Vermont Corporate Income Tax Return (Co-411) Instructions (Page 2 of 5) in pdf

more corporations engaged in unitary business with one or more members

If the filing is over 60 days late from the original due date, a $50 late

of that group. Beginning with tax years starting January 1, 2008, unitary

file penalty applies even if no tax is due unless the return is timely filed

groups must file Form CO-411-U and Schedule(s) CO - 421, not Form

under extension. The failure to pay an income tax liability when due will

CO-411. See separate instructions for that form.

result in imposition of a penalty equal to 1% per month of the outstanding

liability. Estimated payments not made when due are subject to interest

Consolidated Returns

and a late payment penalty of 1% for each month that the payment is

Vermont corporations that file federal tax on a consolidated basis may

late, up to a maximum of 25%.

elect to file a single consolidated Vermont return, elected under 32 V.S.A.

Changes in Return Information

§ 5862(c), provided that the consolidated members have the same fiscal

year. The Vermont consolidated group includes only the members of

An amended Vermont income tax return must be filed whenever the

the federal consolidated group that are taxable in Vermont, and may not

taxpayer’s federal tax return is amended or corrected, or whenever the

contain all of the corporations in the federal group. The consolidated

information on the Vermont return, as previously filed, is incorrect. An

return must be filed by the parent corporation of the group if that company

amended return cannot be filed until the original income tax return has

has nexus (taxable presence) in Vermont. If the parent of the federal group

been filed. An amended Vermont return is due within 60 days after you

become aware of any changes. This requirement may be the result of

does not have nexus in Vermont, the parent for Vermont purposes is the

group member that conducts the most activity and has the most stable

any information that makes your return materially false, inaccurate, or

incomplete; you are notified by the Internal Revenue Service that your

presence in Vermont over time. The intention is that a group have the

same parent corporation from year to year, rather than to have the parent

federal taxable income has been adjusted; or, you file an amended return

corporation change due to fluctuation in activity levels.

with the Internal Revenue Service. If an amended return is not filed with

Vermont within the prescribed time, late filing fees may be assessed and

The election is made by filing Schedule BA-410, Affiliation Schedule,

penalty may be assessed on any additional tax. Include a copy of the IRS

with Form CO-411. Once the election to file on a consolidated basis is

report if the change is a result of a Federal audit.

made, the group must continue to file consolidated and file Schedule

BA-410 each year with the corporate tax return unless the Commissioner

Amending Returns

of Taxes authorizes separate filing. The Vermont Affiliation Schedule,

File an amended return by using the form from the affected tax

Schedule BA-410, is used by both Corporate and Business Income Tax

year, marking the “Amended Return” box in the upper right corner.

filers.

Include a brief statement or explanation summarizing the nature of the

If filing a Vermont consolidated return, review Regulation § 1.5862(d)

amendment(s). If that return required schedules for explanation, attach

to determine if the corporations are conducting unitary business and

those same schedules, as amended, to clarify the change. Amended returns

a combined report (Form CO-411-U) is required. Generally, this will

claiming a refund must be filed within three years from the date a return

be the case. Examples of when a consolidated group would file Form

is required to be filed or six months after a refund was received from the

CO-411 rather than Form CO-411-U include: 1) If all members of the

United States with respect to a change in the amount of taxable income

group conduct all their business within Vermont; 2) If the members of

reported in a return filed under the laws of the United States.

the consolidated group truly have no interconnection other than common

Net Operating Losses

ownership (i.e., no common lines of business, no shared resources, no

For taxable years beginning January 1, 2007 and later, there is created

common management).

a Vermont Net Operating Loss (VNOL), defined as “any negative income

Subchapter S Corporations, Partnerships, and Limited Liability

after allocation and apportionment of Vermont net income pursuant to

Companies (LLC’s) electing not to be taxed as a corporation file Form

32 V.S.A. § 5833.” The VNOL is available to carry forward to offset

BI-471, Vermont Business Income Tax Return. See separate instructions

Vermont income for 10 years following the loss year. Carry backs are

for that form.

not available. Please see Technical Bulletin #35 for a more detailed

Filing Dates and Payments

explanation of VNOL.

Returns must be filed by the 15th day of the third month following the

For any year in which a VNOL is generated, is available, or is applied,

corporation’s year-end, or the extended due date. The Vermont extended

corporations must include a detailed schedule summarizing loss years,

due date is thirty days beyond the extended Federal due date. Corporations

utilization years, expiration years, and available carryover.

needing a Vermont extension should file Form BA-403, Application for

For tax years 2007 and later, Form CO-411, Line 1 will no longer

Extension of Time to File Vermont Corporate/Business Income Tax

include any federal net operating loss deducted from taxable income.

Return, by the original due date, and mark the “Extended Return” box

Corporations can receive the benefit of prior, unused operating losses by

in Part A when filing their corporate return. The BA-403 requires that

completing a one-time conversion to an Initial Vermont Net Operating

you indicate which Federal Income Tax Form will be filed.

Loss. For details on the conversion to an Initial VNOL, please see

For nonprofits reporting URBI on form CO-411, the due date is the same

Technical Bulletin 40. In general, the conversion can only take place in

as the date the federal return is due. If and extension is requested, the

2007, and the Initial VNOL will expire periodically, based on the loss

Vermont extended due date is 30 days after the federal extended due date.

year(s) of the component portions. For any year in which a part or all

of an Initial VNOL is used or remains available, corporations must

An extension of time to file does not extend the time to pay the tax

include a copy of the spreadsheet used to calculate the Initial VNOL

due. Any tax due, including the Vermont minimum tax, must be paid by

in 2007, with updates to show amounts used.

the original due date of the return. Any tax due which is unpaid by the

Carry backs -Vermont Net Operating Loss may not be carried back

original due date will accrue interest and late payment penalties.

to a prior year return. VNOL remains available to carry forward

Estimated Taxes

even if the company has elected to carry back the operating loss for

Any corporation anticipating a Vermont tax liability over $500 must make

federal purposes.

estimated payments on the 15th day of the 4th, 6th, 9th, and 12th months

For taxable years beginning before January 1, 2007, amendments for

of the taxable year. Use payment voucher, Form CO-414. If payment

net operating loss (NOL) carry back and carry forward are permitted

is to be applied to a Vermont consolidated group, provide information

as allowed under the Internal Revenue Code, except NOL carry back

for the Vermont parent.

refunds/credits are not available for Vermont for tax loss years beginning

Interest, Late Fees, and Penalties

on or after January 1, 1995. NOLs are deducted on Federal Form 1120,

Interest is charged on payments not made by the statutory due date. The

Line 29a. When the deduction is taken on Line 29a of a pro-forma federal

rate of interest is established each year. Current and historical interest

return, provide an explanation and schedule of how it was calculated.

rates are available here:

Vermont Corporate Income Tax Return (Co-411) Instructions Page 2

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