Following the implementation on November 18, 2013, the Massachusetts Department of Revenue's ("DOR") Tax Administration Directive 13-4, DOR has been applying a more vigorous and disciplined interpretation of its guidelines than ever before in the history of the Massachusetts Brownfields Tax Credit Program ("BTC"). The Directive provided for an appeal procedure that in the case of a partially approved tax credit, allows the use of the approved portion and the appeal of the portion of the credit that DOR proposes to deny.
We are still in the early stages of this appeal process having only recently seen the procedure in place for a full calendar year, but so far the appeal process is even more vigorous and whimsical than the initial review DOR's Audit Desk. As a whole, therefore, taxpayers now face significantly more arduous hurdles in filing, and securing the Brownfields Tax Credit for their environmental remediation expenses. Furthermore, DOR's timeline for completing the review and determination process for the Massachusetts Brownfields Tax Credit has become an unusually long process, sometimes stretching well over a year from filing to tax credit receipt.
Bottom line, now more than ever, taxpayers must be aware of the BTC rules, regulations, and the intricacies of dealing with the DOR, which portrays a straightforward, open process to tax credit approval, yet in reality has created a system that is anything but straightforward.
As this area has become more specialized and intricate, the tax credit industry has responded with many highly qualified and experienced consultants that assist taxpayers in navigating this minefield. Cherrytree is among the list of consultants that provide this service, and it is our heartfelt belief that our colleagues and us in this industry play a valuable role in assisting taxpayers to receive the tax credits, and that the tax credits generated helps to create the economic fluidity and capital needed to stimulate and continue the remediation and redevelopment of contaminated land in our State. While it is not yet clear if this trend of higher scrutiny by the Massachusetts Department of Revenue will continue, in the meantime at least, we sincerely feel that having a tax credit consultant is more important than ever.