Technical Information Release  TIR 20-17: Cape Cod and Islands Water Protection Fund Excise Abatement Claims

Date:	12/16/2020
Referenced Sources:	Massachusetts General Laws

I. Introduction

The Cape Cod and Islands Water Protection Fund excise (“Fund excise”) is imposed on transfers of occupancy in a bed and breakfast establishment, hotel, lodging house, short-term rental or motel in every city and town in Massachusetts that is a member of the Cape Cod and Islands Water Protection Fund.  G.L. c. 64G, § 3C.  The Fund excise is collected and remitted to the Department of Revenue (“the Department”) together with the state and local option room occupancy excise imposed under G.L. c. 64G.  Imposition of the Fund excise was made effective for transfers of occupancy in short-term rentals that commenced on or after July 1, 2019 and for which contracts with occupants were entered into on or after January 1, 2019.[1]  For all other types of lodging, the Fund excise was made effective for transfers of occupancy commencing on or after July 1, 2019 irrespective of the date of the contract.  See 830 CMR 64G.1.1.

To address this difference in effective dates, “An Act Making Technical Corrective Changes To The Cape Cod And Islands Water Protection Fund Tax Assessments” (“The Act”) was signed into law on September 25, 2020.[2] The Act allows certain operators who paid the Fund excise to file a claim for abatement of such payments where the payments were attributable to contracts entered into before January 1, 2019. This Technical Information Release (‘TIR”) explains the eligibility requirements, process and deadlines for operators to file a claim for abatement with the Department.

II. Eligibility and Application Process

As provided under the Act , the following operators are eligible to file a claim for abatement: [3]

operators who paid the excise for a transfer of occupancy in a bed and breakfast establishment, hotel, lodging house, motel or short-term rental pursuant to a contract that was entered into not later than December 31, 2018 and that occurred between July 1, 2019 and December 31, 2019, inclusive.

The Department construes the eligibility language in the Act as applying to operators who themselves paid the excise rather than collecting it from occupants.

Operators must use the Department’s existing online abatement application process to file claims pursuant to the Act.  All claims for abatements must be made electronically through MassTaxConnect, as follows:

1. Log in to your MassTaxConnect account;
2. Select your Room Occupancy account;
3. Select “File a Dispute” under “I Want To.”
4. Choose “Other Dispute.”
5. Follow the prompts to complete the application for abatement and attach supporting information in spreadsheet format under the Attachments section.

Applications must include the following supporting information for each occupancy[4] for which a claim for abatement is being made:   

1. Date the reservation was made;
2. Date(s) of occupancy;
3. Total amount of Fund excise due to the commissioner for such transfer of occupancy;
4. Total amount of such Fund excise actually paid to the commissioner;
5. Date(s) such Fund excise was paid;    
6. Total amount of such Fund excise so paid that was not paid by the occupant; and

Total amount of tax abatement requested per tax period.

III. January 15, 2021 Deadline for Operators to File an Abatement Claim

While a claim for abatement of previously remitted payments of the Fund excise will be treated by the Department as an application for abatement under General Laws, Chapter 62C,[5] the Act sets forth specific deadlines for operators to file claims and for the Department to approve claims that differ from the normal statutory deadlines for filing claims for abatement.

Under the Act, a claim for abatement of previously remitted payments of the Fund excise must be filed within 30 days of the date guidance is issued by the Department.[6]  Therefore, all such claims must be submitted to the Department by 5:00 pm on January 15, 2021.  Upon the submission of a timely, accurate and complete claim for abatement, the Department has 60 days to approve or deny such claims.[7]

The Act further provides that the Department is required to obtain reimbursement of Fund excise amounts previously distributed to the Cape Cod and Islands Water Protection Fund Management Board before refunds can be issued to operators.[8]

Operators who have questions about the abatement process or need assistance with their accounts should contact the Department’s Problem Resolution Office at [phone] or [e-mail].

 

                                                                                    /s/Geoffrey E. Snyder
                                                                                    Geoffrey E. Snyder
                                                                                    Commissioner of Revenue
 

GES:RHF:rmh

December 16, 2020

TIR 20-17

[1] St. 2018, c. 337, § 14,

[2] St. 2020, c. 182.

[3] St. 2020, c. 182, § 1(a).

[4] See St. 2020, c. 182, § 1(b).

[5] Id.

[6] St. 2020, c. 182, § 1(e).

[7] St. 2020, c. 182, § 1(c).

[8] St. 2020, c. 182, § 1(c), (d).