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with the filming and production of a motion picture, and a credit equal

to zero. To the extent authorized pursuant to the Life Sciences Tax In-

to 25% of their Massachusetts productions expenses. The credits are

centive Program, 90% of the balance of credit remaining is refund-

transferable. For further information, see TIR 06-1.

able. The deduction otherwise allowable for user fees qualifying for

the credit is disallowed. For further information, see TIR 08-23.

Line 23: Medical Device Credit. For tax years beginning on or after

January 1, 2006, medical device companies that develop or manufac-

Line 27: Life Sciences Company Research Credit. For taxable years

ture medical devices in Massachusetts can claim a credit equal to

beginning on or after January 1, 2009, a new credit may be available

100% of the user fees paid to the U. S. Food and Drug Administration.

for certified life sciences companies pursuant to the Life Sciences Tax

The credit is transferable. For more information, see TIR 06-22.

Incentive Program, to provide qualifying companies with a means to

obtain a research credit for certain expenditures not qualifying for the

Line 24: Brownfields Credit. Recent legislation extends the Browns-

existing research credit under c. 63, § 38M. St. 2008, c. 130, §§ 30 and

field credit to nonprofit organizations, extends the time frame for eligibil-

53, codified at G.L. c. 63, § 38W. Under this new provision, the credit is

ity for the credit, and permits the credit to be bought, sold or assigned.

generally calculated in the same manner as the research credit under

Under prior law, net response and removal costs incurred by a tax-

section 38M. However, the qualified research expenditures which form

payer between August 1, 1998 and August 5, 2005, were eligible for

the basis for the calculation in new section 38W differ from those of

the credit provided that the taxpayer commenced and diligently pur-

section 38M in that they can qualify when the activities are performed

sued an environmental response action before August 5, 2005. As a

both inside and outside of the Commonwealth, to the extent they relate

result of the recent legislation, the environmental response action com-

to legally mandated clinical trial activities. The new life sciences re-

mencement cut-off date is changed from August 5, 2005 to August 5,

search credit is not refundable. For further information, see TIR 08-23.

2013, and the time for incurring eligible costs that qualify for the credit

is extended to January 1, 2014. For further information, see TIR 06-16.

Line 30: Voluntary contribution to the Nongame Wildlife Fund.

Any corporation that wishes to contribute any amount to the Natural

Line 25: Life Science Company Investment Tax Credit. For taxable

Heritage and Endangered Species Fund may do so on this form. This

years beginning on or after January 1, 2009, a new Investment Tax

amount is added to the excise due. It increases the amount of the cor-

Credit (ITC) may be available to taxpayers.

poration’s payment or reduces the amount of its refund.

This credit, which is available to certified life sciences companies only

The Natural Heritage and Endangered Species Fund is administered

to the extent authorized pursuant to the Life Sciences Tax Incentive

by the Department of Fisheries, Wildlife and Environmental Law En-

Program, is equal to 10% of the cost of qualifying property acquired,

forcement to provide for conservation programs for rare, endangered

constructed or erected during the taxable year and used exclusively

and nongame wildlife and plants in the Commonwealth.

in the Commonwealth.

Line 35: Pass-through Entity Withholding. Enter the amount of any

The refundable ITC can apply to purchases made on or after January

withholding tax from pass-through entities. Be sure to include the tax-

1, 2009 even if a construction project started before that date. The

payer identification number of the person or entity submitting the with-

scope of qualifying property for purposes of the new credit is the same

holding payment on behalf of the taxpayer.

as that provided by the existing ITC under M.G.L. Ch. 63, sec. 31A.

Line 36: Refundable Film Credit. Schedule RFC, Refundable Film

Life sciences companies or persons also qualifying for the Economic

Credit, is used by motion picture production companies to elect to claim

Opportunity Area Credit (EOAC) for the same property may only take

a refundable film credit if they have not transferred or carried forward a

such EOAC to the extent of an additional 2% of the cost of the qualify-

portion of the film credit for the production. Transferees of the film credit

ing property. Corporations taking these credits are not allowed to take

do not qualify for the refundable film credit. If an election to refund the

the ITC under M.G.L. Ch. 63, sec. 31A or the Low-Income Housing

film credit for a production is made, the entire film credit remaining after

Credit under M.G.L. Ch. 63, sec. 31H for the same qualifying property.

reducing the current year tax liability will be refunded at 90%. The pro-

If a life sciences ITC exceeds the tax otherwise due as applicable,

duction company is not allowed to partially refund and partially trans-

90% of the balance of such credit may, at the option of the taxpayer

fer or carryover over any portion of the credit to the next tax year.

and to the extent authorized pursuant to the Life Sciences Tax Incen-

Line 37: Refundable Dairy Credit. A taxpayer who holds a certificate

tive Program, be refundable to the taxpayer for the tax year in which

of registration as a dairy farmer pursuant to M.G.L. Ch. 94, sec. 16A

the qualified property giving rise to such credit is placed in service. If

is allowed a refundable tax credit based on the amount of milk pro-

such refund is elected by the taxpayer, then the carryover provisions

duced and sold. The dairy farmer tax credit as originally enacted was

for this credit that would otherwise apply shall not be available. For fur-

90% refundable. Under recent legislation, the dairy farmer tax credit

ther information, see TIR 08-23.

is now 100% refundable.

Line 26: Life Science Company FDA User Fees Credit. For taxable

Line 38: Refundable Life Science Credit. There are two different

years beginning on or after January 1, 2009, a new credit may be

credits which the Massachusetts Life Sciences Center, with the ap-

available to taxpayers for user fees paid on or after June 16, 2008 to

proval of the Secretary of Administration and Finance, may authorize

the U.S. Food and Drug Administration (USFDA) upon submission of

a taxpayer to have refunded in lieu of carrying forward such credit to

an application to manufacture a human drug in the Commonwealth.

a future year.

This credit, which is available to certified life sciences companies only

A taxpayer may apply for a refund of 90% of the unused Investment

to the extent authorized pursuant to the Life Sciences Tax Incentive

Tax Credit granted under M.G.L. Ch. 63, sec. 38U or the additional

Program, is equal to 100% of the user fees actually paid by the tax-

credit on the same property that may be granted under M.G.L. Ch.

payer, as specified in the certification, and may be claimed in the tax-

63, sec. 38N if property for which the 38U credit is granted is used in

able year in which the application for licensure of an establishment to

a certified project.

manufacture the drug is approved by the USFDA.

A taxpayer may apply for a refund of 90% of the unused FDA User

To be eligible for the credit, more than 50% of the research and de-

Fee Credit granted under M.G.L. Ch. 63, sec. 38M, including credits

velopment costs for the drug must have been incurred in Massachu-

setts. Taxpayers may use the FDA user fees credit to reduce their tax

Form 63-20p - Massachusetts Premium Excise Return For Life Insurance Companies - 2012 Page 4

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