The Brownfields Tax Credit program allows a taxpayer to claim a direct, dollar-for-dollar credit against its state income taxes or premium taxes (in the case of an insurance company). If you have Massachusetts Brownfields Tax Credits in your name, and have a tax liability, this approach is generally the best alternative. The credits can be applied against income taxes due in the year the credit was granted and can be carried over for up to five additional years – meaning you have six tax years over which to exhaust the credits.
Many Brownfields Tax Credit recipients, however, cannot fully utilize the credits or may otherwise choose not to do so. There are a wide variety of reasons why this may be true:
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The tax credit owner is a tax-exempt organization |
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The tax credit owner is located out-of-state and does not pay Massachusetts income taxes |
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The tax credit owner does not have a sufficient tax appetite to take full advantage of the credits owned (the credits able to be used are limited to 50% of taxes due in any year) |
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The tax credit owner would prefer to monetize the credits and use the proceeds for other purposes |
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Time value of money – utilizing the credits over the life of the certificate reduces the present value |
Fortunately, the 2006 amendments made the Brownfields Tax Credits fully transferable, allowing owners to sell their credits for cash. This process is controlled and administered by the state Department of Revenue (DOR).
Cooperstown Environmental LLC has processed scores of such transfers for our clients and for our own account. We are able to readily process the applications and related paperwork in order to ensure that the transfers are completed in a timely and proper manner.
If you have credits that you would like to sell, please contact us. We routinely purchase credits for our own account and can also assist you with a private sale. Parties interested in buying credits to offset Massachusetts income taxes may also inquire regarding the availability of credits that are available for sale.
