On Friday, Governor Charlie Baker signed legislation, which is intended to close the budget deficit for the 2015 fiscal year. The full text of the legislation (House Bill 52) is available at the following link. In addition to some spending cuts aimed to cure the budget shortfall, the bill authorizes a corporate tax amnesty program, which would run during a two-month period ending on or prior to June 30, 2015. The Senate passed the bill by voice vote on Thursday, one day after the House passed the same bill by a vote of 155 to 1.
The amnesty program would allow taxpayers to settle past-due tax liabilities within the two month amnesty period, while automatically waiving certain penalties. The bill grants the Commissioner of Revenue the authority to determine the taxes to be included in the amnesty, but the corporate excise tax is required to be among the eligible taxes. This new amnesty program follows an amnesty program administered last fall for sales and use taxes, meals tax, income withholding, pass-through entity withholding, and some other tax types.
Although the enactment of the Massachusetts corporate tax amnesty is a welcome development, the amnesty program authorized by the new legislation is likely to be of limited benefit for most Massachusetts corporate excise taxpayers, and may present some traps for the unwary.
We will discuss the taxpayers that will benefit from the program, and some of the potential traps, in a series of upcoming blog posts.