Revision: Dec. 22, 2011, midnight
SB 299-FN-A – AS INTRODUCED
2012 SESSION
10/05
SENATE BILL 299-FN-A
AN ACT relative to the exclusion of certain interest under the business enterprise tax.
SPONSORS: Sen. Barnes, Jr., Dist 17
This bill excludes interest paid or accrued under a mortgage held by a nonprofit enterprise from the calculation of liability for the business enterprise tax.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
12-2890
10/05
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Twelve
AN ACT relative to the exclusion of certain interest under the business enterprise tax.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Business Enterprise Tax; Exclusion of Certain Interest. Amend RSA 77-E:1, XI to read as follows:
XI. “Interest” means all amounts paid or accrued for the use or forbearance of money or property, except that “interest” shall not include interest paid or accrued under a mortgage held by a nonprofit enterprise. The term “interest” shall not include amounts paid, credited or set aside in connection with reserves by insurers to fulfill policy and contractual responsibilities to policy holders or by voluntary employees’ beneficiary associations qualified under section 501(c)(9) of the United States Internal Revenue Code to fulfill obligations to members.
2 Effective Date. This act shall take effect July 1, 2012.
LBAO
12-2890
12/01/11
SB 299-FN-A - FISCAL NOTE
AN ACT relative to the exclusion of certain interest under the business enterprise tax.
FISCAL IMPACT:
The Department of Revenue Administration states this bill may decrease state revenue by an indeterminable amount in FY 2013 and each year thereafter. There will be no fiscal impact on state, county, and local expenditures, or county and local revenue.
METHODOLOGY:
The Department of Revenue Administration states this excludes interest paid or accrued under a mortgage held by a nonprofit enterprise from the calculation of liability for the business enterprise tax (BET). For tax year 2009, of the 68,209 entities who filed BET returns, there were 207 nonprofit entities. Of those 207 returns, a total of $19,636,745 was entered as taxable interest paid or accrued for BET purposes. At the BET tax rate of 0.75%, this would equate to $147,276 of BET from interest. The Department cannot determine how much of this interest was paid or accrued on mortgages. The Department states the impact could go beyond the 207 filers if taxpayers restructure their businesses to tax advantage of the proposed exception. The exact fiscal impact cannot be determined at this time.