Form It 611s Instructions - S Corporation Income Tax - Georgia Department Of Revenue - 2014 Page 9
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19GENERAL INFORMATION: NET WORTH TAX
INITIAL FILING AND DUE DATES
A new domestic or foreign corporation doing business or
For net worth tax purposes, a domestic corporation is a
owning property in Georgia must file an initial net worth tax
corporation or association created or organized under the
return on or before the fifteenth day of the third calendar month
statutory laws of Georgia. A domesticated foreign corporation
after incorporation or qualification. The initial net worth tax
is a foreign corporation which has agreed under the provisions
of Georgia law to be treated as a domestic corporation and to
return is based on the beginning net worth (Federal
be taxed based upon total net worth.
Schedule L) of the corporation and covers the tax period
from the incorporation/qualification date to the end of
A dormant corporation must file a net worth tax return and pay
the year. If this return is for a short period of less than
the tax to retain its charter. A foreign corporation admitted into
six months, the tax due is 50%. The initial net worth return
Georgia must file a net worth tax return until it has withdrawn
cannot be combined with the initial income tax return
from Georgia. A corporation with a deficit net worth will pay
because the due dates do not coincide.
the minimum tax of $10.00. A corporation that has been
Thereafter, an annual return must be filed on or before the
liquidated and is filing its final income tax return is not required
fifteenth day of the third month following the beginning of the
to file a net worth tax return, nor is it entitled to a refund of
corporation’s taxable period.
previously paid net worth tax.
PENALTIES AND INTEREST
NET TAX DUE OR OVERPAYMENT
Schedule 4 provides for the computation of net tax due or the
Penalty for delinquent filing is 10% of tax due. Penalty for
net overpayment of the two taxes. Compute any penalty and
delinquent payment is 10% of tax due. In addition, interest at
interest due for the respective taxes and enter the amounts on
12% per annum is due on delinquent payments from the due
date until the liability is paid in full.
the applicable lines.
QUALIFIED SUBCHAPTER S SUBSIDIARY (QSSS)
For income tax purposes, Georgia follows the Federal treatment
for a QSSS. However, the QSSS and the parent must file
COMPUTATION OF TAX
The tax is graduated based on net worth. In the case of new
separate net worth tax returns. If the parent is not registered
with the Secretary of State and does not do business or own
corporations, this is the beginning net worth. Thereaf
property in Georgia (other than through the QSSS) they would
ter, it is the net worth on the first day of the corporation’s
net worth taxable year. Net worth is defined to include is-
not be required to file a net worth tax return.
sued capital stock, paid in surplus and retained earnings. Trea-
sury stock should not be deducted from issued capital stock.
FEDERAL SCHEDULE L REQUIREMENT
See page 10 for the net worth tax table.
Schedule L must be completed on the Georgia copy of the
Federal return even if it is not required for Federal purposes.
Foreign corporations qualified to conduct business in Georgia
are taxed based upon the portion of net worth employed within
TREATMENT OF SHORT PERIOD NET WORTH TAX RETURN
Georgia as computed in Schedule 3, using the ratio computed
All corporations filing a short period income and/or net worth Georgia
in Schedule 2. To compute the ratio, the property factors will
tax return for any reason other than filing an initial or final return shall
reflect total balance sheet assets within Georgia and
compute the net worth in accordance with the following instructions:
everywhere. This includes all intangible assets reflected on
The net worth tax shall be computed based upon the net worth
the Federal return such as accounts receivable. Gross receipts
per the ending balance sheet of the short period return. The tax
factors are determined per instructions on page 7.
is then prorated based on the number of months included in
For net worth tax purposes, a foreign corporation is a
the short period return.
corporation or association created or organized under the
Note: Any short periods ending on the 1st through the 15th day
statutory laws of any nation or state other than Georgia.
of the month are backed up to the last day of the preceding
month. Years ending on the 16th day or later are moved forward
Domestic corporations and domesticated foreign
to the last day of that month.
corporations are taxed based upon total net worth (100%
EXAMPLE: Corporation A files a three-month short period return
ratio) and should not use the ratio computation in
ending March 31, 2009. The Georgia taxable net worth per the
Schedule 2.
March 31, 2009 balance sheet is $90,000. The Georgia net
worth tax is computed as follows: Tax per scale $100.00 x 3/12
= $25.00 net worth tax due.
Page 8
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