Massachusetts HD 516: An Act to clarify the net-worth measure of the corporate excise

Bill Text

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HOUSE DOCKET, NO. 516        FILED ON: 1/11/2019 
HOUSE  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  No. 2603 
 
The Commonwealth of Massachusetts 
_________________ 
PRESENTED BY: 
Elizabeth A. Poirier 
_________________ 
To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General 
 Court assembled: 
 The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill: 
An Act to clarify the net-worth measure of the corporate excise. 
_______________ 
PETITION OF: 
 
NAME: DISTRICT/ADDRESS: DATE ADDED: 
Elizabeth A. Poirier 14th Bristol 1/11/2019 

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HOUSE DOCKET, NO. 516        FILED ON: 1/11/2019 
HOUSE  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  No. 2603 
By Mrs. Poirier of North Attleborough, a petition (accompanied by bill, House, No. 2603) of 
Elizabeth A. Poirier relative to the calculation of net worth in determining corporate excise taxes.  
Revenue. 
 
[SIMILAR MATTER FILED IN PREVIOUS SESSION 
SEE HOUSE, NO. 1615 OF 2017-2018.] 
 
The Commonwealth of Massachusetts 
 
_______________
 
In the One Hundred and Ninety-First General Court 
(2019-2020) 
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An Act to clarify the net-worth measure of the corporate excise. 
 
 Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority 
of the same, as follows: 
 
1 SECTION 1.   Paragraph 8 of Section 30 of chapter 63, as amended by section 105 of 
2chapter 165 of the acts of 2016, is hereby amended by striking out the last sentence and inserting 
3in place thereof the following sentence:-  
4 In determining whether an item shown on the books of a corporation is to be treated as 
5reflecting debt or equity, the taxpayer’s treatment of the item for accounting purposes shall be 
6considered to be controlling, unless the commissioner establishes that such treatment is not in 
7accordance with the accounting standards used by that taxpayer for making financial reports to 
8shareholders, such as, without limitation, generally accepted accounting principles or 
9International Financial Reporting Standards; and in determining the book value of any asset, the 

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10commissioner may disallow any reserve, in whole or in part, established with respect thereto 
11which, in his judgment, is not reasonable and proper.  
12 SECTION 2.  By this act the general court clarifies its original intention that the 
13treatment of an item on the books of a corporation shall be controlling in determining its net 
14worth. This act shall be effective upon its passage, and shall be applicable to all open tax years.  
15 SECTION 3: Section 38(f) of chapter 63 is hereby amended after the word “include” by 
16adding the following phrase:- 
17 “an item of income of a corporation that is organized outside of the United States to the 
18extent that such item is exempt from United States federal income tax either by virtue of a 
19federal income tax treaty or otherwise, or”