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Budget Summary FY2015

Outside Section 106
Data Current as of:  10/17/2014




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Calculating taxable net worth - qualified real estate investment trust

SECTION 106.   Said section 30 of said chapter 63, as so appearing, is hereby further amended by striking out paragraph 9 and inserting in place thereof the following paragraph:-

9. Notwithstanding paragraph 8, the net worth of a business corporation taxable under clause (1) of subsection (a) of section 39 that is a qualified real estate investment trust shall be such portion of the book value of its total assets less its liabilities on the last day of the taxable year as the book value of its tangible assets situated in the commonwealth on said date and not subject to local taxation plus the amount of its intangible assets on said date allocable to the commonwealth, as hereinafter determined, bear to the book value of its total assets on said date. The intangible assets allocated to the commonwealth shall be calculated as follows: (a) the book value of its total intangible assets on the last day of the taxable year shall be reduced by the book value on said date of its investment in and advances to subsidiary business corporations which represent 80 per cent or more of the voting stock of said corporations, or in the case of a subsidiary business corporation which does not have voting stock, the book value of its investment in such business corporation which represents an 80 per cent or more ownership interest; (b) the amount determined in (a) shall be multiplied by such corporation's income apportionment percentage, as determined under section 38. In determining the book value of an asset, the commissioner may disallow a reserve, in whole or in part, with respect thereto which, in the commissioner's judgment, is not reasonable and proper. For the purpose of this paragraph, "qualified real estate investment trust" shall mean a business corporation that both qualifies as a real estate investment trust under section 856 of the Federal Internal Revenue Code and that is required to file with the Securities and Exchange Commission annual and other reports as specified in section 13 or 15(d) of the Securities Exchange Act of 1934, as amended; and "advances" shall mean such interests in a corporation where a corporation-shareholder relationship exists, determined under such regulations as the commissioner may issue and under section 385 of the Federal Internal Revenue Code as in effect for the taxable year and the regulations issued thereunder.