How did Kansas change how often retailers must file sales tax returns in 2024?

Plain-English summary

Kansas Notice 23-11 explains new sales tax return filing frequency thresholds, created by 2022 House Bill 2136 (Section 18), which amended K.S.A. 79-3607 effective on and after January 1, 2024. The change lets more small retailers file less often by raising the dollar amounts that determine annual, quarterly, or monthly filing.

Prior law. A retailer filed:

• Annually (return due January 25 of the following year) if it did not collect more than $400 in a calendar year;
• Quarterly (due the 25th of the month after each quarter) if it collected more than $400 but $4,000 or less; and
• Monthly (due the 25th of the following month) if it collected more than $4,000.

On and after January 1, 2024. A retailer files:

• Annually if its total tax liability does not exceed $1,000 in a calendar year;
• Quarterly if its total tax liability does not exceed $5,000 in a calendar year; and
• Monthly if its total tax liability exceeds $5,000 in a calendar year.

In each case the tax is remitted at the time the return is filed. (The separate accelerated payment rule for very large retailers -- those over $40,000 a year, who must prepay the first 15 days of each month -- continues under new subsection (b) of K.S.A. 79-3607.)

Retailers unsure of their filing frequency are encouraged to discuss it with the Department.

What this means for you

Retailers filing Kansas sales tax

• If your annual Kansas sales tax is $1,000 or less, you can file just once a year (by January 25), up from the old $400 cutoff.
• If it is between $1,000 and $5,000, you file quarterly; above $5,000, you file monthly.
• The higher thresholds mean some retailers move from monthly to quarterly, or quarterly to annual, starting with the 2024 filing periods.
• Due dates do not change -- returns and payment are due by the 25th.

Bookkeepers and tax preparers

• Review each retail client's collections and reset their filing frequency for periods beginning January 1, 2024. Contact the Department if a client's correct frequency is unclear.

Common questions

What are the new thresholds? Annual filing at $1,000 or less, quarterly up to $5,000, and monthly above $5,000, effective January 1, 2024.

What were the old thresholds? Annual at $400 or less, quarterly up to $4,000, and monthly above $4,000.

Did the due dates change? No -- returns and payment remain due by the 25th (January 25 for annual filers).

What if I'm not sure how often to file? Contact the Department to confirm your filing frequency.

Citations and references

• House Bill 2136 (2022), Section 18 -- amended the sales tax filing thresholds.
• K.S.A. 79-3607 -- sales tax return filing requirements; new subsection (b) raises the annual, quarterly, and monthly thresholds effective January 1, 2024.

Source

• Landing page: Kansas Department of Revenue Policy Information Library
• Original document: Notice 23-11

Original ruling text

Policy and Research
109 SW 9th Street Phone: 785-368-8222
PO Box 3506 Fax: 785-296-1279
Topeka KS 66601-3506 www.ksrevenue.gov
Mark A. Burghart, Secretary Laura Kelly, Governor

                                         NOTICE 23-11

                 CHANGES TO SALES TAX RETURN FILING REQUIREMENTS

                                     (OCTOBER 24, 2023)

   During the 2022 Legislative Session House Bill 2136 was passed and signed into law.

Section 18 of the Bill amended K.S.A. 79-3607 to change the sales tax return filing requirements
for retailers, effective on and after January 1, 2024.

   Under prior law, a retailer who did not collect more than $400 in any calendar year was

required to file a return by January 25th of the following year, and to remit the tax at the time of
filing the return. On and after January 1, 2024, a retailer who does not collect more than $1,000
in any calendar year is required to file a return by January 25th of the following year, and to remit
the tax at the time of filing the return.

  Under prior law, a retailer who collected more than $400 but less than or equal to $4,000 in

any calendar year was required to file returns by the 25th day of the month following the end of
each calendar quarter, and to remit the tax at the time of filing the return. On and after January
1, 2024, a retailer who collects more than $1,000 but less than or equal to $5,000 in any calendar
quarter is required to file a return by the 25th day of the month following the end of each calendar
quarter, and to remit the tax at the time of filing the return.

    Under prior law, a retailer who collected more than $4,000 in any calendar year was required

to file a return for each month, by the 25th day of the following month, and to remit the tax at the
time of filing the return. On and after January 1, 2024, a retailer who collects more than $5,000
in any calendar year is required to file a return for each month, by the 25th day of the following
month, and to remit the tax at the time of filing the return.

  The newly enacted law, specifically, new subsection (b) of K.S.A. 79-3607 provides as

follows:

         (b) (1) When the total tax for which any retailer is liable under this act, does not
   exceed the sum of $400 in any calendar year, the retailer shall file an annual return on
   or before January 25 of the following year. When the total tax liability does not exceed
   $4,000 in any calendar year, the retailer shall file returns quarterly on or before the 25th
   day of the month following the end of each calendar quarter. When the total tax liability
   exceeds $4,000 in any calendar year, the retailer shall file a return for each month on
   or before the 25th day of the following month. When the total tax liability exceeds
   $40,000 in any calendar year, the retailer shall be required to pay the sales tax liability
   for the first 15 days of each month to the director on or before the 25th day of that
   month. Any such payment shall accompany the return filed for the preceding month. A
   retailer will be considered to have complied with the requirements to pay the first 15

 days' liability for any month if, on or before the 25th day of that month, the retailer
 paid 90% of the liability for that fifteen-day period, or 50% of such retailer's liability
 in the immediate preceding calendar year for the same month as the month in which
 the fifteen-day period occurs computed at the rate applicable in the month in which the
 fifteen-day period occurs, and, in either case, paid any underpayment with the payment
 required on or before the 25th day of the following month. Such retailers shall pay
 their sales tax liabilities for the remainder of each such month at the time of filing the
 return for such month. The provisions of this paragraph shall expire on December 31,
 2023.
        (2) On and after January 1, 2024, the retailer shall file:
        (A) An annual return on or before January 25 of the following year when the total
 tax for which any retailer is liable under this act does not exceed the sum of $1,000 in
 any calendar year;
        (B) returns quarterly on or before the 25th day of the month following the end of
 each calendar quarter when the total tax liability does not exceed $5,000 in any
 calendar year; or
        (C) a return for each month on or before the 25th day of the following month
 when the total tax liability exceeds $5,000 in any calendar year.

  Any retailer with questions regarding their filing frequency is encouraged to discuss their

situation with the Department, using the contact information below.

                                 TAXPAYER ASSISTANCE

 Additional copies of this notice, forms or publications are available from our website,

www.ksrevenue.gov. If you have questions about this Notice, please contact:

                              Taxpayer Assistance Center
                             Kansas Department of Revenue
                             Scott Office Building, 1st Floor
                                    120 SE 10th Ave
                                     P. O. Box 3506
                                Topeka, KS 66601-3506
                                  Phone: 785-368-8222
                                   Fax: 785-291-3614