Senate committee substitute to the 1st edition makes the following changes.
Revises the proposed changes to GS 105-228.90 to update the term Code as it applies to the general administration of taxation to mean the Internal Revenue Code as enacted as of April 1, 2021 (was, January 1, 2021).
Further amends and adds to GS 105-153.5(c2), modifying the required adjustments to an individual’s gross income, which are decoupled from federal requirements. Requires a taxpayer to add the amount of any expense deducted under the Code to the extent the expense is allocable to income that is either wholly excluded from gross income or wholly exempt from the taxes imposed by Part 2 of Article 4 (was, to the extent that payment of the expense results in forgiveness of a PPP loan under the federal Cares Act and the associated income is excluded from gross income under the same specified section of the Cares Act). Adds the following new provisions. For taxable years 2021 through 2025, requires a taxpayer to add the amount excluded from the taxpayer's gross income for the discharge of a student loan under the specified section of the Code in order to decouple from the exclusion from income for the discharge of a student loan under the specified section of the American Rescue Plan Act of 2021. For taxable year 2020, requires a taxpayer to add the amount excluded from the taxpayer's gross income for unemployment compensation received by the taxpayer under the specified section of the Code in order to decouple from the exclusion from income for unemployment compensation under the specified section of the American Rescue Plan Act of 2021.
Amends GS 105-130.5(a), which enumerate additions to federal taxable income in determining State corporate net income. Requires a taxpayer to add the amount of any expense deducted under the Code to the extent the expense is allocable to income that is either wholly excluded from gross income or wholly exempt from the taxes imposed by Part 1 of Article 4 (wa,s to the extent that payment of the expense results in forgiveness of a PPP loan under the federal Cares Act and the associated income is excluded from gross income under the same specified section of the Cares Act).
Eliminates the provision of previous Part II, which deemed Extra Credit Grants and COVID-19 Recovery Rebates not to be considered income for purposes of determining a person's eligibility under the elderly or disabled property tax homestead exclusion of GS 105-277.1. Makes conforming organization changes.
Makes organizational changes to include Subparts, placing the remaining content of the previous edition in Part II.
Revises and makes clarifying changes to the proposed changes to GS 105-241.6(b), regarding exceptions to the statute of limitations for individual tax refunds. No longer requires rather than permits the taxpayer to submit a written request to the Secretary seeking an extension prior to the statute of limitations. Provides for the previously proposed period of six months following the conclusion of the event which prevents timely filing to be subject to the Secretary of Revenue agreeing to the request.
Eliminates the proposed changes to GS 105-130.5(a), regarding additions to federal corporate income tax, and amending the Secretary's authority to adjust the net income of a corporation under GS 105-130.5A.
Further amends the duties of a transporters of motor fuel by railroad tank car or transport truck under GS 105-449.115, and GS 105-449.115A regarding the duties of transporters and receivers of fuel by tank wagon. Now requires the person accepting delivery only if the destination state on the shipping document is NC, which includes if changed to NC in accordance with the provisions of each respective statute (previously prohibited from accepting delivery with any other state as the destination state). Adds to GS 105-449.115A, making a person who accepts delivery of motor fuel in violation of violation of the provisions of new subsection (b1) jointly and severally liable for any tax due on the fuel.
Changes the effective date of the proposed changes to GS 105-278, regarding historic properties, from January 1, 2021, to June 19, 2020.
Adds the following new content.
Makes the following changes to Part 1A, Article 4, which governs S Corporation income tax.
Adds and defines a taxed S Corporation under GS 105-131 to mean an S Corporation for which a valid election for taxation under GS 105-131.1A, as enacted, is in effect.
Enacts GS 105-131.1A, authorizing an S Corporation to elect on its timely filed annual tax return to have income tax imposed on the S Corporation at the rate for individual income tax under GS 105-153.7 (currently set at 5.25% for taxable years beginning on or after January 1, 2019) for any taxable period covered by the return. Bars revocation of the election after the due date of the return including extensions. Provides for the tax to to be levied, collected, and paid annually. Establishes parameters for determining taxable income of a taxed S Corporation attributable to the State. Provides for a taxed S Corporation that qualifies for a credit to apply each shareholder's pro rata share of the credits against the shareholder's pro rata share of the income tax imposed. Requires the S Corporation to pass through to its shareholders any credit required to be taken in installments if the first installment was taken in a taxable period that the election under the statute was not in effect. Prohibits passing through credits allowed for any taxable period the S Corporation makes the election (including the carryforward of unused portions of such credit), or any subsequent installment of a credit required to be taken in installments after election is made (including the carryforward of unused portions of such installments). Provides for credit against income taxes imposed for income taxes imposed by and paid to another state or country, as specified. Provides for shareholders to deduct their pro rata share of income from the taxed S Corporation as provided under GS 105-153.5(c3)(1), as enacted, subject to the S Corporation's full payment of taxes due within the time allowed for filing the return and requires shareholders to make an addition for their pro rata share of loss from the taxed S Corporation as provided under GS 105-153.5(c3)(2), to the extent of inclusion in the taxed S Corporation's taxable income and the taxpayer's adjusted gross income. Details requirements for the taxed S Corporation to pay the full amount shown on the return within the time allowed for filing the return. Allows the S Corporation to request a refund for overpayment. Provides for collection of tax debt following proper notice by the Secretary of Revenue. Provides for the basis of shareholders of taxed S Corporations in their stock and indebtedness of the S Corporation to be determined as if the election had not been made.
Makes conforming changes to GS 105-131.1, which exempts S Corporations from the income tax imposed on C Corporations under GS 105-130.3 and provides for income tax of S Corporation shareholders.
Amends GS 105-131.7 to make the general provisions for S Corporations regarding shareholder agreements and mandatory withholdings set forth in subsections (b) through (f) not applicable to taxed S Corporations.
Adds taxed partnership and taxed S Corporation to the defined terms under GS 105-153.3, applicable to individual income tax provisions of Part 2 of Article 4. Adds and defines taxed pass-through entity to mean a taxed S Corporation or a taxed partnership.
Enacts GS 105-154.1, authorizing a partnership to elect on its timely filed annual tax return to have income tax imposed on the partnership at the rate for individual income tax under GS 105-153.7 (currently set at 5.25% for taxable years beginning on or after January 1, 2019) for any taxable period covered by the return. Excludes publicly traded partnerships or partnerships that have at any time in the taxable year had a partner that is not an individual, an estate, a trust, or an organization described in section 1361(c)(6) of the Code (concerning qualified trusts for employer bonus, pension, and profit-sharing plans). Enacts substantively identical provisions to those enacted in new GS 105-131.1A for taxed S Corporations, made applicable for taxed partnerships, except as follows. Provides distinguished parameters for the determination of taxable income of taxed partnerships attributable to the State.
Amends GS 105-153.5, enacting new subsection (c3) to specify four adjustments that taxpayers must make to the taxpayer's adjusted gross income, providing for deduction for a taxpayer who is either a shareholder or partner of a taxed pass-through entity for the pro rata or distributive share of income from the respective entity to the extent it was included in the taxed entity's NC taxable income and the taxpayer's adjusted gross income; and an addition of the amount of the same described taxpayer's pro rata or distributive share of loss from the taxed pass-through entity to the extent it was included in the taxed entity's NC taxable income and the taxpayer's adjusted gross income.
Amends GS 105-153.9 to disallow shareholders of taxed S Corporations or partners of a taxed partnership a credit for taxes paid by the taxed S Corporation or taxed partnership to another state or country on income that is taxed to the taxed S Corporation or taxed partnership. Deems the shareholder's pro rata share or the partner's distributive share of the income of the taxed pass-through entity to be treated as income taxed to the shareholder or partner under the Individual Income Tax Act, and a shareholder's pro rata share or partner's distributive share of the tax imposed on the taxed pass-through entity by election under new GS 105-131.1A or new GS 105-154.1 to be treated as tax imposed on the shareholder or partner under the Individual Income Tax Act (Part 2 of Article 4), for purposes of allowing the credit for taxes paid to another state or country by a taxed S Corporation's shareholders or a taxed partnership's partners. Entitles a taxed partnership to a credit for all such taxes paid. Makes conforming changes to GS 105-131.8 regarding shareholder income tax by a state that does not measure the income of S Corporation shareholders by the income of the S Corporation. Makes similar conforming changes to GS 105-154 regarding nonresident members.
Amends GS 105-160.4 to disallow fiduciaries and beneficiaries of estates and trusts who are shareholders of a taxed S Corporation a credit for income taxes paid by the estates and trusts or by the taxed S Corporation to another state or country on income that is taxed to the taxed S Corporation; entitles the S Corporation to a credit under GS 105-153.9, as amended, for all such taxes paid. Establishes identical provisions regarding taxed partnerships; entitles the taxed partnership to a credit for all such taxes paid.
Makes the requirements of Article 4C, which requires declarations of estimated corporate income tax and installment payments of estimated income tax, apply to taxed pass-through entities in the same manner as a taxed corporation under Article 4, except GS 105-163.41(d)(5) (regarding underpayment interest) does not apply to a taxable year of a taxed pass-through entity if it was not a taxed pass-through entity during the preceding year.
Adds premium cigar to the defined terms set forth in GS 105-113.4, defined as a cigar that is hand rolled. Amends GS 105-113.4F, which governs delivery sales of tobacco products, to no longer exclude cigars from its scope; however, amends the definition of tobacco products as applied to the statute to exclude cigars that are not premium cigars. Makes the age verification requirements and filing requirement of the statute not apply to the delivery sales of premium cigars.
Amends GS 105-113.35 to establish a cap on excise tax levied on a premium cigar at 30 cents of the cost price.
Effective for sales of premium cigars on or after January 1, 2022.
Amends GS 105-129.71(a1), which establishes a tax credit for eligible certified rehabilitated railroad stations, now defined to include a designated local landmark certified on or before September 1, 2020 (was, June 30, 2019), and is issued a certificate of occupancy on or before December 31, 2023 (was, December 31, 2021). Makes conforming changes to the credit installment provisions. Amends GS 105-129.75, extending the expiration of eligibility certifications under Article 3H from January 1, 2023, to January 1, 2025. Additionally, for credits allowed under GS 105-129.71(a1), requires the qualified rehabilitation expenditures to be incurred before January 1, 2024 (was, January 1, 2022), with the Article expiring and credits barred for rehabilitation projects not completed and placed in service prior to January 1, 2024 (was, January 1, 2022).
Amends GS 105-228.5, regarding premium tax on surety bonds, adding the following specifications. Provides that gross premiums from business done in the State in the case of an insurer of bail bonds means the amounts received by an insurer from a surety bondsman during the calendar year for bail bonds written on behalf of the insurer. Subjects an insurer to the definitions of gross premiums under the statute for premiums from transacting any other line of insurance business. Defines terms by statutory cross-reference. Effective for taxable years beginning on or after January 1, 2022.
Makes the general tax rate of 4.75% set forth in GS 105-164.4 applicable to the gross receipts derived from a short-term motor vehicle rental by a peer-to-peer vehicle sharing facilitator. Makes conforming changes to GS 105-164.13. Adds and defines peer-to-peer vehicle sharing facilitator and short-term vehicle rental to GS 105-164.3. Defines short-term vehicle rental to mean a motor vehicle rental to the same period for a period less than 365 continuous days.
Amends GS 105-187.1 to exclude a short-term vehicle rental by a peer-to-peer vehicle sharing facilitator from the term vehicle sharing service.
Amends GS 105-187.9 to provide for taxes collected at the rate of 5% and 8% under the Article 5A (NC Highway Use Tax) be credited to the Highway Fund (previously $10 million credited annually to the Highway Fund with the remainder credited to the General Fund). Maintains that taxes collected at a 3% tax rate are credited to the Highway Trust Fund.
Enacts GS 105-164.44N to provide for the net proceeds of the tax collected on short-term motor vehicle rentals by a peer-to-peer vehicle sharing facilitator to be transferred within 75 days after the end of each fiscal year to the Highway Fund.
Applies to sales occurring on or after October 1, 2021.
Changes the penalties for failure to pay taxes due under GS 105-236 to require a 2% assessment of the amount of the tax if failure is for no more than one month, with an additional 2% for each additional month, or fraction thereof, during which the failure continues, with a 10% aggregate maximum assessment permitted (was, a flat 10% assessment for failure to pay taxes when due). Applies to penalties assessed on or after January 1, 2022.
Enacts GS 105-153.5A, permitting a taxpayer to carry forward a State net operating loss the taxpayer incurred in a prior taxable year and deduct it in the current taxable year. Establishes parameters for calculating a taxpayer's State net operating loss for a taxable year. Sets forth four limitations for the deduction. Details application to nonresident or part-year resident taxpayers. Provides for administration of the provisions, including required access to records for verification of the deduction amount. Allows for the portion of a taxpayer's federal net operating loss carryforward that was not absorbed in tax years beginning prior to January 1, 2021, to be included in the amount of a taxpayer's State net operating loss in taxable years beginning on or after January 1, 2021. Establishes limitations to the federal net operating loss carryforward permitted for a State net operating loss in tax years beginning after January 1, 2021. Makes conforming changes to GS 105-153.5. Effective for taxable years beginning on or after January 1,2021.
Changes the act's long title.
|View NCGA Bill Details||2021|
AN ACT TO UPDATE THE REFERENCE TO THE INTERNAL REVENUE CODE; TO MAKE VARIOUS TECHNICAL, ADMINISTRATIVE, AND CLARIFYING CHANGES TO THE REVENUE LAWS AS RECOMMENDED BY THE DEPARTMENT OF REVENUE; TO REDUCE THE IMPACT OF THE FEDERAL STATE AND LOCAL TAX DEDUCTION CAP; TO MODIFY THE EXCISE TAX ON PREMIUM CIGARS; TO EXTEND THE TIME TO COMPLETE AN ELIGIBLE PROJECT UNDER THE MILL REHABILITATION TAX CREDIT PROGRAM; TO LIMIT THE GROSS PREMIUMS TAX ON SURETY BONDS; TO PROVIDE TAX PARITY FOR SHORT-TERM VEHICLE RENTALS; TO GRADUATE LATE PAYMENT PENALTIES; AND TO CREATE A SEPARATE STATE NET LOSS CALCULATION FOR INDIVIDUAL INCOME TAX PURPOSES.Intro. by Newton, Rabon, Daniel.
Thu, 18 Mar 2021 Senate: Filed
Mon, 22 Mar 2021 Senate: Passed 1st Reading
Mon, 22 Mar 2021 Senate: Ref To Com On Rules and Operations of the Senate
Mon, 22 Mar 2021 Senate: Withdrawn From Com
Wed, 28 Apr 2021 Senate: Reptd Fav Com Substitute
Wed, 28 Apr 2021 Senate: Com Substitute Adopted
Wed, 28 Apr 2021 Senate: Re-ref Com On Rules and Operations of the Senate
Wed, 28 Apr 2021 Senate: Withdrawn From Com
Bill S 322 (2021-2022)Summary date: Apr 29 2021 - More information
Bill S 322 (2021-2022)Summary date: Mar 18 2021 - More information
Identical to H 279, filed 3/11/21.
Part I. IRC Update
Amends GS 105-228.90 to update the term Code as it applies to the general administration of taxation to mean the Internal Revenue Code as enacted as of January 1, 2021 (currently, May 1, 2020).
Amends GS 105-153.5(a)(2)b. to modify the allowable itemized deduction an individual may elect to deduct from their gross income for mortgage expense and property tax. Prohibits the amount allowed as a deduction for interest paid or accrued during the taxable year under the Code with respect to any qualified residence from including the amount for mortgage insurance premiums treated as qualified residence interest for taxable years 2014 through 2021 (currently limited to taxable years 2014 through 2020).
Amends GS 105-153.5(c2) to modify the required adjustments to an individual’s gross income, which are decoupled from federal requirements. Requires the taxpayer to add the amounts excluded from the taxpayer’s gross income for the discharge of qualified principal residence indebtedness and qualified tuition and related expenses under the Code for taxable years 2014 through 2025 (currently limited to taxable years 2014 through 2020). Requires the taxpayer to add the amounts excluded from the taxpayer's gross income for payment by an employer of principal or interest on any qualified education loan incurred by the taxpayer for education of the taxpayer for taxable years 2020 through 2020 (currently limited to taxable year 2020), expanding the purpose of the provision to include decoupling from the federal exclusion of payments under the Consolidated Appropriations Act, 2021. Adds a new decoupling provision for taxable years 2021 and 2022 to require a taxpayer to add an amount equal to the amount which the taxpayer's deduction under of the specified section of the Code, regarding business-related expenses for food and beverages provided by a restaurant, exceeds the deduction that would have been allowed under the Code enacted as of May 1, 2020, stating the purpose of the provision is to decouple from the increased federal deduction under the Consolidated Appropriations Act, 2021.
Part II. Exempt COVID-19 Relief from Homestead Income
Deems Extra Credit Grants and COVID-19 Recovery Rebates, as defined, not to be considered income for purposes of determining a person's eligibility under the elderly or disabled property tax homestead exclusion of GS 105-277.1.
Part III. Personal Income Tax Changes
Amends GS 105-153.5(b) to extend the sunset for the personal income tax deduction for amounts granted to the individual under the Extra Credit Grant program, now setting the provision to expire on January 1, 2022, rather than January 1, 2021.
Modifies and adds to the decoupling adjustments set forth in GS 105-135.5(c2) for individual income tax. Clarifies that the add-back provision for taxable years 2019 and 2020 under subdivision (17) regarding federal deduction for business interest expenses that would have been allowed under the Code as enacted on January 1, 2020, is not required to the extent the amount was required to be added back under another provision of subsection (c2). Enacts GS 105-135.5(c2)(21) to allow a taxpayer who made an addition under subdivision (17) to deduct 20% of the addition in each of the taxable years 2021 through 2025.
Makes a technical change to remove a statutory reference in GS 105-153.9 which has since been repealed.
Amends GS 105-163.7 to modify the deadlines for informational returns due to the Secretary of Revenue (Secretary) to now require an employer who terminates its business before the close of the calendar year to file its informational return on or before the last day of the month following the end of the calendar quarter in which the employer terminates its business, but no later than January 31 of the succeeding year (previously required filing within 30 days of the last payment of remuneration for employers who terminated business or permanently ceased paying wages during the calendar year).
Enacts GS 105-163.8(c) to require the Secretary to estimate the individual tax due and assess the withholding agent based on the estimate if a withholding agent fails to file a return and pay the tax due under Article 4A or fails a grossly incorrect or false or fraudulent return.
Amends GS 105-241.6(b), regarding exceptions to the statute of limitations for individual tax refunds. Now establishes that the period to request a refund of individual overpayment is six months after the end of an event that a taxpayer claims prevents the taxpayer from filing an accurate and definite request within the statutory period. Requires rather than permits the taxpayer to submit a written request to the Secretary seeking an extension prior to the statute of limitations.
Amends GS 105-252.1 to now prohibit a TTIN (Truncated Taxpayer Identification Number) from being used on any return, statement, or other document required to be filed or furnished to the Department of Revenue (DOR) unless specifically authorized by the Secretary, rather than specifically authorized by statute in GS Chapter 105.
Part IV. Corporate Income Tax Changes
Amends GS 105-83, which governs privilege taxes for installment paper dealers, to exclude from the statute's scope banks and savings and loans associations (currently, corporations liable under a since repealed statutory cross-reference, and savings and loans associations). Defines bank by statutory cross-reference. Applies retroactively for taxable years beginning on or after July 1, 2016.
Amends GS 105-130.5(a), regarding additions to federal corporate income tax. Clarifies that regarding the required addition of amounts equal to the deduction for business-related interest expenses for taxable years 2019 and 2020 which would have been allowed under the Code as enacted on January 1, 2020, under subdivision (31), the add-back is not required to the extent the amount was required to be added back under another provisions of subdivision (31). Enacts GS 105-130.5(b)(33) to permit a taxpayer who made an addition under subdivision (a)(31) to deduct 20% of the addition in each of the taxable years 2021 through 2025.
Amends the Secretary's authority to adjust the net income of a corporation under GS 105-130.5A to authorize the Secretary to require the corporation to file a return that reflects the net income on a combined basis of all members of its affiliated group with intercompany transactions that are conducting a unitary business when authorized adjustments are not adequate to redetermine State net income (previously did not specify for members of its affiliated group with intercompany transactions for this authority). Regarding voluntary redetermination, authorizes the Secretary and a corporation to jointly agree to a combined return methodology that accurately reports State net income (currently refers to agreement to alternative filing). Adds a new provision to prohibit a combined return from achieving tax benefits when the Secretary finds intercompany transactions do not distort income properly attributable to the State or could otherwise be corrected without a combined return. Makes the Secretary's authority regarding methods for redetermination subject to the statute's provisions and that of GS 105-130.7A, which governs the option of royalty income reporting. Makes further changes to provisions regarding required combined returns to refer to members of a group that have intercompany transactions. Expands the statute's penalty provisions to replace the statutory reference to negligence penalties regarding consolidated or combined returns in GS 105-236(a)(5)f. to instead refer to the entire subdivision regarding negligence,(a)(5).
Amends GS 105-130.7B to add that the limitation on qualified interest expense does not apply to interest paid or accrued to a related member if the proportionate amount of interest paid or accrued to a related member has already been disallowed by the application of another specified section of the Code regarding the limitations on business interest. Applies retroactively for taxable years beginning on or after January 1, 2018.
Regarding the corporate net loss provisions in the context of mergers and acquisitions under GS 105-130.8A, requires the Secretary to apply the net economic loss standards of GS 105-130.8 (repealed for taxable years beginning on or after January 1, 2015) for mergers and acquisitions occurring prior to January 1, 2015, and the standards of the statute, which requires the Secretary to apply federal regulations, for taxable years beginning on or after January 1, 2015.
Adds to the kinds of information the Secretary can request of a corporation under GS 105-251 to include financial or tax documentation required to determine the appropriate adjustment under GS 105-130.5A, as amended. Authorizes the Secretary to propose any adjustment allowable under the corporate income tax provisions of Part I, Article 4 of the Chapter if the information is not timely provided as required by GS 105-130.5A.
Part V. Sales and Use Tax Changes
Amends GS 105-164.13E to exempt fowl, rather than baby chicks and poults, purchased by qualifying farmers from sales and use tax. Applies retroactively to purchases made on or after July 1, 2020.
Eliminates the authorized disclosure of tax information by State officers, employees and agents under GS 105-259(b) for the purpose of furnishing a list of the utility taxable gross receipts and piped natural gas tax revenues attributable to a city to the appropriate finance officials of the city.
Part VI. Excise Tax Hearings Changes
Makes the following changes to the revocation procedure for tobacco product licenses under GS 105-113.4B. Authorizes the Secretary to summarily revoke a license when the Secretary determines (rather than finds) that the licensee is incurring liability after failure to pay applicable taxes when due. Requires notice of revocation and notice of hearing to be held within 10 days of the notice, unless the licensee requests the hearing to be rescheduled before the date of the hearing whereby the Secretary must reschedule the hearing to allow for 10 days' notice. Establishes that the revocation is not stayed pending the hearing decision. Details notice of hearing requirements. Requires the Secretary to issue a final decision and notify the revoked licensee in writing within 10 days of the hearing stating the basis of the decision, though the stated basis is not binding on DOR. Details the required procedure for revocation applicable to non-summary revocations, which include, (1) notice of the proposed revocation that includes the basis and effectiveness of the proposed revocation as well as the circumstances under which revocation will not occur and an explanation of how the licensee can contest the proposed revocation, (2) deeming any proposed revocation final, and not subject to further administrative review, if not timely contested by requesting a hearing within 45 days of the proposed revocation notice, and (3) requiring the Secretary to conduct a hearing with 20 days' written notice, if timely requested, and issue a final decision and notify the licensee within 60 days of the hearing, with extension allowed upon mutual agreement, with the final decision, basis for the decision which is not binding on DOR, and if applicable, the effectiveness of revocation. Establishes criteria for delivery of notice and return of credentials.
Enacts GS 105-449.47B, establishing substantively identical authority of the Secretary and revocation procedure for motor carrier licenses or decals for noncompliance with Articles 36B, 36C or 36D, as that provided for non-summary revocations in GS 105-113.4B, as amended.
Amends GS 105-449.76 to modify the procedures for summary and non-summary revocations of fuel importer licenses to be the same as those provided in GS 105-113.4B, as amended.
Amends GS 119-19 to modify the procedures for summary and non-summary revocations of kerosene suppliers, distributors and operators, and dyed diesel fuel distributors' licenses for noncompliance with Article 3 or Article 36C or 36D of GS Chapter 105, to be the same as those provided in GS 105-113.4B, as amended. Adds to the procedure required for cancellation of a license upon written request of the licensee to require the request to include a proposed effective date, and require the license be returned on or before the proposed effective date. Otherwise cancels the license within 15 days after DOR receives the request. Requires the inclusion of an explanatory statement when a license cannot be returned. Requires the Secretary to notify the licensee when the license is cancelled.
Applies to summary revocations and non-summary revocations initiated by DOR on or after January 1, 2022.
Part VII. Excise Tax Changes
Recodifies GS 105-113.8 as GS 105-113.4H, regarding the federal Constitution and statutes applicable to tobacco products tax.
Recodifies GS 105-113.11 as GS 105-113.4I. Amends the statute, expanding the licensure mandate regarding engagement in the tobacco product business in the State to include wholesale dealers and retail dealers in addition to the existing requirement for distributors.
Recodifies GS 105-113.29 as GS 105-113.4J. Amends the statute to make conforming changes, expanding the prohibition on operating an unlicensed business that sells, offers for sale, or possess with the intent to sell tobacco products.
Recodifies GS 105-113.33 as GS 105-113.4K, regarding criminal penalties for violations.
Amends GS 105-113.18 to exclude licensed distributors from the required use tax reports.
Amends GS 105-113.35 to no longer allow a manufacturer to request a waiver from tax on vapor products shipped to either a wholesale dealer or retail dealer.
Amends GS 105-113.37 to specify that tobacco product taxes levied by the Part (rather than the Article) are payable by a licensed wholesale dealer or licensed retail dealer when the monthly report is required to filed covering tobacco products, excluding cigarettes. Adds a new requirement for persons not licensed as wholesale dealers or retail dealers that have acquired non-tax-paid tobacco products other than cigarettes to file a report with the Secretary within 96 hours after receipt, showing the product amount and any other required information, along with the tax owed.
Amends GS 105-113.83 to relieve alcoholic beverage excise tax liability for breweries or wineries who have transferred malt beverages or wine, so long as specified conditions are met, with the wholesaler receiving the transfer liable for the tax due. Makes organizational changes.
Amends GS 105-113.86 to authorize the Secretary to require, rather than mandating, wholesalers or importers to furnish a bond of at least $5,000. Additionally authorizes the Secretary to require a distillery to furnish a similar bond of at least $2,000. Makes clarifying and conforming changes.
Amends GS 105-236 to include failure to pay a license required under GS 105-113.4I, as recodified and amended, after written notification from DOR, among those actions which are punishable by a $1,000 penalty. Applies to penalties assessed on or after January 1, 2022.
Adds to GS 105-449.45 regarding penalties for failure of motor carriers to file a return as required. Adds a new penalty for failing to pay the tax, set at the greater of $50 or 10% of the tax due. Provides exceptions and authorizes the Secretary to reduce or waive a penalty under specified state law.
Adds fuel grade ethanol to the defined terms set out in GS 105-449.60, applicable to Article 36C, defined by specified federal standards. Makes conforming changes to the defined term gasohol, now defining the term to mean a blended fuel composed of gasoline and fuel alcohol or gasoline and ethanol. Effective January 1, 2022.
Amends the duties of a transporters of motor fuel by railroad tank car or transport truck under GS 105-449.115 to include maintaining a copy of the shipping document at a centralized place of business for at least three years from the date of delivery. Modifies the language of the duties of the transporter related to delivery to no longer refer to printed specifications. Makes technical and clarifying changes. Eliminates the review required of the person receiving the shipment to determine an NC destination. Adds a new requirement for the receiver to maintain a copy of the shipping document for three years from the date of delivery. Makes similar changes to GS 105-449.115A regarding the duties of transporters and receivers of fuel by tank wagon. Adds to the duties of the transporter (1) delivery of the motor fuel to the person designated in the shipping document unless three conditions are satisfied, and (2) provision of a copy of the shipping document to the person to whom the motor fuel is delivered. Enacts duties of the person receiving the shipment to mirror those of receivers under GS 105-449.15, as amended. Effective January 1, 2022.
Amends GS 105-449.123 to replace the civil penalty provided for failure to properly mark dyed fuel storage facilities. Sets the penalty at $250, with each inspection that results in a finding of noncompliance constituting a separate and distinct offense (previously set at amounts equal to the tax at the motor fuel rate on the inventory held in the violating storage tank, or if that cannot be determined, the capacity of the storage tank). Applies to penalties assessed on or after January 1, 2022.
Part VIII. Local Government Tax Changes
Corrects a statutory cross-reference in GS 105-278.