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April 18, 2024

State and Local Tax Weekly for March 29 and April 5

Ernst & Young's State and Local Tax Weekly newsletter for March 29 and April 5 is now available. Prepared by Ernst & Young's State and Local Taxation group, this weekly update summarizes important news, cases, and other developments in U.S. state and local taxation.


IRS issues guidance on applying for 2024 Low-Income Communities Bonus Credit Program

The Treasury and IRS released Revenue Procedure 2024-19 (Revenue Procedure) on the Low-Income Communities Bonus Credit Program (program) for upcoming applications for the 2024 program year. The program increases the investment tax credits (ITCs) under IRC Section 48(e) for certain solar and wind facilities placed in service in low-income communities. This is the second year of the program and clarifies the application, documentation and lottery procedures that apply to the 2024 program year.

Background: The IRS established the program in Notice 2023-17, specifying that a total annual capacity limitation of 1.8 gigawatts of direct current capacity will be allocated for calendar years 2023 and 2024. To qualify, an individual project cannot exceed five megawatts. In determining how to allocate capacity limitation within certain categories of facilities, the program may also consider criteria such as whether the facility is owned or developed by a community-based organization, provides substantial benefits to a low-income community and has a higher degree of commercial readiness (see Tax Alert 2023-0333).

In June 2023, the Treasury and IRS proposed regulations with more details on the program and the selection process (see Tax Alert 2023-1018). In August 2023, they finalized the regulations (TD 9979) and issued Revenue Procedure 2023-27, which provided guidance on implementing the 2023 program. The IRS application window for the 2023 program was open from Oct. 19, 2023 until Feb. 29, 2024 (see Tax Alert 2023-1647).

2024 program guidance: Revenue Procedure 2024-19 supersedes Revenue Procedure 2023-27 and provides guidance for implementing the 2024 program. Any unused capacity limitation from the 2023 program year will be carried over to the 2024 program. According to the Department of Energy's (DOE) website, applications are still being processed and reviewed.

Annual capacity limitation: The Revenue Procedure specifies that the annual capacity limitation for 2024 will be divided among four categories, with two categories having different capacity limitations from 2023:

  • Category 1: Facilities located in a low-income community as defined in IRC Section 45D(e)(1) (600 megawatts for 2024, 700 megawatts in 2023)
  • Category 2: Facilities located on Indian land (200 megawatts)
  • Category 3: Facilities that are part of a qualified low-income residential building project (200 megawatts)
  • Category 4: Facilities that are part of a qualified low-income economic benefit project (800 megawatts for 2024, 700 megawatts in 2023)

Sub-reservations: The 600-megawatt capacity limitation for Category 1 is subdivided as follows:

  • Four hundred megawatts (490 megawatts in 2023) for eligible residential behind-the-meter (BTM) facilities, which includes rooftop residential solar facilities
  • Two hundred megawatts (210 megawatts in 2023) for applicants with front-of-the-meter (FTM) facilities and non-residential BTM facilities

Applications: Applications must be submitted through DOE's online Program portal system with all the required information, documentation and attestations. The Revenue Procedure lists the different documents and attestations that are required for each type of facility as well as the documentation necessary to demonstrate that a taxpayer meets the ownership requirements.

Applicants may only submit one application per facility for the 2024 program year. The Treasury and IRS will announce the opening and closing dates of the 2024 program application period on DOE's website. After the program is open, the DOE will accept applications for 30 days. The DOE will then continue to accept applications until the close of the 2024 program application period and consider those applications for any remaining capacity limitation.

At the end of the initial 30-day period, DOE will conduct a lottery for applications for oversubscribed facility categories and Category 1 sub-reservations. The lottery will be conducted before the applications are reviewed and the lottery scores will be used to determine which qualified facilities are eligible to be recommended for a capacity limitation allocation.

Applications that claim to meet "Additional Selection Criteria" for ownership or geographical purposes will be prioritized for an allocation over non-Additional Selection Criteria applications within the same facility category or Category 1 sub-reservation.

For more on this development, see Tax Alert 2024-0733.


District of Columbia: On April 3, 2024, Mayor Muriel Bowser presented her FY2025 budget , which has been introduced as B25-0784 "Fiscal Year 2025 Budget Support Act of 2024." Proposed tax changes would: (1) modify combined reporting provisions by moving from the Joyce to Finnigan apportionment method for tax years beginning after Dec. 31, 2025; (2) increase the current 6.0% sales and use tax rate to 6.5% beginning on Oct. 1, 2025 and to 7.0% beginning on Oct. 1, 2026; (3) provide real property tax credits for eligible properties converting from primarily commercial office space to other commercial or non-residential use (e.g., hotels, restaurant, retail); (4) impose a tax of $0.80 per room or suite rental, per night tax on all hotels, starting Oct. 1, 2025 (this tax will help fund 911 and 311 systems); (5) repeal the excise tax exemption for electric vehicles thus subjecting them to tax and increase the excise tax on vehicles that get 40 miles per gallon or more; among other tax changes.


Idaho: New law (HB 521) reduces the income tax rate imposed corporations, individuals, trusts and estates to 5.695% (from 5.8%), retroactively effective to Jan. 1, 2024. Idaho Laws 2024, ch. 237 (HB 521), signed by the governor on March 29, 2021.

New Jersey: New law (S.1422), for corporation business tax and gross receipts tax purposes, allows taxpayers to use an alternative depreciation method for eligible property expenditures related to the construction of qualifying new affordable housing developments. Specifically, taxpayers are allowed to depreciate a percentage of the eligible expenditures over a 10-year period. The percentage is calculated using "the following formula: 2 x (the number of affordable housing units in the development / the total number of housing units in the development)." The law defines "affordable housing," "affordable housing development," "affordable housing subsidy" and "eligible property expenditures." S.1422 took immediate effect and applies to eligible property expenditures for affordable housing developments placed in service during any privilege period or tax year beginning on or after Jan. 1, 2025. N.J. Laws 2024, ch. 1 (S.1422), signed by the governor on March 20, 2024.

Ohio: The Ohio Department of Taxation issued guidance on the alternative apportionment election for remote workers under the Municipal Net Profit Tax. The alternative apportionment formula, which is available for tax years ending on or after Dec. 31, 2023, assigns a remote employees' or owners' property, payroll and receipts to a "qualifying reporting location," which is determined using a hierarchy of locations. The hierarchy starts with the location where the employee regularly/periodically performs services for the business. If that location does not exist, then the amounts are assigned to the location where the employee's or owner's supervisor regularly/periodically reports during the year. And if that location does not exist then the amounts are assigned to a location determined in good faith and recorded on the business' records. Payroll, property and receipts not attributable to remote employees or owners are apportioned using the general apportionment provisions under Ohio R.C. 718.82. The guidance describes how to make an election and defines various terms, including "property factor," "payroll factor," "receipts factor," "qualifying remote employee or owner," "qualifying remote work location," "qualifying reporting location" and "reporting location." The guidance includes examples. Ohio Dept. of Taxn., Information Release "Municipal Net Profit Tax MNP 2024-01 — Am. Sub. H.B. 33 Updates" (March 6, 2024).

Oregon: New law (HB 4034) updates the state's date of conformity to the Internal Revenue Code (IRC) to Dec. 31, 2023 (from Dec. 31, 2022). This change applies to transactions or activities occurring on or after Jan. 1, 2024. The effective and applicable dates and the exceptions, special rules and coordination with the IRC, relative to those dates, contained in federal law amending the IRC and enacted before Jan. 1, 2024, apply for Oregon individual income and corporate excise and income tax purposes to the extent such can be made applicable. The law takes effect on the 91st day after the legislature adjourns sine die. Ore. Laws 2024, ch. 75 (HB 4034), signed by the governor on April 4, 2024.

Pennsylvania: The Pennsylvania Department of Revenue (PA DOR) issued a revised bulletin listing the obligations it believes constitute United States obligations and those that do not constitute such obligations. The PA DOR noted that the list is subject to change and that taxpayers seeking to deduct an amount on account of an obligation not on the lists will need to prepare adequate support and send it to the PA DOR Office of Chief Counsel. Pa. Dept. of Rev., Corporation Tax Bulletin 2024-02 "Shares Tax — Banks and Title Insurance and Trust Companies" (revised March 21, 2024).

Tennessee: In response to a ruling request, the Tennessee Department of Revenue (TN DOR) found that three real estate investment trusts (REITs), each owned by a limited partnership (LP A, LP B and LP C), and any entities more than 50% owned by the REITs each constitute separate captive REIT affiliated groups. The general partner/managing member of the LPs is a limited liability company that is a registered investment adviser under the Investment Advisers Act, is domiciled outside of Tennessee and does not have an office in Tennessee. The business activity of the REITs (as well as the LPs and LLCs they own) are to hold and receive payments on mortgages secured by property, and their only connection to Tennessee is that some of its mortgages, "from time to time", are secured by real or personal property in Tennessee and some of the borrows could be in Tennessee. Based on the facts presented, the TN DOR further found that the captive REIT affiliated groups, LP A, LP B and LP C are not doing business in Tennessee because they fall under the financial institution safe harbor and, as such, are not subject to the state's franchise and excise taxes. Tenn. Dept. of Rev., Revenue Ruling #24-01 (Feb. 14, 2024).

West Virginia: New law (HB 5024) exempts licensed private trusts companies created pursuant to W.V. Code Section 31I-1-1 from personal income tax, effective for tax years beginning on or after Jan. 1, 2024. HB 5024 takes effect June 7, 2024. W.V. Laws 2024, HB 5024, signed by the governor on March 27, 2024.

Wisconsin: Governor Tommy Evers approved an emergency administrative rule (Wis. Admin. Code 3.10) on March 7, 2024, clarifying what income from certain commercial and agricultural loans qualifies for a tax exemption enacted in 2023. For tax years beginning after Dec. 31, 2022, Wis. Stat. 71.26(l)(i), 71.05(l)(i) permits financial institutions to exclude from their income interest, fees, and penalties from a commercial loan of $5 million or less that they provide to a Wisconsin resident primarily for business or agricultural purposes. The emergency rule further defines statutory terms, outlines the Wisconsin Department of Revenue's interpretation of the $5 million limitation, and prescribes record-keeping requirements. For additional information on this development, see Tax Alert 2024-0728.


Arizona: New law (HB 2380) allows the Arizona Department of Revenue to deny a city's or a town's request to audit a taxpayer engaged in business in more than one city or town. Such denial prohibits that city or town from auditing the taxpayer. The law also requires the uniform audit committee established by the revenue director with cities and towns to create and publish uniform audit guidelines. HB 2380 takes effect 91 days after the legislative session ends. Ariz. Laws 2024, ch. 33 (HB 2380), signed by the governor on March 29, 2024.

Colorado: New law (HB 24-1041) prohibits a Home Rule city, town and city and county that collects its own sales and use tax and does not use the Electronic Sales and Use Tax Simplification System from collecting sales and use tax from retailers that do not have a physical presence in Colorado, unless the retailer elects to enter into a voluntary collection agreement the Home Rule city, town and city and county. Currently, the executive director of the revenue department can allow taxpayers whose monthly tax collected is less than $300 to file returns and pay taxes quarterly. HB 24-1041 increases the threshold to $600 for returns that must be filed on or after Jan. 1, 2025. For returns that must be filed on or after Jan. 1, 2026, the executive director may increase the amount of the monthly threshold. HB 24-1041 takes effect 91 days after final adjournment of the general assembly, unless a referendum petition is filed. If a petition is filed and approved during the Nov. 2024 general election, HB 24-1041 will take effect on the date of the governor's official declaration of the vote. Colo. Laws 2024, ch. 45 (HB 24-1041), signed by the governor on April 4, 2024.

New Jersey: New law (A.1495) exempts from sales and use tax receipts from sales made to contractors or repairmen of materials, supplies and services for housing sponsors engaged in affordable housing projects where all of the units are restricted for occupants with moderate, low or very low income. The law takes effect and the exemption applies to sales made on or after the May 1, 2024. N.J. Laws 2024, ch. 3 (A.1495), signed by the governor on March 20, 2024.

Texas: In response to a ruling request, the Texas Comptroller of Public Accounts (Comptroller) determined that retractor blades and handles sold by a medical device sales company are therapeutic devices and are subject to sales and use tax when sold to healthcare providers. Texas law exempts from sales and use tax (1) orthopedic devices and supplies and replacement parts for such devices (Tex. Tax Code Section 151.313(a)(5)), and (2) "therapeutic appliance, device, and any related supplies specifically designed for those products if dispensed or prescribed by a licensed practitioner of the healing arts, when those items are purchased and used by an individual for whom the device was dispensed or prescribed" (Tex. Tax Code Section 151.313(a)(6)). Orthopedic appliances are "any appliance or device designed specifically for use in the correction or prevention of human deformities, defects, or chronic diseases of the skeleton, joints or spine." Therapeutic devices are those "designed to alleviate pain or for use during the treatment or cure of human sickness, disease, suffering, or deformity … ." The retractor blades, which are used to separate tissue for various procedures, are not orthopedic devices but are therapeutic devices, the Comptroller found, further stating that health care providers or other institutions providing health care/medical services to individuals owe tax on therapeutic appliances and devices (and related supplies) used to provide nontaxable health care and medical services. Heath care providers that qualify as an exempt organization, however, may make an exempt purchase of medical devices by providing a properly completed exemption certificate. Tex. Comp. of Pub. Acct., Star System # 202401025L (Jan. 30, 2024).

Virginia: New law (HB 1508 and SB 709) allows the Virginia Department of Taxation (Department), upon application of the taxpayer, to apply erroneously remitted retail sales tax payments to a use tax assessment of the taxpayer for the same transaction. To be eligible, the taxpayer must provide evidence of the erroneously paid retail sales tax and the amount remitted in each transaction. Relief under this provision does not apply to taxpayers that previously applied for and received relief, or in the case of a false or fraudulent action by a taxpayer with the intent to evade tax. Taxpayers are not entitled to a refund of any erroneously remitted retail sales tax until they show the tax has been refunded to the purchaser or credited to the purchaser's account. Va. Laws 2024, ch. 113 (HB 1508) and ch. 128 (SB 709), both bills signed by the governor on March 20, 2024.

Wisconsin: New law (SB 616) exempts from sales and use tax the sales, storage, use or other consumption of portable machinery and equipment used primarily to crush, mill, produce or pulverize asphalt, concrete, gravel, rock or aggregate base for road or commercial surface lot construction or resurfacing. The exemption applies to accessories, attachments, parts and supplies for such machinery and equipment. The exemption applies starting June 1, 2024. Wis. Laws 2024, Act 146 (SB 616), signed by the governor on March 21, 2024.

Wisconsin: New law (AB 29) exempts from sales and use tax the sale, use, consumption of precious metal bullion (e.g., coins, bars, rounds or sheets containing at least 35% gold, silver, copper, platinum or palladium, and marked with weight, purity and content). This exemption does not apply to any other tangible personal property that contains precious metal, such as jewelry. This provision took effect on March 23, 2024. Wis. Laws 2024, Act 149 (AB 29), signed by the governor on March 21, 2024.


Federal: In Notice 2024-30 (Notice), the IRS modifies earlier guidance on defining "energy communities" for purposes of the increased production tax credits (PTCs) under IRC Sections 45 and 45Y and investment tax credits (ITCs) under IRC Sections 48 and 48E. The Notice expands the areas that could qualify for the bonus credits by modifying the "nameplate capacity attribution rule" and the "fossil fuel employment rate" in Notice 2023-29. According to the Notice, the rules will apply to tax years ending after April 4, 2023. Taxpayers can rely on Notice 2023-29, as modified by subsequent notices, until the proposed rules are issued. For additional information on this development, see Tax Alert 2024-0691.

Oregon: New law (SB 1526) extends the sunset date of the Oregon Industrial Site Readiness Program to before Dec. 31, 2029 (from before July 1, 2023). The law modifies employment level and wage qualification provisions, requiring for rural sites an increase of average annual employment by at least 25 jobs (from at least 25 full-time jobs). For urban sites, the job requirement is the hiring of at least 50 full-time employees. The law also adds semiconductor-related development activities in a designated e-commerce city that may qualify for a property tax exemption. This change applies to property tax years beginning on or after July 1, 2025. In addition, the law expands the property tax exemption for permanent improvements consisting of solar energy systems for the purposes of heating, cooling or generating electricity that are made to land owned by the United States and held in trust for a federally recognized Indian tribe in Oregon and is within Jefferson or Wasco counties. To qualify for the exemption, such improvements must be subject to a property tax program imposed by the tribe. This exemption applies to (1) the first solar energy system project completed on or after June 6, 2024, (2) property tax years beginning on or after July 1, 2025. SB 1526 takes effect June 6, 2024. Ore. Laws 2024, SB 1526, signed by the governor on March 27, 2024.

Pennsylvania: The Pennsylvania Department of Revenue issued a bulletin on restricted tax credits, discussing how they are applied to a taxpayer's liability and requirements for their sale. The guidance lists the saleable restricted tax credits to which the bulletin applies, including the research and development credit, film credit, various Keystone credits, manufacturing and investment tax credit, semiconductor manufacturing, biomedical manufacturing and research tax credit, among other credits. Topics addressed by the bulletin include: (1) the application of the restricted credit to tax periods and to corporate accounts, with examples; (2) the requirements sellers must met before the sale or assignment of a credit will be approved; (3) the requirements that must be met for a pass-through entity to pass the credits to their shareholders, partners, members or owners; (4) the waiting period before credits can be sold (e.g., certain credits must be held for one year before being sold); (5) the use of purchased credits by buyers and limits on buyer tax liability offsets; and (6) the tax return reporting requirements for buyers and sellers. The bulletin includes frequently asked questions. Pa. Dept. of Rev., Restricted Tax Credit Bulletin 2024-01 "The Application and Sale of Restricted Tax Credits" (March 20, 2024) (replaces Restricted Tax Bulletins 2021-02 and 2018-01 and Corporation Tax Bulletins 2014-04, 2011-03 and 2008-02).

South Carolina: The South Carolina Department of Revenue issued guidance on the income tax credit for purchase and installation of a qualifying solar energy system, small hydropower system or geothermal machinery and equipment (commonly referred to as the solar energy credit). The guidance describes: (1) which purchases and expenses qualify for the solar energy credit; (2) the requirements that must be met to qualify for the solar energy credit; (3) the types of facilities in South Carolina that will qualify for the credit; (4) whether a taxpayer can claim a credit for a system installed on rental property or on a leased solar energy system; (5) whether community solar qualify for the credit; (6) whether the credit is reduced by any rebates or other incentives received by the taxpayer; (7) when and who can claim the credit; (8) the amount of the credit and credit carryforward; (9) claiming the credit for systems installed in multiple locations or for the installation of separately qualifying equipment at the same facility; (10) how to calculate the credit when the taxpayer has multiple different types of credits; (11) how to claim the credit on a South Carolina income tax return; and (12) the differences between the solar energy credit and the solar energy property credit. The SC DOR also said taxpayers who qualify for federal solar credits do not automatically qualify for the South Carolina Energy Credit as the requirements for each credit are different. The guidance applies to all open periods. S.C. Dept. of Rev., SC Revenue Ruling #24-2 (March 26, 2024).

Washington: New law (HB 2482) reinstates and extends the following tax preferences for semiconductor manufacturing: (1) the preferential 0.275% business and occupation (B&O) tax rate for manufacturing or processing for hire semiconductor materials; (2) the B&O tax credit equal to $3,000 for each manufacturing production position at the new building that manufactures semiconductive materials; (3) the B&O exemption for manufacturing semiconductor microchips; (4) the sales and use tax exemptions for purchases of gases and chemicals used in the semiconductor manufacturing process; (5) the sales and use tax exemption for labor, services and sales of tangible personal property related to the construction of new buildings used for manufacturing semiconductor materials (applications for this exemption must be made 90 days before initiation of the construction of the facility); and (6) the property tax exemption for machinery and equipment exempt from sales and use taxes used in manufacturing semiconductor materials at a building exempt from sales and use tax and in compliance with certain employment requirements. These preferences are contingent on the siting and commercial operation of a significant semiconductor microchip fabrication facility in Washington; they expire on Jan. 1, 2034. Reimbursement of 50% of the amount of the tax preference received is required for certain preferences when the number of the taxpayer's employees is less than 90% of the person's three-year employment average for the three years immediately preceding the year the preferential rate is claimed. HB 2482 took effect on March 26, 2024. Wash. Laws 2024, ch. 261 (HB 2482), signed by the governor on March 26, 2024.


New Jersey: New law (A.3337) allows a municipality to exempt from real property tax housing projects or programs that have been awarded a grant or loan from a State or municipal affordable housing trust fund if the housing sponsor enters an agreement with the municipality for payments in lieu of taxation for municipal services. The agreement may require the housing sponsor to pay up to 20% of annual gross revenue from each housing project located on the real property. The agreement must require the housing sponsor pay not less than the greater of 4% of annual gross revenue or the amount of taxes attributable to the land value component of the project site's property for the year preceding the recording of the mortgage, if applicable. The law provides that the exemption should not extend beyond the date on which the eligible loan for the project is paid in full; a municipality, however, may agree to continue a tax exemption for a state, federally or municipally subsidized housing project beyond the date such loan is fully paid or the date upon which the exemption expires for any period the project remains subject to certain affordability controls. A.3337 took immediate effect. N.J. Laws 2024, ch. 6 (A.3337), signed by the governor on March 20, 2024.

South Dakota: New law (SB 201) allows a county to impose a pipeline surcharge up to $1 per liner foot of carbon dioxide pipeline installed in the county during a tax year the carbon dioxide pipeline company claims a federal tax credit for carbon dioxide sequestration under 26 U.S.C. Section 45Q. The company must report to a county in which it installed a pipeline the linear footage of carbon dioxide installed in the county. The law also prohibits a county, municipality, township or other governmental unity from enacting or increasing a tax, fee or charge that is related to a gas or liquid transmission line or an electric transmission line that requires or holds a permit under S.D. Code Section 49-41B. This prohibition does not apply to real property taxes; road use, construction, maintenance and improvement agreements; and the new surcharge on carbon dioxide pipeline. The law requires that any fee or tax permitted under these provisions be uniform and apply to all classes of facilities (except the new surcharge). SB 201 takes effect July 1, 2024. S.D. Laws 2024, SB 201, signed by the governor on March 7, 2024.

Virginia: New law (HB 1429 and SB 483) classifies as farm machinery and farm implements, which a locality may exempt from personal property tax, "farm machinery, farm equipment, and farm implements, other than farm machinery and farm implements [designed solely for planting, production or harvesting of a single product or commodity], used by an indoor, closed, controlled-environment commercial agricultural facility … for the production of agricultural products." Such indoor facilities include indoor vertical farming or a greenhouse. The provisions of HB 1492/SB 483 take effect on July 1, 2024. Va. Laws 2024, ch. 87 (HB 1429) and ch. 88 (SB 483), both bills signed by the governor on March 14, 2024.

Virginia: New law (HB 574), for recordation tax purposes, defines the "value of the property conveyed" or "value of the interest" as "the most recent property tax assessment for such property at the time the property is conveyed." Recordation tax is imposed at a rate of 25 cents on every $100 (or fraction thereof) of the greater of (1) the consideration of the deed or (2) the actual value of the property conveyed. This provision takes effect on July 1, 2024. Va. Laws 2024, ch. 140 (HB 574), signed by the governor on March 26, 2024.


Colorado: New law (HB 24-1119 ) provides for the use of a multi-state filing system for insurance tax filings. Applicable to premium and surplus lines tax filings submitted on or after Jan. 1, 2025, insurance companies and other taxpayers are required to submit all taxes, penalties, fees and associated filings required for premium tax filings, surplus lines tax filings and associated payments, to the Division of Insurance (DOI) through a DOI identified secure web-based application system (hereafter "system"). The Commissioner may contract with a qualified third party, including the national Association of Insurance Commissioners as well as the Florida Surplus Line Service Office, for a system that allows insurance companies to file their premium taxes and surplus line taxes in multiple states on a single system. A third party would be allowed to charge an insurance company a nominal fee for the filing service. Colo. Laws 2024, ch. 38 (HB 24-1119), signed by the governor on March 22, 2024.


Idaho: New law (HB 445) modifies provisions on the accrual of interest on income and sales tax deficiencies. Effective retroactively to Jan. 1, 2024, interest on deficiencies will not accrue for any period beginning on the date the state tax commission sends written notice that an audit is being initiated until the date the notice of deficiency determination is issued. Interest also will not accrue on a deficiency for any period between the issuance of a notice of deficiency determination that is subject to a perfected protest and the date of the final determination of the deficiency by the state tax commission. Idaho Laws 2024, ch. 116 (HB 445), signed by the governor on March 20, 2024.


California: New law (SB 136) increases the tax amount for Medi-Cal taxing tier II. The prior rate of $182.50, which applied for the period of April 1, 2023 through Dec. 31, 2023 is increased to $205 for calendar years 2024 (from $182.50), 2025 (from $187.50) and 2026 (from $192.50). Cal. Laws 2024, ch. 6 (SB 136), signed by the governor on March 25, 2024.

New Mexico: An omnibus tax bill, HB 252 (ch. 67), signed into law by New Mexico's Governor Michelle Lujan Grisham on March 6, 2024, includes changes to corporate and individual income taxes, as well as gross receipts and compensating taxes. It also creates new and enhances certain existing tax credits. See Tax Alert 2024-0722 for a summary of those changes.

New Jersey: New law (A.4011) imposes an annual fee of $250 on every zero-emission vehicle to be registered, effective July 1, 2024 through June 30, 2025. (The new annual fee is in addition to registration fees.) The fee is increased as follow: (1) $260 for the period July 1, 2025 through June 30, 2026; (2) $270 for the period July 1, 2026 through June 30, 2027; (3) $280 for the period July 1, 2027 through June 30, 2028; and (4) $290 for the period beginning July 1, 2028 and each year thereafter. N.J. Laws 2024, ch. 7 (A.4011), signed by the governor on March 26, 2024.

South Dakota: New law (HB 1092) increases the monthly uniform 911 emergency surcharge to $2 (from $1.25) per service user line. The increase is effective July 1, 2024, and expires on July 1, 2026. S.D. Laws 2024, HB 1092, signed by the governor on March 18, 2024.

Utah: New law (HB 164) provides that a central bank digital currency is not "specie legal tender" and "is not legal tender in Utah," further making clear that money does not include "central bank digital currency." The law defines central bank digital currency as a digital currency, a digital medium of exchange, a digital monetary unit of account issued by the United States Federal Reserve System, a federal agency, a foreign government, a foreign reserve system, or a foreign central bank and that is made available to consumers by such entities or processed or validated by such entities. HB 164 takes effect May 1, 2024. Utah Laws 2024, HB 164, signed by the governor on March 13, 2024.

Because the matters covered herein are complicated, State and Local Tax Weekly should not be regarded as offering a complete explanation and should not be used for making decisions. Any decision concerning matters covered herein should be reviewed with a qualified tax advisor.