Amends TCA Title 67.

Under present law, the making of sales by engaging in a vocation, occupation, business, or business activity is declared to be a privilege upon which a state tax is levied at the rates fixed by law. On or after January 1, 2024, and prior to January 1, 2028, this bill authorizes a taxpayer who is subject to such taxation and who incurs as expenses for the care of one or more dependents under the age of five years old ("eligible childcare expenses") during a business tax period to elect to defer payment of the taxpayer's liability for that tax period by the amount of eligible childcare expenses, but not to exceed $2,000. <br /> <br /> This bill requires that tax deferral requests be submitted to the department of revenue with the timely filed tax return on a form prescribed by the department and including the following: <br /> <br /> (1) The taxpayer's name and social security number;<br /> <br /> (2) The qualifying dependent's social security number and birthdate; <br /> <br /> (3) The name, address, and social security number or employer identification number of the childcare provider; and <br /> <br /> (4) Proof of childcare expenses incurred for the business tax period. <br /> <br /> AUDITS<br /> <br /> This bill authorizes the commissioner of revenue to conduct audits or require the filing of additional information necessary to substantiate or adjust the amount of the deferred tax liability allowed, and to determine that the taxpayer has complied with all statutory requirements for the deferral. The commissioner must review the documentation submitted by the taxpayer and notify the taxpayer of the following: <br /> <br /> (1) The total amount of the taxpayer's deferred liability;<br /> <br /> (2) The tax period in which repayment will begin, which must begin no later than four years from the date of the business tax return for which deferral was approved; and <br /> <br /> (3) An estimate of the amount for which the taxpayer will be liable each tax period once the eligibility for the deferral expires.<br /> <br /> PAYMENTS<br /> <br /> This bill requires that repayment of tax liability be divided into equal installments over a period not to exceed 10 years, and interest and penalties do not apply to these repayments. However, this bill does not prevent a taxpayer from repaying accumulated liability earlier than scheduled or from taking less than the total amount allowable in a given tax period.<br /> <br /> RULEMAKING<br /> <br /> The commissioner is authorized to promulgate rules to effectuate this bill.<br /> <br /> APPLICABILITY<br /> <br /> This bill applies to tax periods that begin on or after January 1, 2024. <br />