A nonprofit organization or taxpayer subject to G.L. c. 62 or G.L. c. 63 that meets the eligibility requirements of G.L. c. 62,§ 6(j) or G.L. c. 63, § 38Q (“Applicant”) may apply for the Massachusetts Brownfields Tax Credit (“MBTC”), which provides a credit of either 25 percent or 50 percent of certain net environmental response and removal costs incurred to remediate contaminated property owned or leased for business purposes and located within an economically distressed area.
636.2. Application Process for Massachusetts Brownfields Tax Credit
The provisions of G.L. c. 62, § 6(j) and G.L. c. 63, § 38Q state that an Applicant shall be allowed a credit “at the time” that a “permanent solution or remedy operation status is achieved.” The Department of Revenue (“Department”), under its authority pursuant to G.L. c. 62C, § 3 to prescribe and furnish all forms necessary and proper for the enforcement of G.L. c. 62C and the statutes referred to in § 2, has implemented an application process to determine whether an Applicant fulfills the statutory requisites of G.L. c. 62, § 6(j) or G.L. c. 63, § 38Q. An Applicant must complete a “Form BCA – Brownfields Credit Application” (“Form BCA”) and submit the Form BCA and supporting documentation to the Department’s Audit Division, 200 Arlington Street, Room 4300, Chelsea, MA 02150, Attention: Brownfields Unit.
An Applicant need not be represented in any proceeding before the Department regarding its Form BCA. An Applicant that wishes to be represented before the Department regarding its Form BCA must submit a completed “Form M-2848 – Power of Attorney and Declaration of Representative,” designating the individual(s) who may act on the Applicant’s behalf.
636.4. Review of Application for Massachusetts Brownfields Tax Credit
Upon receipt of an Applicant’s completed Form BCA and supporting documentation, the Brownfields Unit will conduct a review to verify eligibility. The Brownfields Unit will contact the Applicant in the event that the Form BCA is incomplete or includes insufficient supporting documentation.
The Department and the Applicant may jointly elect to execute a “Form A-37 – Consent Extending the Time for Assessment of Taxes” (“Form A-37”) in the event that the timing of the Department’s review of the Form BCA would impact the Applicant’s ability to use an approved MBTC in the initial claim year or any of the five subsequent tax years for which the MBTC could be carried forward.
636.5. Approval of Application for Massachusetts Brownfields Tax Credit
If the Brownfields Unit determines that the Form BCA should be approved, it will send the Applicant a notice of credit approval and a “Form BCC – Brownfields Credit Certificate” (“Form BCC”), indicating a certificate number and the amount of MBTC approved. Upon receipt of the Form BCC, the Applicant may use the approved MBTC against its own tax liability and/or transfer, sell, or assign the approved MBTC to a taxpayer with a liability under G.L. c. 62 or G.L. c. 63, or to a nonprofit organization. If the Applicant wishes to transfer the approved MBTC, in whole or in part, it must file a “Form BCTA – Brownfields Credit Transfer Application” with the Department.
636.6. Proposed Denial or Partial Denial of Application for Massachusetts Brownfields Tax Credit
If the Brownfields Unit intends to deny an application for MBTC, in whole or in part, as submitted on Form BCA, the Brownfields Unit will contact the Applicant to discuss the reason(s) for the proposed denial, as well as send written notification to the Applicant of its proposed denial. If the Brownfields Unit proposes to deny the application in part, the Brownfields Unit will also send the Applicant a Form BCC with the amount of approved MBTC eligible for the Applicant’s own use and/or for transfer, sale, or assignment.
636.7. Department of Revenue Appeal Process for Proposed Denial or Partial Denial of Application for Massachusetts Brownfields Tax Credit
Upon receipt of a proposed denial or partial denial, the Applicant may make a written request for a conference with the Department’s Office of Appeals. Such request must be filed with and received by the Brownfields Unit within 30 days of the date set forth in the proposed denial or partial denial and must include a statement as to the reason or reasons why a specific amount of credit that has been denied should be approved, as well as supporting documentation. The request must be submitted to the Department’s Audit Division, 200 Arlington Street, Room 4300, Chelsea, MA 02150, Attention: Brownfields Unit. The Brownfields Unit will forward all timely filed requests for a conference to the Department’s Office of Appeals.
Upon receipt of the request, the Office of Appeals will schedule a conference with an appeals officer and notify the Applicant in writing of the date and time of such conference. In some instances, an Applicant may be asked to provide additional information before the conference is scheduled.
The conference is conducted either in person at the Office of Appeals, located in Boston, Massachusetts, or by telephone. The Applicant and/or its designated representative must participate in the conference. A representative of the Brownfields Unit may also attend the conference.
Conferences are informal; the rules of evidence are not applied and no testimony is taken under oath. No transcript or formal record of the hearing is made. However, the Office of Appeals may request that matters alleged as fact be submitted under the pains and penalties of perjury.
The appeals officer will begin the conference by summarizing the contested issues regarding the Form BCA, and asking the Applicant to present its case. The appeals officer also may pose questions to the Applicant. If the appeals officer requests additional information from the Applicant, a date will be set by which the information must be submitted to the Office of Appeals to be considered in connection with the final determination on the Form BCA. A representative of the Brownfields Unit may also examine any additional information submitted by the Applicant.
The appeals officer will not make a decision regarding the Applicant’s appeal at the conference. Rather, the matter will be taken under advisement. The Office of Appeals will notify the Applicant as to its decision by a letter of determination. If an amount of previously denied credit is approved, in whole or in part, the Applicant will receive a Form BCC or an additional Form BCC.
If the Brownfields Unit does not receive a request for a conference within 30 days of the proposed denial or partial denial, it will issue the Applicant a notice of credit denial.
The Office of Appeals generally will require that the Applicant execute a “Form B-37 – Special Consent Extending the Time for Assessment of Taxes” in the event that the timing of the Office of Appeals’ review of the Form BCA could impact the Applicant’s ability to use an approved MBTC in the initial claim year or any of the five subsequent tax years for which the MBTC could be carried forward.
636.8. Appeal Remedies Upon Final Determination by the Department on an Application for Massachusetts Brownfields Tax Credit
If an Applicant disagrees, in whole or in part, with the Department’s final determination with respect to the Applicant’s application for MBTC as submitted on its Form BCA, it may have appeal remedies outside the Department. An appeal from the denial or partial denial of an application by the Department is not specifically enumerated within the statutory jurisdiction granted to the Appellate Tax Board under the provisions of G.L. c. 58A, § 6. The Department recommends that an Applicant consult with an attorney to determine the proper venue and procedure for appeal of a denial of an application for Brownfields Tax Credit as submitted on a Form BCA, keeping in mind statutory limitations on time periods for filing any such appeals.
G.L. c. 58A, § 6
G.L. c. 62
G.L. c. 62, § 6(j)
G.L. c. 62C, § 3
G.L. c. 63
G.L. c. 63, § 38Q
Form BCA – Brownfields Credit Application
Form BCC – Brownfields Credit Certificate
Form BCTA – Brownfields Credit Transfer Application
Form A-37 – Consent Extending the Time for Assessment of Taxes
Form B-37 – Special Consent Extending the Time for Assessment of Taxes
Form M-2848 – Power of Attorney and Declaration of Representative
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