S257 - Appropriations Act of 2017. (SL 2017-57)

Overview: Part 38 of S.L. 2017-94 contains the following finance provisions:

Individual Income Tax

• Lowers the personal income tax rate from 5.499% to 5.25%, effective for taxable years beginning in 2019.
• Increases the standard deduction to $20,000 for married filing jointly taxpayers and to $10,000 for single filers, effective for taxable years beginning in 2019.
• Changes the standard deduction for head of household filers to an amount that is 75% of the amount for married filing jointly taxpayers, effective for taxable years beginning in 2019.
• Changes the child credit to a tiered child deduction, effective for taxable years beginning in 2018.

Corporate Income Tax

• Reduces the corporate income tax rate from 3% to 2.5% rate, effective for taxable years beginning in 2019.

Franchise Tax

• Reduces the franchise tax rate for S corporations by applying a flat $200 on the first $1 million of the calculated base, applicable to the calculation of franchise tax reported on the 2018 and later corporate income tax returns.

Sales Tax

• Exempts from sales tax distribution equipment, and accessories, attachments, or repair parts for distribution equipment, sold to a large fulfillment facility, effective July 1, 2017.
• Repeals the 1%/$80 privilege tax applicable to mill machinery and certain other manufacturing and industrial equipment and establishes a sales tax exemption for this equipment, effective July 1, 2018. It also directs the Revenue Laws Study Committee to study this area of law to provide more guidance to taxpayers and the Department of Revenue about what constitutes "mill machinery," how to define "manufacturing," and how to incorporate the body of Departmental administrative law in this area into the statutes.
• Exempts from sales tax repair or replacement parts for a ready mix concrete mill, regardless of whether the mill is freestanding or affixed to a motor vehicle, effective July 1, 2018.
• Provides a sales tax refund for building materials, supplies, and equipment sold to a business that receives a JDIG award prior to June 30, 2019, for a "transformative project," which is a project that requires an investment of $4 billion in private funds and creates at least 5,000 eligible positions.

Renewable Energy Tax Credit

• Allows certain biomass resource-related projects to claim the renewable energy tax credit if it had a certain minimum level of completion prior to January 1, 2016, and it was placed in service prior to May 5, 2017.