[Rev. 11/21/2013 11:06:19 AM--2013]

CHAPTER 363A - TAXES ON FINANCIAL INSTITUTIONS

GENERAL PROVISIONS

NRS 363A.010        Definitions.

NRS 363A.015        “Business activity” defined.

NRS 363A.020        “Commission” defined.

NRS 363A.030        “Employer” defined.

NRS 363A.040        “Employment” defined.

NRS 363A.050        “Financial institution” defined.

NRS 363A.060        “Taxpayer” defined.

ADMINISTRATION

NRS 363A.070        Duties of Department.

NRS 363A.080        Maintenance and availability of records of taxpayer; penalty.

NRS 363A.090        Examination of records by Department; payment of expenses of Department for examination of records outside State.

IMPOSITION AND COLLECTION

NRS 363A.120        Excise tax on banks: Imposition, amount and payment; filing of return.

NRS 363A.130        Payroll tax: Imposition, amount and payment; filing of return.

NRS 363A.135        Payroll tax: Deduction of certain amounts paid for health insurance or health benefit plan for employees.

NRS 363A.140        Extension of time for payment; payment of interest during period of extension.

OVERPAYMENTS AND REFUNDS

NRS 363A.150        Certification of excess amount collected; credit and refund.

NRS 363A.160        Limitations on claims for refund or credit; form and contents of claim; failure to file claim constitutes waiver; service of notice of rejection of claim.

NRS 363A.170        Interest on overpayments; disallowance of interest.

NRS 363A.180        Injunction or other process to prevent collection of tax prohibited; filing of claim is condition precedent to maintaining action for refund.

NRS 363A.190        Action for refund: Period for commencement; venue; waiver.

NRS 363A.200        Rights of claimant upon failure of Department to mail notice of action on claim; allocation of judgment for claimant.

NRS 363A.210        Allowance of interest in judgment for amount illegally collected.

NRS 363A.220        Standing to recover.

NRS 363A.230        Action for recovery of erroneous refund: Jurisdiction; venue; prosecution.

NRS 363A.240        Cancellation of illegal determination.

MISCELLANEOUS PROVISIONS

NRS 363A.250        Prohibited acts; penalty.

NRS 363A.260        Remedies of State are cumulative.

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GENERAL PROVISIONS

      NRS 363A.010  Definitions.  As used in this chapter, unless the context otherwise requires, the words and terms defined in NRS 363A.015 to 363A.060, inclusive, have the meanings ascribed to them in those sections.

      (Added to NRS by 2003, 20th Special Session, 133; A 2005, 22nd Special Session, 133)

      NRS 363A.015  “Business activity” defined.  “Business activity” means the performance of a service or engagement in a trade for profit.

      (Added to NRS by 2005, 22nd Special Session, 132)

      NRS 363A.020  “Commission” defined.  “Commission” means the Nevada Tax Commission.

      (Added to NRS by 2003, 20th Special Session, 133)

      NRS 363A.030  “Employer” defined.  “Employer” means any financial institution who is required to pay a contribution pursuant to NRS 612.535 for any calendar quarter with respect to any business activity of the financial institution, except an Indian tribe, a nonprofit organization or a political subdivision. For the purposes of this section:

      1.  “Indian tribe” includes any entity described in subsection 10 of NRS 612.055.

      2.  “Nonprofit organization” means a nonprofit religious, charitable, fraternal or other organization that qualifies as a tax-exempt organization pursuant to 26 U.S.C. § 501(c).

      3.  “Political subdivision” means any entity described in subsection 9 of NRS 612.055.

      (Added to NRS by 2003, 20th Special Session, 133; A 2005, 22nd Special Session, 134)

      NRS 363A.040  “Employment” defined.  “Employment” has the meaning ascribed to it in NRS 612.065 to 612.145, inclusive.

      (Added to NRS by 2003, 20th Special Session, 134)

      NRS 363A.050  “Financial institution” defined.

      1.  Except as otherwise provided in subsection 2, “financial institution” means:

      (a) An institution licensed, registered or otherwise authorized to do business in this State pursuant to the provisions of title 55 or 56 of NRS or chapter 604A, 645B or 645E of NRS, or a similar institution chartered or licensed pursuant to federal law;

      (b) A person licensed or registered or required to be licensed or registered pursuant to NRS 90.310, 90.330, 90.453, 686A.340 or 688C.190;

      (c) A person holding or required to hold a solicitation permit or license pursuant to NRS 692B.040, 692B.190 or 692B.260;

      (d) A person designated or registered or required to be designated or registered pursuant to the Commodity Exchange Act, the Securities Exchange Act of 1934, the Public Utility Holding Company Act of 1935, the Investment Company Act of 1940 or the Investment Advisers Act of 1940, as amended;

      (e) A person licensed pursuant to 7 U.S.C. § 2009cc-3 to operate as a rural business investment company;

      (f) A person registered or required to be registered as a savings and loan holding company pursuant to 12 U.S.C. § 1467a;

      (g) A person registered or required to be registered as a bank holding company pursuant to 12 U.S.C. § 1844;

      (h) An investment bank holding company supervised pursuant to 15 U.S.C. § 78q;

      (i) A person electing to be treated as a business development company pursuant to 15 U.S.C. § 80a-53;

      (j) A person licensed pursuant to 15 U.S.C. § 681 to operate as a small business investment company;

      (k) A person granted final approval pursuant to 15 U.S.C. § 689c to operate as a new markets venture capital company;

      (l) A person qualifying as and electing to be considered a real estate investment trust pursuant to 26 U.S.C. § 856;

      (m) A bank, as defined in 12 U.S.C. § 1813(a);

      (n) A savings association, as defined in 12 U.S.C. § 1813(b);

      (o) A savings bank, as defined in 12 U.S.C. § 1813(g);

      (p) A thrift institution, as defined in 12 U.S.C. § 1841(i);

      (q) A national banking association organized under the National Bank Act;

      (r) An entity that is related to any of the entities described in paragraphs (a), (b), (d) to (k), inclusive, and (m) to (q), inclusive, regardless of whether the entity described in any of those paragraphs is doing business in this State; and

      (s) An issuer or a service provider,

Ê who is conducting a business activity in this State.

      2.  The term does not include:

      (a) A credit union organized under the provisions of chapter 678 of NRS or the Federal Credit Union Act;

      (b) A federal land credit association, farm credit bank, agricultural credit association or similar institution organized under the provisions of the Farm Credit Act; and

      (c) Any person or other entity that this State is prohibited from taxing under the Constitution, laws or treaties of the United States or the Nevada Constitution.

      3.  For the purposes of this section:

      (a) “Credit card” has the meaning ascribed to it in NRS 97A.050.

      (b) “Entity” includes, without limitation, any corporation, limited-liability company, association, organization, company, firm, partnership, joint venture, trust, business trust, receiver, trustee, syndicate, cooperative or assignee, or any other group or combination acting as a unit.

      (c) “Issuer” has the meaning ascribed to it in NRS 97A.100, except that the term does not include a seller of goods or provider of services who issues a credit card for the purpose of providing or extending credit only in connection with the goods he or she sells or the services he or she provides.

      (d) Entities are “related” if at least 50 percent of the interest, either by vote or value, in each entity is owned, either directly or indirectly, by the same entity, including either of those entities.

      (e) “Service provider” has the meaning ascribed to it in NRS 97A.130, except that the term does not include a service provider who acts in that capacity solely on behalf of a seller of goods or provider of services who issues a credit card for the purpose of providing or extending credit only in connection with the goods he or she sells or the services he or she provides.

      (Added to NRS by 2003, 20th Special Session, 134; A 2005, 1711, 1779; 2005, 22nd Special Session, 134)

      NRS 363A.060  “Taxpayer” defined.  “Taxpayer” means any person liable for a tax imposed by this chapter.

      (Added to NRS by 2003, 20th Special Session, 135)

ADMINISTRATION

      NRS 363A.070  Duties of Department.  The Department shall:

      1.  Administer and enforce the provisions of this chapter, and may adopt such regulations as it deems appropriate for those purposes.

      2.  Deposit all taxes, interest and penalties it receives pursuant to this chapter in the State Treasury for credit to the State General Fund.

      (Added to NRS by 2003, 20th Special Session, 135)

      NRS 363A.080  Maintenance and availability of records of taxpayer; penalty.

      1.  Each person responsible for maintaining the records of a taxpayer shall:

      (a) Keep such records as may be necessary to determine the amount of the liability of the taxpayer pursuant to the provisions of this chapter;

      (b) Preserve those records for 4 years or until any litigation or prosecution pursuant to this chapter is finally determined, whichever is longer; and

      (c) Make the records available for inspection by the Department upon demand at reasonable times during regular business hours.

      2.  The Department may by regulation specify the types of records which must be kept to determine the amount of the liability of a taxpayer pursuant to the provisions of this chapter.

      3.  Any person who violates the provisions of subsection 1 is guilty of a misdemeanor.

      (Added to NRS by 2003, 20th Special Session, 135)

      NRS 363A.090  Examination of records by Department; payment of expenses of Department for examination of records outside State.

      1.  To verify the accuracy of any return filed or, if no return is filed by a taxpayer, to determine the amount required to be paid, the Department, or any person authorized in writing by the Department, may examine the books, papers and records of any person who may be liable for a tax imposed by this chapter.

      2.  Any person who may be liable for a tax imposed by this chapter and who keeps outside of this State any books, papers and records relating thereto shall pay to the Department an amount equal to the allowance provided for state officers and employees generally while traveling outside of the State for each day or fraction thereof during which an employee of the Department is engaged in examining those documents, plus any other actual expenses incurred by the employee while he or she is absent from his or her regular place of employment to examine those documents.

      (Added to NRS by 2003, 20th Special Session, 135)

IMPOSITION AND COLLECTION

      NRS 363A.120  Excise tax on banks: Imposition, amount and payment; filing of return.

      1.  There is hereby imposed an excise tax on each bank at the rate of $1,750 for each branch office maintained by the bank in this State in excess of one branch office maintained by the bank in each county in this State on the first day of each calendar quarter.

      2.  Each bank that maintains more than one branch office in any county in this State on the first day of a calendar quarter shall, on or before the last day of the first month of that calendar quarter:

      (a) File with the Department a return on a form prescribed by the Department; and

      (b) Remit to the Department any tax due pursuant to this section for the branch offices maintained by the bank in this State on the first day of that calendar quarter.

      3.  For the purposes of this section:

      (a) “Bank” means:

             (1) A corporation or limited-liability company that is chartered by this State, another state or the United States which conducts banking or banking and trust business; or

             (2) A foreign bank licensed pursuant to chapter 666A of NRS.

Ê The term does not include a financial institution engaging in business pursuant to chapter 677 of NRS, a credit union organized under the provisions of chapter 678 of NRS or the Federal Credit Union Act, or any person or other entity this State is prohibited from taxing under the Constitution, laws or treaties of the United States or the Nevada Constitution.

      (b) “Branch office” means any location or facility of a bank where deposit accounts are opened, deposits are accepted, checks are paid and loans are granted, including, but not limited to, a brick and mortar location, a detached or attached drive-in facility, a seasonal office, an office on a military base or government installation, a station or unit for paying and receiving, and a location where a customer can open accounts, make deposits and borrow money by telephone or through use of the Internet, and excluding any automated teller machines, consumer credit offices, contractual offices, customer bank communication terminals, electronic fund transfer units and loan production offices.

      (Added to NRS by 2003, 20th Special Session, 136; A 2005, 22nd Special Session, 135)

      NRS 363A.130  Payroll tax: Imposition, amount and payment; filing of return.

      1.  There is hereby imposed an excise tax on each employer at the rate of 2 percent of the wages, as defined in NRS 612.190, paid by the employer during a calendar quarter with respect to employment in connection with the business activities of the employer.

      2.  The tax imposed by this section:

      (a) Does not apply to any person or other entity or any wages this State is prohibited from taxing under the Constitution, laws or treaties of the United States or the Nevada Constitution.

      (b) Must not be deducted, in whole or in part, from any wages of persons in the employment of the employer.

      3.  Each employer shall, on or before the last day of the month immediately following each calendar quarter for which the employer is required to pay a contribution pursuant to NRS 612.535:

      (a) File with the Department a return on a form prescribed by the Department; and

      (b) Remit to the Department any tax due pursuant to this section for that calendar quarter.

      (Added to NRS by 2003, 20th Special Session, 137; A 2005, 22nd Special Session, 136)

      NRS 363A.135  Payroll tax: Deduction of certain amounts paid for health insurance or health benefit plan for employees.

      1.  Except as otherwise provided in subsection 2, an employer may deduct from the total amount of wages reported and upon which the excise tax is imposed pursuant to NRS 363A.130 any amount authorized pursuant to this section that is paid by the employer for health insurance or a health benefit plan for its employees in the calendar quarter for which the tax is paid. The amounts for which the deduction is allowed include:

      (a) For a self-insured employer, all amounts paid during the calendar quarter for claims, direct administrative services costs, including such services provided by the employer, and any premiums paid for individual or aggregate stop-loss insurance coverage. An employer is not authorized to deduct the costs of a program of self-insurance unless the program is a qualified employee welfare benefit plan pursuant to the Employee Retirement Income Security Act of 1974, 29 U.S.C. §§ 1001 et seq.

      (b) The premiums for a policy of health insurance or reinsurance for a health benefit plan for employees.

      (c) Any amounts which are:

             (1) Paid by an employer to a Taft-Hartley trust which:

                   (I) Is formed pursuant to 29 U.S.C. § 186(c)(5); and

                   (II) Qualifies as an employee welfare benefit plan; and

             (2) Considered by the Internal Revenue Service to be fully tax deductible pursuant to the provisions of the Internal Revenue Code.

      (d) Such other similar payments for health care or insurance for health care for employees as are authorized by the Department.

      2.  An employer may not deduct from the wages upon which the excise tax is imposed pursuant to NRS 363A.130:

      (a) Amounts paid for health care or premiums paid for insurance for an industrial injury or occupational disease for which coverage is required pursuant to chapters 616A to 616D, inclusive, or 617 of NRS; or

      (b) Any payments made by employees for health care or health insurance or amounts deducted from the wages of employees for such health care or insurance.

      3.  If the amount of the deduction allowed pursuant to this section to an employer for a calendar quarter exceeds the amount of reported wages for that calendar quarter, the excess amount of that deduction may be carried forward to the following calendar quarter until the deduction is exhausted. An employer claiming the deduction allowed pursuant to this section shall, upon the request of the Department, explain the amount claimed to the satisfaction of the Department and provide the Department with such documentation as the Department deems appropriate for that purpose.

      4.  As used in this section:

      (a) “Claims” means claims for those categories of health care expenses that are generally deductible by employees on their individual federal income tax returns pursuant to the provisions of 26 U.S.C. § 213 and any federal regulations relating thereto, if those expenses had been borne directly by those employees.

      (b) “Direct administrative services costs” means, if borne directly by a self-insured employer and reasonably allocated to the direct administration of claims:

             (1) Payments for medical or office supplies that will be consumed in the course of the provision of medical care or the direct administration of claims;

             (2) Payments to third-party administrators or independent contractors for the provision of medical care or the direct administration of claims;

             (3) Rent and utility payments for the maintenance of medical or office space used for the provision of medical care or the direct administration of claims;

             (4) Payments for the maintenance, repair and upkeep of medical or office space used for the provision of medical care or the direct administration of claims;

             (5) Salaries and wages paid to medical, clerical and administrative staff and other personnel employed to provide medical care or directly to administer claims; and

             (6) The depreciation of property other than medical or office supplies, used for the provision of medical care or the direct administration of claims.

      (c) “Employee welfare benefit plan” has the meaning ascribed to it in 29 U.S.C. § 1002.

      (d) “Employees” means employees whose wages are included within the measure of the excise tax imposed upon an employer by NRS 363A.130, and their spouses, children and other dependents who qualify for coverage under the terms of the health insurance or health benefit plan provided by that employer.

      (e) “Health benefit plan” means a health benefit plan that covers only those categories of health care expenses that are generally deductible by employees on their individual federal income tax returns pursuant to the provisions of 26 U.S.C. § 213 and any federal regulations relating thereto, if those expenses had been borne directly by those employees.

      (f) “Self-insured employer” means an employer that provides a program of self-insurance for its employees.

      (Added to NRS by 2005, 22nd Special Session, 132)

      NRS 363A.140  Extension of time for payment; payment of interest during period of extension.  Upon written application made before the date on which payment must be made, the Department may for good cause extend by 30 days the time within which a taxpayer is required to pay a tax imposed by this chapter. If the tax is paid during the period of extension, no penalty or late charge may be imposed for failure to pay at the time required, but the taxpayer shall pay interest at the rate of 1 percent per month from the date on which the amount would have been due without the extension until the date of payment, unless otherwise provided in NRS 360.232 or 360.320.

      (Added to NRS by 2003, 20th Special Session, 138)

OVERPAYMENTS AND REFUNDS

      NRS 363A.150  Certification of excess amount collected; credit and refund.  If the Department determines that any tax, penalty or interest has been paid more than once or has been erroneously or illegally collected or computed, the Department shall set forth that fact in the records of the Department and certify to the State Board of Examiners the amount collected in excess of the amount legally due and the person from whom it was collected or by whom it was paid. If approved by the State Board of Examiners, the excess amount collected or paid must, after being credited against any amount then due from the person in accordance with NRS 360.236, be refunded to the person or his or her successors in interest.

      (Added to NRS by 2003, 20th Special Session, 138; A 2009, 66)

      NRS 363A.160  Limitations on claims for refund or credit; form and contents of claim; failure to file claim constitutes waiver; service of notice of rejection of claim.

      1.  Except as otherwise provided in NRS 360.235 and 360.395:

      (a) No refund may be allowed unless a claim for it is filed with the Department within 3 years after the last day of the month following the calendar quarter for which the overpayment was made.

      (b) No credit may be allowed after the expiration of the period specified for filing claims for refund unless a claim for credit is filed with the Department within that period.

      2.  Each claim must be in writing and must state the specific grounds upon which the claim is founded.

      3.  Failure to file a claim within the time prescribed in this chapter constitutes a waiver of any demand against the State on account of overpayment.

      4.  Within 30 days after rejecting any claim in whole or in part, the Department shall serve notice of its action on the claimant in the manner prescribed for service of notice of a deficiency determination.

      (Added to NRS by 2003, 20th Special Session, 138)

      NRS 363A.170  Interest on overpayments; disallowance of interest.

      1.  Except as otherwise provided in this section, NRS 360.320 or any other specific statute, interest must be paid upon any overpayment of any amount of the taxes imposed by this chapter at the rate set forth in, and in accordance with the provisions of, NRS 360.2937.

      2.  If the Department determines that any overpayment has been made intentionally or by reason of carelessness, the Department shall not allow any interest on the overpayment.

      (Added to NRS by 2003, 20th Special Session, 139; A 2007, 912)

      NRS 363A.180  Injunction or other process to prevent collection of tax prohibited; filing of claim is condition precedent to maintaining action for refund.

      1.  No injunction, writ of mandate or other legal or equitable process may issue in any suit, action or proceeding in any court against this state or against any officer of the State to prevent or enjoin the collection under this chapter of a tax imposed by this chapter or any amount of tax, penalty or interest required to be collected.

      2.  No suit or proceeding may be maintained in any court for the recovery of any amount alleged to have been erroneously or illegally determined or collected unless a claim for refund or credit has been filed.

      (Added to NRS by 2003, 20th Special Session, 139)

      NRS 363A.190  Action for refund: Period for commencement; venue; waiver.

      1.  Within 90 days after a final decision upon a claim filed pursuant to this chapter is rendered by the Commission, the claimant may bring an action against the Department on the grounds set forth in the claim in a court of competent jurisdiction in Carson City, the county of this state where the claimant resides or maintains his or her principal place of business or a county in which any relevant proceedings were conducted by the Department, for the recovery of the whole or any part of the amount with respect to which the claim has been disallowed.

      2.  Failure to bring an action within the time specified constitutes a waiver of any demand against the State on account of alleged overpayments.

      (Added to NRS by 2003, 20th Special Session, 139)

      NRS 363A.200  Rights of claimant upon failure of Department to mail notice of action on claim; allocation of judgment for claimant.

      1.  If the Department fails to mail notice of action on a claim within 6 months after the claim is filed, the claimant may consider the claim disallowed and file an appeal with the Commission within 30 days after the last day of the 6-month period. If the claimant is aggrieved by the decision of the Commission rendered on appeal, the claimant may, within 90 days after the decision is rendered, bring an action against the Department on the grounds set forth in the claim for the recovery of the whole or any part of the amount claimed as an overpayment.

      2.  If judgment is rendered for the plaintiff, the amount of the judgment must first be credited towards any tax due from the plaintiff.

      3.  The balance of the judgment must be refunded to the plaintiff.

      (Added to NRS by 2003, 20th Special Session, 139)

      NRS 363A.210  Allowance of interest in judgment for amount illegally collected.  In any judgment, interest must be allowed at the rate of 3 percent per annum upon the amount found to have been illegally collected from the date of payment of the amount to the date of allowance of credit on account of the judgment, or to a date preceding the date of the refund warrant by not more than 30 days. The date must be determined by the Department.

      (Added to NRS by 2003, 20th Special Session, 140; A 2011, 3144)

      NRS 363A.220  Standing to recover.  A judgment may not be rendered in favor of the plaintiff in any action brought against the Department to recover any amount paid when the action is brought by or in the name of an assignee of the person paying the amount or by any person other than the person who paid the amount.

      (Added to NRS by 2003, 20th Special Session, 140)

      NRS 363A.230  Action for recovery of erroneous refund: Jurisdiction; venue; prosecution.

      1.  The Department may recover a refund or any part thereof which is erroneously made and any credit or part thereof which is erroneously allowed in an action brought in a court of competent jurisdiction in Carson City or Clark County in the name of the State of Nevada.

      2.  The action must be tried in Carson City or Clark County unless the court, with the consent of the Attorney General, orders a change of place of trial.

      3.  The Attorney General shall prosecute the action, and the provisions of NRS, the Nevada Rules of Civil Procedure and the Nevada Rules of Appellate Procedure relating to service of summons, pleadings, proofs, trials and appeals are applicable to the proceedings.

      (Added to NRS by 2003, 20th Special Session, 140)

      NRS 363A.240  Cancellation of illegal determination.

      1.  If any amount in excess of $25 has been illegally determined, either by the Department or by the person filing the return, the Department shall certify this fact to the State Board of Examiners, and the latter shall authorize the cancellation of the amount upon the records of the Department.

      2.  If an amount not exceeding $25 has been illegally determined, either by the Department or by the person filing the return, the Department, without certifying this fact to the State Board of Examiners, shall authorize the cancellation of the amount upon the records of the Department.

      (Added to NRS by 2003, 20th Special Session, 140)

MISCELLANEOUS PROVISIONS

      NRS 363A.250  Prohibited acts; penalty.

      1.  A person shall not:

      (a) Make, cause to be made or permit to be made any false or fraudulent return or declaration or false statement in any return or declaration with intent to defraud the State or to evade payment of a tax or any part of a tax imposed by this chapter.

      (b) Make, cause to be made or permit to be made any false entry in books, records or accounts with intent to defraud the State or to evade the payment of a tax or any part of a tax imposed by this chapter.

      (c) Keep, cause to be kept or permit to be kept more than one set of books, records or accounts with intent to defraud the State or to evade the payment of a tax or any part of a tax imposed by this chapter.

      2.  Any person who violates the provisions of subsection 1 is guilty of a gross misdemeanor.

      (Added to NRS by 2003, 20th Special Session, 140)

      NRS 363A.260  Remedies of State are cumulative.  The remedies of the State provided for in this chapter are cumulative, and no action taken by the Department or the Attorney General constitutes an election by the State to pursue any remedy to the exclusion of any other remedy for which provision is made in this chapter.

      (Added to NRS by 2003, 20th Special Session, 138)