Tax Department seeks housekeeping changes in House Bill 1115; committee gives do-pass recommendation

House Bill 1115 would make a series of administrative changes to state tax law, including clarifying county installment deed forms for property-tax foreclosures, requiring certain bonds be maintained, updating penalties for late W-2/1099 filings and allowing short extensions for some tax reports.

The tax department's general counsel, Charles Dende, told the House Finance and Taxation Committee the bill is “a housekeeping bill for the session” that groups 34 sections into four main subject areas and is intended to clarify long‑standing administrative practice.

The bill revises Section 1 to remove a statutory requirement that the Office of State Tax Commissioner prescribe the form of county installment deeds in property‑tax foreclosures, Dende said, allowing counties and purchasers to negotiate installment terms locally. It also repeats clarifying language across several sections that a bond posted to avoid corporate officer personal liability must be maintained so the state can collect against it if taxes later become due.

Dende described Section 7 as a modernization of penalties for employers that fail to file informational returns (W‑2s and 1099s). “Those sections of code haven't been updated in about 30 years,” he said, explaining the bill raises the per‑report penalty from $10 to $15 and removes the $2,000 aggregate cap so the penalty remains a meaningful incentive for very large filers. The bill also makes the penalty provisions applicable to informational statements due after Dec. 31, 2025.

Another recurring change in the bill grants the tax commissioner authority to grant short extensions — up to 30 days for good cause shown — before assessing penalties for late fuel and use tax reports, Dende said. “This change would allow us to, on the front end, hear from the taxpayer they're having a problem,” he told committee members, describing it as a taxpayer service measure that avoids assessing then waiving penalties.

Representative Vicki Steiner pressed the department on the modest $5 per‑report increase, calling the change “arbitrary and fishy” and questioning whether the state should be expanding penalties while it has a large surplus. Dende replied the department is not attempting to raise revenue through penalties; the intent is to restore an incentive that has not been adjusted for inflation.

After testimony and a brief discussion, Representative Jeremy Olsen moved a do‑pass recommendation; Representative **** Anderson seconded. The committee roll call produced a final tally the clerk read as 11 in favor, 2 opposed and 1 absent/unrecorded. The motion carried, and Representative Ty Dressler agreed to carry the bill to the floor.

Committee members and department witnesses confined remarks to administrative and enforcement mechanics; no amendments were adopted at the committee level and no public opposition appeared in the record.

What happens next: With a committee do‑pass recommendation, the bill will be scheduled for floor consideration and possible amendments there.