Bill > H1615

This bill aims to clarify the net-worth measure used in calculating corporate excise taxes. The key provisions are: 1. The taxpayer's treatment of an item on their books will be considered controlling in determining whether it is debt or equity, unless the Commissioner establishes that the treatment is not in accordance with the accounting standards used by the taxpayer for financial reporting (e.g., Generally Accepted Accounting Principles or International Financial Reporting Standards). 2. The Commissioner may disallow any asset reserve that is deemed unreasonable or improper when determining the book value of an asset. 3. The bill clarifies that the Legislature's original intention was for the treatment of an item on the corporation's books to be controlling in determining its net worth, and this act shall apply to all open tax years. 4. The bill also amends Section 38(f) of Chapter 63 to exclude from a corporation's income any items that are exempt from U.S. federal income tax due to a tax treaty or other provisions, if the corporation is organized outside the United States.

Budget and Finance

https://malegislature.gov/Bills/190/H1615