Amendment 351

Budget Amendment ID: FY2019-S4-351

GOV 351

EMAC Supplemental Tax Credit

Messrs. Tarr, Humason, Pacheco, Hinds, Tran, Moore, O'Connor, Ross and Fattman moved that the proposed new text be amended moves to amend the bill by inserting after section 14, the following 3 sections:-

SECTION 14A. Section 6 of chapter 62 of the General Laws, as so appearing, is hereby amended by adding the following subsection:-

(u)(1) As used in this subsection, the following words shall have the following meanings unless the context clearly indicates otherwise:

"ConnectorCare", a program administered by the commonwealth health insurance connector authority established pursuant to chapter 176Q to provide premium assistance payments and point-of-service cost-sharing subsidies to residents of the commonwealth eligible pursuant to said chapter 176Q.

"Employer Medical Assistance Contribution Supplement" or "EMAC Supplement", a monetary amount actually paid by a taxpayer to the department of unemployment assistance pursuant to section 189A of chapter 149.

"Employer Shared Responsibility Payment", a monetary amount actually paid by a taxpayer to the Internal Revenue Service pursuant to 26 U.S.C. § 4980H as an assessment for employees domiciled in the commonwealth.

"Full-time employee", shall have the same meaning as defined in 26 U.S.C. § 4980H(c)(4).

"Taxpayer", an employer as defined in section 1 of chapter 151A subject to the income tax under this chapter.

(2) Except as otherwise limited by paragraph (3), where a taxpayer pays both the EMAC supplement and the employer shared responsibility payment in the same taxable year, a taxpayer shall be allowed a refundable credit against the tax liability imposed under this chapter in an amount equal to $750 times the lesser of: (i) the number of Massachusetts employees for which the taxpayer pays the employer shared responsibility payment in the taxable year, or (ii) the number of full-time employees on ConnectorCare for which the taxpayer pays the EMAC supplement in the taxable year.

(3) The aggregate amount of credit available to a taxpayer in a taxable year under this subsection shall not exceed the lesser of: (i) the aggregate employer shared responsibility payment paid by the taxpayer in the taxable year, or (ii) the aggregate EMAC supplement paid by the taxpayer in the taxable year for full-time employees on ConnectorCare.

(4) The taxpayer may claim the credit only in the taxable year in which the taxpayer pays both the EMAC supplement and the employer shared responsibility payment, without regard to the years or other periods for which liabilities for such payments accrued.

(5) Where the credit allowed to a taxpayer exceeds the liability otherwise due under this chapter, 100 per cent of the balance of that credit may, at the option of the taxpayer, be refunded to the taxpayer for the taxable year in which the credit is claimed or may be applied by the taxpayer to its estimated liability for the subsequent taxable year.

(6) The credit shall not be transferrable.

(7) For the purpose of this subsection, any deduction from gross income that may otherwise be taken with respect to any expenditures qualifying for the credit is disallowed to the extent that such expenditure is taken into account in the calculation of the credit.

(8) Notwithstanding the provisions of section 21 of chapter 62C and section 46 of chapter 151A, the department of unemployment assistance and the department of revenue shall conduct data matches for the purposes of administering this section.

(9) The commissioner shall, in consultation with the department of unemployment assistance, promulgate regulations to implement this section.

(10) The credit provided for in this subsection shall apply to taxable years beginning on or after January 1, 2018 and before January 1, 2020.

And moves to further amend the bill by inserting after section 15, the following section:-

SECTION 15A. Chapter 63 of the General Laws is hereby amended by inserting after section 38FF the following section:-

Section 38GG. (a) As used in this section, the following words shall have the following meanings unless the context clearly indicates otherwise:

"Full-time employee", shall have the same meaning as defined in 26 U.S.C. § 4980H(c)(4).

"Taxpayer", an employer as defined in section 1 of chapter 151A subject to an excise imposed by this chapter.

(b) Except as otherwise limited by subsection (c), where a taxpayer pays both the EMAC supplement and the employer shared responsibility payment in the same taxable year, a taxpayer shall be allowed a refundable credit against the tax liability imposed under this chapter in an amount equal to $750 times the lesser of: (i) the number of Massachusetts employees for which the taxpayer pays the employer shared responsibility payment in the taxable year, or (ii) the number of full-time employees on ConnectorCare for which the taxpayer pays the EMAC supplement in the taxable year.

(c) The aggregate amount of credit available to a taxpayer in a taxable year under this section shall not exceed the lesser of: (i) the aggregate employer shared responsibility payment paid by the taxpayer in the taxable year, or (ii) the aggregate EMAC supplement paid by the taxpayer in the taxable year for full-time employees on ConnectorCare.

(d) The taxpayer may claim the credit only in the taxable year in which the taxpayer pays both the EMAC supplement and the employer shared responsibility payment, without regard to the years or other periods for which liabilities for such payments accrued.

(e) Where the credit allowed to a taxpayer exceeds the liability otherwise due under this chapter, 100 per cent of the balance of that credit may, at the option of the taxpayer, be refundable to the taxpayer for the taxable year in which the credit is claimed or may be applied by the taxpayer to its estimated liability for the subsequent taxable year. The credit allowed to a taxpayer shall not be subject to section 32C.

(f) The credit shall not be transferrable.

(g) For the purpose of this section, any deduction from gross income that may otherwise be taken with respect to any expenditures qualifying for the credit under this section is disallowed to the extent that such expenditure is taken into account in the calculation of the credit.

(h) Notwithstanding the provisions of section 21 of chapter 62C and section 46 of chapter 151A, the department of unemployment assistance and the department of revenue shall conduct data matches for the purposes of administering this section.

(i) The commissioner shall, in consultation with the department of unemployment assistance, promulgate regulations to implement this section.

(j) The credit provided for in this section shall apply to taxable years beginning on or after January 1, 2018 and before January 1, 2020.

And moves to further amend the bill by inserting the following 2 sections:-

SECTION 62A. A taxpayer may claim a credit in a taxable year pursuant to subsection (u) of section 6 of chapter 62 of the General Laws, as inserted by section 29, or section 38GG of chapter 63 of the General Laws, as inserted by section 30, but not both. Any EMAC supplement or employer shared responsibility payment may not be taken into account in calculating more than 1 credit by a taxpayer or combination of taxpayers. The terms used in this section shall have the meanings defined in said subsection (u) of said section 6 of said chapter 62 and said section 38GG of said chapter 63.

SECTION X . Sections 14AA, 15A and 62A shall take effect on January 1, 2018.