The bill proposes amendments to Chapter 44-11 of the General Laws, specifically related to the "Business Corporation Tax." It introduces changes to the tax rates and the treatment of net income and capital gains for corporations. The bill reduces the tax rate from nine percent (9%) to seven percent (7.0%) of net income for tax years beginning on or after January 1, 2015. Additionally, it allows corporations engaged in buying, selling, dealing in, or holding securities to deduct fifty percent (50%) of the excess of capital gains over capital losses from their net income, provided their gross receipts from these activities constitute at least ninety percent (90%) of their total gross receipts for the year.

The bill also addresses the tax obligations of personal holding companies, regulated investment companies, and real estate investment trusts, setting a tax equal to the greater of ten cents ($.10) per one hundred dollars ($100) of gross income or one hundred dollars ($100) for the taxable year. It specifies the definition of "gross income" for these entities and the adjustments to be made for certain types of interest and capital gains. Furthermore, the bill eliminates the minimum tax requirement for corporations, including small business corporations with a subchapter S election, which was previously set at a minimum of four hundred fifty dollars ($450) and was to be reduced to four hundred dollars ($400) for tax years beginning on or after January 1, 2017. The act would take effect upon passage and includes a provision to repeal the corporation minimum tax.

Statutes affected:
7928: 44-11-2