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Press Release
September 8, 2006

Agency Undertakes Voluntary Compliance Initiative

The Oklahoma Tax Commission has recently undertaken a corporate income tax voluntary compliance initiative as a result of the Oklahoma Court of Civil Appeals decision in Geoffrey, Inc v. Oklahoma Tax Commission*. This initiative affects companies deriving income from Oklahoma sources by licensing intangible property to related parties operating in Oklahoma. Taxpayers engaged in sheltering Oklahoma income through the use of an intangible holding company can now come forward to participate in the compliance initiative.

If the corporation derived income from Oklahoma sources, under this initiative the corporation must file and pay all income and franchise taxes due for the tax years 2003, 2004, and 2005. In return for complying the Commission will waive all penalties and one-half of the interest as provided by statute. The Oklahoma Tax Commission initiative will run through December 31, 2006.

Oklahoma Corporate Income Tax Returns(s) along with payment, and/or any correspondence should be mailed to:

Oklahoma Tax Commission
Attn: Corporate Income Tax—Audit Division
PO Box 53248
Oklahoma City OK 73152-3248

Should you have any questions or if we can be of any assistance please do not hesitate to contact our Corporate Income Tax Section at (405) 521-3126 or toll-free in Oklahoma at 1 (800) 522-8165 ext. 1-3126. E-mailed inquiries may be sent to cjrobertson@tax.ok.gov.

*See Geoffrey, Inc v. Oklahoma Tax Commission, 2006 WL 832318, 2006 OK CIV APP 27 ( Oklahoma Civil Appeals Division 1, December 23, 2005) (Number 99,938)