PURPOSE: This rule establishes when a taxpayer is entitled to request a credit for charged-off items and interprets and applies section 144.660, RSMo.

1. (1) A person filing on the basis of gross sales is entitled to request a credit of charged-off items upon which the tax has already been paid to the director of revenue. Charge-off items are not allowable deductions when returns are made on a gross receipts basis.
2. (2) The two (2) tests as to whether or not that request will be granted are, first, whether or not the tax has been remitted on the items and, second, whether or not the charge-off credit would be deductible in making state or federal income tax returns. The application for credit on charged-off items should be made immediately after discovery that the debt must be charged-off if within the two (2)-year statute of limitations as prescribed by section 136.035, RSMo.

AUTHORITY: section 144.705, RSMo (1994).* U.T. regulation 655-2 originally filed Oct. 28, 1975, effective Nov. 7, 1975. Refiled March 30, 1976. *Original authority 1959.