AN ACT TO MAKE TECHNICAL CHANGES TO THE REVENUE LAWS. Enacted March 20, 2019. Effective March 20, 2019, except as otherwise provided.
Summary date: Mar 20 2019 - View Summary
Summary date: Feb 19 2019 - View Summary
Senate committee substitute to the 1st edition makes the following changes.
Amends the proposed language in GS 105-164.8(b), concerning conditions that must be met in order for a retailer who makes a remote sale to be subject to tax, to include when the retailer had gross sales exceeding $100,000 or 200 or more separate transactions, with respect to remote sales into the state for the previous or current (was, previous only) calendar year.
Summary date: Feb 13 2019 - View Summary
Identical to H 60, filed 2/12/19.
Part I. IRC Update
Updates the definition of Code set out in GS 105-228.90(b)(1b) to refer to the Internal Revenue Code as enacted as of January 1, 2019.
Part II. Corporate Income Tax Changes
Amends GS 105-130.5(a), regarding additions made to federal taxable income in determining State net income. Modifies the addition of the amount of gain that would be included for federal income tax purposes without regard to section 1400Z-2(b) (concerning the deferral of capital gains invested in opportunity zones) to instead refer to section 1400Z-2(a) of the Code (concerning capital gains invested in opportunity zones, generally). Further amends GS 105-130.5, modifying the deduction of the amount of gain included in the taxpayer's federal income tax under section 1400Z-2(a) of the Code to the extent the same income was included in the taxpayer's State net income (was, federal taxable income) in a prior taxable year under subdivision (a)(26) of the statute, as amended above.
Part III. Personal Income Tax Changes
Amends Section 38.1(j) of SL 2018-5, specifying the changes made by Section 38.1(c) of the session law to GS 105-153.5(a) (concerning modifications to a taxpayer's adjusted gross income with regard to capital gains invested in opportunity zones) are effective for taxable years beginning on or after January 1, 2018.
Amends GS 105-153.5(a1), concerning the child deduction amount from a taxpayer's adjusted gross income, to refer to a deduction for each qualifying child for whom the taxpayer is allowed a federal tax credit, rather than each dependent child.
Further amends GS 105-153.5, modifying subsection (c2) regarding decoupling adjustments in the calculation of a taxpayer's adjusted gross income. Tracks the changes made by the act to GS 105-130.5 regarding corporate income tax additions and deductions relating to capital gains invested in opportunity zones.
Part IV. Excise Tax Changes
Amends GS 105-113.6, specifying the cigarette tax levied is levied upon the sale or possession for sale by a person other than a licensed distributor (currently, does not specify a licenseddistributor), and upon the use, consumption, and possession for use or consumption of cigarettes within the State.
Amends GS 105-113.9, regarding out-of-state cigarette shipments whereby partial stock may be set aside without paying tax, to more specifically refer to licensed distributors throughout the statute.
Amends GS 105-113.13, regarding the Secretary's authority to require a bond or irrevocable letter of credit of cigarette distributors, to more specifically refer to licensed distributors throughout the statute.
Amends GS 105-113.77, GS 105-113.78, GS 105-113.82, GS 105-113.80, and GS 105-113.83, concerning city and county retail licenses and taxing, to refer to malt beverage(s) rather than beer.
Further amends GS 105-113.80, to refer to the spirituous liquor seller's rather than distiller's price in calculating the excise tax on liquor, and to allow for another calculation specified by law.
Amends GS 105-113.83, removing the sale or disposal of the beverage by the wine shipper permittee from the determination of the date on which the excise tax on malt beverages and wine is due.
Amends GS 105-164.13(11), exempting the specified fuels from the retail sales and use tax, to except from the exemption motor fuel for which a refund of the per gallon excise tax is allowed under GS 105-449.106(c) (provides quarterly tax refund for certain nonprofits for purchase and use of motor fuel) (was, GS 105-449.105A, which sets out monthly tax refund for kerosene sold for non-Highway use).
Amends GS 105-259 to allow an officer, an employee, or an agent of the State who has access to tax information in the course of service to or employment by the State to exchange information concerning a tax imposed by GS Chapter 105, Articles 2A (Tobacco Products Tax), 2C (Alcoholic Beverage License and Excise Tax), or 2D (Unauthorized Substances Tax) with the Alcohol and Tobacco Tax and Trade Bureau of the US Department of the Treasury when the information is needed to fulfill a duty.
Amends GS 105-449.76 by specifying that the Secretary may cancel a license issued to gasoline refiners, suppliers, terminal operators, importers, exporters, blenders, and specified others under Article 36C upon the licensee’s written request and the immediate return of the license to the Secretary (was, only upon licensee’s written request). Requires that a notice of license revocation and the required hearing be sent by certified mail (was, registered mail). Makes a clarifying change to GS 105-449.90(e).
Part V. Sales Tax Changes
Amends SL 2018-5, Section 38.5(aa) by making GS 105-164.13(5e) [which provides an exemption from sales tax for sales of mill machinery or mill machinery parts or accessories (not to include electricity) to the specified persons] effective on July 1, 2018.
Amends GS 105-164.8(b), which requires one of the listed conditions to be met in order for a retailer making a remote sale subject to sales tax, by adding as one of the conditions that the retailer, with respect to remote sales into the state for the previous calendar year, had one or more of (1) gross sales exceeding $100,000 or (2) 200 or more separate transactions.
Amends GS 105-164.13, concerning the exemption from sales tax, by referring to food and other items purchased under the Supplemental Nutrition Assistance Program instead of the Food Stamp Program.
Amends GS 105-164.13E, concerning the exemption for farmers, by requiring that an exempt item be purchased by a qualifying farmer or conditional farmer (was, qualifying farmer only) and used by the qualifying or conditional farmer primarily in farming operations (was, used by the farmer in farming operations). Amends the list of items considered to be used by a farmer for farming operations to include those used by a person who boards horses. Makes additional conforming changes.
Amends GS 105-164.27A(a3) by correcting a statutory cross-reference.
Amends GS 105-164.28A, concerning exemption certificates, by removing all requirements for items that are subject to a preferential rate of tax, which was dependent on the status of the purchaser or the intended use of the item.
Amends GS 105-241.14 to clarify that when a taxpayer requests a review of a proposed assessment and the Department of Revenue (Department) and the taxpayer cannot resolve the taxpayer’s objection, the Department must send the taxpayer a notice of final determination concerning the proposed assessment (was, concerning the assessment). Makes conforming changes.
Amends GS 105-244.3(a), which lists the conditions that must be met when granting grace periods when the retailer did not receive written advice for the transaction at issue for the law in effect for the applicable periods. Clarifies that the condition for a person who failed to collect sales tax on the taxable portion of a mixed service contract that exceeds 10% for a transaction on or after January 1, 2017, and before January 1, 2019, does not prohibit assessing use tax on purchases used to fulfill a mixed service contract (was, a mixed contract). Makes additional clarifying changes.
Amends GS 105-269.14(b) by requiring that the Secretary distribute the local portion of the net use tax proceeds collected under the statute in accordance with GS Chapter 105, Subchapter VIII (Local Government Sales and Use Tax), and SL 1967-1096 (concerning Mecklenburg County sales and use tax); deletes the currently specified formula.
Unless otherwise indicated, effective when the act becomes law.