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Spotlight on 2014 Connecticut Tax Legislation

Several new tax developments from the state's 2014 legislative session may affect businesses in Connecticut. The state has an ongoing $75 million revenue tax collection initiative focused on transfer payments, non-filers and remaining tax deficiencies following the 2013 tax amnesty. Here’s a summary of two of the most significant business changes.

Manufacturing Reinvestment Account (MRA)

Certain small manufacturers are permitted to deposit funds into an MRA and use those funds to pay for qualified investments in property and employees. Manufacturers can make annual cash contributions to an MRA of up to the lesser of $100,000 or the manufacturer’s domestic gross receipts. A contribution is eligible for an income tax deduction in the year in which the contribution is made as long as the funds are used for qualified investments, which include certain purchases in the state of Connecticut related to machinery or equipment, the manufacturing facility, and workforce development and expansion.
 

The tax exemption for MRAs is increased from 50% to 100% for amounts used for eligible purposes for both income and corporation business tax. Effective July 1, 2014.

Sales and Use Tax Return Due Date Accelerated

The filing and payment due date for all filers is moved up to the 20th of the month, rather than the last day of the month. Certain delinquent taxpayers may be required to remit on a weekly basis. Effective October 1, 2014.

 

In addition to the above mentioned changes, also available are some tax incentives for targeted areas such as apprenticeship training, historic preservation, and aerospace reinvestment (R&D).

If you would like to find out how these provisions may affect your business, please contact us.

 

Contact Us

Meredith Smith, SALT tax manager, at MTheiss@TaxOps.com or 720.227.0064.

TaxOps State and Local Practice at a Glance TaxOps State and Local Practice at a Glance (219 KB)

 

 

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