Bill > S1344

This bill proposes to amend Chapter 63 of the General Laws to extend an investment tax credit, which is a reduction in taxes for businesses that invest in certain types of property, to all corporations. Currently, this credit is likely limited to specific types of corporations or investments. The bill would allow businesses to claim a credit equal to three percent of the cost of qualifying tangible property, such as machinery or equipment, that they acquire, construct, or improve during the tax year. This property must be depreciable, have a useful life of at least four years, and be used within the Commonwealth. The bill also outlines provisions for leased property, where a lessee corporation can claim a credit based on the lessor's adjusted basis in the property. Importantly, the bill removes Section 38U of Chapter 63, suggesting that the existing investment tax credit provisions are being consolidated or replaced by this new, broader credit. The credit cannot reduce a corporation's tax liability below a certain minimum amount, and corporations can choose between this investment tax credit or a deduction under Section 38D, but not both. There are also rules regarding how the credit is adjusted if the property is disposed of or its use changes before the end of its useful life, and provisions for carrying over unused credit to future tax years.