SB 260-FN - AS AMENDED BY THE SENATE
02/22/2023 0559s
2023 SESSION
23-0983
07/04
SENATE BILL 260-FN
AN ACT relative to deductions under the business profits tax for compensation of members and owners.
SPONSORS: Sen. Lang, Dist 2; Rep. Mooney, Hills. 12
COMMITTEE: Ways and Means
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ANALYSIS
This bill creates a deduction of fair, reasonable, and customary compensation for members and owners of businesses subject to the business profits 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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
02/22/2023 0559s 23-0983
07/04
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Twenty Three
AN ACT relative to deductions under the business profits tax for compensation of members and owners.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Paragraph; Business Profits Tax. Amend RSA 77-A:4 by inserting after paragraph XIX the following new paragraph:
XX. A deduction of the full amount of fair, reasonable, and customary compensation for members and owners of business organizations subject to taxation under RSA 77-A, to the extent such amounts are not already deducted in arriving at the business organization's gross business profits, as defined in RSA 77-A:1, III.
2 New Paragraph; Department of Revenue Administration; General Provisions; Rulemaking Authority. Amend RSA 21-J:13 by inserting after paragraph XIV the following new paragraph:
XV. The implementation of a deduction for fair, reasonable, and customary compensation of members and owners of businesses subject to the business profits tax established under RSA 77-A:4, XX.
3 Effective Date. This act shall take effect July 1, 2023.
23-0983
Amended 3/1/23
SB 260-FN- FISCAL NOTE
AS AMENDED BY THE SENATE (AMENDMENT #2023-0559s)
AN ACT relative to deductions under the business profits tax for compensation of members and owners.
FISCAL IMPACT: [ X ] State [ ] County [ ] Local [ ] None
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| Estimated Increase / (Decrease) | ||||
STATE: | FY 2023 | FY 2024 | FY 2025 | FY 2026 | |
Appropriation | $0 | $0 | $0 | $0 | |
Revenue | $0 | Indeterminable Decrease | Indeterminable Decrease | Indeterminable Decrease | |
Expenditures | $0 | $0 | $0 | $0 | |
Funding Source: | [ X ] General [ X ] Education [ ] Highway [ ] Other | ||||
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METHODOLOGY:
This bill allows a Business Profits Tax (BPT) deduction for the full amount of fair, reasonable, and customary compensation for members and owners of business organizations that are subject to the Business Profits Tax (BPT). The Department of Revenue Administration states this bill will result in a decrease in BPT owed, resulting in a decrease in General Fund and Education Trust Fund revenue. The Department is not able to calculate the potential revenue decrease as it does not collect information on the compensation for members and owners of business organizations.
AGENCIES CONTACTED:
Department of Revenue Administration
| Date | Body | Type |
|---|---|---|
| Feb. 8, 2023 | Senate | Hearing |
| Feb. 23, 2023 | Senate | Floor Vote |
| March 23, 2023 | Senate | Floor Vote |
| April 26, 2023 | House | Hearing |
| April 26, 2023 | House | Exec Session |
| April 26, 2023 | House | Floor Vote |
May 4, 2023: Inexpedient to Legislate: MA VV 05/04/2023 HJ 13 P. 20
April 27, 2023: Committee Report: Inexpedient to Legislate 04/26/2023 (Vote 20-0; CC)
April 19, 2023: Executive Session: 04/26/2023 01:30 pm LOB 202-204
April 19, 2023: Public Hearing: 04/26/2023 11:00 am LOB 202-204
March 28, 2023: Introduced (in recess of) 03/23/2023 and referred to Ways and Means
March 23, 2023: Ought to Pass: MA, VV; OT3rdg; 03/23/2023; SJ 11
March 16, 2023: Committee Report: Ought to Pass, 03/23/2023; SC 14
Feb. 22, 2023: Ought to Pass with Amendment 2023-0559s, MA, VV; Refer to Finance Rule 4-5; 02/22/2023; SJ 8
Feb. 22, 2023: Committee Amendment # 2023-0559s, AA, VV; 02/22/2023; SJ 8
Feb. 16, 2023: Committee Report: Ought to Pass with Amendment # 2023-0559s, 02/22/2023; SC 11
Jan. 31, 2023: Hearing: 02/08/2023, Room 100, SH, 09:15 am; SC 9
Jan. 24, 2023: Introduced 01/19/2023 and Referred to Ways and Means; SJ 5