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S.A.L.T. Select Developments: Georgia

Baker Donelson's S.A.L.T. Select Developments will identify important state and local tax developments from Georgia.

State and local taxes impact almost every taxpayer. S.A.L.T developments in any one jurisdiction can be frequent and sometimes confusing. Where multiple jurisdictions are involved, staying current with state and local tax developments can be overwhelming for any taxpayer.

To assist you with staying current on a periodic basis, Baker Donelson's S.A.L.T. Select Developments will identify one or more recent state and local tax developments from Georgia.

October 2021

Proposed Rule Concerning Implementation/Administration of Life Sciences Manufacturing Job Tax Credit: On October 7, 2021, the Georgia Department of Revenue (Department) issued Notice IT-2021-4 setting forth a proposal to adopt Rule 560-7-8-.67 involving the life sciences manufacturing job tax credit. According to this Notice, the Department will consider the adoption of this Rule at a remote regulation hearing to be held on November 10, 2021, and that all comments regarding such Rule from interested persons and parties must be submitted no later than 10:00 am on November 10, 2021. As noted in this proposed Rule, the life sciences manufacturing job tax credit may be used to offset 100 percent of a medical equipment and supplies manufacturer's and pharmaceutical and medicine manufacturer's Georgia income tax liability derived from operations from within Georgia. The proposed Rule sets forth various definitions, provides information regarding the maximum credit amount, the eligibility of the credit, and the conditions and limitations pertinent to the credit, among other information. According to this proposed Rule, this Rule would be effective on July 1, 2021 and shall be applicable to taxable years beginning on or after January 1, 2021. More information can be found here.

September 2021

Revenue Leadership Team: On September 2, 2021, the Georgia Department of Revenue (Department) announced an innovative leadership team at the Department to address functional areas of Tax Operations, Agency Operations and Governance & Planning. This leadership team is comprised of the Deputy State Revenue Commissioner and two Assistant Deputy Commissioners. The objective of these new functional areas within the Department is to streamline services for taxpayers, and this new leadership team will apparently be responsible for achieving that objective. More information can be found here.

August 2021

HB 149 as a Federal SALT Limitation Workaround: In November 2020, the IRS issued Notice 2020-75, responsive to the $10,000 limitation on the deductibility of state and local taxes applicable to individuals which was part of the Tax Cuts and Jobs Act of 2017. In the notice, the IRS said that it intended to issue proposed regulations clarifying that state and local income taxes imposed on and paid by a partnership or an S corporation on its income are allowed as a deduction by the partnership or S corporation in computing its non-separately stated taxable income or loss for the taxable year of payment. If, by virtue of state and local legislation, the obligor of the tax is the entity (i.e., a Subchapter S corporation or partnership), this would effectively provide a workaround to the limitation. The tenor of this notice was to validate the workaround acts passed by some states and to invite other states to pass similar legislation.

The Georgia legislature approved, and the Governor signed HB 149, the effect of which is to allow, in limited circumstances, an S corporation or a partnership to make an annual irrevocable election to pay income taxes at the entity level. See May issue here.

The Georgia Department of Revenue apparently believes that HB 149 is directly responsive to the invitation in Notice 2020-75, in that it provides that the annual election makes the entity, and not the partners or shareholders, the taxpayer, thus distinguishing this feature from the otherwise applicable withholding elections.

Sales Tax Extension to Marketplace Innkeepers: In 2020, Georgia adopted amendments to its Sales and Use Tax Act defining "marketplace facilitators" as "dealers" for purposes of requiring so called "click through" merchants who sell through other online merchants to collect and remit sales tax. In 2021, Georgia extended the reach of the Sales and Use Tax Act to booking agents who book rooms for transients. HB 317 adds the term "Marketplace Innkeeper" to the definition of "dealer," thus applying parallel requirements on booking agents. More information can be found here.

July 2021

Proposed Amendment to Manufacturing Sales Tax Rule: On June 11, 2021, the Georgia Department of Revenue (Department) issued Notice SUT 2021-002, which proposes to amend Rule 560-12-2-.62 "Manufacturing Machinery and Equipment, Industrial Materials, and Packaging Supplies." The Department states in this Notice that the proposed amendment will be considered at a remote regulation hearing to be held on July 27, 2021. In the synopsis following the Notice, the Department states that it proposes to amend that Rule by making changes as indicated in the copy attached to the Notice. The copy of the Rule attached to the Notice contains the word "PROPOSED" on each page of the proposed amendment to Rule 560-12-2-.62. The Department also states in the synopsis that the purpose of the proposed amended Rule is to conform the Rule to O.C.G.A. Section 48-8-3.2 as amended in 2021. The Notice states that comments may be submitted to the Department in advance of the hearing. More information can be found here.

June 2021

Legislation Addressing Chevron Deference: Chevron deference is a principle of judicial review in which a federal court yields to an agency's interpretation of a statute or regulation. This principle was developed by the United States Supreme Court in 1984 in the case of Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc. However, with respect to tax laws in the State of Georgia, Governor Kemp signed Senate Bill 185 a few months ago which provides in essence that all questions of law decided by a court or by the Georgia Tax Tribunal pursuant Georgia law, including interpretations of constitutional, statutory and regulatory provisions, shall be made without any deference to any determination or interpretation, whether written or unwritten, that may have been made on the matter by the Georgia Department of Revenue (Department), except such requirement shall have no effect on the judicial standard of deference accorded to rules propagated pursuant to the Georgia Administrative Procedure Act. Similar language in this legislation addresses refund claims and related tax matters in Georgia. More information can be found here.

Film Tax Credit/Non-qualifying Vendors: The Department recently issued Informational Bulletin CRED-2013-2-13, revised June 2, 2021, dealing with the Georgia film tax credit (more information as to this credit can be found here). In this revised Informational Bulletin, the Department gives examples of vendors that do not qualify as a Georgia vendor under applicable regulations for purposes of the film tax credit. For instance, one example provides that Company A has an inventory of costumes that it rents and sells to production companies; that a production company places an order for a type of costume that Company A does not regularly hold in its Georgia inventory; that Company A rents/buys the costumes from a company that is not a Georgia vendor in order to fulfill the order from the production company; and, as a result, Company A would not be considered a Georgia vendor for this costume because more than a de minimis amount of this type of costume is not regularly held in their inventory and therefore the amount paid to Company A by the production company for the costume would not qualify as a production expenditure for purposes of the film tax credit. More information can be found here.

Usufruct/Property Tax Litigation Update: Georgia recognizes a property interest, having an origin in the English common law, known as a usufruct. A usufruct, as opposed to a leasehold interest, is an interest in real property pursuant to which the holder is limited to specific uses for the property. Generally, but not always, the term of a usufruct interest is no more than five years. A common example of a usufruct is an apartment lease. The Mercedes stadium, used by the Atlanta Falcons, had been classified by the Fulton Assessor's Office as a usufruct and hence not taxable for ad valorem tax purposes. In Love v. Fulton County Board of Tax Assessors, property owners contended that the Board of Assessors had erred in classifying the interest of the Atlanta Falcons as a usufruct, as opposed to a leasehold. The Georgia Supreme Court on June 1, 2021 sided with the Board in recognizing that the limitations put on the use of the facility were sufficient to justify classifying the property interest as a usufruct. More information can be found here.

May 2021

Entity Level Taxation for Electing S Corporations/Partnerships: Act 164, as signed by Governor Kemp on May 4, 2021, permits Subchapter S corporations and electing partnerships to elect irrevocably to pay tax at the entity level at the rate of 5.75 percent of its net income, in lieu of the shareholders or partners paying tax on the entity's net income. There are various qualifying conditions for this election. Just a few of such conditions are, following such election, neither the entity nor the shareholders/partners are entitled to a deduction on account of the payment and the election has no effect on the basis of the shareholders/partners in their stock/partnership interests in the entity. This new law is effective with respect to taxable years beginning on or after January 1, 2022. More information may be found here.

April 2021

Extension to May 17: On March 19, 2021, the Georgia Department of Revenue (Department) announced, in conformance with the federal extension of the individual income tax return due date, that Georgia is automatically extending the 2020 individual income tax filing and payment deadline from April 15, 2021 to May 17, 2021, without penalties or interest. According to this announcement, this Georgia relief is only for the tax year 2020 individual state income tax payments and state individual income tax returns due on April 15, 2021. Further, individual taxpayers do not need to file forms or call the Department to qualify for this automatic filing and payment extension. Estimated income tax payments due on April 15, 2020 are not included in this extension. Separately, the Department has published various FAQs regarding the 2020 individual income tax filing and payment deadline extension, which can be found here.

Reduction in Individual Income Taxes: On March 22, 2021, Governor Kemp signed legislation passed by the Georgia Legislature increasing the standard deduction for various taxpayers, effective for all taxable years beginning on or after January 1, 2022. More information can be found here.

Unemployment Income Still Taxable: On April 5, 2021, the Department updated its income tax guidance to state that unemployment income remains taxable at the state level and must be included in the taxpayer's income in their Georgia return. The American Rescue Plan Act of 2021, which provides for an exemption at the federal level for certain amounts of unemployment income, was signed into law by President Biden on March 11, 2021. However, Governor Kemp had already signed earlier Georgia legislation updating the state's income tax laws to conform to the Internal Revenue Code as it existed prior to January 1, 2021, so the revisions made by the American Rescue Plan were not included within the confirmation legislation signed by Governor Kemp. As result, Georgia has not yet adopted the tax exemption for any unemployment income. More information can be found here.

March 2021

Updates Reported – The Georgia Department of Revenue is amending the sales and use tax rules dealing with direct pay reporting. The Department considered these amendments at a remote regulation hearing held on March 9, 2021, with such proposed changes addressing definitions as well as substantive provisions within the current Direct Pay Reporting Regulations found at Section 560-12-1-.16 of the Department's Regulations.

Additionally, the Georgia Legislature recently passed legislation (H.B.265), and Governor Kemp signed that legislation on February 24, 2021, updating Georgia's corporate and personal income tax laws so as to conform to the Internal Revenue Code as it existed prior to January 1, 2021. This legislation provides that, for taxable years beginning on or after January 1, 2020, the provisions of the Internal Revenue Code of 1986, as amended, which were as of January 2021, enacted into law but not yet effective, shall become effective for purposes of Georgia taxation on the same dates upon which they become effective for federal tax purposes. Notably, businesses eligible for PPP loan forgiveness would not be required to pay Georgia taxes on such forgiven loans even though included in income; and those businesses can claim tax deductions for appropriate business expenditures using the loan proceeds. This new law is effective for all taxable years beginning on or after January 1, 2020. More information can be found here.

February 2021

Updates Reported – On January 26, 2021, the Georgia Department of Revenue posted General Instructions for third-party audit firms interested in becoming certified eligible auditors for purposes of conducting mandatory film tax credit audits. (For background information, see here for our September 2020 SALT Select Developments addressing the recently revised Georgia firm production credit, which references that the audit requirement would be phased in starting in 2021.) As noted in the General Instructions, production companies may alternatively request either a third-party audit firm to conduct the mandatory audit or request the Department to conduct the audit. A production company requests an audit by completing the application, the link for which is in the General Instructions. Whether the audit is completed by the third-party audit firm or by the Department, the Department will complete the final review and issue the Final Certification Letter. Eligible third-party audit firms are added to the certified list of auditors once they have completed the required training and have been certified by the Department. Third-party audit firms interested in becoming a certified auditor will find a list of qualifications and applications at another link within the General Instructions. Those links within the General Instructions are supposed to be available February 10, 2021. More information can be found here.

January 2021

Updates Reported – On January 5, 2021, the Georgia Department of Revenue announced the interest rate which would apply to interest-bearing refunds and past due taxes for the 2021 calendar year. According to the Department's Policy Bulletin ADMIN-2021-01, the annual interest rate will be 6.25 percent, accruing monthly, for the calendar year 2021. The interest rate for 2020 was 7.75 percent. More information can be found here.

December 2020

Updates Reported – The Georgia Department of Revenue recently held a remote regulation hearing regarding a proposed amendment to a certain substantive Regulation. Specifically, Regulation Section 560-3-2-.26 is being amended so as to add a new Subsection (7)(g) which will provide that any Form 900, Georgia Financial Institutions Business Occupation Tax Return, which is due on or after March 1, 2021, must be filed and the tax be paid through the Department's Georgia Tax Center. This proposal also states that the amendment is necessary so that the Department's systems can more efficiently process the related credit that is allowed against income tax.

November 2020

Updates Reported – On November 10, 2020, the Georgia Department of Revenue issued Policy Bulletin ADMIN-2020-02, which addresses the acceptance of electronic signatures, remote notaries, and electronic filings. As noted in this Policy Bulletin, the Department is clarifying its current regulations on electronic signatures and filings, and authorizing broader acceptance of digital or electronic signatures, electronic filings, and remote notarization for certain documents and forms. The Policy Bulletin specifically states that it does not apply to the Department's Motor Vehicle Division documents and forms. This Policy Bulletin does state that through the Department's regulations, the Department has defined "electronic signature" for purposes of electronic filings of registrations and tax returns. The Department has also laid out guidelines for the acceptance of e-signatures by taxpayers and/or their authorized third-party representatives. The Bulletin further states that e-signatures that comply with the standards set forth in this Bulletin will have the same effect as signatures on a paper tax return or form. The Bulletin sets forth the various acceptable forms of an e-signature, remote notarization, electronic transmission of e-signature documents, among other topics pertaining to e-signatures. More information can be found here.

October 2020

Updates Reported – On October 7, 2020, and so as to provide additional economic assistance during this pandemic, the Georgia Department of Revenue has issued Notice IT-2020-1. That Notice announced a proposal to adopt Rule 560-7-8-.66 which, if promulgated, would provide an additional $1,250 personal protective equipment manufacturer jobs tax credit for qualifying jobs engaged in manufacturing personal protective equipment in Georgia during the taxable year. The credit appears to be applicable to personal protective equipment manufacturers that qualify for the jobs tax credit under O.C.G.A. Section 48-7-40 or 48-7-40.1 and the applicable regulations associated with that credit. This additional jobs tax credit can be used to offset 100 percent of the manufacturer's Georgia income tax liability derived from operations within Georgia. The qualifying activity of manufacturing personal protective equipment shall be determined on a monthly basis, and that manufacturer must compute a monthly average number of jobs engaged in the qualifying activity in this State. Any job that is included in the jobs tax credit calculation where 50 percent or more of the time is spent on such qualifying activities shall be eligible to be included in the total for the month. Examples are given in the proposed Rule with respect to such computations.

If eligible for this additional jobs tax credit, the manufacturer would claim the additional credit by submitting a Form IT-CA with the manufacturer's Georgia income tax return each year the credit is claimed. Any excess credit may be applied against the manufacturer's withholding tax liability under certain circumstances. A carry-forward of unused credit is available for ten years. Special provisions are provided in the Rule for pass-through entities. This proposed Rule, if promulgated, shall be applicable to tax years beginning on or after January 1, 2020, but shall not be allowed for any jobs created on or after January 1, 2025. A hearing on this proposed Rule is scheduled for November 17, 2020. Written comments on this proposed Rule must be sent to the Department as set forth in the Notice.

September 2020

Coronavirus Tax Payment and Return Filing Responsibilities (September 30) - Updates Reported: For some years, Georgia has encouraged film production in that State by allowing a credit against Georgia income taxes of 20 percent of certain expenses incurred in film production within Georgia. If the production company could not use the credit, the credit could be sold to a Georgia taxpayer who could use the credit. This sale typically occurs at a discount from face value. Due to perceived abuses, the Georgia Legislature this year passed, and Governor Kemp signed on August 4, 2020, House Bill 1037, which will narrow the types of expenditures for which credits are available and limit the expenses to those incurred in Georgia. In addition, the Bill will require that all expenses for which a credit is available be audited. The audit requirement would be phased in starting in 2021. For 2021, the audit requirement will apply to projects for which the credit sought exceeds $2.5 million. The threshold is reduced to $1.25 million in 2022. The threshold drops to zero in 2023. The audit can be performed either by the Department of Revenue or by a certified public accountant who has met the requirements set by the Department. More information can be found here.

August 2020

Coronavirus Tax Payment and Return Filing Responsibilities (August 20) - Updates Reported: On August 17, 2020, the Georgia Department of Revenue issued an Informational Bulletin entitled Property Tax Appeal Deadline and COVID-19. This Bulletin referenced that the Chief Justice of the Georgia Supreme Court has issued an Order Declaring Statewide Judicial Emergency, which has been extended several times, that modifies various deadlines or other time schedules including an extension of the deadline for filing certain ad valorem tax appeals. The most recent of these extension orders, according to the Bulletin, provided that, for notices of assessment issued between March 14, 2020 and July 13, 2020, the 45-day appeal period began running on July 14, 2020, making the new appeal deadline August 27, 2020. Further, the Bulletin noted that pursuant to Georgia law the Department issues Orders Authorizing Collection after receiving required certifications from County Boards of Assessors; and, in view of this recent Extension Order affecting filing of property tax appeals, the certification regarding properties under appeal and values in dispute should be made after the new appeal deadline of August 27, 2020. More information can be found here.

July 2020

Coronavirus Tax Payment and Return Filing Responsibilities (July 27) - Updates Reported: Georgia, like most states, allows local governmental entities to piggy-back their local sales taxes onto the State tax. When this is done, the State collects both portions and remits to the local government entity its respective portion. When there is an occasion for a taxpayer to claim a refund, the State Department of Revenue determines the validity of the claim for refund and notifies the local government entity that the refund has been approved. In such instances, the State Department of Revenue deducts the refund from future payments otherwise due the local government entity. In some instances, the local government entity may experience a shortfall in budgeted revenue sufficient to cause disruption.

Georgia House Bill 846, recently passed by the Georgia Legislature and signed by the Governor on June 29, 2020, provides that if an approved refund exceeds a certain amount, the Department of Revenue is required to notify the local government, which then has the option to pay its share, with interest, over a period of time equal to the period covered by the refund. More information can be found here.

June 2020

Coronavirus Tax Payment and Return Filing Responsibilities (June 25) - Developments Discussed: Many Georgia counties exempt from property taxes "inventory of finished goods" destined for shipment out of state. Most people would construe the term "inventory" as meaning something the taxpayer holds for sale to others. In a surprising decision, the Georgia Court of Appeals upheld a trial court's decision that self-checkout components that Wal-Mart agreed to purchase from NCR qualified for freeport exemption as constituting "inventory of finished goods."

NCR had gathered the component parts at its facility in Fayette County, Georgia and held them for up to 90 days before shipping them to out-of-state Wal-Mart stores for installation in those stores. By contrast, the same equipment which was destined for installation in Georgia stores was conceded to not qualify for freeport exemption.

The court, relying on the Merriam-Webster Dictionary, held that the self-checkout component parts constituted inventory.

The decision does not discuss why the equipment was considered to be the property of Wal-Mart as it had apparently not left the possession of NCR on January 1 of the year in question. More information can be found here.

Coronavirus Tax Payment and Return Filing Responsibilities (June 2) - Updates Reported: The Georgia Department of Revenue has continued to update its Coronavirus Tax Relief FAQ's with a policy statement on the effect of employees' relocation due to the COVID-19 pandemic.

When employees work from temporary locations, the issue of what state has the jurisdiction to tax earnings associated with that location frequently arises.

The Georgia Department of Revenue has announced that it will not use an employee's relocation that is the direct result of temporary remote work requirements due to the COVID-19 pandemic to establish Georgia nexus or for exceeding the protections provided by PL 86-272 (the long-standing exemption for agents with no authority to bind the principal). The temporary protection extends for periods when: (a) there is an official work from home order issued by a government unit, or (b) pursuant to the order of a physician in relation to the pandemic or due to an actual diagnosis of COVID-19, the employee is working at home, including the subsequent 14-day period to allow for a return to normal work locations.

If an employee who normally works in another state remains in Georgia after the remote work requirements end, the normal rules for determining nexus apply.

In addition, wages paid to a nonresident employee who normally works in Georgia but who is temporarily working in another state due to the COVID-19 emergency are considered Georgia wages and the employer should continue to withhold Georgia income taxes. More information can be found here.

May 2020

Coronavirus Tax Payment and Return Filing Responsibilities (May 8) - Further Updates Reported: The Georgia Department of Revenue announced on April 16, 2020 that the state estimated income tax payments due on June 15, 2020 have been extended to July 15, 2020, as well as any other estimated income tax payments due after April 15, 2020 and before July 15, 2020. The Department had previously announced that the estimated income tax payments due on April 15, 2020 were extended to July 15, 2020. Further, any income tax return and payment due after April 15, 2020, and before July 15, 2020, is also due now on July 15, 2020. The Department stated that this extension adds additional corporate filers, as well as other fiscal year income tax filers, to the relief previously announced. It noted that the statute of limitations to file a refund claim for a previous tax year has been extended to July 15, 2020 with respect to refund claims that would have expired from April 15, 2020 and before July 15, 2020. Also, the Department stated that it has been given a 30-day extension within which it can perform certain time sensitive actions if the last date for the performance of the action is on or after April 15 and before July 15, 2020. More information can be found here.

April 2020

Coronavirus Tax Payment and Return Filing Responsibilities (April 16) - Further Updates Reported: On April 7, 2020, the Commissioner of the Georgia Department of Revenue certified an emergency rule which extends the application deadline for conservation use and forest land property tax breaks to the later of June 1, 2020 or 45 days after the date of the mailing of the notice of assessment. Georgia law allows for certain property tax relief where the property is used either for conservation purposes or forest land protection purposes. This deadline extension was initiated based on the Georgia Governor's March 31 Executive Order focused on providing broader relief for taxpayers impacted by the COVID-19 pandemic. More information can be found here.

Coronavirus Tax Payment and Return Filing Responsibilities (April 3) - Further Updates Reported: The Georgia Department of Revenue has included FAQs on their website which address a number of questions dealing with the extended 2019 filing deadline. That deadline has been extended from the original due date of April 15 to July 15 with respect to Georgia income tax payments and Georgia income tax returns that were due on April 15. The response to one of these questions involves whether the extension also applies to a fiscal year filer where the state income tax return is due on April 15; the response given is "Yes, if your state income tax return for your fiscal year ending during 2019 is due on April 15, your due date is postponed to July 15. This would apply regardless of whether that is the original due date or the due date on extension." More information can be found here.

March 2020

Coronavirus Tax Payment and Return Filing Responsibilities (March 25) - Due Date Changes Reported: On March 23, 2020, the Governor of the State of Georgia announced that the deadline for filing income tax returns in that state would be moved from April 15 to July 15 in accordance with the new federal tax filing deadline. Although anticipated, a formal Executive Order has not yet been published nor has the Georgia Department of Revenue issued as yet a formal notice of this deadline extension. Find more information here.

Coronavirus Tax Payment and Return Filing Responsibilities (March 19) - No Broad Changes Reported: The Georgia Department of Revenue (DOR) website has recently posted a notice stating that "Due to concerns regarding COVID-19, the DOR is encouraging all taxpayers to conduct their business with the DOR through online services. The DOR offers a number of motor vehicle and tax-related services online, without the need of in-person interactions." Find more information here. No further specifics at this time. 

Tax Incentives: The Georgia Senate has unanimously passed SB302, the "Tax Credit Return on Investment Act of 2020." This would allow the Chair of the House Ways & Means Committee and the Senate Finance Committee to request economic analyses detailing the return on investment of tax incentives offered by the State. The purpose of this is to periodically evaluate all state tax incentives in order to determine if the cost to the state is worth the benefit. On the same subject, HB 1037 would require that every film, television and media production that qualifies for the film tax credit be audited. This later bill is responsive to recent state audits that raise concern over whether some film credits used by Georgia taxpayers are proper. This bill would also expand the credit to major sporting events (i.e., the Super Bowl and World Cup).

Click here for the full bill.

February 2020

Sales and Use Tax: On January 30, 2020, Georgia Governor Brian Kemp signed into law an amendment to the state's sales tax laws requiring marketplace facilitators to collect and remit the tax, effective April 1, 2020. Under this new law, a marketplace facilitator must collect the tax if it makes at least $100,000 in Georgia taxable sales of property or services in the previous or current calendar year, calculating that $100,000 threshold using not only the facilitator's sales of its own property and services, but also sales it makes on behalf of all its marketplace sellers. Franchisors are not considered as marketplace facilitators if certain conditions are satisfied, including the conditions that such franchisor and all of its franchisees combined made annual gross sales in the U.S. of at least $500 million in the aggregate and the franchisee holds a valid certificate of registration with the Georgia Department of Revenue. In addition, large marketplace sellers are not subject to the facilitator requirements under certain conditions, including that gross sales in Georgia must be at least $500 million and the seller must hold a valid certificate of registration with the Department. More information regarding this new law can be found here.

November 2019

Income Tax Proposed Amendments to Rules for Quality Jobs and Manufacturer's and Telecommunications Investment Tax Credits: The Georgia Department of Revenue has published proposed amendments to Rule 560-7-8-.51, "Quality Jobs Tax Credit" and to Rule 560-7-8-.37, "Manufacturer's and Telecommunications Investment Tax Credit." Comments to the Department of Revenue on the proposed amendments to the Quality Jobs Tax Credit are due on or before 10:00 a.m., December 4, 2019, and comments on the proposed amendments to the Manufacturer's and Telecommunications Investment Tax Credit are due on or before 10:00 a.m., December 19, 2019.

October 2019

Taxation of Nonresident Trust Fiduciaries: The Georgia Department of Revenue released Policy Bulletin IT-2019-02 in August 2019 offering guidance on the Georgia income tax effect of the U.S. Supreme Court's decision in the case of North Carolina Dept. of Revenue v. Kimberly Rice Kaestner 1992 Family Trust on nonresident fiduciaries of trusts having Georgia resident beneficiaries. The Department announced in the Bulletin that it will follow the Kaestner decision, but only to the extent of the facts in that case, so "with respect to facts that are specifically like those in Kaestner, a nonresident trust fiduciary would not be subject to Georgia taxation. Otherwise, the fiduciary would be subject to taxation under O.C.G.A. §48-7-22 and must file a return." The Bulletin can be found here.

September 2019

Service on the Georgia Department of Revenue: The Georgia Department of Revenue released Policy Bulletin ADMIN-2019-04, effective August 28, 2019, setting forth specific procedures required for serving legal documents on the Department. Documents requiring personal service must be delivered in person at Window 1 of the Customer Service area of the Department's primary office during the Department's business hours. Legal documents not requiring personal service will not be considered to be accepted or valid unless sent by certified mail or any other method specifically authorized by law to a specified address and with receipt acknowledged by the Department. Electronic service is only accepted if required by law or if the Department has approved it.

August 2019

Tax Incentives/Sales Tax Exemptions: Rather than expiring June 30, 2019, Georgia enacted a two-year extension of its sales and use tax exemption for purchases made during the construction of a competitive project of regional significance, so the exemption will now expire on June 30, 2021. Please refer to this webpage for said extension.

July 2019

Freeport Exemption: An amendment to O.C.G.A. Section 48-5-48.2 took effect on July 1, 2019, expanding the Level 1 Freeport Exemption to include personal property of a taxpayer's affiliates as well as inventory held for the repair, modification, or remanufacture of goods manufactured, processed, or produced by the taxpayer. The text of amendment can be found in 2019 Georgia Act 250 (HB 405), which is available here.

June 2019

Sales Tax: On May 7, 2019, the Georgia Department of Revenue issued a Policy Bulletin alerting taxpayers that remote sellers meeting certain revenue or number of retail sales thresholds can no longer satisfy their Georgia sales tax obligations by meeting specified notice and reporting requirements, and on or before July 1, 2019, must start collecting and remitting Georgia sales tax on their taxable sales. Policy Bulletin SUT-2019-02, which discusses the elimination of the notice and reporting option for remote sellers pursuant to legislation enacted effective April 28, 2019, can be found here.

For more information about state and local tax developments in Georgia, please contact:

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