managed audit agreement, or if the director
believes that a managed audit should not be conducted for any other reason.
New Sec. 5. Upon completion of the managed audit and verification by the director,
interest shall be computed at 50% of the rate that would otherwise be imposed for liabilities
covered by the audit period. Payment of the tax, penalty and interest shall be made within
the time period specified by the director.
New Sec. 6. In all cases where husband and wife file a joint Kansas income tax return
and one spouse is relieved of liability under section 6013(e) or section 6015 of the federal
internal revenue code, or would have otherwise been relieved of liability under either such
section had there been a liability, such spouse shall be relieved of liability for tax, including
interest and penalties, imposed under the Kansas income tax act for such taxable year.
Sec. 7. K.S.A. 79-32,101 is hereby amended to read as follows: 79-32,101. (a) At the
time prescribed in this section: (1) Every individual shall pay estimated tax who can
reasonably expect to owe, after withholding and credits, tax of at least $200 and who expects
their withholding and credits to be less than (A) 90% of the tax shown on the return for the
current year or (B) 100% of the tax shown for the preceding tax year; and
(2) every corporation shall pay estimated tax if its Kansas income tax liability can
reasonably be expected to exceed $500.
(b) In the case of a husband and wife, single payments under this section may be made
by them jointly. If a joint payment is made, but a joint return is not made for the taxable
year, the estimated tax for such year may be divided between them. Notification of the
division of such payments shall be made at such time and in such manner as the director
of taxation may provide, on forms issued by the director of taxation.
(c) If on or before January 31, or March 1, in the case of an individual referred to in
subsection (b) of K.S.A. 79-32,102(b) 79-32,102, relating to income from farming or fishing,
of the succeeding year, the taxpayer files a return for the taxable year, and pays in full the
amount of tax computed on the return, then, under rules and regulations of the secretary
of revenue no payment otherwise required to be made under this section on January 15, or
at any time during the preceding year, in the case of an individual referred to in subsection
(b) of K.S.A. 79-32,102(b) 79-32,102, relating to income from farming or fishing, is required
to be made.
(d) An individual or corporation with a taxable year of less than 12 months shall make
a declaration for less than 12 months as prescribed by rules and regulations of the secretary
of revenue.
(e) The provisions of this section shall not apply to an estate or trust.
Sec. 8. K.S.A. 79-3295 is hereby amended to read as follows: 79-3295. (a) The term
``employee'' means a resident of this state as defined by subsection (b) of K.S.A. 79-32,109,
and amendments thereto, performing services for an employer either within or without the
state and a nonresident performing services within this state, and includes an officer,
employee or elected official of the United States, a state, territory, or any political subdivision
thereof or any agency or instrumentality thereof, and an officer of a corporation, but shall
not include an individual who performs services as an extra in connection with any phase
of motion picture or television production or television commercials for less than 14 days
during any calendar year. As used in this subsection, the term ``extra'' means an individual
who pantomimes in the background, adds atmosphere to the set and performs such actions
without speaking.
(b) The term ``employer'' means any person, firm, partnership, limited liability
company, corporation, association, trust or fiduciary of any kind or other type organization
transacting qualifying as an employer for federal income tax withholding purposes and who
maintains an office, transacts business in or deriving derives any income from sources within
the state of Kansas for whom an individual performs or performed any services, of whatever
nature, as the employee of such employer, and who has control of the payment of wages
for such services, or is the officer, agent or employee of the person having control of the
payment of wages. It also includes the United States, the state and all political subdivisions
thereof, and all agencies or instrumentalities of any of them.
(c) The term ``payor'' means any person or organization, other than an employer, who
makes payments which are subject to withholding of income tax pursuant to this act.
(d) The term ``wages'' means wages as defined by section 3401(a) of the federal internal
revenue code which are taxable under the Kansas income tax act.
Sec. 9. K.S.A. 79-3296 is hereby amended to read as follows: 79-3296. (a) Every
employer who is required under federal law to withhold upon wages pursuant to the federal
internal revenue code shall, whenever the wage recipient is a resident of Kansas or the
wages shall be paid on account of personal service performed in Kansas, withhold and deduct
from such wages paid 10% of the amount required under federal law to be deducted, except
that withholding from employees of interstate carriers shall be determined under the
provisions of public law 91-569 an amount to be determined in accordance with section 13,
and amendments thereto.
(b) In the event that a resident individual of this state is employed in another state, and
such other state requires a withholding of income tax on wages earned by such resident in
such other state, the secretary may enter into an agreement with such other state or the
employer of such resident as to the manner and amount of withholding required by this act
on the wages of such resident earned in such other state.
(c) The secretary is hereby authorized to enter into an agreement pursuant to 10 U.S.C.
1045 providing for the withholding of state income tax from monthly retired or retainer pay
of any member or former member of the United States armed forces.
(b) Notwithstanding the requirements of subsection (a), an employer shall not withhold
from the wages of an individual who performs services as an extra in connection with any
phase of motion picture or television production or television commercials for less than 14
days during any calendar year. As used in this subsection, the term ``extra'' means an
individual who pantomimes in the background, adds atmosphere to the set and performs
such actions without speaking.
(c) A determination by the internal revenue service which relieves an employer or payor
from withholding responsibility with respect to payments to an employee or payee shall also
apply for Kansas income tax withholding purposes. Where an employer or payor is required
to reinstate withholding for federal income tax with regard to any employee or payee, such
obligation shall be equally applicable for Kansas withholding purposes.
New Sec. 10. Every payor who withholds federal income tax:
(a) For any supplemental unemployment compensation, annuity or sick pay;
(b) pursuant to a voluntary withholding agreement;
(c) on gambling winnings;
(d) on taxable payments of Indian casino profits;
(e) for any vehicle fringe benefit;
(f) on periodic payments of pensions, annuities and other deferred income;
(g) on nonperiodic distributions of pensions, annuities and other deferred income; or
(h) on eligible rollover distributions of pensions, annuities and other deferred income,
from payments made to those persons whose primary residence is in Kansas shall withhold
and deduct an amount to be determined in accordance with section 11, and amendments
thereto.
New Sec. 11. (a) Every employer or payor required to deduct and withhold tax from
wages of an employee or payments other than wages of a payee under this act shall be liable
for the payment of such tax whether or not it is collected from the employee or payee by
the employer or payor. For purposes of assessment and collection, any amount required to
be withheld and paid over to the department of revenue, and any additions to tax, penalties
and interest with respect thereto, shall be considered the tax of the employer.
(b) Any amount of tax withheld shall constitute a special fund in trust for the department
of revenue.
(c) No employee or payee shall have any right of action against their employer or payor
in respect to any moneys deducted and withheld from wages or payments other than wages
and paid over to the department of revenue in compliance or in intended compliance with
this act.
New Sec. 12. (a) If an employer or payor fails to deduct and withhold the tax as required
under this act, and thereafter, the income tax against which the tax may be credited is paid,
the tax required to be deducted and withheld shall not be collected from the employer or
payor. The payment of such tax does not, however, operate to relieve the employer from
liability for penalties, interest or additions to the tax applicable with respect to such failure
to deduct and withhold. The employer or payor will not be relieved under this provision
from liability for payment of the tax required to be withheld unless it can be shown that the
income tax against which the tax required to be withheld under this act may be credited
has been paid.
(b) Every agent or other person having control, receipt, custody or disposal of, or paying
the wages of an employee or group of employees employed by one or more employers, is
for the purpose of this act designated to be an employer. In the case of the corporation, the
officers and board of directors are likewise considered employers. Employers of classes
named in this section shall be subject to all the provisions of law including penalties as is
their principal. Any employer who willfully fails to collect the tax imposed by the Kansas
withholding tax act or truthfully account for any pay over such tax, or willfully attempts in
any manner to evade or defeat any tax or the payment thereof, shall be subject to a penalty
equal to the total amount of the tax evaded, or not collected, or not accounted for and paid
over in addition to other penalties provided by law.
New Sec. 13. (a) The amount to be withheld from wages as required by K.S.A. 79-
3296, and amendments thereto, or from payments other than wages as required by section
10, and amendments thereto, shall be an amount which will approximate the employee's or
payee's annual tax liability on a calendar year basis, calculated on the basis of tables to be
prepared by the secretary, and schedules or percentage rates to be prescribed by the
secretary, based on the wages, payments other than wages, or adjusted gross income of the
taxpayer.
(b) The state withholding rate shall be in proper proportion to the tax rates imposed
under K.S.A. 79-32,110, and amendments thereto, and the tax base, so that the withholding
rate corresponds to the employee's or payee's expected income tax liability. Such rate may
be fixed for all adjusted gross income classes, or variable rates may be established, based
upon adjusted gross income class, to insure proper withholding consistent with the taxpayer's
expected tax liability.
(c) In the event a resident individual of this state is employed in another state, and such
other state requires a withholding of income tax on wages earned by such resident in such
other state, the secretary may enter into an agreement with such other state or the employer
of such resident as to the manner and amount of withholding required by this act on the
wages of such resident earned in such other state.
(d) The secretary is hereby authorized to enter into an agreement pursuant to 10 U.S.C.
1045 providing for the withholding of state income tax from monthly retired or retainer pay
of any member or former member of the United States armed forces.
Sec. 14. K.S.A. 79-3298 is hereby amended to read as follows: 79-3298. (a) With respect
to any taxes withheld before April 1, 1983, every employer, other than employers who have
received the prior approval of the director to file an annual return, shall file a withholding
return on or before the last day of the first month following the end of the calendar quarter
in which withholding was required. Such return shall be on a form prescribed by the director
of taxation and shall be accompanied by payment in full of any amounts withheld by the
employer. Employers who have received the approval of the director to file an annual return
before the effective date of this act shall comply with the applicable provisions of subsection
(b).
(b) With respect to any taxes withheld after March 31, 1983, Every employer and payor
shall remit the taxes and file returns in accordance with the following provisions. (1)
Whenever the total amount withheld exceeds $100,000 in any calendar year, the employer
or payor shall remit the taxes withheld in accordance with the following schedule: Each
calendar month shall be divided into four remittance periods that end on the 7th, 15th, 21st
and the last day of such month. If at the end of any one or all of such remittance periods
the total undeposited taxes equal or exceed $667, the taxes shall be remitted within three
banking days. Saturdays, Sundays and legal holidays shall not be treated as banking days.
(2) Whenever the total amount withheld exceeds $8,000 but does not exceed $100,000 in
any calendar year, the employer or payor shall remit the taxes withheld for wages paid
during the first 15 days of any month on or before the 25th day of the month. The employer
or payor shall remit the taxes withheld for wages paid during the remainder of that month
on or before the 10th day of the following month. (3) Whenever the total amount withheld
exceeds $1,200 but does not exceed $8,000 in any calendar year, the employer or payor
shall remit the taxes withheld during any month on or before the 15th day of the following
month. (4) Whenever the total amount withheld exceeds $200 but does not exceed $1,200
in any calendar year, the employer or payor shall remit the taxes withheld in any calendar
quarter on or before the 25th day of the first month following the end of that calendar
quarter. (5) Whenever the total amount withheld does not exceed $200 in any calendar year,
the employer or payor shall remit the taxes withheld during that year on or before January
25 of the following year.
(c) (b) Each remittance required under the provisions of subsection (b) (a) shall be
accompanied by a Kansas withholding tax remittance form prescribed and furnished by the
director.
(d) (c) Every employer or payor making remittances pursuant to subsection (b) (a) shall
file a return on a form prescribed and furnished by the director for each calendar year on
or before the last day of February of the following year.
(e) (d) The excess of any remittance over the actual taxes withheld in any withholding
period shall be credited against the liability for following withholding periods until
exhausted. A refund shall be allowed in accordance with K.S.A. 79-32,105, and amendments
thereto, where an overpayment cannot be adjusted by an offset against the liability for a
subsequent withholding period.
(f) (e) Determinations of amounts withheld during a calendar year by employers or
payors for purposes of determining filing requirements shall be made by the director upon
the basis of amounts withheld by those employers or payors during the preceding calendar
year or by estimates in cases of employers or payors having no previous withholding
histories. The director is hereby authorized to modify the filing schedule for any employer
or payor when it is apparent that the original determination was inaccurate.
(g) (f) Whenever the director has cause to believe that money withheld by an employer
or payor pursuant to this act may be converted, diverted, lost, or otherwise not timely paid
in accordance with this section, the director shall have the power to require returns and
payment from any such employer or payor at any time at more frequent intervals than
prescribed by this section in order to secure full payment to the state of all amounts withheld
by such employer or payor in accordance with this act.
Sec. 15. K.S.A. 79-3299 is hereby amended to read as follows: 79-3299. (a) Every
employer or payor shall, on or before January 31 of each year prepare a statement for each
employee or payee on a form prescribed by the director stating the amount of wages or
payments other than wages subject to Kansas income tax paid during the preceding year,
the total amount of tax withheld, if any, from such wages or payments other than wages by
the employer or payor pursuant to this act and such other information as may be prescribed
by the director. One copy of such statement shall be filed by the employer or payor with
the division of taxation on or before the last day of February of each year. Two copies of
such statement shall be given to the employee or payee concerned, one of which will be
filed by the employee or payee with the tax return required by this chapter.
(b) In the case of an employee whose employment is terminated before the end of a
calendar year, the statement required by subsection (a) may be mailed at the time provided
in that subsection to the last known address of the employee, or issued at the time of the
last payment to the employee, at the employer's option.
(c) Any employer or payor who willfully fails to furnish a statement to an employee or
payee as required under the provisions of subsections (a) and (b) of this section shall be
guilty of a misdemeanor and upon conviction thereof shall be punished by a fine not
exceeding $100 for each such offense.
(d) The annual statement of wages and salaries paid and amount withheld required by
this section shall be in lieu of the annual information return required under K.S.A. 79-3222.
Sec. 16. K.S.A. 79-32,100 is hereby amended to read as follows: 79-32,100. (a) The tax
deducted and withheld under this act shall not be allowed as a deduction either to the
employer or payor or to the employee or payee in computing taxable income under the
``Kansas income tax act.''
(b) The full amount of wages and salaries or payments other than wages from which an
amount was withheld in accordance with this act shall be included in the gross income of
the employee or payee unless such wages and salaries or payments other than wages or a
portion thereof are otherwise excludable under the provisions of the ``Kansas income tax
act.''
(c) The amount deducted and withheld under this act during any calendar year from
the wages or payments other than wages of an individual taxpayer shall be allowed as a
credit against the income tax otherwise imposed on such taxpayer by the ``Kansas income
tax act,'' whether or not such amount was remitted to the division of taxation by the employer
or payor in accordance with the terms of this act.
(d) If the amount withheld under this act during any calendar year exceeds the individual
income tax liability of the employee-payee-taxpayer any excess shall be applied to any other
income tax owed the state of Kansas by such individual (including fines, penalties and
interest, if any) and the balance of such excess, if any, refunded to the taxpayer as provided
in subsection (c) of K.S.A. 79-32,105(c) 79-32,105, and amendments thereto.
Sec. 17. K.S.A. 79-32,106 is hereby amended to read as follows: 79-32,106. (a) The
employer shall be liable to the state for the payment of the amount required to be deducted
and withheld under this act but shall not be otherwise liable for the amount of any such
payments.
(b) If the employer is the United States or any agency or instrumentality thereof, the
return of the amount deducted and withheld upon any wages or payments other than wages
may be made by any officer or employee of the United States or of such agency or
instrumentality, as the case may be, having control of the payment of such wages or payments
other than wages, or appropriately designated for that purpose. Such withholding shall, in
accordance with 5 U.S.C. 84c, be exempt from penalties otherwise provided by law for
noncompliance with this act.
(c) In case a fiduciary, agent, or other person has the control, receipt, custody or disposal
of, or pays the wages of an employee or group of employees, employed by one or more
employers, the director, under rules and regulations of the secretary of revenue, is
authorized to designate such fiduciary, agent, or other person to perform such acts as are
required of employers under this act and as the director may specify. Except as may be
otherwise prescribed by the director, all provisions of law (including penalties) applicable
in respect of any employer shall be applicable to a fiduciary, agent, or other person so
designated, but, except as so provided, the employer for whom such fiduciary, agent, or
other persons acts shall remain subject to the provisions of law (including penalties)
applicable in respect of employers.
Sec. 18. K.S.A. 79-3228 is hereby amended to read as follows: 79-3228. (a) For all
taxable years ending prior to January 1, 2002, if any taxpayer, without intent to evade the
tax imposed by this act, shall fail to file a return or pay the tax, if one is due, at the time
required by or under the provisions of this act, but shall voluntarily file a correct return of
income or pay the tax due within six months thereafter, there shall be added to the tax an
additional amount equal to 10% of the unpaid balance of tax due plus interest at the rate
prescribed by subsection (a) of K.S.A. 79-2968, and amendments thereto, from the date the
tax was due until paid.
(b) For all taxable years ending prior to January 1, 2002, if any taxpayer fails voluntarily
to file a return or pay the tax, if one is due, within six months after the time required by or
under the provisions of this act, there shall be added to the tax an additional amount equal
to 25% of the unpaid balance of tax due plus interest at the rate prescribed by subsection
(a) of K.S.A. 79-2968, and amendments thereto, from the date the tax was due until paid.
Notwithstanding the foregoing, in the event an assessment is issued following a field audit
for any period for which a return was filed by the taxpayer and all of the tax was paid
pursuant to such return, a penalty shall be imposed for the period included in the assessment
in the amount of 10% of the unpaid balance of tax due shown in the notice of assessment.
If after review of a return for any period included in the assessment, the secretary or
secretary's designee determines that the underpayment of tax was due to the failure of the
taxpayer to make a reasonable attempt to comply with the provisions of this act, such penalty
shall be imposed for the period included in the assessment in the amount of 25% of the
unpaid balance of tax due.
(c) For all taxable years ending after December 31, 2001, if any taxpayer fails to file a
return or pay the tax if one is due, at the time required by or under the provisions of this
act, there shall be added to the tax an additional amount equal to 1% of the unpaid balance
of the tax due for each month or fraction thereof during which such failure continues, not
exceeding 24% in the aggregate, plus interest at the rate prescribed by subsection (a) of
K.S.A. 79-2968, and amendments thereto, from the date the tax was due until paid.
Notwithstanding the foregoing, in the event an assessment is issued following a field audit
for any period for which a return was filed by the taxpayer and all of the tax was paid
pursuant to such return, a penalty shall be imposed for the period included in the assessment
in an amount of 1% per month not exceeding 10% of the unpaid balance of tax due shown
in the notice of assessment. If after review of a return for any period included in the
assessment, the secretary or secretary's designee determines that the underpayment of tax
was due to the failure of the taxpayer to make a reasonable attempt to comply with the
provisions of this act, such penalty shall be imposed for the period included in the assessment
in the amount of 25% of the unpaid balance of tax due.
(c) (d) If any taxpayer who has failed to file a return or has filed an incorrect or
insufficient return, and after notice from the director refuses or neglects within 20 days to
file a proper return, the director shall determine the income of such taxpayer according to
the best available information and assess the tax together with a penalty of 50% of the
unpaid balance of tax due plus interest at the rate prescribed by subsection (a) of K.S.A.
79-2968, and amendments thereto, from the date the tax was originally due to the date of
payment.
(d) (e) Any person, who with fraudulent intent, fails to pay any tax or to make, render
or sign any return, or to supply any information, within the time required by or under the
provisions of this act, shall be assessed a penalty equal to the amount of the unpaid balance
of tax due plus interest at the rate prescribed by subsection (a) of K.S.A. 79-2968, and
amendments thereto, from the date the tax was originally due to the date of payment. Such
person shall also be guilty of a misdemeanor and shall, upon conviction, be fined not more
than $1,000 or be imprisoned in the county jail not less than 30 days nor more than one
year, or both such fine and imprisonment.
(e) (f) Any person who willfully signs a fraudulent return shall be guilty of a felony, and
upon conviction thereof shall be punished by imprisonment for a term not exceeding five
years. The term ``person'' as used in this section includes any agent of the taxpayer, and
officer or employee of a corporation or a member or employee of a partnership, who as
such officer, employee or member is under a duty to perform the act in respect of which
the violation occurs.
(f) (g) (1) Whenever the secretary or the secretary's designee determines that the failure
of the taxpayer to comply with the provisions of subsections (a), (b) and, (c) and (d) of this
section was due to reasonable causes, the secretary or the secretary's designee may waive
or reduce any of the penalties and may reduce the interest rate to the underpayment rate
prescribed and determined for the applicable period under section 6621 of the federal
internal revenue code as in effect on January 1, 1994, upon making a record of the reasons
therefor.
(2) No penalty shall be assessed hereunder with respect to any underpayment of income
tax liability reported on any amended return filed by any taxpayer who at the time of filing
pays such underpayment and whose return is not being examined at the time of filing.
(3) No penalty assessed hereunder shall be collected if the taxpayer has had the tax
abated on appeal, and any penalty collected upon such tax shall be refunded.
(g) (h) In case of a nonresident or any officer or employee of a corporation, the failure
to do any act required by or under the provisions of this act shall be deemed an act
committed in part at the office of the director.
(h) (i) In the case of a nonresident individual, partnership or corporation, the failure to
do any act required by or under the provision of this act shall prohibit such nonresident
from being awarded any contract for construction, reconstruction or maintenance or for the
sale of materials and supplies to the state of Kansas or any political subdivision thereof until
such time as such nonresident has fully complied with this act.
Sec. 19. K.S.A. 79-3615 is hereby amended to read as follows: 79-3615. (a) If any
taxpayer shall fail to pay the tax required under this act at the time required by or under
the provisions of this act, there shall be added to the unpaid balance of the tax, interest at
the rate per month prescribed by subsection (a) of K.S.A. 79-2968 and amendments thereto
from the date the tax was due until paid.
(b) For all taxable years ending prior to January 1, 2002, if any taxpayer due to
negligence or intentional disregard fails to file a return or pay the tax due at the time required
by or under the provisions of this act, there shall be added to the tax a penalty in an amount
equal to 10% of the unpaid balance of tax due.
(c) For all taxable years ending prior to January 1, 2002, if any person fails to make a
return, or to pay any tax, within six months from the date the return or tax was due, except
in the case of an extension of time granted by the secretary of revenue or the secretary's
designee, there shall be added to the tax due a penalty equal to 25% of the unpaid balance
of such tax due. Notwithstanding the foregoing, in the event an assessment is issued following
a field audit for any period for which a return was filed by the taxpayer and all of the tax
was paid pursuant to such return, a penalty shall be imposed for the period included in the
assessment in the amount of 10% of the unpaid balance of tax due shown in the notice of
assessment. If after review of a return for any period included in the assessment, the
secretary or secretary's designee determines that the underpayment of tax was due to the
failure of the taxpayer to make a reasonable attempt to comply with the provisions of this
act, such penalty shall be imposed for the period included in the assessment in the amount
of 25% of the unpaid balance of tax due.
(d) For all taxable years ending after December 31, 2001, if any taxpayer fails to file a
return or pay the tax if one is due, at the time required by or under the provisions of this
act, there shall be added to the tax an additional amount equal to 1% of the unpaid balance
of the tax due for each month or fraction thereof during which such failure continues, not
exceeding 24% in the aggregate, plus interest at the rate prescribed by subsection (a) of
K.S.A. 79-2968, and amendments thereto, from the date the tax was due until paid.
Notwithstanding the foregoing, in the event an assessment is issued following a field audit
for any period for which a return was filed by the taxpayer and all of the tax was paid
pursuant to such return, a penalty shall be imposed for the period included in the assessment
in an amount of 1% per month not exceeding 10% of the unpaid balance of tax due shown
in the notice of assessment. If after review of a return for any period included in the
assessment, the secretary or secretary's designee determines that the underpayment of tax
was due to the failure of the taxpayer to make a reasonable attempt to comply with the
provisions of this act, such penalty shall be imposed for the period included in the assessment
in the amount of 25% of the unpaid balance of tax due.
(d) (e) If any taxpayer, with fraudulent intent, fails to pay any tax or make, render or
sign any return, or to supply any information, within the time required by or under the
provisions of this act, there shall be added to the tax a penalty in an amount equal to 50%
of the unpaid balance of tax due.
(e) (f) Penalty or interest applied under the provisions of subsections (a) and (d) shall
be in addition to the penalty added under any other provisions of this section, but the
provisions of subsections (b) and (c) shall be mutually exclusive of each other.
(f) (g) Whenever the secretary or the secretary's designee determines that the failure
of the taxpayer to comply with the provisions of subsections (b) and (c) (a), (b), (c) and (d)
of this section was due to reasonable causes, the secretary or the secretary's designee may
waive or reduce any of the penalties and may reduce the interest rate to the underpayment
rate prescribed and determined for the applicable period under section 6621 of the federal
internal revenue code as in effect on January 1, 1994, upon making a record of the reasons
therefor.
(g) (h) In addition to all other penalties provided by this section, any person who willfully
fails to make a return or to pay any tax imposed under the Kansas retailers' sales tax act, or
who makes a false or fraudulent return, or fails to keep any books or records prescribed by
this act, or who willfully violates any regulations of the secretary of revenue, for the
enforcement and administration of this act, or who aids and abets another in attempting to
evade the payment of any tax imposed by this act, or who violates any other provision of
this act, shall, upon conviction thereof, be fined not less than $500, nor more than $10,000,
or be imprisoned in the county jail not less than one month, nor more than six months, or
be both so fined and imprisoned, in the discretion of the court.
(i) No penalty assessed hereunder shall be collected if the taxpayer has had the tax abated
on appeal, and any penalty collected upon such tax shall be refunded.
Sec. 20. K.S.A. 79-3706 is hereby amended to read as follows: 79-3706. (a) Each retailer
or person subject to the provisions of this act shall make remittances of the tax imposed by
K.S.A. 79-3703, and amendments thereto, and file returns in accordance with the provisions
of K.S.A. 79-3607 and amendments thereto, except that the time schedule for remitting tax
and filing returns shall be determined on the basis of calendar year compensating tax liability
in lieu of calendar year sales tax liability. Returns shall show in detail the total quantity of
tangible personal property sold by any retailer or used, stored or consumed by any person
within the state during the period for which the return is filed subject to the tax herein
imposed, and such other information as the director may deem pertinent. The director may,
upon request and a proper showing of the necessity therefor, grant an extension of time not
to exceed 60 days for making any return and payment. Returns shall be signed by the retailer
or such retailer's duly authorized agent, and must be certified by such retailer to be correct.
(b) If any taxpayer fails to pay the tax required under the act of which this section is
amendatory at the time required by or under the provisions of the act of which this section
is amendatory, there shall be added to the unpaid balance of the tax, interest at the rate per
month prescribed by subsection (a) of K.S.A. 79-2968, and amendments thereto, from the
date the tax was due until paid.
(c) For all taxable years ending prior to January 1, 2002, if any taxpayer due to
negligence or intentional disregard fails to file a return or pay the tax due at the time required
by or under the provisions of this section, there shall be added to the tax a penalty in an
amount equal to 10% of the unpaid balance of tax due.
(d) For all taxable years ending prior to January 1, 2002, if any person fails to make a
return, or to pay any tax, within six months from the date the return or tax was due, except
in the case of an extension of time granted by the secretary of revenue or the secretary's
designee, there shall be added to the tax due a penalty equal to 25% of the unpaid balance
of such tax due.
(e) For all taxable years ending after December 31, 2001, if any taxpayer fails to file a
return or pay the tax if one is due, at the time required by or under the provisions of this
act, there shall be added to the tax an additional amount equal to 1% of the unpaid balance
of the tax due for each month or fraction thereof during which such failure continues, not
exceeding 24% in the aggregate, plus interest at the rate prescribed by subsection (a) of
K.S.A. 79-2968, and amendments thereto, from the date the tax was due until paid.
Notwithstanding the foregoing, in the event an assessment is issued following a field audit
for any period for which a return was filed by the taxpayer and all of the tax was paid
pursuant to such return, a penalty shall be imposed for the period included in the assessment
in an amount of 1% per month not exceeding 10% of the unpaid balance of tax due shown
in the notice of assessment. If after review of a return for any period included in the
assessment, the secretary or secretary's designee determines that the underpayment of tax
was due to the failure of the taxpayer to make a reasonable attempt to comply with the
provisions of this act, such penalty shall be imposed for the period included in the assessment
in the amount of 25% of the unpaid balance of tax due.
(e) (f) If any taxpayer, with fraudulent intent, fails to pay any tax or make, render or
sign any return, or to supply any information, within the time required by or under the
provisions of this section, there shall be added to the tax a penalty in an amount equal to
50% of the unpaid balance of tax due.
(f) (g) Penalty or interest applied under the provisions of subsections (b) and (e) shall
be in addition to the penalty added under any other provisions of this section, but the
provisions of subsections (c) and (d) shall be mutually exclusive of each other.
(g) (h) Whenever the secretary of revenue or the secretary's designee determines that
the failure of the taxpayer to comply with the provisions of subsections (c) and (d) (b), (c),
(d) and (e) was due to reasonable causes, the secretary or the secretary's designee may waive
or reduce any of the penalties and may reduce the interest rate to the underpayment rate
prescribed and determined for the applicable period under section 6621 of the federal
internal revenue code as in effect on January 1, 1994 upon making a record of the reasons
therefor.
(h) (i) In addition to all other penalties provided by this section, any person who willfully
fails to make a return or to pay any tax imposed under the Kansas compensating tax act, or
who makes a false or fraudulent return, or fails to keep any books or records prescribed by
the Kansas compensating tax act, or who willfully violates any regulations of the secretary
of revenue, for the enforcement and administration of the Kansas compensating tax act, or
who aids and abets another in attempting to evade the payment of any tax imposed by the
Kansas compensating tax act, or who violates any other provision of the Kansas compensating
tax act, shall, upon conviction thereof, be fined not less than $100 nor more than $1,000,
or be imprisoned in the county jail not less than one month nor more than six months, or
be both so fined and imprisoned, in the discretion of the court.
(j) No penalty assessed hereunder shall be collected if the taxpayer has had the tax abated
on appeal, and any penalty collected upon such tax shall be refunded.
Sec. 21. K.S.A. 79-41a03a is hereby amended to read as follows: 79-41a03a. (a) If any
taxpayer fails to pay the tax levied pursuant to K.S.A. 79-41a02, and amendments thereto,
at the time required by or under the provisions of K.S.A. 79-41a03, and amendments thereto,
there shall be added to the unpaid balance of the tax, interest at the rate per month
prescribed by subsection (a) of K.S.A. 79-2968, and amendments thereto, from the date the
tax was due until paid.
(b) For all taxable years ending prior to January 1, 2002, if any taxpayer due to
negligence or intentional disregard fails to file a return or pay the tax due at the time required
by or under the provisions of K.S.A. 79-41a03, and amendments thereto, there shall be
added to the tax a penalty in an amount equal to 10% of the unpaid balance of tax due.
(c) For all taxable years ending prior to January 1, 2002, if any person fails to make a
return, or to pay any tax, within six months from the date the return or tax was due, except
in the case of an extension of time granted by the secretary of revenue or the secretary's
designee, there shall be added to the tax due a penalty equal to 25% of the unpaid balance
of such tax due.
(d) For all taxable years ending after December 31, 2001, if any taxpayer fails to file a
return or pay the tax if one is due, at the time required by or under the provisions of this
act, there shall be added to the tax an additional amount equal to 1% of the unpaid balance
of the tax due for each month or fraction thereof during which such failure continues, not
exceeding 24% in the aggregate, plus interest at the rate prescribed by subsection (a) of
K.S.A. 79-2968, and amendments thereto, from the date the tax was due until paid.
Notwithstanding the foregoing, in the event an assessment is issued following a field audit
for any period for which a return was filed by the taxpayer and all of the tax was paid
pursuant to such return, a penalty shall be imposed for the period included in the assessment
in an amount of 1% per month not exceeding 10% of the unpaid balance of tax due shown
in the notice of assessment. If after review of a return for any period included in the
assessment, the secretary or secretary's designee determines that the underpayment of tax
was due to the failure of the taxpayer to make a reasonable attempt to comply with the
provisions of this act, such penalty shall be imposed for the period included in the assessment
in the amount of 25% of the unpaid balance of tax due.
(d) (e) If any taxpayer, with fraudulent intent, fails to pay any tax or make, render or
sign any return, or to supply any information, within the time required by or under the
provisions of K.S.A. 79-41a03, and amendments thereto, there shall be added to the tax a
penalty in an amount equal to 50% of the unpaid balance of tax due.
(e) (f) Penalty or interest applied under the provisions of subsections (a) and (d) shall
be in addition to the penalty added under any other provisions of this section, but the
provisions of subsections (b) and (c) shall be mutually exclusive of each other.
(f) (g) Whenever the secretary of revenue or the secretary's designee determines that
the failure of the taxpayer to comply with the provisions of subsections (b) and (c) was due
to reasonable causes, the secretary or the secretary's designee may waive or reduce any of
the penalties and may reduce the interest rate to the underpayment rate prescribed and
determined for the applicable period under section 6621 of the federal internal revenue
code as in effect on January 1, 1994, upon making a record of the reasons therefor.
(g) (h) In addition to all other penalties provided by this section, any person who willfully
fails to make a return or to pay any tax imposed under K.S.A. 79-41a02, and amendments
thereto, or who makes a false or fraudulent return, or fails to keep any books or records
necessary to determine the accuracy of the person's reports, or who willfully violates any
regulations of the secretary of revenue, for the enforcement and administration of the
provisions of K.S.A. 79-41a01 to 79-41a09, inclusive, and amendments thereto, or who aids
and abets another in attempting to evade the payment of any tax imposed by K.S.A. 79-
41a02, and amendments thereto, or who violates any other provision of K.S.A. 79-41a01 to
79-41a09, inclusive, and amendments thereto, shall, upon conviction thereof, be fined not
less than $100 nor more than $1,000, or be imprisoned in the county jail not less than one
month nor more than six months, or be both so fined and imprisoned, in the discretion of
the court.
Sec. 22. K.S.A. 79-1009 is hereby amended to read as follows: 79-1009. To the end that
the state of Kansas and the political subdivisions thereof may receive all taxes due in every
instance, including contributions due under the employment security law, contractors, who
are nonresidents of this state, desiring to engage in, prosecute, follow or carry on the business
of contracting as defined in this act shall register with the secretary of revenue or the
secretary's designee for each contract where the total contract price or compensation to be
received amounts to more than $10,000, except that a foreign corporation authorized to do
business in this state shall not be required to register under the provisions of this act. The
secretary or the secretary's designee shall charge a fee for such registration in the amount
of $10 for each such contract. All such fees received by the secretary or the secretary's
designee shall be deposited on Monday of each week with the state treasurer. The state
treasurer shall thereupon credit the amount of such fees to the state general fund.
Sec. 23. K.S.A. 79-2974 is hereby amended to read as follows: 79-2974. On and after
January 1, 1998, the The secretary of revenue shall make available in a medium readily
accessible to taxpayers all administrative rulings of the department of revenue which affect
the duties and responsibilities of taxpayers pursuant to any law administered by the
department of revenue. Private letter rulings and written final determinations of the
secretary or the designee of the secretary shall be provided in such a manner as to conceal
the identity of the specific taxpayer for whom the private letter ruling was issued. The
secretary shall cause to be published in the Kansas register a description of each such
administrative ruling within 30 days of such ruling together with specific instructions as to
how the complete text of the administrative ruling may be obtained. As used in this section,
administrative rulings shall include revenue notices, revenue rulings, information guides,
policy directives, private letter rulings, written final determinations of the secretary or the
designee of the secretary and directives of the division of property valuation or its director.
Sec. 24. K.S.A. 79-4502 is hereby amended to read as follows: 79-4502. As used in this
act, unless the context clearly indicates otherwise:
(a) ``Income'' means the sum of adjusted gross income under the Kansas income tax
act, maintenance, support money, cash public assistance and relief (not including any refund
granted under this act), the gross amount of any pension or annuity (including all monetary
retirement benefits from whatever source derived, including but not limited to, railroad
retirement benefits, all payments received under the federal social security act except
disability payments, and veterans disability pensions), all dividends and interest from
whatever source derived not included in adjusted gross income, workers compensation and
the gross amount of ``loss of time'' insurance. It does not include gifts from nongovernmental
sources or surplus food or other relief in kind supplied by a governmental agency, nor shall
net operating losses and net capital losses be considered in the determination of income.
(b) ``Household'' means a claimant, a claimant and spouse who occupy the homestead
or a claimant and one or more individuals not related as husband and wife who together
occupy a homestead.
(c) ``Household income'' means all income received by all persons of a household in a
calendar year while members of such household.
(d) ``Homestead'' means the dwelling, or any part thereof, whether owned or rented,
which is occupied as a residence by the household and so much of the land surrounding it,
as defined as a home site for ad valorem tax purposes, and may consist of a part of a multi-
dwelling or multi-purpose building and a part of the land upon which it is built or a
manufactured home or mobile home and the land upon which it is situated. ``Owned''
includes a vendee in possession under a land contract, a life tenant, a beneficiary under a
trust and one or more joint tenants or tenants in common.
(e) ``Claimant'' means a person who has filed a claim under the provisions of this act
and was, during the entire calendar year preceding the year in which such claim was filed
for refund under this act, except as provided in K.S.A. 79-4503, and amendments thereto,
both domiciled in this state and was: (1) A person having a disability; (2) a person who is
55 years of age or older or (3) a person other than a person included under (1) or (2) having
one or more dependent children under 18 years of age residing at the person's homestead
during the calendar year immediately preceding the year in which a claim is filed under this
act.
When a homestead is occupied by two or more individuals and more than one of the
individuals is able to qualify as a claimant, the individuals may determine between them as
to whom the claimant will be. If they are unable to agree, the matter shall be referred to
the secretary of revenue whose decision shall be final.
(f) ``Property taxes accrued'' means property taxes, exclusive of special assessments,
delinquent interest and charges for service, levied on a claimant's homestead in 1979 or any
calendar year thereafter by the state of Kansas and the political and taxing subdivisions of
the state. When a homestead is owned by two or more persons or entities as joint tenants
or tenants in common and one or more of the persons or entities is not a member of
claimant's household, ``property taxes accrued'' is that part of property taxes levied on the
homestead that reflects the ownership percentage of the claimant's household. For purposes
of this act, property taxes are ``levied'' when the tax roll is delivered to the local treasurer
with the treasurer's warrant for collection. When a claimant and household own their
homestead part of a calendar year, ``property taxes accrued'' means only taxes levied on the
homestead when both owned and occupied as a homestead by the claimant's household at
the time of the levy, multiplied by the percentage of 12 months that the property was owned
and occupied by the household as its homestead in the year. When a household owns and
occupies two or more different homesteads in the same calendar year, property taxes
accrued shall be the sum of the taxes allocable to those several properties while occupied
by the household as its homestead during the year. Whenever a homestead is an integral
part of a larger unit such as a multi-purpose or multi-dwelling building, property taxes
accrued shall be that percentage of the total property taxes accrued as the value of the
homestead is of the total value. For the purpose of this act, the word ``unit'' refers to that
parcel of property covered by a single tax statement of which the homestead is a part.
(g) ``Disability'' means:
(1) Inability to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in death or
has lasted or can be expected to last for a continuous period of not less than 12 months,
and an individual shall be determined to be under a disability only if the physical or mental
impairment or impairments are of such severity that the individual is not only unable to do
the individual's previous work but cannot, considering age, education and work experience,
engage in any other kind of substantial gainful work which exists in the national economy,
regardless of whether such work exists in the immediate area in which the individual lives
or whether a specific job vacancy exists for the individual, or whether the individual would
be hired if application was made for work. For purposes of the preceding sentence (with
respect to any individual), ``work which exists in the national economy'' means work which
exists in significant numbers either in the region where the individual lives or in several
regions of the country; for purposes of this subsection, a ``physical or mental impairment''
is an impairment that results from anatomical, physiological or psychological abnormalities
which are demonstrable by medically acceptable clinical and laboratory diagnostic
techniques; or
(2) blindness and inability by reason of blindness to engage in substantial gainful activity
requiring skills or abilities comparable to those of any gainful activity in which the individual
has previously engaged with some regularity and over a substantial period of time.
(h) ``Blindness'' means central visual acuity of 20/200 or less in the better eye with the
use of a correcting lens. An eye which is accompanied by a limitation in the fields of vision
such that the widest diameter of the visual field subtends an angle no greater than 20 degrees
shall be considered for the purpose of this paragraph as having a central visual acuity of 20/
200 or less.
(i) ``Rent constituting property taxes accrued'' means 20% of the gross rent actually paid
in cash or its equivalent in 1979 or any taxable year thereafter by a claimant and claimant's
household solely for the right of occupancy of a Kansas homestead on which ad valorem
property taxes were levied in full for that year. When a household occupies two or more
different homesteads in the same calendar year, rent constituting property taxes accrued
shall be computed by adding the rent constituting property taxes accrued for each property
rented by the household while occupied by the household as its homestead during the year.
(j) ``Gross rent'' means the rental paid at arm's length solely for the right of occupancy
of a homestead or space rental paid to a landlord for the parking of a mobile home, exclusive
of charges for any utilities, services, furniture and furnishings or personal property
appliances furnished by the landlord as a part of the rental agreement, whether or not
expressly set out in the rental agreement. Whenever the director of taxation finds that the
landlord and tenant have not dealt with each other at arms length and that the gross rent
charge was excessive, the director may adjust the gross rent to a reasonable amount for the
purposes of the claim.
New Sec. 25. Insofar as the same may be made applicable, the provisions of K.S.A. 79-
3226, and amendments thereto, shall apply to claims for refunds allowable pursuant to the
homestead property tax refund act which may become in dispute.
Sec. 26. K.S.A. 79-4517 is hereby amended to read as follows: 79-4517. For claims in
respect of property taxes levied in 1976 or in any year subsequent thereto, the director of
taxation may: (a) extend the time for filing any claim under the provisions of this act or
accept a claim filed after the filing deadline when good cause exists therefor; or (b) accept
a claim filed after the deadline for filing in the case of sickness, absence or disability of the
claimant if said the claim has been filed within four (4) years of said the deadline.
Sec. 27. K.S.A. 1999 Supp. 79-3234 is hereby amended to read as follows: 79-3234. (a)
All reports and returns required by this act shall be preserved for three years and thereafter
until the director orders them to be destroyed.
(b) Except in accordance with proper judicial order, or as provided in subsection (c) or
in K.S.A. 17-7511, subsection (g) of K.S.A. 46-1106, K.S.A. 46-1114, or K.S.A. 79-32,153a,
and amendments thereto, it shall be unlawful for the director, any deputy, agent, clerk or
other officer, employee or former employee of the department of revenue or any other state
officer or employee or former state officer or employee to divulge, or to make known in
any way, the amount of income or any particulars set forth or disclosed in any report, return,
federal return or federal return information required under this act; and it shall be unlawful
for the director, any deputy, agent, clerk or other officer or employee engaged in the
administration of this act to engage in the business or profession of tax accounting or to
accept employment, with or without consideration, from any person, firm or corporation
for the purpose, directly or indirectly, of preparing tax returns or reports required by the
laws of the state of Kansas, by any other state or by the United States government, or to
accept any employment for the purpose of advising, preparing material or data, or the
auditing of books or records to be used in an effort to defeat or cancel any tax or part thereof
that has been assessed by the state of Kansas, any other state or by the United States
government.
(c) Nothing in this section shall be construed to prohibit the publication of statistics, so
classified as to prevent the identification of particular reports or returns and the items
thereof, or the inspection of returns by the attorney general or other legal representatives
of the state. Nothing in this section shall prohibit the post auditor from access to all income
tax reports or returns in accordance with and subject to the provisions of subsection (g) of
K.S.A. 46-1106 or K.S.A. 46-1114, and amendments thereto. Nothing in this section shall
be construed to prohibit the disclosure of taxpayer information from income tax returns to
persons or entities contracting with the secretary of revenue where the secretary has
determined disclosure of such information is essential for completion of the contract and
has taken appropriate steps to preserve confidentiality. Nothing in this section shall be
construed to prohibit the disclosure of job creation and investment information derived
from tax schedules required to be filed under the Kansas income tax act to the secretary of
commerce. Nothing in this section shall be construed to prohibit the disclosure of income
tax returns to the state gaming agency to be used solely for the purpose of determining
qualifications of licensees of and applicants for licensure in tribal gaming. Any information
received by the state gaming agency shall be confidential and shall not be disclosed except
to the executive director, employees of the state gaming agency and members and employees
of the tribal gaming commission. Nothing in this section shall be construed to prohibit the
disclosure of the taxpayer's name, last known address and residency status to the department
of wildlife and parks to be used solely in its license fraud investigations. Nothing in this
section shall prohibit the disclosure of the name, residence address, employer or Kansas
adjusted gross income of a taxpayer who may have a duty of support in a title IV-D case to
the secretary of the Kansas department of social and rehabilitation services for use solely in
administrative or judicial proceedings to establish, modify or enforce such support obligation
in a title IV-D case. In addition to any other limits on use, such use shall be allowed only
where subject to a protective order which prohibits disclosure outside of the title IV-D
proceeding. As used in this section, ``title IV-D case'' means a case being administered
pursuant to part D of title IV of the federal social security act (42 U.S.C. § 651 et seq.) and
amendments thereto. Any person receiving any information under the provisions of this
subsection shall be subject to the confidentiality provisions of subsection (b) and to the
penalty provisions of subsection (d).
(d) Any violation of subsection (b) or (c) is a class B nonperson misdemeanor and, if
the offender is an officer or employee of the state, such officer or employee shall be
dismissed from office.
(e) Notwithstanding the provisions of this section, the secretary of revenue may permit
the commissioner of internal revenue of the United States, or the proper official of any state
imposing an income tax, or the authorized representative of either, to inspect the income
tax returns made under this act and the secretary of revenue may make available or furnish
to the taxing officials of any other state or the commissioner of internal revenue of the
United States or other taxing officials of the federal government, or their authorized
representatives, information contained in income tax reports or returns or any audit thereof
or the report of any investigation made with respect thereto, filed pursuant to the income
tax laws, as the secretary may consider proper, but such information shall not be used for
any other purpose than that of the administration of tax laws of such state, the state of
Kansas or of the United States.
(f) Notwithstanding the provisions of this section, the secretary of revenue may:
(1) Communicate to the executive director of the Kansas lottery information as to
whether a person, partnership or corporation is current in the filing of all applicable tax
returns and in the payment of all taxes, interest and penalties to the state of Kansas, excluding
items under formal appeal, for the purpose of determining whether such person, partnership
or corporation is eligible to be selected as a lottery retailer;
(2) communicate to the executive director of the Kansas racing commission as to
whether a person, partnership or corporation has failed to meet any tax obligation to the
state of Kansas for the purpose of determining whether such person, partnership or
corporation is eligible for a facility owner license or facility manager license pursuant to the
Kansas parimutuel racing act; and
(3) provide such information to the president of Kansas, Inc. as required by K.S.A. 1999
Supp. 74-8017, and amendments thereto. The president and any employees or former
employees of Kansas, Inc. receiving any such information shall be subject to the
confidentiality provisions of subsection (b) and to the penalty provisions of subsection (d).
(g) Nothing in this section shall be construed to allow disclosure of the amount of
income or any particulars set forth or disclosed in any report, return, federal return or federal
return information, where such disclosure is prohibited by the federal internal revenue code
as in effect on September 1, 1996, and amendments thereto, related federal internal revenue
rules or regulations, or other federal law.
New Sec. 28. (a) For tax years 2000 and 2001, each Kansas state individual income tax
return form shall contain a designation as follows:
Kansas World War II Memorial Fund. Check if you wish to donate, in addition to your
tax liability, or designate from your refund, ____$1, ____$5, ____$10, or $____.
(b) The director of taxation of the department of revenue shall determine annually the
total amount designated for contribution to the Kansas World War II Memorial Fund
pursuant to subsection (a) and shall report such amount to the state treasurer who shall
credit the entire amount thereof to the Kansas World War II Memorial Fund which fund
is hereby established in the state treasury. In the case where donations are made pursuant
to subsection (a), the director shall remit the entire amount thereof to the state treasurer
who shall credit the same to such fund. All moneys deposited in such fund shall be used
solely for the purpose of providing contributions to the World War II Memorial Society on
behalf of Kansas for the benefit of the World War II memorial to be located in Washington,
D.C. All expenditures from such fund shall be made in accordance with appropriation acts
upon warrants of the director of accounts and reports payable to the World War II Memorial
Society issued pursuant to vouchers approved by the state treasurer.
New Sec. 29. (a) For all taxable years commencing after December 31, 1999, and
subject to the provisions of this section, there shall be allowed as a property tax refund to
the operator of an oil lease an amount equal to 50% of the total amount of property tax
levied and actually and timely paid by the operator for a property tax year which is
attributable to the working interest of an oil lease the average daily production per well
from which is 15 barrels or less when the price per barrel of oil is $16 or less, as prescribed
in the oil and gas appraisal guide by the director of property valuation for the applicable tax
year. No refund shall be allowed for property tax paid upon machinery and equipment for
which a credit is claimed pursuant to K.S.A. 1999 Supp. 79-32,206 and amendments thereto.
(b) No claim for a refund allowable pursuant to subsection (a) shall be paid unless filed
with and in possession of the department of revenue on or before April 15 of the year next
succeeding the year in which such taxes were paid, except that the director of taxation may
extend the time for filing any claim or accept a claim filed after the deadline for filing when
good cause exists therefor if the claim has been filed within three years of the deadline.
(c) The allowable amount of such claim shall be paid to the operator from funds
appropriated for such purposes upon warrants of the director of accounts and reports
pursuant to vouchers approved by the director of taxation or by any person designated by
the claimant, but no warrant issued hereunder shall be drawn in an amount of less than $5.
No interest shall be allowed on any payment made to an operator pursuant to this section.
(d) Insofar as the same may be made applicable, the provisions of K.S.A. 79-3226, and
amendments thereto, shall apply to claims for refunds allowable pursuant to this section
which may become in dispute.
(e) The department of revenue shall devise and provide forms and instructions necessary
to administer this section, and the secretary of revenue may adopt rules and regulations for
such purpose.
New Sec. 30. (a) For all taxable years commencing after December 31, 2000, and with
respect to property initially acquired and first placed into service in this state on and after
January 1, 2001, there shall be allowed as a credit against the tax liability imposed by the
Kansas income tax act of a telecommunications company, as defined in K.S.A. 79-3271 and
amendments thereto, an amount equal to the difference between the property tax levied
for property tax year 2001, and all such years thereafter, and actually and timely paid during
the appropriate income taxable year upon property assessed at the 33% assessment rate and
the property tax which would be levied and paid on such property if assessed at a 25%
assessment rate.
(b) If the amount of the tax credit determined under subsection (a) exceeds the tax
liability for the telecommunications company for any taxable year, the amount thereof which
exceeds such tax liability shall be refunded to the telecommunications company. If the
telecommunications company is a corporation having an election in effect under subchapter
S of the federal internal revenue code, a partnership or a limited liability company, the
credit provided by this section shall be claimed by the shareholders of such corporation, the
partners of such partnership or the members of such limited liability company in the same
manner as such shareholders, partners or members account for their proportionate shares
of income or loss of the corporation, partnership or limited liability company.
(c) As used in this section, the term ``acquired'' shall not include the transfer of property
pursuant to an exchange for stock securities, or the transfer of assets of one business entity
to another due to a merger or other consolidation.
Sec. 31. K.S.A. 1999 Supp. 79-4217 is hereby amended to read as follows: 79-4217. (a)
There is hereby imposed an excise tax upon the severance and production of coal, oil or gas
from the earth or water in this state for sale, transport, storage, profit or commercial use,
subject to the following provisions of this section. Such tax shall be borne ratably by all
persons within the term ``producer'' as such term is defined in K.S.A. 79-4216, and
amendments thereto, in proportion to their respective beneficial interest in the coal, oil or
gas severed. Such tax shall be applied equally to all portions of the gross value of each barrel
of oil severed and subject to such tax and to the gross value of the gas severed and subject
to such tax. The rate of such tax shall be 8% of the gross value of all oil or gas severed from
the earth or water in this state and subject to the tax imposed under this act. The rate of
such tax with respect to coal shall be $1 per ton. For the purposes of the tax imposed
hereunder the amount of oil or gas produced shall be measured or determined: (1) In the
case of oil, by tank tables compiled to show 100% of the full capacity of tanks without
deduction for overage or losses in handling; allowance for any reasonable and bona fide
deduction for basic sediment and water, and for correction of temperature to 60 degrees
Fahrenheit will be allowed; and if the amount of oil severed has been measured or
determined by tank tables compiled to show less than 100% of the full capacity of tanks,
such amount shall be raised to a basis of 100% for the purpose of the tax imposed by this
act; and (2) in the case of gas, by meter readings showing 100% of the full volume expressed
in cubic feet at a standard base and flowing temperature of 60 degrees Fahrenheit, and at
the absolute pressure at which the gas is sold and purchased; correction to be made for
pressure according to Boyle's law, and used for specific gravity according to the gravity at
which the gas is sold and purchased, or if not so specified, according to the test made by
the balance method.
(b) The following shall be exempt from the tax imposed under this section:
(1) The severance and production of gas which is: (A) Injected into the earth for the
purpose of lifting oil, recycling or repressuring; (B) used for fuel in connection with the
operation and development for, or production of, oil or gas in the lease or production unit
where severed; (C) lawfully vented or flared; (D) severed from a well having an average
daily production during a calendar month having a gross value of not more than $87 per
day, which well has not been significantly curtailed by reason of mechanical failure or other
disruption of production; in the event that the production of gas from more than one well
is gauged by a common meter, eligibility for exemption hereunder shall be determined by
computing the gross value of the average daily combined production from all such wells and
dividing the same by the number of wells gauged by such meter; (E) inadvertently lost on
the lease or production unit by reason of leaks, blowouts or other accidental losses; (F) used
or consumed for domestic or agricultural purposes on the lease or production unit from
which it is severed; or (G) placed in underground storage for recovery at a later date and
which was either originally severed outside of the state of Kansas, or as to which the tax
levied pursuant to this act has been paid;
(2) the severance and production of oil which is: (A) From a lease or production unit
whose average daily production is five barrels or less per producing well, which well or wells
have not been significantly curtailed by reason of mechanical failure or other disruption of
production; (B) from a lease or production unit, the producing well or wells upon which
have a completion depth of 2,000 feet or more, and whose average daily production is six
barrels or less per producing well or, if the price of oil as determined pursuant to subsection
(d) is $16 or less, whose average daily production is seven barrels or less per producing well,
or, if the price of oil as determined pursuant to subsection (d) is $15 or less, whose average
daily production is eight barrels or less per producing well, or, if the price of oil as
determined pursuant to subsection (d) is $14 or less, whose average daily production is nine
barrels or less per producing well, or, if the price of oil as determined pursuant to subsection
(d) is $13 or less, whose average daily production is 10 barrels or less per producing well,
which well or wells have not been significantly curtailed by reason of mechanical failure or
other disruption of production; (C) from a lease or production unit, whose production results
from a tertiary recovery process. ``Tertiary recovery process'' means the process or processes
described in subparagraphs (1) through (9) of 10 C.F.R. 212.78(c) as in effect on June 1,
1979; (D) from a lease or production unit, the producing well or wells upon which have a
completion depth of less than 2,000 feet and whose average daily production resulting from
a water flood process, is six barrels or less per producing well, which well or wells have not
been significantly curtailed by reason of mechanical failure or other disruption of production;
(E) from a lease or production unit, the producing well or wells upon which have a
completion depth of 2,000 feet or more, and whose average daily production resulting from
a water flood process, is seven barrels or less per producing well or, if the price of oil as
determined pursuant to subsection (d) is $16 or less, whose average daily production is eight
barrels or less per producing well, or, if the price of oil as determined pursuant to subsection
(d) is $15 or less, whose average daily production is nine barrels or less per producing well,
or, if the price of oil as determined pursuant to subsection (d) is $14 or less, whose average
daily production is 10 barrels or less per producing well, which well or wells have not been
significantly curtailed by reason of mechanical failure or other disruption of production; (F)
test, frac or swab oil which is sold or exchanged for value; or (G) inadvertently lost on the
lease or production unit by reason of leaks or other accidental means;
(3) (A) any taxpayer applying for an exemption pursuant to subsection (b)(2)(A) and
(B) shall make application annually to the director of taxation therefor. Exemptions granted
pursuant to subsection (b)(2)(A) and (B) shall be valid for a period of one year following
the date of certification thereof by the director of taxation; (B) any taxpayer applying for an
exemption pursuant to subsection (b)(2)(D) or (E) shall make application annually to the
director of taxation therefor. Such application shall be accompanied by proof of the approval
of an application for the utilization of a water flood process therefor by the corporation
commission pursuant to rules and regulations adopted under the authority of K.S.A. 55-152
and amendments thereto and proof that the oil produced therefrom is kept in a separate
tank battery and that separate books and records are maintained therefor. Such exemption
shall be valid for a period of one year following the date of certification thereof by the
director of taxation; and (C) notwithstanding the provisions of paragraph (A) or (B), any
exemption in effect on the effective date of this act affected by the amendments to
subsection (b)(2) by this act shall be redetermined in accordance with such amendments.
Any such exemption, and any new exemption established by such amendments and applied
for after the effective date of this shall be valid for a period commencing with May 1, 1998,
and ending on April 30, 1999.
(4) the severance and production of gas or oil from any pool from which oil or gas was
first produced on or after April 1, 1983, as determined by the state corporation commission
and certified to the director of taxation, and continuing for a period of 24 months from the
month in which oil or gas was first produced from such pool as evidenced by an affidavit of
completion of a well, filed with the state corporation commission and certified to the director
of taxation. Exemptions granted for production from any well pursuant to this paragraph
shall be valid for a period of 24 months following the month in which oil or gas was first
produced from such pool. The term ``pool'' means an underground accumulation of oil or
gas in a single and separate natural reservoir characterized by a single pressure system so
that production from one part of the pool affects the reservoir pressure throughout its extent;
(5) the severance and production of oil or gas from a three-year inactive well, as
determined by the state corporation commission and certified to the director of taxation,
for a period of 10 years after the date of receipt of such certification. As used in this
paragraph, ``three-year inactive well'' means any well that has not produced oil or gas in
more than one month in the three years prior to the date of application to the state
corporation commission for certification as a three-year inactive well. An application for
certification as a three-year inactive well shall be in such form and contain such information
as required by the state corporation commission, and shall be made prior to July 1, 1996.
The commission may revoke a certification if information indicates that a certified well was
not a three-year inactive well or if other lease production is credited to the certified well.
Upon notice to the operator that the certification for a well has been revoked, the exemption
shall not be applied to the production from that well from the date of revocation;
(6) (A) The incremental severance and production of oil or gas which results from a
production enhancement project begun on or after July 1, 1998, shall be exempt for a period
of seven years from the startup date of such project. As used in this paragraph (6):
(1) ``Incremental severance and production'' means the amount of oil or natural gas
which is produced as the result of a production enhancement project which is in excess of
the base production of oil or natural gas, and is determined by subtracting the base
production from the total monthly production after the production enhancement projects
is completed.
(2) ``Base production'' means the average monthly amount of production for the twelve-
month period immediately prior to the production enhancement project beginning date,
minus the monthly rate of production decline for the well or project for each month
beginning 180 days prior to the project beginning date. The monthly rate of production
decline shall be equal to the average extrapolated monthly decline rate for the well or project
for the twelve-month period immediately prior to the production enhancement project
beginning date, except that the monthly rate of production decline shall be equal to zero in
the case where the well or project has experienced no monthly decline during the twelve-
month period immediately prior to the production enhancement project beginning date. Such
monthly rate of production decline shall be continued as the decline that would have
occurred except for the enhancement project. Any well or project which may have produced
during the twelve-month period immediately prior to the production enhancement project
beginning date but is not capable of production on the project beginning date shall have a
base production equal to zero. The calculation of the base production amount shall be
evidenced by an affidavit and supporting documentation filed by the applying taxpayer with
the state corporation commission.
(3) ``Workover'' means any downhole operation in an existing oil or gas well that is
designed to sustain, restore or increase the production rate or ultimate recovery of oil or
gas, including but not limited to acidizing, reperforation, fracture treatment, sand/paraffin/
scale removal or other wellbore cleanouts, casing repair, squeeze cementing, initial
installation, or enhancement of artificial lifts including plunger lifts, rods, pumps,
submersible pumps and coiled tubing velocity strings, downsizing existing tubing to reduce
well loading, downhole commingling, bacteria treatments, polymer treatments, upgrading
the size of pumping unit equipment, setting bridge plugs to isolate water production zones,
or any combination of the aforementioned operations; ``workover'' shall not mean the routine
maintenance, routine repair, or like for-like replacement of downhole equipment such as
rods, pumps, tubing packers or other mechanical device.
(4) ``Production enhancement project'' means performing or causing to be performed
the following:
(i) Workover;
(ii) recompletion to a different producing zone in the same well bore, except
recompletions in formations and zones subject to a state corporation commission proration
order;
(iii) secondary recovery projects;
(iv) addition of mechanical devices to dewater a gas or oil well;
(v) replacement or enhancement of surface equipment;
(vi) installation or enhancement of compression equipment, line looping or other
techniques or equipment which increases production from a well or a group of wells in a
project;
(vii) new discoveries of oil or gas which are discovered as a result of the use of new
technology, including, but not limited to, three dimensional seismic studies.
(B) The state corporation commission shall adopt rules and regulations necessary to
efficiently and properly administer the provisions of this paragraph (6) including rules and
regulations for the qualification of production enhancement projects, the procedures for
determining the monthly rate of production decline, criteria for determining the share of
incremental production attributable to each well when a production enhancement project
includes a group of wells, criteria for determining the start up date for any project for which
an exemption is claimed, and determining new qualifying technologies for the purposes of
paragraph (6)(A)(4)(vii).
(C) Any taxpayer applying for an exemption pursuant to this paragraph (6) shall make
application to the director of taxation. Such application shall be accompanied by a state
corporation commission certification that the production for which an exemption is sought
results from a qualified production enhancement project and certification of the base
production for the enhanced wells or group of wells, and the rate of decline to be applied
to that base production. The secretary of revenue shall provide credit for any taxes paid
between the project startup date and the certification of qualifications by the commission.
(D) The exemptions provided for in this paragraph (6) shall not apply for 12 months
beginning July 1 of the year subsequent to any calendar year during which: (1) In the case
of oil, the secretary of revenue determines that the weighted average price of Kansas oil at
the wellhead has exceeded $20.00 per barrel; or (2) in the case of natural gas the secretary
of revenue determines that the weighted average price of Kansas gas at the wellhead has
exceeded $2.50 per Mcf.
(E) The provisions of this paragraph (6) shall not affect any other exemption allowable
pursuant to this section; and
(7) for the calendar year 1988, and any year thereafter, the severance or production of
the first 350,000 tons of coal from any mine as certified by the state geological survey.
(c) No exemption shall be granted pursuant to subsection (b)(3) or (4) to any person
who does not have a valid operator's license issued by the state corporation commission,
and no refund of tax shall be made to any taxpayer attributable to any production in a period
when such taxpayer did not hold a valid operator's license issued by the state corporation
commission.
(d) On April 15, 1988, and on April 15 of each year thereafter, the secretary of revenue
shall determine from statistics compiled and provided by the United States department of
energy, the average price per barrel paid by the first purchaser of crude oil in this state for
the six-month period ending on December 31 of the preceding year. Such price shall be
used for the purpose of determining exemptions allowed by subsection (b)(2)(B) or (E) for
the twelve-month period commencing on May 1 of such year and ending on April 30 of the
next succeeding year.
Sec. 32. K.S.A. 79-32,143 is hereby amended to read as follows: 79-32,143. (a) For net
operating losses incurred in taxable years beginning after December 31, 1987, a net
operating loss deduction shall be allowed in the same manner that it is allowed under the
federal internal revenue code except that such net operating loss may only be carried forward
to each of the 10 taxable years following the taxable year of the net operating loss. For net
operating farm losses, as defined by subsection (i) of section 172 of the federal internal
revenue code, incurred in taxable years beginning after December 31, 1999, a net operating
loss deduction shall be allowed in the same manner that it is allowed under the federal
internal revenue code except that such net operating loss may be carried forward to each of
the 10 taxable years following the taxable year of the net operating loss. The amount of the
net operating loss that may be carried back or forward for Kansas income tax purposes shall
be that portion of the federal net operating loss allocated to Kansas under this act in the
taxable year that the net operating loss is sustained.
(b) The amount of the loss to be carried back or forward will be the federal net operating
loss after (1) all modifications required under this act applicable to the net loss in the year
the loss was incurred; and (2) after apportionment as to source in the case of corporations,
nonresident individuals for losses incurred in taxable years beginning prior to January 1,
1978, and nonresident estates and trusts in the same manner that income for such
corporations, nonresident individuals, estates and trusts is required to be apportioned.
(c) If a net operating loss was incurred in a taxable year beginning prior to January 1,
1988, the amount of the net operating loss that may be carried back and carried forward
and the period for which it may be carried back and carried forward shall be determined
under the provisions of the Kansas income tax laws which were in effect during the year
that such net operating loss was incurred.
(d) If any portion of a net operating loss described in subsections (a) and (b) is not
utilized prior to the final year of the carryforward period provided in subsection (a), a refund
shall be allowable in such final year in an amount equal to the refund which would have
been allowable in the taxable year the loss was incurred by utilizing the three year carryback
provided under K.S.A. 79-32,143, as in effect on December 31, 1987, multiplied by a
fraction, the numerator of which is the unused portion of such net operating loss in the final
year, and the denominator of which is the amount of such net operating loss which could
have been carried back to the three years immediately preceding the year in which the loss
was incurred. In no event may such fraction exceed 1.
(e) Notwithstanding any other provisions of the Kansas income tax act, the net operating
loss as computed under subsections (a), (b) and (c) of this section shall be allowed in full in
determining Kansas taxable income or at the option of the taxpayer allowed in full in
determining Kansas adjusted gross income.
(f) No refund of income tax which results from a net operating loss carry back shall be
allowed in an amount exceeding $1,500 in any year. Any excess amount may be carried back
or forward to any other year or years as provided by this section.
Sec. 33. On and after January 1, 2000, K.S.A. 1999 Supp. 79-32,208 is hereby repealed.
Sec. 34. K.S.A. 79-1009, 79-2974, 79-3228, 79-3295, 79-32,143, 79-3296, 79-3297a, 79-
3298, 79-3299, 79-32,100, 79-32,101, 79-32,106, 79-3615, 79-3706, 79-41a03a, 79-4502, 79-
4512, 79-4514 and 79-4517 and K.S.A. 1999 Supp. 79-3234 and 79-4217 are hereby
repealed.
Sec. 35. This act shall take effect and be in force from and after its publication in the
statute book.'';
In the title, in line 16, by striking all after ``ACT''; by striking all in line 17 and inserting
``relating to taxation; amending K.S.A. 79-1009, 79-2974, 79-3228, 79-3295, 79-3296, 79-
3298, 79-3299, 79-32,100, 79-32,101, 79-32,106, 79-32,143, 79-3615, 79-3706, 79-41a03a,
79-4502 and 79-4517 and K.S.A. 1999 Supp. 79-3234 and 79-4217 and repealing the existing
sections; also repealing K.S.A. 79-3297a, 79-4512 and 79-4514 and K.S.A. 1999 Supp. 79-
32,208.'';
\ And your committee on conference recommends the adoption of this report.
Susan Wagle
Clay Aurand
Melvin Minor
Conferees on the part of House
Audrey Langworthy
Janis K. Lee
David R. Corbin
Conferees on part of Senate
Senator Langworthy moved the Senate adopt the Conference Committee Report on SB
226.
On roll call, the vote was: Yeas 37, Nays 0, Present and Passing 0, Absent or Not Voting
3.
Yeas: Barone, Becker, Bleeker, Bond, Brownlee, Clark, Corbin, Donovan, Downey,
Emert, Feleciano, Gilstrap, Gooch, Goodwin, Harrington, Hensley, Huelskamp, Jones,
Jordan, Kerr, Langworthy, Lawrence, Lee, Morris, Oleen, Petty, Praeger, Pugh, Ranson,
Salisbury, Salmans, Steffes, Steineger, Stephens, Tyson, Umbarger, Vidricksen.
Absent or Not Voting: Biggs, Hardenburger, Vratil.
The Conference Committee report was adopted.
INTRODUCTION OF ORIGINAL MOTIONS AND SENATE RESOLUTIONS
Senator Hensley introduced the following Senate resolution, which was read:
SENATE RESOLUTION No. 1864
A RESOLUTION congratulating and commending Eric Avery.
WHEREAS, Eric Avery, a Sophomore at Highland Park High School, Topeka, has been
selected as the Boys and Girls Club Kansas Youth of the Year 2000; and
WHEREAS, Eric Avery is the recipient of a $25,000 scholarship from Oprah Winfrey's
Angel Network program and will be a guest on her daytime TV talk show. He also will
compete for the Southwest regional title. Five regional winners will compete to be installed
as the National Youth of the Year by President Clinton at a White House ceremony; and
WHEREAS, Eric Avery has been a member of the Topeka Boys and Girls Club for seven
years. He is the Sophomore class president at Highland Park High School and president of
the Boys and Girls Club Keystone Explorers Club; and
WHEREAS, Eric Avery, who is the son of John Avery and Mary Ann Avery, wants to
study premedicine in college but has not decided which college he will attend; and
WHEREAS, Eric Avery has honored his family, school, city and state upon being selected
for this award: Now, therefore,
Be it resolved by the Senate of the State of Kansas: That we congratulate and commend
Eric Avery upon being selected as the Boys and Girls Club Kansas Youth of the Year 2000
and wish him every success at the regional and national competition for National Youth of
the Year; and
Be it further resolved: That the Secretary of the Senate be directed to provide an
enrolled copy of this resolution to Eric Avery, 615 S.E. 33rd Street, Topeka, Kansas 66605.
On emergency motion of Senator Hensley SR 1864 was adopted unanimously.
There being no further business to be considered Senator Emert moved, as provided in
SR 1645, the Senate adjourn sine die. The motion prevailed.
President Bond thereupon announced: ``By the virtue of the authority vested in me as
President of the Senate, I now declare the 2000 session of the Kansas Senate adjourned
sine die.''
VETO SUSTAINED
Announcing a veto message from the Governor on SB 410, AN ACT relating to taxation;
amending K.S.A. 79-1009, 79-2974, 79-3228, 79-3295, 79-3296, 79-3298, 79-3299, 79-
32,100, 79-32,101, 79-32,106, 79-32,143, 79-3615, 79-3706, 79-41a03a, 79-4502 and 79-
4517 and K.S.A. 1999 Supp. 79-3234 and 79-4217 and repealing the existing sections; also
repealing K.S.A. 79-3297a, 79-4512 and 79-4514 and K.S.A. 1999 Supp. 79-32,208, was
received and read.
There being no action on SB 410, the veto was sustained.
MESSAGE FROM THE HOUSE
Announcing the following bills are hereby transmitted to the Senate with final disposition:
Senate bills and concurrent resolution that died in conference: SB 4, 79, 124; House
Substitute for SB 138; SB 388, 389, 431, 462, 463, 465, 502; SCR 1626.
Senate bills and concurrent resolutions stricken from the Calendar: SB 27, 28, 29, 30, 68,
69, 72; House Substitute SB 115; SB 116, 232, 319, 327, 342, 346, 347, 391, 397,
411, 440, 443, 444, 448, 455, 458, 490, 491; House Substitute SB 492; SB 506, 533,
543, 556; Substitute SB 600; SB 607, 651; SCR 1609, 1635, 1639.
Senate bills and concurrent resolutions that died in House Committees: SB 9, 10, 14, 25,
44; Substitute SB 54; SB 86, 87, 90, 95, 96, 98, 103, 119, 125, 137, 139, 200, 201,
203, 206, 216, 231, 245; Substitute SB 260; SB 266, 278, 283, 285, 288, 299;
Substitute SB 304; SB 317; Substitute SB 322; SB 328; Substitute SB 341; SB 343,
344, 348, 350, 356, 358, 359, 369, 377, 378, 379, 381, 382, 398, 403, 405, 408, 417,
418, 420, 424, 428, 433, 446, 461; Substitute SB 469; SB 478, 485, 499, 505, 527,
530, 545, 546; Substitute SB 547; SB 552, 559, 560, 578, 579, 585, 589, 592, 595,
598, 613, 619, 620, 629; Substitute SB 633; SB 634, 635, 639, 645; Substitute SB
652; SB 653, 656, 668, 669, 671, 672, 673; SCR 1612, 1614, 1619, 1624, 1628, 1641,
1644.
Senate bill returned with no House action taken: Substitute for Substitute SB 554.
MESSAGE FROM THE HOUSE
Announcing the veto message from the Governor on House Bill 2700, An act
concerning certain providers of care services; employment of persons by such providers;
amending K.S.A. 1999 Supp. 39-970 and 65-5117 and repealing the existing sections, which
was received May 8, 2000 and read on May 24, 2000.
Message to the House of Representatives of the State of Kansas:
Pursuant to Article 2, Section 14 of the Constitution of the State of Kansas, I hereby veto
House Bill 2700.
I support the good public policy of prohibiting persons convicted of the crimes
enumerated in House Bill 2700 from working in an adult care facility. However, as written,
House Bill 2700 allows the public release of confidential non-conviction data contrary to
other provisions of law.
I hope the legislature will address these issues and concerns during the next legislative
session.
Bill Graves
Governor
Dated: May 8, 2000
There being no motion to reconsider the veto of House Bill 2700, the Speaker ruled
the veto sustained.
REPORT ON ENGROSSED BILLS
SB 226 correctly re-engrossed May 24, 2000.
HELEN A. MORELAND, Journal Clerk.
PAT SAVILLE, Secretary of Senate.