Signed by the governor on April 10, 2014, H.B. 799 provides two procedural changes: (1) the party that asserts the application of alternative apportionment has the burden of proof in administrative and judicial proceedings and (2) generally, proceedings before the Board of Tax Appeals require a hearing on all factual and legal issues raised by the taxpayer. Additionally, the new law limits the Department’s power to force combined filings by imposing a high burden of proof standard and suspending the Department’s power until regulations are enacted. The new law also restricts the imposition of penalties when deficiencies result from assertions of alternative apportionment.
These changes are in response to the recent Mississippi Supreme Court decision in Equifax. By placing the burden of proof on the Department when it asserts alternative apportionment, requiring the Board to conduct full evidentiary hearing on appeal of Department matters, and limiting the imposition of penalties, this new law should be a welcome change for Mississippi taxpayers.
The new law is effective January 1, 2015.