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INCOME TAX

INTRODUCTION

date for payment to the date paid. An extension of time for

The following instructions apply to two separate taxes on cor-

filing does not alter the interest charge, nor the penalty for late

porations. One is an income tax at a rate of 6% on taxable

payment of tax.

income. The second is a graduated tax based on corporate net

COMPUTATION OF TAX

worth. The instructions for the net worth tax are on page 3.

The Georgia income tax is 6% of the Georgia taxable income

Both taxes must be paid annually, and Schedule 3 of the return

shown on line 7, Schedule 1. The amount of tax must be entered

is designed to combine the liabilities, any penalty and interest

on line 8, Schedule 1 and on line 1 of Schedule 3.

due, and the credits for prepayment, resulting in a single balance

RELATION TO FEDERAL RETURN

due or overpayment.

The Georgia return is correlative with the Federal return in

The 1999 General Assembly updated the Georgia Income Tax

most respects. The taxable income shown on the Federal return

Code to closely follow the Internal Revenue Code of 1986 as it

is the basis of the Georgia taxable income, with only a few

existed on January 1, 1999.

adjustments outlined in the following section. The accounting

period and method for the Georgia return must be the same as

FILING REQUIREMENTS

the Federal. The Federal principles pertaining to execution of the

All corporations owning property or doing business within

return by an officer and the preparer apply to Georgia returns. A

Georgia are required to file a Georgia Income Tax return. Please

copy of the Federal return and all supporting schedules must be

round all dollar entries. A corporation electing to file under the

attached to the Georgia return.

Internal Revenue Code provisions for S corporations, having one

or more stockholders who are nonresidents of Georgia, must file

If two or more corporations file Federal income tax returns on

consent, Form 600 S-CA, on behalf of each such nonresident.

a consolidated basis and all such corporations derive all of their

Failure to furnish properly executed Forms 600 S-CA for all non-

income from sources within Georgia, the corporations must file a

resident stockholders negates Georgia recognition of the elec-

consolidated return for Georgia income tax purposes. However,

tion, requiring each corporation to file on Form 600, and to pay

a separate net worth tax return must be filed by each subsidiary.

the regular corporate tax.

The parent corporation should file its net worth tax return in

Schedule 2 of the consolidated return but use only the parent’s

WHEN AND WHERE TO FILE

net worth for computing the tax due.

The return is due on or before the 15th day of the 3rd month fol-

lowing the close of the taxable year. This means March 15th, if on

Affiliated corporations which file a consolidated Federal

the calendar year basis. Returns should be mailed to Georgia

income tax return, but derive income from sources outside

Income Tax Division, P.O. Box 740397, Atlanta, Georgia 30374-0397.

this State, must file separate income tax returns with

Georgia unless they have prior approval or have been

EXTENSION OF TIME

requested to file a consolidated return by the Commissioner

A reasonable extension of time for filing may be granted by the

of Revenue.

Commissioner upon application on Form IT-303. It must be filed

prior to the date the return is due and show that the delay is due

When a taxpayer entitled to a carryback period for a net oper-

to a reasonable cause. The Georgia Law prohibits the granting of

ating loss elects under I.R.C. Section 172(b)(3)(c) to forego the

an extension of over 6 months from the due date of the return.

entire carryback period and carryforward only, such election is

If taxpayer has received from the Internal Revenue Service an

binding on the Georgia return.

extension of time within which to file his Federal return, taxpay-

If a Federal audit results in a change in taxable income, the

er need not apply to the Georgia Department of Revenue for a

taxpayer shall make a return to the commissioner, of the

similar extension of time. All that is required is a copy of the

changed or corrected net income, within 180 days of final deter-

request for Federal extension to be attached to the Georgia

mination to: Georgia Income Tax Division, P.O. Box 38467,

return. The form IT-560-C is to be used to submit any payment of

Atlanta, Georgia 30334.

tax when an extension is requested or in force. Interest accrues

at the rate of 12% per year on any tax due from the regular due

ADJUSTMENT TO FEDERAL INCOME

date of the return until paid.

The Federal taxable income is the basis of computation of

Georgia taxable income. Lines 2 and 4 of Schedule 1 are provid-

LATE PAYMENT PENALTY

ed for the modifications required by Georgia Law. The total of

A taxpayer having a Federal extension must also prepay the

additions to Federal income is to be shown on line 2, Schedule 1

Georgia tax accompanying such remittance with Form 560-C. On

and listed in Schedule 4. The total of subtractions from Federal

Form 600, credit for such prepayment should be claimed on line

income is to be shown on line 4, Schedule 1, and listed in

3, Schedule 3. If tax is not paid by the statutory due date of the

Schedule 5. The more commonly used items are listed in each of

return, a late payment penalty of 1/2 of 1% per month will accrue

these schedules.

until tax is paid. This penalty will accrue from the statutory due

A corporation which is a party to state contracts may sub-

date regardless of any extension for filing the return.

tract from Federal taxable income 10% of qualified payments

PENALTIES AND INTEREST

to minority subcontractors or $100,000, whichever is less,

The Georgia Code imposes certain penalties, which must be

per taxable year. A list of certified minority subcontractors

assessed as follows:

will be maintained by the Commissioner of Administrative

Delinquent filing of return–5% of the tax shown on the return

Services for the Revenue Department and general public.

for each month or fractional part thereof–up to 25%.

(For further information, call (404) 656-6315.)

Failure to pay tax shown on a return by the due date–1/2 of 1%

If you claim a net operating loss deduction, you must file a

of the tax due for each month or fractional part thereof–up to

complete statement as to sources of such deduction.

25%.

Corporations doing business both within and without Georgia

Other penalties are also provided, as follows:

incurring a loss shall compute the net operating loss carryover

Negligent underpayment of tax–5% of the underpayment.

deduction by allocating to Georgia only the amount of the loss

Fraudulent underpayment–50% thereof.

attributable to operations within Georgia. Such deduction shall

Interest accrues at the rate of 12% per year from the due

be entered in line 8, Schedule 7.

Page 1

Form It-611 - Georgia Income Tax Forms And General Instructions - Georgia Department Of Revenue - 1999 Page 2

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