39-22-303.5–8 Election to Treat Nonbusiness Income as Business Income.

The provisions of this rule apply to income tax years commencing on or after January 1, 2009, but prior to January 1, 2019. (1) Every year, taxpayers have an election to treat all nonbusiness income as business income. (a) The election must be made with the original return on the appropriate departmental form filed prior to the extended due date of the return (the fifteenth day of the tenth month following the close of the tax year). If no departmental form is available, the taxpayer may make the election on its own form in a clear and unequivocal manner filed together with the original return. The taxpayer’s form must be clearly marked “Election to treat nonbusiness income as business income for the tax year ending MM, YYYY” (enter the appropriate month and year in which the tax year for which the election is being made ends). (b) Once the election has been filed for the year, it may not be changed, even if the extended due date for the year has not passed. (c) The filing of a return without the election constitutes the non-exercise of the election for that tax year, even if the return is calculated with all income as business income. (d) The failure to file a return prior to the extended due date of the return constitutes the non-exercise of the election for that tax year. (2) If the election described in this rule is made for the income tax year, all sales of the taxpayer are included in the denominator and, if appropriate, the numerator of the taxpayer’s sales factor.