Last Thursday, the South Dakota Supreme Court said that Citibank wouldn’t be able to reclaim $30 million in bank taxes. Citibank overpaid those taxes, but the court said that Citibank didn’t request a refund within the three-year legal window. According to SF Gate, the court said Citibank put in a request outside of the time limit.
The court rejected an argument from Citibank stating that Citibank should have been able to request the refund after the time limit passed because there is a limited exception to the statute of limitations, which is carved out by state rules.
According to Yahoo News, lawmakers and legislative leaders, as well as the governor’s office, talked about what would happen if South Dakota lost the case to Citibank. Sen. Deb Peters, the chairwoman of the Senate Appropriations Committee, said that if the state had to pay Citibank back, then that would have left the state with less money for other things. Some of the examples Peters gave included education and Medicaid.
A spokeswoman for the governor, Dennis Daugaard, released a statement that said they were glad the issue was resolved. The statement also said that Citibank is an important corporate citizen.
The case dates back to 2012, when Citibank put in a claim for a refund of $30 million for state bank taxes that the company paid between 1999 and 2002. In 2012, the Internal Revenue Service reduced Citibank’s taxable income for the earlier period. When that happened, the state bank franchise tax payment was reduced.
When Citibank’s claim was received, South Dakota’s Department of Revenue rejected it, due to it not being filed in time. However, Citibank said that it did file a timely refund request after their books were reviewed by the federal tax agency. Citibank said that was when they found out what the final tax outcome was.
The financial review often takes longer than three years, but the Department of Revenue told the court that regardless of whether the federal audit was finished or not, Citibank should have still asked for a refund. The court ended up agreeing with the Department of Revenue.
Citibank released a statement after the court made its decision, saying that it accepts the decision. Citibank added that ever since the company came to the state in 1981, it has enjoyed a strong and mutually beneficial relationship.
This isn’t the only thing Citibank has had to deal with, as recently the U.S. federal government ruled that Citibank owes $700 million to its customers. As the Inquisitr previously reported, the ruling, which was made almost two weeks ago, stated that the financial group got customers to sign up for benefits that were misrepresented. The group was accused of using deceptive practices.
Citibank was ordered to reimburse customers, who qualify, who decided to get services such as debt forgiveness and credit monitoring.
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