This Technical Information Release ("TIR") is being issued in response to the May 15, 2006 rulings of the Appellate Tax Board ("Board") in Bell Atlantic Mobile of Massachusetts Corporation, Ltd. d/b/a Verizon Wireless v. Commissioner of Revenue et al., A.T.B. Nos. C267959-C268176, C269027-028 (2006) and Board of Assessors of City of Newton v. Commissioner of Revenue and Bell Atlantic Mobile, LLC, A.T.B. No. C269569 (2006); and Bell Atlantic Mobile of Massachusetts Corporation, LTD d/b/a Verizon Wireless v. Boards of Assessors of 220 Cities and Towns (multiple docket numbers) (2006).
II. Appellate Tax Board's Rulings
Pursuant to the above rulings, a wireless telecommunications carrier would not be considered a telephone or telegraph company under G. L. c. 59, § 39 and would no longer be subject to central valuation of its taxable telephone personal property by the Commissioner of Revenue ("Commissioner"). In addition, pursuant to the Board's ruling that an incorporated wireless telecommunications carrier "was not subject to G.L. c. 63, § 52A and G.L. c. 166, and therefore, was not entitled to the exemption under G.L. c. 59, § 5, cl. 16(1)(d)," an incorporated wireless telecommunications carrier would not be subject to the utility corporation excise under G.L. c. 63, § 52A, nor would it be entitled to the exemption from local property tax for certain machinery under G.L. c. 59, § 5, cl. 16(1). An incorporated wireless telecommunications carrier would instead be subject to the business corporation excise pursuant to the provisions of G.L. c. 63, §§ 32, 39.
At this time, the Board has not issued its Findings of Fact and Report in the above rulings. Once a report is issued, an appeal may be taken by any party in accordance with the Massachusetts Rules of Appellate Procedure and Rule 1.35 of the Rules of the Board. The Commissioner anticipates that the rulings will be appealed.
III. Effect of Rulings on the Corporate Excise Tax
At the present time, subject to further developments arising from the Board's forthcoming report or from any appeals, an incorporated wireless telecommunications carrier is subject to the business corporation excise going forward and as to all open taxable years within the statute of limitations for assessment or abatement. However, the Commissioner will refrain from making any assessments of the business corporation excise against an incorporated wireless telecommunications carrier for open tax periods if he receives a signed waiver from the incorporated wireless telecommunications carrier agreeing to keep all such tax periods open for a specified period after all judicial appeals processes are complete.
IV. Effect of Rulings on the Property Tax
At the present time, subject to further developments arising from the Board's forthcoming report or rulings on appeal, the Commissioner is no longer required to issue centralized valuations of a wireless telecommunications carrier's taxable telephone personal property under G.L. c. 59, § 39. However, in order to protect the interests of the Commonwealth and its cities and towns in the event that the Board's rulings are not upheld on appeal, the Commissioner intends to continue to issue centralized valuations of a wireless telecommunications carrier's personal property, without regard to the exemption under G.L. c. 59, § 5, cl. 16(1). Until all judicial appeals processes are complete, wireless telecommunications carriers should continue to centrally file Form 5941 as issued by the Commissioner. In addition, wireless telecommunications carriers should file Form 2 (Form of List), with local boards of assessors, without regard to the exemption under G.L. c. 59, § 5, cl. 16(1). Final assessment determinations in accordance with the Commissioner's central valuations or local valuations will be made by the local board of assessors in the locality where the wireless telecommunications carrier's property is located. If there are any future changes to the valuations process, the Commissioner will announce them in a subsequent public written statement.
V. Contact Information
Taxpayers affected by this TIR with questions concerning central valuations should contact the Division of Local Services at (617) 626-4087. Taxpayers with questions concerning the waiver to keep corporate excise periods open should contact the Audit Division at (617) 626-6714.
This TIR supersedes and replaces all prior Department of Revenue public or private written statements, advice, forms, and instructions, to the extent they may be inconsistent with this TIR.
Commissioner of Revenue
October 16, 2006
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