Procedure where allocation does not fairly represent taxpayer's business activity; burden of proof of tax evasion

79-3288. Procedure where allocation does not fairly represent taxpayer's business activity; burden of proof of tax evasion. If the allocation and apportionment provisions of this act including the provisions of K.S.A. 79-3279, do not fairly represent the extent of the taxpayer's business activity in this state, the taxpayer may petition for or the secretary of revenue may require, in respect to all or any part of the taxpayer's business activity, if reasonable: (a) Separate accounting; (b) the exclusion of any one or more of the factors; (c) the inclusion of one or more additional factors which will fairly represent the taxpayer's business activity in this state; or (d) the employment of any other method to effectuate an equitable allocation and apportionment of the taxpayer's income; or (e) in the case of two or more businesses, whether or not incorporated and whether or not organized in Kansas, owned or controlled directly or indirectly by the same interests, which contrive through inter-company transactions to evade taxes imposed under this act, the secretary of revenue may distribute or allocate the gross income and deductions between or among such businesses or may require returns on a consolidated basis. The burden of proof of any contrivance to evade taxes under this act shall rest upon the director of taxation or secretary of revenue. History: L. 1963, ch. 485, § 18; L. 1965, ch. 526, § 1; L. 1972, ch. 342, § 99; L. 1980, ch. 318, § 3; July 1. Law Review and Bar Journal References: The Uniform Division of Income for Tax Purposes Act, 14 W.L.J. 415, 417 (1975). "A Review of Kansas Tax Law Governing the Allocation and Apportionment of Income for Multistate Corporations Doing Business in Kansas," Ryan Pace, 37 W.L.J. 703 (1998). CASE ANNOTATIONS 1. Discussed in action challenging order requiring multistate corporation to apportion net business income under separate accounting method. Amoco Production Co. v. Armold, Director of Taxation, 213 Kan. 636, 640, 641, 644, 645, 647, 648, 652, 653, 657, 518 P.2d 453. 2. Allocation and apportionment under three-factor formula general rule; relief provisions hereunder are exceptions. Pioneer Container Corp. v. Beshears, 235 Kan. 745, 752, 755, 684 P.2d 396 (1984). Previous | Next LEGISLATIVE COORDINATING COUNCIL General Policies 2026 Archived LCC Documents Archived LCC Meetings REVISOR OF STATUTES Archived Session Documents Archived School Finance Documents USEFUL LINKS Session Laws Kansas Administrative Regulations OTHER LEGISLATIVE SITES Kansas Legislature Administrative Services Division of Post Audit Research Department Contact Us PDF Help www.ksrevisor.gov 2026