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HOUSE DOCKET, NO. 1608 FILED ON: 1/18/2023
HOUSE . . . . . . . . . . . . . . . No. 2789
The Commonwealth of Massachusetts
_________________
PRESENTED BY:
Ann-Margaret Ferrante
_________________
To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
Court assembled:
The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
An Act establishing a tax credit for artist work space.
_______________
PETITION OF:
NAME:DISTRICT/ADDRESS :DATE ADDED:Ann-Margaret Ferrante5th Essex1/18/2023 1 of 9
HOUSE DOCKET, NO. 1608 FILED ON: 1/18/2023
HOUSE . . . . . . . . . . . . . . . No. 2789
By Representative Ferrante of Gloucester, a petition (accompanied by bill, House, No. 2789) of
Ann-Margaret Ferrante for legislation to establish an artist workspace tax credit. Revenue.
[SIMILAR MATTER FILED IN PREVIOUS SESSION
SEE HOUSE, NO. 2896 OF 2021-2022.]
The Commonwealth of Massachusetts
_______________
In the One Hundred and Ninety-Third General Court
(2023-2024)
_______________
An Act establishing a tax credit for artist work space.
Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
of the same, as follows:
1 SECTION 1. Chapter 62 of the General Laws is hereby amended by inserting after
2section 6N, as appearing in the 2012 Official Edition, the following section:-
3 Section 6O. (a) For the purposes of this section, the following words shall, unless the
4context clearly requires otherwise, have the following meanings:-
5 “Commissioner”, the commissioner of revenue.
6 “Cultural district”, a geographical area of a city or town within the commonwealth
7designated as a cultural district pursuant to the provisions of section 58A of chapter 10.
8 “Department”, the department of housing and community development, or its successor
9agency. 2 of 9
10 “Eligibility statement”, a statement authorized and issued by the department certifying
11that a given project is a qualified project. The department shall, in consultation with the
12commissioner, promulgate regulations establishing criteria upon which the eligibility statements
13will be issued. The eligibility statement shall specify the maximum annual amount of the
14Massachusetts artist work shop tax credit authorized. The department shall only authorize the tax
15credits to qualified projects which are placed in service on or after January 1, 2016.
16 “Qualified project”, a project for the construction of a new building located in a cultural
17district, or renovation of an existing building located in a cultural district, providing artists with
18the workspace necessary to produce art, which meets the requirements of this section.
19 “Taxpayer”, a person, firm, partnership or other entity subject to the income tax imposed
20by the provisions of this chapter hired as a contractor, subcontractor or otherwise to perform
21construction on a qualified project.
22 (b)(1) There shall be a Massachusetts artist workspace tax credit. The department may
23authorize annually under this section together with section 38GGH of chapter 63 the total sum
24of: (i) $20,000,000; (ii) unused Massachusetts artist workspace tax credits, if any, for the
25preceding calendar years; and (iii) Massachusetts artist workspace tax credits returned to the
26department by a qualified project.
27 (2) Unless otherwise provided in this section or the context clearly requires otherwise, the
28department shall authorize, administer, determine eligibility for the Massachusetts artist
29workspace tax credit. 3 of 9
30 (3) The department shall allocate the total available Massachusetts artist workspace tax
31credit among as many qualified projects as fiscally feasible, with the goal of increasing the
32commonwealth's stock of artist workspace.
33 (c)(1) A taxpayer may be allowed a state tax credit with respect to a qualified project,
34provided that the department issues an eligibility statement for that qualified project. This state
35tax credit shall be termed the Massachusetts artist workspace tax credit.
36 (2) The total Massachusetts artist workspace tax credit available to a qualified project
37shall be authorized and allocated by the department, or its successor agency, based on the
38qualified project's need for the credit for economic feasibility.
39 (3) The Massachusetts artist workspace tax credit shall be taken against the taxes
40imposed under this chapter, claimed equally for 5 years, subtracted from the amount of state tax
41otherwise due for each taxable period and shall not be refundable. Any amount of the artist
42workspace tax credit that exceeds the tax due for a taxable year may be carried forward to any of
43the 5 subsequent taxable years.
44 (4) All or any portion of tax credits issued in accordance with the provisions of this
45section may be allocated to parties who are eligible under the provisions of paragraph (1) of
46subsection (c). A taxpayer shall certify to the commissioner the amount of credit allocated to
47such taxpayer. The taxpayer shall provide to the commissioner appropriate information so that
48the artist workspace tax credit can be properly allocated.
49 (5) In the event that recapture of Massachusetts artist workspace tax credit is required,
50any statement submitted to the commissioner as provided in subsection (c) shall include the 4 of 9
51proportion of the state credit required to be recaptured, the identity of each taxpayer subject to
52the recapture and the amount of credit previously allocated to such taxpayer.
53 (6) The director of the department, in consultation with the commissioner, shall
54promulgate regulations necessary to administer the provisions of this subsection.
55 (d) The taxpayer shall submit, at the time of filing the taxpayer’s state tax return, a copy
56of the eligibility statement issued by the department with respect to such qualified project. In the
57case of failure to attach the eligibility statement, a credit under this section shall not be allowed
58with respect to such qualified project for that year until the copy is provided to the department of
59revenue.
60 (e) The commissioner or the department, through the promulgation of regulations, may
61require the filing of additional documentation necessary to determine the eligibility or accuracy
62of a tax credit claimed under the provisions of this section.
63 (f) The department, in consultation with the commissioner, shall monitor and oversee
64compliance with the Massachusetts artist workspace tax credit program and may promulgate
65regulations requiring the filing of additional documentation deemed necessary to determine
66continuing eligibility for the Massachusetts artist workspace tax credit. The department or the
67commissioner shall report specific occurrences of noncompliance to appropriate state, federal
68and local authorities.
69 (g) Except for unused credits carried forward pursuant to paragraph (3) of subsection (c)
70and section 38GGH of chapter 63, a qualified project shall not be eligible for any Massachusetts
71artist workspace tax credits for more than 7 taxable years. 5 of 9
72 (h) The department may provide that upon application for state tax credits issued by the
73department, such taxpayer may elect to receive such state tax credit in the form of a loan
74generated by transferring the credit to the department or its designee on terms specified by the
75department in accordance with its qualified allocation plan. Neither a direct tax refund nor a loan
76received as the result of the transfer of the credit shall be considered taxable income under this
77chapter.
78 (i) The department may pursue methods of enhancing the efficiency of the Massachusetts
79artist workspace tax credit program including but not limited to: pursuing opinions from the
80United States department of treasury's internal revenue service in the form of general counsel
81memoranda, private letter rulings and other notices, rulings or guidelines; by reviewing other
82state tax programs which utilize an option for taxpayers to receive such tax credit in the form of a
83loan generated by transferring the credit to a designated state entity; and any other such methods.
84 SECTION 2. Chapter 63 of the General Laws is hereby amended by inserting after
85section 38FF, as so appearing, the following section:-
86 Section 38GG. (a) For the purposes of this section, unless the context clearly requires
87otherwise, the following words shall have the following meanings:-
88 “Commissioner”, the commissioner of the department of revenue
89 “Cultural district”, a geographical area of a city or town within the commonwealth
90designated as a cultural district pursuant to the provisions of section 58A of chapter 10.
91 “Department”, the department of housing and community development, or its successor
92agency. 6 of 9
93 “Eligibility statement”, a statement authorized and issued by the department certifying
94that a given project is a qualified artist workspace project. The department, in consultation with
95the commissioner, shall promulgate regulations establishing criteria upon which the eligibility
96statements shall be issued. The eligibility statement shall specify the maximum annual amount of
97the artist workspace tax credit authorized. The department shall only authorize the tax credits to
98qualified artist workspace projects which are placed in service on or after January 1, 2016.
99 “Qualified artist workspace project” or “qualified project”, a project for the construction
100of a new building in a cultural district, or renovation of an existing building located in a cultural
101district, providing artists with the workspace necessary to produce art, which meets the
102requirements of this section.
103 “Taxpayer”, a corporation subject to an excise imposed by the provisions of this chapter,
104including, without limitations, section 2, sections 20 to 23, inclusive, section 29A, section 32 and
105section 39, hired as a contractor, subcontractor or otherwise to perform construction on a
106qualified project..
107 (b)(1) There shall be a Massachusetts artist workspace tax credit. The department may
108authorize annually under this section together with section 6O of chapter 62 the total sum of: (i)
109$20,000,000; (ii) unused artist workspace tax credits, if any, for the preceding calendar years;
110and (iii) any artist workspace tax credits returned to the department by a qualified artist
111workspace project.
112 (2) Unless otherwise provided in this section or the context clearly requires otherwise, the
113department shall authorize, administer, determine eligibility for the artist workspace tax credit. 7 of 9
114 (3) The department shall allocate the total available Massachusetts artist workspace tax
115credit among as many qualified artist workspace projects as fiscally feasible, with the goal of
116increasing the commonwealth's stock of artist workspace.
117 (c)(1) A taxpayer may be allowed a state tax credit with respect to a qualified artist
118workspace project, provided that the department issues an eligibility statement for that qualified
119project. This state tax credit shall be termed the Massachusetts artist workspace tax credit.
120 (2) The total Massachusetts artist workspace tax credit available to a qualified project
121shall be authorized and allocated by the department, or its successor agency, based on the
122qualified project's need for the credit for economic feasibility.
123 (3) The Massachusetts artist workspace tax credit shall be taken against the taxes
124imposed under this chapter, claimed equally for 5 years, subtracted from the amount of state tax
125otherwise due for each taxable period and shall not be refundable. Any amount of the tax credit
126that exceeds the tax due for a taxable year may be carried forward to any of the 5 subsequent
127taxable years.
128 (4) All or any portion of tax credits issued in accordance with the provisions of this
129section may be allocated to parties who are eligible under the provisions of paragraph (1) of
130subsection (c). A taxpayer shall certify to the commissioner the amount of credit allocated to
131such taxpayer. The taxpayer shall provide to the commissioner appropriate information so that
132the artist workspace tax credit can be properly allocated.
133 (5) In the event that recapture of Massachusetts artist workspace tax credits is required,
134any statement submitted to the commissioner as provided in subsection (c) shall include the 8 of 9
135proportion of the state credit required to be recaptured, the identity of each taxpayer subject to
136the recapture and the amount of credit previously allocated to such taxpayer.
137 (6) The director of the department, in consultation with the commissioner, shall
138promulgate regulations necessary to administer the provisions of this subsection.
139 (d) The taxpayer shall submit, at the time of filing the taxpayer’s state tax return, a copy
140of the eligibility statement issued by the department with respect to such qualified project. In the
141case of failure to attach the eligibility statement, a credit under this section shall not be allowed
142with respect to such qualified project for that year until the copy is provided to the department of
143revenue.
144 (e) The commissioner or the department may require the filing of additional
145documentation necessary to determine the eligibility or accuracy of a tax credit claimed under
146the provisions of this section through the promulgation of regulations.
147 (f) The department, in consultation with the commissioner, shall monitor and oversee
148compliance with the Massachusetts artist workspace tax credit program and may promulgate
149regulations requiring the filing of additional documentation deemed necessary to determine
150continuing eligibility for the Massachusetts artist workspace tax credit. The department or the
151commissioner shall report specific occurrences of noncompliance to appropriate state, federal
152and local authorities.
153 (g) Except for unused credits carried forward pursuant to section 6O of chapter 62 and
154paragraph (3) of subsection (c) of this section, a qualified project shall not be eligible for any
155Massachusetts artist workspace tax credits for more than 7 taxable years. 9 of 9
156 (h) The department may provide that upon application for state tax credits issued by the
157department, such taxpayer may elect to receive such state tax credit in the form of a loan
158generated by transferring the credit to the department or its designee on terms specified by the
159department in accordance with its qualified allocation plan. Neither a direct tax refund nor a loan
160received as the result of the transfer of the credit shall be considered taxable income under this
161chapter.
162 (i) The department may pursue methods of enhancing the efficiency of the Massachusetts
163artist workspace tax credit program including but not limited to; pursuing opinions from the
164United States department of treasury's internal revenue service in the form of general counsel
165memoranda, private letter rulings and other notices, rulings or guidelines and reviewing other
166state tax programs which utilize an option for taxpayers to receive such tax credit in the form of a
167loan generated by transferring the credit to a designated state entity.