Tenn. Code Ann. § 67-4-2009 — TN Code / Title 67 / Chapter 4 / Section 67-4-2009
[Effective Until 7/1/2025] Credits
Status: in_force

The tax imposed by this part shall be in addition to all other taxes and there shall be no credit allowed upon it except the following: (1) In accordance with § 56-4-217 , there shall be credited upon the tax imposed by this part the net amount of gross premiums tax paid that is measured by a period that corresponds to the excise tax period on which the return is based, plus any amount used to offset payment to the Tennessee guaranty association that has not otherwise been recovered, but not including the gross premiums receipts tax paid by fire insurance companies for the purpose of executing the fire marshal law; (2) When an audit of an excise tax return for any year not barred by the statute of limitations discloses a change in the amount of tax due, there may be applied upon it as a credit any amount that the taxpayer is otherwise entitled to receive either as a credit under part 4 or 5 of this chapter for excise taxes paid, or as a refund thereof under § 67-1-1802 . This tax credit allowance may be applied notwithstanding the statute of limitations or the requirement for approval of certain refunds by the commissioner and the attorney general and reporter if such was made under § 67-1-1802 , and also any statutory or regulatory requirement under various items of part 4 or 5 of this chapter that the excise tax be paid prior to the allowance of any credit; (3) (A) There shall be allowed against the sum total of the taxes imposed by the Franchise Tax Law of 1999, compiled in part 21 of this chapter, and by this part, a credit equal to one percent (1%) of the purchase price of industrial machinery purchased during the tax period covered by the return and located in this state. For purposes of this section, "industrial machinery" means: (i) "Industrial machinery" as defined by § 67-6-102 ; or (ii) "Computer," "computer network," "computer software," or "computer system" as defined by § 39-14-601 , and any peripheral devices, including, but not limited to, hardware, such as printers, plotters, external disc drives, modems, and telephone units, purchased by a taxpayer in the process of making the required capital investment in Tennessee described in § 67-4-2109(a) , if as a result of making such purchase and meeting the other requirements set forth in § 67-4-2109(b) , the taxpayer qualifies for the job tax credit provided therein; (B) The industrial machinery credit taken on any franchise and excise tax return, however, shall not exceed fifty percent (50%) of the combined franchise and excise tax liability shown by the return before the credit is taken; (C) (i) Any unused credit may be carried forward in any tax period until the credit is taken; however, the credit may not be carried forward for more than fifteen (15) years; provided, however, that credits earned in tax years ending on or after December 31, 2008, may be carried forward for twenty-five (25) years; (ii) If the taxpayer qualifies for the credit provided in subdivision (3)(I)(i), the fifteen-year limitation otherwise applicable to the carry-forward of unused credit shall not apply; provided, that the commissioner of economic and community development and the commissioner of revenue have determined that the allowance of the additional carry-forward is in the best interest of the state; (iii) Subdivision (3)(C)(ii) shall apply only to applications received and approved by the commissioner of revenue and the commissioner of economic and community development on or before January 1, 2011; (D) If the industrial machinery, for the purchase of which a tax credit has been allowed, is sold or removed from this state during its useful life according to the depreciation guidelines in effect for excise tax purposes, the department shall be entitled to recapture a portion of the credit allowed by increasing the franchise and/or excise tax liability of any taxpayer, for the taxable period during which the machinery was sold or removed, in an amount equal to the percentage of useful life remaining on the industrial machinery at the time of sale or removal times the total credit taken on the purchase of the machinery; (E) For purposes of the allowance of the credit against franchise and excise taxes under this section, any taxpayer who is a lessee of new industrial machinery and the original user of the industrial machinery, including a lessee from an industrial development corporation as defined by title 7, chapter 53, or other tax exempt entity, shall be treated as having purchased the machinery during the tax period in which it is placed in service by the lessee, at an amount equal to its purchase price; (F) If industrial machinery is leased for a period that constitutes less than eighty percent (80%) of its useful life, then the lessee shall be deemed to have purchased only a portion of the machinery, at an amount determined by multiplying the actual purchase price of the machinery by a fraction, the numerator of which is the lease term, and the denominator of which is the useful life of the leased machinery; (G) (i) Notwithstanding any law to the contrary, the industrial machinery franchise and excise tax credit provided in this subdivision (3) may be computed by a general partnership that operates a call center in this state that is placed in service by the general partnership on or after June 30, 2003, and that would otherwise qualify for the credit provided in § 67-4-2109(b)(3)(G) . The industrial machinery franchise and excise tax credit shall be computed as if the general partnership were subject to franchise and excise tax. With respect to the general partnership tax year during which a credit is so computed, a partner in the general partnership that is subject to franchise and excise tax and that directly holds a first tier ownership interest in the general partnership may take a percentage of the credit that equals the total amount of the credit for the general partnership multiplied by the partner's percentage interest in the general partnership on the last day of the general partnership tax year against the partner's franchise and excise tax liability for the partner's tax year that includes the last day. The industrial machinery franchise and excise tax credit passed through from the general partnership to the first tier partner under this section shall, in the hands of the first tier partner, be subject to applicable provisions and limitations otherwise provided by this section, including carry forward provisions; provided, that in no case shall the credit or a carryover of a credit be taken by a business entity, unless it was a partner in the general partnership and subject to franchise and excise tax at the time the credit was earned by the general partnership; (ii) This subdivision (3)(G) shall expire on July 1, 2015; provided, that any taxpayer that has filed a business plan with the department prior to July 1, 2015, shall continue to be eligible for the credit; (H) Notwithstanding any provision to the contrary, a taxpayer that has established its international, national, or regional headquarters in this state and has met the requirements to qualify for the credit provided in § 67-6-224 , or a taxpayer that has established an international, national, or regional warehousing or distribution hub in this state and has met the requirements to be a qualified new or expanded warehouse or distribution facility, shall be allowed to offset up to one hundred percent (100%) of its franchise and/or excise tax liability by the industrial machinery credit provided in this subdivision (3), or any carryforward of the industrial machinery credit, if the commissioner of revenue and the commissioner of economic and community development determine that increasing the percentage of offset above that allowed by subdivision (3)(B) is in the best interests of the state. For purposes of this subdivision (3)(H), "best interests of the state" means a determination that the taxpayer established its headquarters or a warehousing or distribution hub in this state, or converted a regional headquarters or regional warehousing or distribution hub in this state into its national or international headquarters or a national or international warehousing or distribution hub, as a result of such action. The commissioner of revenue and the commissioner of economic and community development shall determine the percentage of franchise and/or excise tax liability allowed to be offset, above that otherwise allowed by subdivision (3)(B), and the period during which the increased offset shall continue; (I) (i) If the taxpayer makes a required capital investment in excess of one billion dollars ($1,000,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to ten percent (10%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ; (ii) If the taxpayer makes a required capital investment in excess of five hundred million dollars ($500,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to seven percent (7%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ; (iii) If the taxpayer makes a required capital investment in excess of two hundred fifty million dollars ($250,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to five percent (5%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ; (iv) If the taxpayer makes a capital investment in excess of one hundred million dollars ($100,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to three percent (3%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ; (v) The taxpayer shall file a business plan with the commissioner of revenue in order to qualify for the credit provided in this subdivision (3)(I). The business plan shall be filed on or before the last day of the first fiscal year in which the investment is made and shall describe the investment. The commissioner of revenue has the authority to conduct audits or require the filing of additional information necessary to substantiate or adjust the findings contained within the business plan and to determine that the taxpayer has complied with all statutory requirements so as to be entitled to the credit in this subdivision (3)(I); (vi) The credit in this subdivision (3)(I) shall begin to apply in the first year of the investment period; however, if the required capital investment is not met during the investment period, the taxpayer shall be subject to an assessment equal to the amount of any credit taken under this subdivision (3)(I) for which the taxpayer failed to qualify, plus interest; (vii) For purposes of this subdivision (3)(I), unless the context otherwise requires: (a) "Good cause" means a determination by the commissioner of economic and community development that the capital investment is a result of the credit provided in this subdivision (3)(I); (b) "Investment period" means a period not to exceed three (3) years from the filing of the business plan related to the required capital investment, during which the required capital investment must be made. The three-year period for making the required capital investment may, for good cause shown, be extended by the commissioner of economic and community development for a reasonable period not to exceed four (4) years for a taxpayer that meets the requirements of subdivision (3)(I)(i) and not to exceed two (2) years for any other taxpayer; and (c) "Required capital investment" means an increase of a business investment in real property, tangible personal property or computer software owned or leased in this state valued in accordance with generally accepted accounting principles. A capital investment shall be deemed to have been made as of the date of payment or the date the taxpayer enters into a legally binding commitment or contract for purchase or construction; (J) [Expired July 1, 2015; see (3)(J)(vi)] (i) In addition to the credit provided in subdivision (3)(A), the owner of a qualifying environmental project shall be entitled to a one-time credit in the amount of one and three-fourths percent (1.75%) of the investment in the qualifying environmental project, and such credit shall have the same carry-forward features, limitations and other attributes as are applicable to job tax credits under § 67-4-2109(b)(1) . The owner of a qualifying environmental project shall also be provided six (6) annual credits in the amount of one and three-fourths percent (1.75%) of the investment in the qualifying project, and such credits shall have the same carry-forward features, limitations and other attributes as are applicable to enhanced job tax credits under § 67-4-2109(b)(2)(B)(iii) , and the entire investment in the qualifying environmental project shall be treated as exempt required capital investment for purposes of § 67-4-2108(a)(6)(G) ; (ii) For purposes of this subdivision (3)(J), a "qualifying environmental project" means a project in which the taxpayer makes an investment in excess of one hundred million dollars ($100,000,000) to eliminate mercury from the manufacturing process and operations of one (1) or more existing chlor-alkali manufacturing and ancillary facilities and equipment in the state; (iii) The maximum investment in a qualifying environmental project that is eligible for the credits provided under this subdivision (3)(J) is one hundred million dollars ($100,000,000), inclusive of all capital investment and other direct and indirect costs of the project. To be eligible for the credits provided under this subdivision (3)(J), construction of the qualifying environmental project must have commenced on or after January 1, 2011, and construction of the qualifying environmental project must be substantially complete on or before January 1, 2014. The credits provided under this subdivision (3)(J) shall first be available in the later of the year in which the qualifying environmental project is substantially complete or July 1, 2013; (iv) As a condition to receiving credits under this subdivision (3)(J), the owner of a qualifying environmental project shall agree to maintain an annual average of at least three hundred fifty (350) jobs in the state that meet the requirements set forth in § 67-4-2109(a)(6)(A) for a period of six (6) years after substantial completion of the qualifying environmental project. In the event the owner does not maintain the required number of qualified jobs in a specific year, the annual credit provided under this subdivision (3)(J) for that year shall be reduced in proportion to the percentage of the shortfall; (v) As a further condition to receiving credits under this subdivision (3)(J), the owner of a qualifying environmental project shall agree to forego any and all claims for credits that may be available to the owner pursuant to § 67-4-2109(b)(1) and (2) in connection with the qualifying environmental project; (vi) This subdivision (3)(J) shall expire on July 1, 2015; provided, that any taxpayer that has filed a business plan with the department prior to July 1, 2015, shall continue to be eligible for the credit; and (K) Notwithstanding any law to the contrary, a taxpayer that has previously made a capital investment in excess of one billion dollars ($1,000,000,000) during a single investment period and has previously qualified for the credit provided in § 67-6-224 and that qualifies during the applicable tax year for, but chooses to not make, the election under § 67-4-2012 ( l ), shall, upon written request submitted to the commissioner, be allowed to offset up to one hundred percent (100%) of its excise tax liability by the industrial machinery credit provided in this subdivision (3), or any carryforward of the industrial machinery credit, if the commissioners of revenue and economic and community development determine that increasing the percentage of offset above fifty percent (50%), as limited by subdivision (3)(B), will allow the taxpayer to maximize the use of its industrial machinery credits while resulting in an excise tax liability substantially equal to the amount otherwise due if the taxpayer had made the election under § 67-4-2012 ( l ). The commissioners of revenue and the commissioner of economic and community development shall determine the percentage of excise tax liability allowed to be offset, above that otherwise allowed by subdivision (3)(B), and the period during which the increased offset shall continue; (4) A hospital company filing a franchise/excise tax return on a combined basis as required in § 67-4-2014(e) , together with all other members of its combined group filing with it, shall be allowed as a credit against the combined annual franchise/excise tax imposed an amount equal to the lesser of the franchise tax or excise tax so that the combined annual franchise/excise tax of the combined group shall be limited to the greater of the two (2) of them; provided, that this credit shall not apply to tax years beginning on or after January 1, 2007; (5) A hospital company filing a franchise/excise tax return on a combined basis as described in § 67-4-2014(e) , together with all members of its combined group filing with it, shall be allowed as a further credit against the combined annual franchise/excise tax imposed on the group remaining after application of the credit allowed under subdivision (4) an amount equal to four percent (4%) of the cost of medical supplies and medical equipment used by or placed in service by the members of the controlled group in this state during the tax year; provided, that the aggregate amount of the credit allowed to a taxpayer under subdivision (4), together with the credit allowed to a taxpayer under this subdivision (5), shall not exceed nine million dollars ($9,000,000) in any one (1) tax year; and provided, further, that the credit allowed under this subdivision (5) shall not apply to tax years beginning on or after January 1, 2007. A corporation or other entity shall be deemed to have used or placed in service medical supplies and medical equipment used or placed in service by a partnership or limited liability company of which it is a partner or member that would be a hospital company, as defined in § 67-4-2004 , if it were a corporation or other entity upon which tax is imposed under this part and part 21 of this chapter, and would be a member of its same controlled group, as defined in § 267(f)(1) of the Internal Revenue Code of 1986 ( 26 U.S.C. § 267(f)(1) ) if it were a corporation and its partners or members were shareholders. The amount of the cost of such medical supplies and medical equipment that is attributed to and deemed to have been used or placed in service by such corporation or other entity shall be equal to the pro rata portion of the cost of medical supplies and medical equipment used or placed in service by the partnership or limited liability company in the tax year. Such pro rata portion shall be determined based upon the corporation's or other entity's percentage of the profits and losses of such partnership or limited liability company during such tax year. As used in this subdivision (5), "medical equipment" has the same meaning as "major medical equipment" as set forth in § 68-11-102(10) [repealed], but without the limitation therein as to the cost thereof; and "medical supplies" means all apparatus, consumable products, appliances, and other tangible personal property, except drugs and medicines, used in provision of patient health care services, including all recordkeeping and documentation in connection with such services; (6) (A) Except for unitary groups of financial institutions, each taxpayer is considered a separate entity; therefore, in the case of mergers, consolidations, and like transactions, no tax credit incurred by the predecessor taxpayer shall be allowed as a credit on the tax return filed by the successor taxpayer. With the exception set forth in subdivision (6)(B), a credit carryforward may be taken only by the taxpayer that generated it; (B) Notwithstanding the provisions contained in subdivision (6)(A), when a taxpayer merges out of existence and into a successor taxpayer that has no income, expenses, assets, liabilities, equity or net worth, any qualified Tennessee credit carryover of the predecessor that merged out of existence shall be available for carryover on the return of the surviving successor; provided, that the time limitations for the carryover have not expired; (C) A unitary group of financial institutions may take any qualified credit that was generated by any group member that is in existence as a member of the group at the end of the group's tax year; provided, that such credit has not previously been taken by the member itself before it joined the group or by another unitary group of financial institutions at the time the financial institution generating the credit was a member of that group; and provided, further, that the credit carryover shall be subject to the limitations set forth in this subdivision (6); (7) A credit shall be allowed against the tax imposed by this part in an amount equal to the tax imposed by chapter 2 of this title paid by the taxpayer; (8) (A) There shall be allowed against the sum total of the taxes imposed by the Franchise Tax Law of 1999, and by this part, a credit equal to fifty percent (50%) of the purchase price of brownfield property purchased in this state during the tax period covered by the return for the purpose of a qualified development project; (B) For the purposes of this subdivision (8), unless the context otherwise requires: (i) "Brownfield property" means real property that is the subject of an investigation, remediation, or mitigation as a brownfield project under a voluntary agreement or consent order pursuant to § 68-212-224 ; (ii) "Capital investment" means an investment in real property, tangible personal property or computer software owned or leased in this state valued in accordance with generally accepted accounting principles. A capital investment shall be deemed to have been made as of the date of payment or the date the taxpayer enters into a legally binding commitment or contract for purchase or construction of the real or personal property; (iii) "Investment period" means a period not to exceed five (5) years from the filing of the business plan related to the required capital investment, during which the required capital investment must be made; (iv) "Qualified development project" means a project consisting of a capital investment of at least twenty-five million dollars ($25,000,000), located on a brownfield property, and having a business plan approved by the commissioner of revenue in accordance with the applicable provisions of subdivision (8)(D); (C) The credit allowed pursuant to this subdivision (8) shall apply against the excise tax imposed by this part and the Franchise Tax Law of 1999; provided, however, that such credit, together with any carry-forward thereof, taken on any franchise and excise tax return shall not exceed fifty percent (50%) of the combined franchise and excise tax liability shown by the return before any credit is taken. Any credit authorized under this subdivision (8)(C) that is unused may be carried forward in any tax period until the credit is taken; provided, that the credit may not be carried forward for more than fifteen (15) years; provided, however, that credits earned in tax years ending on or after December 31, 2008, may be carried forward for twenty-five (25) years; (D) (i) The taxpayer shall file a business plan for the development project with the commissioner of revenue in order to qualify for the credit provided in subdivision (8)(A). The plan must describe the capital investment to be made toward the qualified development project within the investment period and also include a determination by the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development pursuant to subdivision (8)(G) that the credit is in the best interest of the state; (ii) Qualifying plans shall be approved by the commissioner of revenue. At such time, an approval letter authorizing the credit, the value of the credit and the terms of the credit shall be issued. A copy of the approval letter shall be filed by the taxpayer with the department of revenue in any year in which the taxpayer utilizes the credit; (iii) The commissioner of revenue has the authority to conduct audits or require the filing of additional information necessary to substantiate or adjust the findings contained within the business plan and to determine that the taxpayer has complied with all statutory requirements so as to be entitled to the credit in this subdivision (8); (E) In order to receive the credit, the taxpayer must submit a claim for the credit, along with documentation as required by the commissioner showing that the capital investment was made toward the qualified development project during the investment period. The taxpayer shall not be eligible to receive the credit until the minimum capital investment required by subdivision (8)(B)(v) has been met; (F) The commissioner shall review the claim for the credit and notify the taxpayer of the approved tax credit amount. The taxpayer may not take the credit until the commissioner has notified the taxpayer of the approved amount; (G) Notwithstanding any provision of this subdivision (8) to the contrary, no credit shall be allowed unless the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development determine, in their sole discretion, that the credit is in the best interest of the state. For purposes of this subdivision (8)(G), "best interest of the state" means a determination by the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development that the qualified development project is a result of the credit provided in subdivision (8)(A) and that the economic benefits to this state resulting from the qualified development project outweigh the anticipated amount of the credit; and (H) For a qualified development project in which the taxpayer receives the brownfield property from a county, municipality, or industrial development board as defined in § 7-53-101 for a sale price of less than one dollar ($1.00), the amount of any credit authorized under this subdivision (8) is fifty percent (50%) of the most recent purchase price of the brownfield property that was paid by the county, municipality, or industrial development board; (9) (A) Notwithstanding subdivision (8), there shall be allowed against the sum total of the taxes imposed by the Franchise Tax Law of 1999 and by this part, a credit equal to seventy-five percent (75%) of the purchase price of brownfield property purchased in a tier 3 or tier 4 enhancement county in this state during the tax period covered by the return for the purpose of a qualified development project; (B) For the purposes of this subdivision (9), unless the context otherwise requires: (i) "Brownfield property" means real property that is the subject of an investigation, remediation, or mitigation as a brownfield project under a voluntary agreement or consent order pursuant to § 68-212-224 ; (ii) "Capital investment" means an investment in real property, tangible personal property, or computer software owned or leased in this state valued in accordance with generally accepted accounting principles. A capital investment shall be deemed to have been made as of the earlier of the date of payment or the date the taxpayer enters into a legally binding commitment or contract for lease, purchase, or construction of the real or personal property; (iii) "Investment period" means a period not to exceed five (5) years from the filing of the business plan related to the required capital investment, during which the required capital investment must be made; and (iv) "Qualified development project" means a project consisting of a capital investment of at least five million dollars ($5,000,000), located on a brownfield property, and having a business plan approved by the commissioner of revenue in accordance with the applicable provisions of subdivision (9)(D); (C) The credit allowed pursuant to this subdivision (9) shall apply against the excise tax imposed by this part and the Franchise Tax Law of 1999; provided, however, that such credit, together with any carry-forward thereof, taken on any franchise and excise tax return shall not exceed seventy-five percent (75%) of the combined franchise and excise tax liability shown on the return before any credit is taken. Any credit authorized under this subdivision (9)(C) that is unused may be carried forward in any tax period until the credit is taken; provided, that the credit may not be carried forward for more than fifteen (15) years; provided, however, that credits earned in tax years ending on or after December 31, 2008, may be carried forward for twenty-five (25) years; (D) (i) The taxpayer shall file a business plan for the qualified development project with the commissioner of revenue prior to the investment period in order to qualify for the credit provided in subdivision (9)(A). The plan shall describe the capital investment to be made toward the qualified development project within the investment period and shall also include a determination by the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development pursuant to subdivision (9)(G) that the credit is in the best interest of the state; (ii) Qualifying plans shall be approved by the commissioner of revenue. At such time, an approval letter authorizing the credit, the value of the credit, and the terms of the credit shall be issued. A copy of the approval letter must be filed by the taxpayer with the department of revenue in any year in which the taxpayer utilizes the credit; and (iii) The commissioner of revenue has the authority to conduct audits or require the filing of additional information necessary to substantiate or adjust the information contained in the business plan and to determine that the taxpayer has complied with all statutory requirements so as to be entitled to the credit pursuant to this subdivision (9); (E) In order to receive the credit, the taxpayer must submit a claim for the credit, along with documentation as required by the commissioner showing that the capital investment was made toward the qualified development project during the investment period. The taxpayer shall not be eligible to receive the credit until the minimum capital investment required by subdivision (9)(B)(iv) has been met; (F) The commissioner shall review the claim for the credit and notify the taxpayer of the approved tax credit amount. The taxpayer may not take the credit until the commissioner has notified the taxpayer of the approved amount; (G) Notwithstanding any provision of this subdivision (9) to the contrary, no credit shall be allowed unless the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development determine, in their sole discretion, that the credit is in the best interest of the state. For purposes of this subdivision (9)(G), "best interest of the state" means a determination by the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development that the qualified development project is a result of the credit provided in subdivision (9)(A) and that the economic benefits to this state resulting from the qualified development project outweigh the anticipated amount of the credit; and (H) For a qualified development project in which the taxpayer receives the brownfield property from a county, municipality, or industrial development board as defined in § 7-53-101 for a sale price of less than one dollar ($1.00), the amount of any credit authorized under this subdivision (9) is seventy-five percent (75%) of the most recent purchase price of the brownfield property that was paid by the county, municipality, or industrial development board; (10) (A) For purposes of this subdivision (10): (i) "Capital investment" has the same meaning as defined in subdivision (9)(B)(ii); (ii) "Investment period" has the same meaning as defined in subdivision (9)(B)(iii); (iii) "Qualified development project" has the same meaning as defined in subdivision (9)(B)(iv); and (iv) "Remediation costs" means costs that are directly related to the investigation, remediation, or mitigation of a brownfield property as required by a voluntary agreement or consent order pursuant to § 68-212-224 ; (B) Notwithstanding subdivision (9), there is allowed against the sum total of the taxes imposed by the Franchise Tax Law of 1999 and by this part, a credit equal to the remediation costs for a brownfield property for a qualified development project in a tier 3 or tier 4 enhancement county in this state; provided, however, that the credit must not exceed five hundred thousand dollars ($500,000), and provided, further, that the credit, together with any carry forward thereof, taken on a franchise and excise tax return must not exceed one hundred percent (100%) of the combined franchise and excise tax liability shown on the return before a credit is taken. An unused credit may be carried forward in a tax period until the credit is taken; provided, however, that the credit may not be carried forward for more than fifteen (15) years; provided, however, that credits earned in tax years ending on or after December 31, 2008, may be carried forward for twenty-five (25) years; (C) In order to receive the credit, the taxpayer must submit a claim for the credit, along with documentation as required by the commissioner showing that the capital investment was made toward the qualified development project during the investment period and that the costs claimed are remediation costs. The taxpayer is not eligible to receive the credit until the minimum capital investment has been met and the commissioner has approved the tax credit amount; (D) The commissioner shall review the claim for the credit in consultation with the commissioner of environment and conservation and notify the taxpayer of the approved tax credit amount; and (11) (A) For tax years ending on or after December 31, 2023, but before December 31, 2025, there is allowed against the sum total of the taxes imposed by the Franchise Tax Law of 1999, compiled in part 21 of this chapter, and by this part, a credit equal to the federal employer tax credit in Section 45S of the Internal Revenue Code of 1986 ( 26 U.S.C. § 45S ), as amended, as a result of compensation paid in this state during the tax period by the taxpayer as determined consistent with § 67-4-2012 ; (B) The credit allowed pursuant to this subdivision (11) taken on a franchise and excise tax return must not exceed fifty percent (50%) of the combined franchise and excise tax liability shown by the return before the credit is taken. A credit authorized under this subdivision (11) that is unused may be carried forward in a tax period until the credit is taken; provided, however, that the credit may not be carried forward for more than twenty-five (25) years. Amended by 2023 Tenn. Acts, ch. 86, s 8, eff. 7/1/2023. Amended by 2023 Tenn. Acts, ch. 86, s 7, eff. 7/1/2023. Amended by 2023 Tenn. Acts, ch. 377, s 40, eff. 5/11/2023. Amended by 2023 Tenn. Acts, ch. 377, s 18, eff. 5/11/2023. Amended by 2021 Tenn. Acts, ch. 517, s 1, eff. 5/25/2021. Amended by 2020 Tenn. Acts, ch. 606, Secs.s 2, s 3, s 4, s 5, s 6, s 7, s 8, s 9, s 10, s 11, s 12, s 13, s 14, s 15 eff. 7/1/2020. Amended by 2020 Tenn. Acts, ch. 606, s 1, eff. 7/1/2020. Amended by 2019 Tenn. Acts, ch. 501, s 2, eff. 7/1/2019. Amended by 2017 Tenn. Acts, ch. 228, s 15, eff. 4/24/2017. Amended by 2015 Tenn. Acts, ch. 504, s 5, eff. 7/1/2015. Amended by 2015 Tenn. Acts, ch. 504, s 4, eff. 7/1/2015. Acts 1999, ch. 406, § 3; 2000, ch. 973, § 1; 2000, ch. 982, §§ 19, 54; 2003 , ch. 202, § 2; 2006, ch. 1019, § 1; 2007 , ch. 602, § 1; 2008 , ch. 1106, §§ 56, 57; 2009 , ch. 530, §§ 2, 5-7, 15, 23; 2010 , ch. 1134, § 65; 2011 , ch. 508, §§ 24, 28, 29; 2012 , ch. 937, § 1. This section is set out more than once due to postponed, multiple, or conflicting amendments.
The tax imposed by this part shall be in addition to all other taxes and there shall be no credit allowed upon it except the following:
(1) In accordance with § 56-4-217 , there shall be credited upon the tax imposed by this part the net amount of gross premiums tax paid that is measured by a period that corresponds to the excise tax period on which the return is based, plus any amount used to offset payment to the Tennessee guaranty association that has not otherwise been recovered, but not including the gross premiums receipts tax paid by fire insurance companies for the purpose of executing the fire marshal law;
(2) When an audit of an excise tax return for any year not barred by the statute of limitations discloses a change in the amount of tax due, there may be applied upon it as a credit any amount that the taxpayer is otherwise entitled to receive either as a credit under part 4 or 5 of this chapter for excise taxes paid, or as a refund thereof under § 67-1-1802 . This tax credit allowance may be applied notwithstanding the statute of limitations or the requirement for approval of certain refunds by the commissioner and the attorney general and reporter if such was made under § 67-1-1802 , and also any statutory or regulatory requirement under various items of part 4 or 5 of this chapter that the excise tax be paid prior to the allowance of any credit;
(3) (A) There shall be allowed against the sum total of the taxes imposed by the Franchise Tax Law of 1999, compiled in part 21 of this chapter, and by this part, a credit equal to one percent (1%) of the purchase price of industrial machinery purchased during the tax period covered by the return and located in this state. For purposes of this section, "industrial machinery" means: (i) "Industrial machinery" as defined by § 67-6-102 ; or (ii) "Computer," "computer network," "computer software," or "computer system" as defined by § 39-14-601 , and any peripheral devices, including, but not limited to, hardware, such as printers, plotters, external disc drives, modems, and telephone units, purchased by a taxpayer in the process of making the required capital investment in Tennessee described in § 67-4-2109(a) , if as a result of making such purchase and meeting the other requirements set forth in § 67-4-2109(b) , the taxpayer qualifies for the job tax credit provided therein; (B) The industrial machinery credit taken on any franchise and excise tax return, however, shall not exceed fifty percent (50%) of the combined franchise and excise tax liability shown by the return before the credit is taken; (C) (i) Any unused credit may be carried forward in any tax period until the credit is taken; however, the credit may not be carried forward for more than fifteen (15) years; provided, however, that credits earned in tax years ending on or after December 31, 2008, may be carried forward for twenty-five (25) years; (ii) If the taxpayer qualifies for the credit provided in subdivision (3)(I)(i), the fifteen-year limitation otherwise applicable to the carry-forward of unused credit shall not apply; provided, that the commissioner of economic and community development and the commissioner of revenue have determined that the allowance of the additional carry-forward is in the best interest of the state; (iii) Subdivision (3)(C)(ii) shall apply only to applications received and approved by the commissioner of revenue and the commissioner of economic and community development on or before January 1, 2011; (D) If the industrial machinery, for the purchase of which a tax credit has been allowed, is sold or removed from this state during its useful life according to the depreciation guidelines in effect for excise tax purposes, the department shall be entitled to recapture a portion of the credit allowed by increasing the franchise and/or excise tax liability of any taxpayer, for the taxable period during which the machinery was sold or removed, in an amount equal to the percentage of useful life remaining on the industrial machinery at the time of sale or removal times the total credit taken on the purchase of the machinery; (E) For purposes of the allowance of the credit against franchise and excise taxes under this section, any taxpayer who is a lessee of new industrial machinery and the original user of the industrial machinery, including a lessee from an industrial development corporation as defined by title 7, chapter 53, or other tax exempt entity, shall be treated as having purchased the machinery during the tax period in which it is placed in service by the lessee, at an amount equal to its purchase price; (F) If industrial machinery is leased for a period that constitutes less than eighty percent (80%) of its useful life, then the lessee shall be deemed to have purchased only a portion of the machinery, at an amount determined by multiplying the actual purchase price of the machinery by a fraction, the numerator of which is the lease term, and the denominator of which is the useful life of the leased machinery; (G) (i) Notwithstanding any law to the contrary, the industrial machinery franchise and excise tax credit provided in this subdivision (3) may be computed by a general partnership that operates a call center in this state that is placed in service by the general partnership on or after June 30, 2003, and that would otherwise qualify for the credit provided in § 67-4-2109(b)(3)(G) . The industrial machinery franchise and excise tax credit shall be computed as if the general partnership were subject to franchise and excise tax. With respect to the general partnership tax year during which a credit is so computed, a partner in the general partnership that is subject to franchise and excise tax and that directly holds a first tier ownership interest in the general partnership may take a percentage of the credit that equals the total amount of the credit for the general partnership multiplied by the partner's percentage interest in the general partnership on the last day of the general partnership tax year against the partner's franchise and excise tax liability for the partner's tax year that includes the last day. The industrial machinery franchise and excise tax credit passed through from the general partnership to the first tier partner under this section shall, in the hands of the first tier partner, be subject to applicable provisions and limitations otherwise provided by this section, including carry forward provisions; provided, that in no case shall the credit or a carryover of a credit be taken by a business entity, unless it was a partner in the general partnership and subject to franchise and excise tax at the time the credit was earned by the general partnership; (ii) This subdivision (3)(G) shall expire on July 1, 2015; provided, that any taxpayer that has filed a business plan with the department prior to July 1, 2015, shall continue to be eligible for the credit; (H) Notwithstanding any provision to the contrary, a taxpayer that has established its international, national, or regional headquarters in this state and has met the requirements to qualify for the credit provided in § 67-6-224 , or a taxpayer that has established an international, national, or regional warehousing or distribution hub in this state and has met the requirements to be a qualified new or expanded warehouse or distribution facility, shall be allowed to offset up to one hundred percent (100%) of its franchise and/or excise tax liability by the industrial machinery credit provided in this subdivision (3), or any carryforward of the industrial machinery credit, if the commissioner of revenue and the commissioner of economic and community development determine that increasing the percentage of offset above that allowed by subdivision (3)(B) is in the best interests of the state. For purposes of this subdivision (3)(H), "best interests of the state" means a determination that the taxpayer established its headquarters or a warehousing or distribution hub in this state, or converted a regional headquarters or regional warehousing or distribution hub in this state into its national or international headquarters or a national or international warehousing or distribution hub, as a result of such action. The commissioner of revenue and the commissioner of economic and community development shall determine the percentage of franchise and/or excise tax liability allowed to be offset, above that otherwise allowed by subdivision (3)(B), and the period during which the increased offset shall continue; (I) (i) If the taxpayer makes a required capital investment in excess of one billion dollars ($1,000,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to ten percent (10%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ; (ii) If the taxpayer makes a required capital investment in excess of five hundred million dollars ($500,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to seven percent (7%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ; (iii) If the taxpayer makes a required capital investment in excess of two hundred fifty million dollars ($250,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to five percent (5%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ; (iv) If the taxpayer makes a capital investment in excess of one hundred million dollars ($100,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to three percent (3%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ; (v) The taxpayer shall file a business plan with the commissioner of revenue in order to qualify for the credit provided in this subdivision (3)(I). The business plan shall be filed on or before the last day of the first fiscal year in which the investment is made and shall describe the investment. The commissioner of revenue has the authority to conduct audits or require the filing of additional information necessary to substantiate or adjust the findings contained within the business plan and to determine that the taxpayer has complied with all statutory requirements so as to be entitled to the credit in this subdivision (3)(I); (vi) The credit in this subdivision (3)(I) shall begin to apply in the first year of the investment period; however, if the required capital investment is not met during the investment period, the taxpayer shall be subject to an assessment equal to the amount of any credit taken under this subdivision (3)(I) for which the taxpayer failed to qualify, plus interest; (vii) For purposes of this subdivision (3)(I), unless the context otherwise requires: (a) "Good cause" means a determination by the commissioner of economic and community development that the capital investment is a result of the credit provided in this subdivision (3)(I); (b) "Investment period" means a period not to exceed three (3) years from the filing of the business plan related to the required capital investment, during which the required capital investment must be made. The three-year period for making the required capital investment may, for good cause shown, be extended by the commissioner of economic and community development for a reasonable period not to exceed four (4) years for a taxpayer that meets the requirements of subdivision (3)(I)(i) and not to exceed two (2) years for any other taxpayer; and (c) "Required capital investment" means an increase of a business investment in real property, tangible personal property or computer software owned or leased in this state valued in accordance with generally accepted accounting principles. A capital investment shall be deemed to have been made as of the date of payment or the date the taxpayer enters into a legally binding commitment or contract for purchase or construction; (J) [Expired July 1, 2015; see (3)(J)(vi)] (i) In addition to the credit provided in subdivision (3)(A), the owner of a qualifying environmental project shall be entitled to a one-time credit in the amount of one and three-fourths percent (1.75%) of the investment in the qualifying environmental project, and such credit shall have the same carry-forward features, limitations and other attributes as are applicable to job tax credits under § 67-4-2109(b)(1) . The owner of a qualifying environmental project shall also be provided six (6) annual credits in the amount of one and three-fourths percent (1.75%) of the investment in the qualifying project, and such credits shall have the same carry-forward features, limitations and other attributes as are applicable to enhanced job tax credits under § 67-4-2109(b)(2)(B)(iii) , and the entire investment in the qualifying environmental project shall be treated as exempt required capital investment for purposes of § 67-4-2108(a)(6)(G) ; (ii) For purposes of this subdivision (3)(J), a "qualifying environmental project" means a project in which the taxpayer makes an investment in excess of one hundred million dollars ($100,000,000) to eliminate mercury from the manufacturing process and operations of one (1) or more existing chlor-alkali manufacturing and ancillary facilities and equipment in the state; (iii) The maximum investment in a qualifying environmental project that is eligible for the credits provided under this subdivision (3)(J) is one hundred million dollars ($100,000,000), inclusive of all capital investment and other direct and indirect costs of the project. To be eligible for the credits provided under this subdivision (3)(J), construction of the qualifying environmental project must have commenced on or after January 1, 2011, and construction of the qualifying environmental project must be substantially complete on or before January 1, 2014. The credits provided under this subdivision (3)(J) shall first be available in the later of the year in which the qualifying environmental project is substantially complete or July 1, 2013; (iv) As a condition to receiving credits under this subdivision (3)(J), the owner of a qualifying environmental project shall agree to maintain an annual average of at least three hundred fifty (350) jobs in the state that meet the requirements set forth in § 67-4-2109(a)(6)(A) for a period of six (6) years after substantial completion of the qualifying environmental project. In the event the owner does not maintain the required number of qualified jobs in a specific year, the annual credit provided under this subdivision (3)(J) for that year shall be reduced in proportion to the percentage of the shortfall; (v) As a further condition to receiving credits under this subdivision (3)(J), the owner of a qualifying environmental project shall agree to forego any and all claims for credits that may be available to the owner pursuant to § 67-4-2109(b)(1) and (2) in connection with the qualifying environmental project; (vi) This subdivision (3)(J) shall expire on July 1, 2015; provided, that any taxpayer that has filed a business plan with the department prior to July 1, 2015, shall continue to be eligible for the credit; and (K) Notwithstanding any law to the contrary, a taxpayer that has previously made a capital investment in excess of one billion dollars ($1,000,000,000) during a single investment period and has previously qualified for the credit provided in § 67-6-224 and that qualifies during the applicable tax year for, but chooses to not make, the election under § 67-4-2012 ( l ), shall, upon written request submitted to the commissioner, be allowed to offset up to one hundred percent (100%) of its excise tax liability by the industrial machinery credit provided in this subdivision (3), or any carryforward of the industrial machinery credit, if the commissioners of revenue and economic and community development determine that increasing the percentage of offset above fifty percent (50%), as limited by subdivision (3)(B), will allow the taxpayer to maximize the use of its industrial machinery credits while resulting in an excise tax liability substantially equal to the amount otherwise due if the taxpayer had made the election under § 67-4-2012 ( l ). The commissioners of revenue and the commissioner of economic and community development shall determine the percentage of excise tax liability allowed to be offset, above that otherwise allowed by subdivision (3)(B), and the period during which the increased offset shall continue;
(A) There shall be allowed against the sum total of the taxes imposed by the Franchise Tax Law of 1999, compiled in part 21 of this chapter, and by this part, a credit equal to one percent (1%) of the purchase price of industrial machinery purchased during the tax period covered by the return and located in this state. For purposes of this section, "industrial machinery" means: (i) "Industrial machinery" as defined by § 67-6-102 ; or (ii) "Computer," "computer network," "computer software," or "computer system" as defined by § 39-14-601 , and any peripheral devices, including, but not limited to, hardware, such as printers, plotters, external disc drives, modems, and telephone units, purchased by a taxpayer in the process of making the required capital investment in Tennessee described in § 67-4-2109(a) , if as a result of making such purchase and meeting the other requirements set forth in § 67-4-2109(b) , the taxpayer qualifies for the job tax credit provided therein;
(i) "Industrial machinery" as defined by § 67-6-102 ; or
(ii) "Computer," "computer network," "computer software," or "computer system" as defined by § 39-14-601 , and any peripheral devices, including, but not limited to, hardware, such as printers, plotters, external disc drives, modems, and telephone units, purchased by a taxpayer in the process of making the required capital investment in Tennessee described in § 67-4-2109(a) , if as a result of making such purchase and meeting the other requirements set forth in § 67-4-2109(b) , the taxpayer qualifies for the job tax credit provided therein;
(B) The industrial machinery credit taken on any franchise and excise tax return, however, shall not exceed fifty percent (50%) of the combined franchise and excise tax liability shown by the return before the credit is taken;
(C) (i) Any unused credit may be carried forward in any tax period until the credit is taken; however, the credit may not be carried forward for more than fifteen (15) years; provided, however, that credits earned in tax years ending on or after December 31, 2008, may be carried forward for twenty-five (25) years; (ii) If the taxpayer qualifies for the credit provided in subdivision (3)(I)(i), the fifteen-year limitation otherwise applicable to the carry-forward of unused credit shall not apply; provided, that the commissioner of economic and community development and the commissioner of revenue have determined that the allowance of the additional carry-forward is in the best interest of the state; (iii) Subdivision (3)(C)(ii) shall apply only to applications received and approved by the commissioner of revenue and the commissioner of economic and community development on or before January 1, 2011;
(i) Any unused credit may be carried forward in any tax period until the credit is taken; however, the credit may not be carried forward for more than fifteen (15) years; provided, however, that credits earned in tax years ending on or after December 31, 2008, may be carried forward for twenty-five (25) years;
(ii) If the taxpayer qualifies for the credit provided in subdivision (3)(I)(i), the fifteen-year limitation otherwise applicable to the carry-forward of unused credit shall not apply; provided, that the commissioner of economic and community development and the commissioner of revenue have determined that the allowance of the additional carry-forward is in the best interest of the state;
(iii) Subdivision (3)(C)(ii) shall apply only to applications received and approved by the commissioner of revenue and the commissioner of economic and community development on or before January 1, 2011;
(D) If the industrial machinery, for the purchase of which a tax credit has been allowed, is sold or removed from this state during its useful life according to the depreciation guidelines in effect for excise tax purposes, the department shall be entitled to recapture a portion of the credit allowed by increasing the franchise and/or excise tax liability of any taxpayer, for the taxable period during which the machinery was sold or removed, in an amount equal to the percentage of useful life remaining on the industrial machinery at the time of sale or removal times the total credit taken on the purchase of the machinery;
(E) For purposes of the allowance of the credit against franchise and excise taxes under this section, any taxpayer who is a lessee of new industrial machinery and the original user of the industrial machinery, including a lessee from an industrial development corporation as defined by title 7, chapter 53, or other tax exempt entity, shall be treated as having purchased the machinery during the tax period in which it is placed in service by the lessee, at an amount equal to its purchase price;
(F) If industrial machinery is leased for a period that constitutes less than eighty percent (80%) of its useful life, then the lessee shall be deemed to have purchased only a portion of the machinery, at an amount determined by multiplying the actual purchase price of the machinery by a fraction, the numerator of which is the lease term, and the denominator of which is the useful life of the leased machinery;
(G) (i) Notwithstanding any law to the contrary, the industrial machinery franchise and excise tax credit provided in this subdivision (3) may be computed by a general partnership that operates a call center in this state that is placed in service by the general partnership on or after June 30, 2003, and that would otherwise qualify for the credit provided in § 67-4-2109(b)(3)(G) . The industrial machinery franchise and excise tax credit shall be computed as if the general partnership were subject to franchise and excise tax. With respect to the general partnership tax year during which a credit is so computed, a partner in the general partnership that is subject to franchise and excise tax and that directly holds a first tier ownership interest in the general partnership may take a percentage of the credit that equals the total amount of the credit for the general partnership multiplied by the partner's percentage interest in the general partnership on the last day of the general partnership tax year against the partner's franchise and excise tax liability for the partner's tax year that includes the last day. The industrial machinery franchise and excise tax credit passed through from the general partnership to the first tier partner under this section shall, in the hands of the first tier partner, be subject to applicable provisions and limitations otherwise provided by this section, including carry forward provisions; provided, that in no case shall the credit or a carryover of a credit be taken by a business entity, unless it was a partner in the general partnership and subject to franchise and excise tax at the time the credit was earned by the general partnership; (ii) This subdivision (3)(G) shall expire on July 1, 2015; provided, that any taxpayer that has filed a business plan with the department prior to July 1, 2015, shall continue to be eligible for the credit;
(i) Notwithstanding any law to the contrary, the industrial machinery franchise and excise tax credit provided in this subdivision (3) may be computed by a general partnership that operates a call center in this state that is placed in service by the general partnership on or after June 30, 2003, and that would otherwise qualify for the credit provided in § 67-4-2109(b)(3)(G) . The industrial machinery franchise and excise tax credit shall be computed as if the general partnership were subject to franchise and excise tax. With respect to the general partnership tax year during which a credit is so computed, a partner in the general partnership that is subject to franchise and excise tax and that directly holds a first tier ownership interest in the general partnership may take a percentage of the credit that equals the total amount of the credit for the general partnership multiplied by the partner's percentage interest in the general partnership on the last day of the general partnership tax year against the partner's franchise and excise tax liability for the partner's tax year that includes the last day. The industrial machinery franchise and excise tax credit passed through from the general partnership to the first tier partner under this section shall, in the hands of the first tier partner, be subject to applicable provisions and limitations otherwise provided by this section, including carry forward provisions; provided, that in no case shall the credit or a carryover of a credit be taken by a business entity, unless it was a partner in the general partnership and subject to franchise and excise tax at the time the credit was earned by the general partnership;
(ii) This subdivision (3)(G) shall expire on July 1, 2015; provided, that any taxpayer that has filed a business plan with the department prior to July 1, 2015, shall continue to be eligible for the credit;
(H) Notwithstanding any provision to the contrary, a taxpayer that has established its international, national, or regional headquarters in this state and has met the requirements to qualify for the credit provided in § 67-6-224 , or a taxpayer that has established an international, national, or regional warehousing or distribution hub in this state and has met the requirements to be a qualified new or expanded warehouse or distribution facility, shall be allowed to offset up to one hundred percent (100%) of its franchise and/or excise tax liability by the industrial machinery credit provided in this subdivision (3), or any carryforward of the industrial machinery credit, if the commissioner of revenue and the commissioner of economic and community development determine that increasing the percentage of offset above that allowed by subdivision (3)(B) is in the best interests of the state. For purposes of this subdivision (3)(H), "best interests of the state" means a determination that the taxpayer established its headquarters or a warehousing or distribution hub in this state, or converted a regional headquarters or regional warehousing or distribution hub in this state into its national or international headquarters or a national or international warehousing or distribution hub, as a result of such action. The commissioner of revenue and the commissioner of economic and community development shall determine the percentage of franchise and/or excise tax liability allowed to be offset, above that otherwise allowed by subdivision (3)(B), and the period during which the increased offset shall continue;
(I) (i) If the taxpayer makes a required capital investment in excess of one billion dollars ($1,000,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to ten percent (10%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ; (ii) If the taxpayer makes a required capital investment in excess of five hundred million dollars ($500,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to seven percent (7%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ; (iii) If the taxpayer makes a required capital investment in excess of two hundred fifty million dollars ($250,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to five percent (5%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ; (iv) If the taxpayer makes a capital investment in excess of one hundred million dollars ($100,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to three percent (3%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ; (v) The taxpayer shall file a business plan with the commissioner of revenue in order to qualify for the credit provided in this subdivision (3)(I). The business plan shall be filed on or before the last day of the first fiscal year in which the investment is made and shall describe the investment. The commissioner of revenue has the authority to conduct audits or require the filing of additional information necessary to substantiate or adjust the findings contained within the business plan and to determine that the taxpayer has complied with all statutory requirements so as to be entitled to the credit in this subdivision (3)(I); (vi) The credit in this subdivision (3)(I) shall begin to apply in the first year of the investment period; however, if the required capital investment is not met during the investment period, the taxpayer shall be subject to an assessment equal to the amount of any credit taken under this subdivision (3)(I) for which the taxpayer failed to qualify, plus interest; (vii) For purposes of this subdivision (3)(I), unless the context otherwise requires: (a) "Good cause" means a determination by the commissioner of economic and community development that the capital investment is a result of the credit provided in this subdivision (3)(I); (b) "Investment period" means a period not to exceed three (3) years from the filing of the business plan related to the required capital investment, during which the required capital investment must be made. The three-year period for making the required capital investment may, for good cause shown, be extended by the commissioner of economic and community development for a reasonable period not to exceed four (4) years for a taxpayer that meets the requirements of subdivision (3)(I)(i) and not to exceed two (2) years for any other taxpayer; and (c) "Required capital investment" means an increase of a business investment in real property, tangible personal property or computer software owned or leased in this state valued in accordance with generally accepted accounting principles. A capital investment shall be deemed to have been made as of the date of payment or the date the taxpayer enters into a legally binding commitment or contract for purchase or construction;
(i) If the taxpayer makes a required capital investment in excess of one billion dollars ($1,000,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to ten percent (10%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ;
(ii) If the taxpayer makes a required capital investment in excess of five hundred million dollars ($500,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to seven percent (7%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ;
(iii) If the taxpayer makes a required capital investment in excess of two hundred fifty million dollars ($250,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to five percent (5%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ;
(iv) If the taxpayer makes a capital investment in excess of one hundred million dollars ($100,000,000) during the investment period, the credit allowed in subdivision (3)(A) shall be equal to three percent (3%) of the purchase price of industrial machinery located in this state and purchased in the process of making the required capital investment. The credit shall be subject to subdivisions (3)(A)-(H), except that a taxpayer making the required capital investment for purposes of this subdivision (3)(I) shall be entitled to the credit for the items listed in subdivision (3)(A)(ii) regardless of whether the taxpayer meets any of the requirements of, or qualifies for, the job tax credit provided in § 67-4-2109(b) ;
(v) The taxpayer shall file a business plan with the commissioner of revenue in order to qualify for the credit provided in this subdivision (3)(I). The business plan shall be filed on or before the last day of the first fiscal year in which the investment is made and shall describe the investment. The commissioner of revenue has the authority to conduct audits or require the filing of additional information necessary to substantiate or adjust the findings contained within the business plan and to determine that the taxpayer has complied with all statutory requirements so as to be entitled to the credit in this subdivision (3)(I);
(vi) The credit in this subdivision (3)(I) shall begin to apply in the first year of the investment period; however, if the required capital investment is not met during the investment period, the taxpayer shall be subject to an assessment equal to the amount of any credit taken under this subdivision (3)(I) for which the taxpayer failed to qualify, plus interest;
(vii) For purposes of this subdivision (3)(I), unless the context otherwise requires: (a) "Good cause" means a determination by the commissioner of economic and community development that the capital investment is a result of the credit provided in this subdivision (3)(I); (b) "Investment period" means a period not to exceed three (3) years from the filing of the business plan related to the required capital investment, during which the required capital investment must be made. The three-year period for making the required capital investment may, for good cause shown, be extended by the commissioner of economic and community development for a reasonable period not to exceed four (4) years for a taxpayer that meets the requirements of subdivision (3)(I)(i) and not to exceed two (2) years for any other taxpayer; and (c) "Required capital investment" means an increase of a business investment in real property, tangible personal property or computer software owned or leased in this state valued in accordance with generally accepted accounting principles. A capital investment shall be deemed to have been made as of the date of payment or the date the taxpayer enters into a legally binding commitment or contract for purchase or construction;
(a) "Good cause" means a determination by the commissioner of economic and community development that the capital investment is a result of the credit provided in this subdivision (3)(I);
(b) "Investment period" means a period not to exceed three (3) years from the filing of the business plan related to the required capital investment, during which the required capital investment must be made. The three-year period for making the required capital investment may, for good cause shown, be extended by the commissioner of economic and community development for a reasonable period not to exceed four (4) years for a taxpayer that meets the requirements of subdivision (3)(I)(i) and not to exceed two (2) years for any other taxpayer; and
(c) "Required capital investment" means an increase of a business investment in real property, tangible personal property or computer software owned or leased in this state valued in accordance with generally accepted accounting principles. A capital investment shall be deemed to have been made as of the date of payment or the date the taxpayer enters into a legally binding commitment or contract for purchase or construction;
(J) [Expired July 1, 2015; see (3)(J)(vi)] (i) In addition to the credit provided in subdivision (3)(A), the owner of a qualifying environmental project shall be entitled to a one-time credit in the amount of one and three-fourths percent (1.75%) of the investment in the qualifying environmental project, and such credit shall have the same carry-forward features, limitations and other attributes as are applicable to job tax credits under § 67-4-2109(b)(1) . The owner of a qualifying environmental project shall also be provided six (6) annual credits in the amount of one and three-fourths percent (1.75%) of the investment in the qualifying project, and such credits shall have the same carry-forward features, limitations and other attributes as are applicable to enhanced job tax credits under § 67-4-2109(b)(2)(B)(iii) , and the entire investment in the qualifying environmental project shall be treated as exempt required capital investment for purposes of § 67-4-2108(a)(6)(G) ; (ii) For purposes of this subdivision (3)(J), a "qualifying environmental project" means a project in which the taxpayer makes an investment in excess of one hundred million dollars ($100,000,000) to eliminate mercury from the manufacturing process and operations of one (1) or more existing chlor-alkali manufacturing and ancillary facilities and equipment in the state; (iii) The maximum investment in a qualifying environmental project that is eligible for the credits provided under this subdivision (3)(J) is one hundred million dollars ($100,000,000), inclusive of all capital investment and other direct and indirect costs of the project. To be eligible for the credits provided under this subdivision (3)(J), construction of the qualifying environmental project must have commenced on or after January 1, 2011, and construction of the qualifying environmental project must be substantially complete on or before January 1, 2014. The credits provided under this subdivision (3)(J) shall first be available in the later of the year in which the qualifying environmental project is substantially complete or July 1, 2013; (iv) As a condition to receiving credits under this subdivision (3)(J), the owner of a qualifying environmental project shall agree to maintain an annual average of at least three hundred fifty (350) jobs in the state that meet the requirements set forth in § 67-4-2109(a)(6)(A) for a period of six (6) years after substantial completion of the qualifying environmental project. In the event the owner does not maintain the required number of qualified jobs in a specific year, the annual credit provided under this subdivision (3)(J) for that year shall be reduced in proportion to the percentage of the shortfall; (v) As a further condition to receiving credits under this subdivision (3)(J), the owner of a qualifying environmental project shall agree to forego any and all claims for credits that may be available to the owner pursuant to § 67-4-2109(b)(1) and (2) in connection with the qualifying environmental project; (vi) This subdivision (3)(J) shall expire on July 1, 2015; provided, that any taxpayer that has filed a business plan with the department prior to July 1, 2015, shall continue to be eligible for the credit; and
(i) In addition to the credit provided in subdivision (3)(A), the owner of a qualifying environmental project shall be entitled to a one-time credit in the amount of one and three-fourths percent (1.75%) of the investment in the qualifying environmental project, and such credit shall have the same carry-forward features, limitations and other attributes as are applicable to job tax credits under § 67-4-2109(b)(1) . The owner of a qualifying environmental project shall also be provided six (6) annual credits in the amount of one and three-fourths percent (1.75%) of the investment in the qualifying project, and such credits shall have the same carry-forward features, limitations and other attributes as are applicable to enhanced job tax credits under § 67-4-2109(b)(2)(B)(iii) , and the entire investment in the qualifying environmental project shall be treated as exempt required capital investment for purposes of § 67-4-2108(a)(6)(G) ;
(ii) For purposes of this subdivision (3)(J), a "qualifying environmental project" means a project in which the taxpayer makes an investment in excess of one hundred million dollars ($100,000,000) to eliminate mercury from the manufacturing process and operations of one (1) or more existing chlor-alkali manufacturing and ancillary facilities and equipment in the state;
(iii) The maximum investment in a qualifying environmental project that is eligible for the credits provided under this subdivision (3)(J) is one hundred million dollars ($100,000,000), inclusive of all capital investment and other direct and indirect costs of the project. To be eligible for the credits provided under this subdivision (3)(J), construction of the qualifying environmental project must have commenced on or after January 1, 2011, and construction of the qualifying environmental project must be substantially complete on or before January 1, 2014. The credits provided under this subdivision (3)(J) shall first be available in the later of the year in which the qualifying environmental project is substantially complete or July 1, 2013;
(iv) As a condition to receiving credits under this subdivision (3)(J), the owner of a qualifying environmental project shall agree to maintain an annual average of at least three hundred fifty (350) jobs in the state that meet the requirements set forth in § 67-4-2109(a)(6)(A) for a period of six (6) years after substantial completion of the qualifying environmental project. In the event the owner does not maintain the required number of qualified jobs in a specific year, the annual credit provided under this subdivision (3)(J) for that year shall be reduced in proportion to the percentage of the shortfall;
(v) As a further condition to receiving credits under this subdivision (3)(J), the owner of a qualifying environmental project shall agree to forego any and all claims for credits that may be available to the owner pursuant to § 67-4-2109(b)(1) and (2) in connection with the qualifying environmental project;
(vi) This subdivision (3)(J) shall expire on July 1, 2015; provided, that any taxpayer that has filed a business plan with the department prior to July 1, 2015, shall continue to be eligible for the credit; and
(K) Notwithstanding any law to the contrary, a taxpayer that has previously made a capital investment in excess of one billion dollars ($1,000,000,000) during a single investment period and has previously qualified for the credit provided in § 67-6-224 and that qualifies during the applicable tax year for, but chooses to not make, the election under § 67-4-2012 ( l ), shall, upon written request submitted to the commissioner, be allowed to offset up to one hundred percent (100%) of its excise tax liability by the industrial machinery credit provided in this subdivision (3), or any carryforward of the industrial machinery credit, if the commissioners of revenue and economic and community development determine that increasing the percentage of offset above fifty percent (50%), as limited by subdivision (3)(B), will allow the taxpayer to maximize the use of its industrial machinery credits while resulting in an excise tax liability substantially equal to the amount otherwise due if the taxpayer had made the election under § 67-4-2012 ( l ). The commissioners of revenue and the commissioner of economic and community development shall determine the percentage of excise tax liability allowed to be offset, above that otherwise allowed by subdivision (3)(B), and the period during which the increased offset shall continue;
(4) A hospital company filing a franchise/excise tax return on a combined basis as required in § 67-4-2014(e) , together with all other members of its combined group filing with it, shall be allowed as a credit against the combined annual franchise/excise tax imposed an amount equal to the lesser of the franchise tax or excise tax so that the combined annual franchise/excise tax of the combined group shall be limited to the greater of the two (2) of them; provided, that this credit shall not apply to tax years beginning on or after January 1, 2007;
(5) A hospital company filing a franchise/excise tax return on a combined basis as described in § 67-4-2014(e) , together with all members of its combined group filing with it, shall be allowed as a further credit against the combined annual franchise/excise tax imposed on the group remaining after application of the credit allowed under subdivision (4) an amount equal to four percent (4%) of the cost of medical supplies and medical equipment used by or placed in service by the members of the controlled group in this state during the tax year; provided, that the aggregate amount of the credit allowed to a taxpayer under subdivision (4), together with the credit allowed to a taxpayer under this subdivision (5), shall not exceed nine million dollars ($9,000,000) in any one (1) tax year; and provided, further, that the credit allowed under this subdivision (5) shall not apply to tax years beginning on or after January 1, 2007. A corporation or other entity shall be deemed to have used or placed in service medical supplies and medical equipment used or placed in service by a partnership or limited liability company of which it is a partner or member that would be a hospital company, as defined in § 67-4-2004 , if it were a corporation or other entity upon which tax is imposed under this part and part 21 of this chapter, and would be a member of its same controlled group, as defined in § 267(f)(1) of the Internal Revenue Code of 1986 ( 26 U.S.C. § 267(f)(1) ) if it were a corporation and its partners or members were shareholders. The amount of the cost of such medical supplies and medical equipment that is attributed to and deemed to have been used or placed in service by such corporation or other entity shall be equal to the pro rata portion of the cost of medical supplies and medical equipment used or placed in service by the partnership or limited liability company in the tax year. Such pro rata portion shall be determined based upon the corporation's or other entity's percentage of the profits and losses of such partnership or limited liability company during such tax year. As used in this subdivision (5), "medical equipment" has the same meaning as "major medical equipment" as set forth in § 68-11-102(10) [repealed], but without the limitation therein as to the cost thereof; and "medical supplies" means all apparatus, consumable products, appliances, and other tangible personal property, except drugs and medicines, used in provision of patient health care services, including all recordkeeping and documentation in connection with such services;
(6) (A) Except for unitary groups of financial institutions, each taxpayer is considered a separate entity; therefore, in the case of mergers, consolidations, and like transactions, no tax credit incurred by the predecessor taxpayer shall be allowed as a credit on the tax return filed by the successor taxpayer. With the exception set forth in subdivision (6)(B), a credit carryforward may be taken only by the taxpayer that generated it; (B) Notwithstanding the provisions contained in subdivision (6)(A), when a taxpayer merges out of existence and into a successor taxpayer that has no income, expenses, assets, liabilities, equity or net worth, any qualified Tennessee credit carryover of the predecessor that merged out of existence shall be available for carryover on the return of the surviving successor; provided, that the time limitations for the carryover have not expired; (C) A unitary group of financial institutions may take any qualified credit that was generated by any group member that is in existence as a member of the group at the end of the group's tax year; provided, that such credit has not previously been taken by the member itself before it joined the group or by another unitary group of financial institutions at the time the financial institution generating the credit was a member of that group; and provided, further, that the credit carryover shall be subject to the limitations set forth in this subdivision (6);
(A) Except for unitary groups of financial institutions, each taxpayer is considered a separate entity; therefore, in the case of mergers, consolidations, and like transactions, no tax credit incurred by the predecessor taxpayer shall be allowed as a credit on the tax return filed by the successor taxpayer. With the exception set forth in subdivision (6)(B), a credit carryforward may be taken only by the taxpayer that generated it;
(B) Notwithstanding the provisions contained in subdivision (6)(A), when a taxpayer merges out of existence and into a successor taxpayer that has no income, expenses, assets, liabilities, equity or net worth, any qualified Tennessee credit carryover of the predecessor that merged out of existence shall be available for carryover on the return of the surviving successor; provided, that the time limitations for the carryover have not expired;
(C) A unitary group of financial institutions may take any qualified credit that was generated by any group member that is in existence as a member of the group at the end of the group's tax year; provided, that such credit has not previously been taken by the member itself before it joined the group or by another unitary group of financial institutions at the time the financial institution generating the credit was a member of that group; and provided, further, that the credit carryover shall be subject to the limitations set forth in this subdivision (6);
(7) A credit shall be allowed against the tax imposed by this part in an amount equal to the tax imposed by chapter 2 of this title paid by the taxpayer;
(8) (A) There shall be allowed against the sum total of the taxes imposed by the Franchise Tax Law of 1999, and by this part, a credit equal to fifty percent (50%) of the purchase price of brownfield property purchased in this state during the tax period covered by the return for the purpose of a qualified development project; (B) For the purposes of this subdivision (8), unless the context otherwise requires: (i) "Brownfield property" means real property that is the subject of an investigation, remediation, or mitigation as a brownfield project under a voluntary agreement or consent order pursuant to § 68-212-224 ; (ii) "Capital investment" means an investment in real property, tangible personal property or computer software owned or leased in this state valued in accordance with generally accepted accounting principles. A capital investment shall be deemed to have been made as of the date of payment or the date the taxpayer enters into a legally binding commitment or contract for purchase or construction of the real or personal property; (iii) "Investment period" means a period not to exceed five (5) years from the filing of the business plan related to the required capital investment, during which the required capital investment must be made; (iv) "Qualified development project" means a project consisting of a capital investment of at least twenty-five million dollars ($25,000,000), located on a brownfield property, and having a business plan approved by the commissioner of revenue in accordance with the applicable provisions of subdivision (8)(D); (C) The credit allowed pursuant to this subdivision (8) shall apply against the excise tax imposed by this part and the Franchise Tax Law of 1999; provided, however, that such credit, together with any carry-forward thereof, taken on any franchise and excise tax return shall not exceed fifty percent (50%) of the combined franchise and excise tax liability shown by the return before any credit is taken. Any credit authorized under this subdivision (8)(C) that is unused may be carried forward in any tax period until the credit is taken; provided, that the credit may not be carried forward for more than fifteen (15) years; provided, however, that credits earned in tax years ending on or after December 31, 2008, may be carried forward for twenty-five (25) years; (D) (i) The taxpayer shall file a business plan for the development project with the commissioner of revenue in order to qualify for the credit provided in subdivision (8)(A). The plan must describe the capital investment to be made toward the qualified development project within the investment period and also include a determination by the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development pursuant to subdivision (8)(G) that the credit is in the best interest of the state; (ii) Qualifying plans shall be approved by the commissioner of revenue. At such time, an approval letter authorizing the credit, the value of the credit and the terms of the credit shall be issued. A copy of the approval letter shall be filed by the taxpayer with the department of revenue in any year in which the taxpayer utilizes the credit; (iii) The commissioner of revenue has the authority to conduct audits or require the filing of additional information necessary to substantiate or adjust the findings contained within the business plan and to determine that the taxpayer has complied with all statutory requirements so as to be entitled to the credit in this subdivision (8); (E) In order to receive the credit, the taxpayer must submit a claim for the credit, along with documentation as required by the commissioner showing that the capital investment was made toward the qualified development project during the investment period. The taxpayer shall not be eligible to receive the credit until the minimum capital investment required by subdivision (8)(B)(v) has been met; (F) The commissioner shall review the claim for the credit and notify the taxpayer of the approved tax credit amount. The taxpayer may not take the credit until the commissioner has notified the taxpayer of the approved amount; (G) Notwithstanding any provision of this subdivision (8) to the contrary, no credit shall be allowed unless the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development determine, in their sole discretion, that the credit is in the best interest of the state. For purposes of this subdivision (8)(G), "best interest of the state" means a determination by the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development that the qualified development project is a result of the credit provided in subdivision (8)(A) and that the economic benefits to this state resulting from the qualified development project outweigh the anticipated amount of the credit; and (H) For a qualified development project in which the taxpayer receives the brownfield property from a county, municipality, or industrial development board as defined in § 7-53-101 for a sale price of less than one dollar ($1.00), the amount of any credit authorized under this subdivision (8) is fifty percent (50%) of the most recent purchase price of the brownfield property that was paid by the county, municipality, or industrial development board;
(A) There shall be allowed against the sum total of the taxes imposed by the Franchise Tax Law of 1999, and by this part, a credit equal to fifty percent (50%) of the purchase price of brownfield property purchased in this state during the tax period covered by the return for the purpose of a qualified development project;
(B) For the purposes of this subdivision (8), unless the context otherwise requires: (i) "Brownfield property" means real property that is the subject of an investigation, remediation, or mitigation as a brownfield project under a voluntary agreement or consent order pursuant to § 68-212-224 ; (ii) "Capital investment" means an investment in real property, tangible personal property or computer software owned or leased in this state valued in accordance with generally accepted accounting principles. A capital investment shall be deemed to have been made as of the date of payment or the date the taxpayer enters into a legally binding commitment or contract for purchase or construction of the real or personal property; (iii) "Investment period" means a period not to exceed five (5) years from the filing of the business plan related to the required capital investment, during which the required capital investment must be made; (iv) "Qualified development project" means a project consisting of a capital investment of at least twenty-five million dollars ($25,000,000), located on a brownfield property, and having a business plan approved by the commissioner of revenue in accordance with the applicable provisions of subdivision (8)(D);
(i) "Brownfield property" means real property that is the subject of an investigation, remediation, or mitigation as a brownfield project under a voluntary agreement or consent order pursuant to § 68-212-224 ;
(ii) "Capital investment" means an investment in real property, tangible personal property or computer software owned or leased in this state valued in accordance with generally accepted accounting principles. A capital investment shall be deemed to have been made as of the date of payment or the date the taxpayer enters into a legally binding commitment or contract for purchase or construction of the real or personal property;
(iii) "Investment period" means a period not to exceed five (5) years from the filing of the business plan related to the required capital investment, during which the required capital investment must be made;
(iv) "Qualified development project" means a project consisting of a capital investment of at least twenty-five million dollars ($25,000,000), located on a brownfield property, and having a business plan approved by the commissioner of revenue in accordance with the applicable provisions of subdivision (8)(D);
(C) The credit allowed pursuant to this subdivision (8) shall apply against the excise tax imposed by this part and the Franchise Tax Law of 1999; provided, however, that such credit, together with any carry-forward thereof, taken on any franchise and excise tax return shall not exceed fifty percent (50%) of the combined franchise and excise tax liability shown by the return before any credit is taken. Any credit authorized under this subdivision (8)(C) that is unused may be carried forward in any tax period until the credit is taken; provided, that the credit may not be carried forward for more than fifteen (15) years; provided, however, that credits earned in tax years ending on or after December 31, 2008, may be carried forward for twenty-five (25) years;
(D) (i) The taxpayer shall file a business plan for the development project with the commissioner of revenue in order to qualify for the credit provided in subdivision (8)(A). The plan must describe the capital investment to be made toward the qualified development project within the investment period and also include a determination by the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development pursuant to subdivision (8)(G) that the credit is in the best interest of the state; (ii) Qualifying plans shall be approved by the commissioner of revenue. At such time, an approval letter authorizing the credit, the value of the credit and the terms of the credit shall be issued. A copy of the approval letter shall be filed by the taxpayer with the department of revenue in any year in which the taxpayer utilizes the credit; (iii) The commissioner of revenue has the authority to conduct audits or require the filing of additional information necessary to substantiate or adjust the findings contained within the business plan and to determine that the taxpayer has complied with all statutory requirements so as to be entitled to the credit in this subdivision (8);
(i) The taxpayer shall file a business plan for the development project with the commissioner of revenue in order to qualify for the credit provided in subdivision (8)(A). The plan must describe the capital investment to be made toward the qualified development project within the investment period and also include a determination by the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development pursuant to subdivision (8)(G) that the credit is in the best interest of the state;
(ii) Qualifying plans shall be approved by the commissioner of revenue. At such time, an approval letter authorizing the credit, the value of the credit and the terms of the credit shall be issued. A copy of the approval letter shall be filed by the taxpayer with the department of revenue in any year in which the taxpayer utilizes the credit;
(iii) The commissioner of revenue has the authority to conduct audits or require the filing of additional information necessary to substantiate or adjust the findings contained within the business plan and to determine that the taxpayer has complied with all statutory requirements so as to be entitled to the credit in this subdivision (8);
(E) In order to receive the credit, the taxpayer must submit a claim for the credit, along with documentation as required by the commissioner showing that the capital investment was made toward the qualified development project during the investment period. The taxpayer shall not be eligible to receive the credit until the minimum capital investment required by subdivision (8)(B)(v) has been met;
(F) The commissioner shall review the claim for the credit and notify the taxpayer of the approved tax credit amount. The taxpayer may not take the credit until the commissioner has notified the taxpayer of the approved amount;
(G) Notwithstanding any provision of this subdivision (8) to the contrary, no credit shall be allowed unless the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development determine, in their sole discretion, that the credit is in the best interest of the state. For purposes of this subdivision (8)(G), "best interest of the state" means a determination by the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development that the qualified development project is a result of the credit provided in subdivision (8)(A) and that the economic benefits to this state resulting from the qualified development project outweigh the anticipated amount of the credit; and
(H) For a qualified development project in which the taxpayer receives the brownfield property from a county, municipality, or industrial development board as defined in § 7-53-101 for a sale price of less than one dollar ($1.00), the amount of any credit authorized under this subdivision (8) is fifty percent (50%) of the most recent purchase price of the brownfield property that was paid by the county, municipality, or industrial development board;
(9) (A) Notwithstanding subdivision (8), there shall be allowed against the sum total of the taxes imposed by the Franchise Tax Law of 1999 and by this part, a credit equal to seventy-five percent (75%) of the purchase price of brownfield property purchased in a tier 3 or tier 4 enhancement county in this state during the tax period covered by the return for the purpose of a qualified development project; (B) For the purposes of this subdivision (9), unless the context otherwise requires: (i) "Brownfield property" means real property that is the subject of an investigation, remediation, or mitigation as a brownfield project under a voluntary agreement or consent order pursuant to § 68-212-224 ; (ii) "Capital investment" means an investment in real property, tangible personal property, or computer software owned or leased in this state valued in accordance with generally accepted accounting principles. A capital investment shall be deemed to have been made as of the earlier of the date of payment or the date the taxpayer enters into a legally binding commitment or contract for lease, purchase, or construction of the real or personal property; (iii) "Investment period" means a period not to exceed five (5) years from the filing of the business plan related to the required capital investment, during which the required capital investment must be made; and (iv) "Qualified development project" means a project consisting of a capital investment of at least five million dollars ($5,000,000), located on a brownfield property, and having a business plan approved by the commissioner of revenue in accordance with the applicable provisions of subdivision (9)(D); (C) The credit allowed pursuant to this subdivision (9) shall apply against the excise tax imposed by this part and the Franchise Tax Law of 1999; provided, however, that such credit, together with any carry-forward thereof, taken on any franchise and excise tax return shall not exceed seventy-five percent (75%) of the combined franchise and excise tax liability shown on the return before any credit is taken. Any credit authorized under this subdivision (9)(C) that is unused may be carried forward in any tax period until the credit is taken; provided, that the credit may not be carried forward for more than fifteen (15) years; provided, however, that credits earned in tax years ending on or after December 31, 2008, may be carried forward for twenty-five (25) years; (D) (i) The taxpayer shall file a business plan for the qualified development project with the commissioner of revenue prior to the investment period in order to qualify for the credit provided in subdivision (9)(A). The plan shall describe the capital investment to be made toward the qualified development project within the investment period and shall also include a determination by the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development pursuant to subdivision (9)(G) that the credit is in the best interest of the state; (ii) Qualifying plans shall be approved by the commissioner of revenue. At such time, an approval letter authorizing the credit, the value of the credit, and the terms of the credit shall be issued. A copy of the approval letter must be filed by the taxpayer with the department of revenue in any year in which the taxpayer utilizes the credit; and (iii) The commissioner of revenue has the authority to conduct audits or require the filing of additional information necessary to substantiate or adjust the information contained in the business plan and to determine that the taxpayer has complied with all statutory requirements so as to be entitled to the credit pursuant to this subdivision (9); (E) In order to receive the credit, the taxpayer must submit a claim for the credit, along with documentation as required by the commissioner showing that the capital investment was made toward the qualified development project during the investment period. The taxpayer shall not be eligible to receive the credit until the minimum capital investment required by subdivision (9)(B)(iv) has been met; (F) The commissioner shall review the claim for the credit and notify the taxpayer of the approved tax credit amount. The taxpayer may not take the credit until the commissioner has notified the taxpayer of the approved amount; (G) Notwithstanding any provision of this subdivision (9) to the contrary, no credit shall be allowed unless the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development determine, in their sole discretion, that the credit is in the best interest of the state. For purposes of this subdivision (9)(G), "best interest of the state" means a determination by the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development that the qualified development project is a result of the credit provided in subdivision (9)(A) and that the economic benefits to this state resulting from the qualified development project outweigh the anticipated amount of the credit; and (H) For a qualified development project in which the taxpayer receives the brownfield property from a county, municipality, or industrial development board as defined in § 7-53-101 for a sale price of less than one dollar ($1.00), the amount of any credit authorized under this subdivision (9) is seventy-five percent (75%) of the most recent purchase price of the brownfield property that was paid by the county, municipality, or industrial development board;
(A) Notwithstanding subdivision (8), there shall be allowed against the sum total of the taxes imposed by the Franchise Tax Law of 1999 and by this part, a credit equal to seventy-five percent (75%) of the purchase price of brownfield property purchased in a tier 3 or tier 4 enhancement county in this state during the tax period covered by the return for the purpose of a qualified development project;
(B) For the purposes of this subdivision (9), unless the context otherwise requires: (i) "Brownfield property" means real property that is the subject of an investigation, remediation, or mitigation as a brownfield project under a voluntary agreement or consent order pursuant to § 68-212-224 ; (ii) "Capital investment" means an investment in real property, tangible personal property, or computer software owned or leased in this state valued in accordance with generally accepted accounting principles. A capital investment shall be deemed to have been made as of the earlier of the date of payment or the date the taxpayer enters into a legally binding commitment or contract for lease, purchase, or construction of the real or personal property; (iii) "Investment period" means a period not to exceed five (5) years from the filing of the business plan related to the required capital investment, during which the required capital investment must be made; and (iv) "Qualified development project" means a project consisting of a capital investment of at least five million dollars ($5,000,000), located on a brownfield property, and having a business plan approved by the commissioner of revenue in accordance with the applicable provisions of subdivision (9)(D);
(i) "Brownfield property" means real property that is the subject of an investigation, remediation, or mitigation as a brownfield project under a voluntary agreement or consent order pursuant to § 68-212-224 ;
(ii) "Capital investment" means an investment in real property, tangible personal property, or computer software owned or leased in this state valued in accordance with generally accepted accounting principles. A capital investment shall be deemed to have been made as of the earlier of the date of payment or the date the taxpayer enters into a legally binding commitment or contract for lease, purchase, or construction of the real or personal property;
(iii) "Investment period" means a period not to exceed five (5) years from the filing of the business plan related to the required capital investment, during which the required capital investment must be made; and
(iv) "Qualified development project" means a project consisting of a capital investment of at least five million dollars ($5,000,000), located on a brownfield property, and having a business plan approved by the commissioner of revenue in accordance with the applicable provisions of subdivision (9)(D);
(C) The credit allowed pursuant to this subdivision (9) shall apply against the excise tax imposed by this part and the Franchise Tax Law of 1999; provided, however, that such credit, together with any carry-forward thereof, taken on any franchise and excise tax return shall not exceed seventy-five percent (75%) of the combined franchise and excise tax liability shown on the return before any credit is taken. Any credit authorized under this subdivision (9)(C) that is unused may be carried forward in any tax period until the credit is taken; provided, that the credit may not be carried forward for more than fifteen (15) years; provided, however, that credits earned in tax years ending on or after December 31, 2008, may be carried forward for twenty-five (25) years;
(D) (i) The taxpayer shall file a business plan for the qualified development project with the commissioner of revenue prior to the investment period in order to qualify for the credit provided in subdivision (9)(A). The plan shall describe the capital investment to be made toward the qualified development project within the investment period and shall also include a determination by the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development pursuant to subdivision (9)(G) that the credit is in the best interest of the state; (ii) Qualifying plans shall be approved by the commissioner of revenue. At such time, an approval letter authorizing the credit, the value of the credit, and the terms of the credit shall be issued. A copy of the approval letter must be filed by the taxpayer with the department of revenue in any year in which the taxpayer utilizes the credit; and (iii) The commissioner of revenue has the authority to conduct audits or require the filing of additional information necessary to substantiate or adjust the information contained in the business plan and to determine that the taxpayer has complied with all statutory requirements so as to be entitled to the credit pursuant to this subdivision (9);
(i) The taxpayer shall file a business plan for the qualified development project with the commissioner of revenue prior to the investment period in order to qualify for the credit provided in subdivision (9)(A). The plan shall describe the capital investment to be made toward the qualified development project within the investment period and shall also include a determination by the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development pursuant to subdivision (9)(G) that the credit is in the best interest of the state;
(ii) Qualifying plans shall be approved by the commissioner of revenue. At such time, an approval letter authorizing the credit, the value of the credit, and the terms of the credit shall be issued. A copy of the approval letter must be filed by the taxpayer with the department of revenue in any year in which the taxpayer utilizes the credit; and
(iii) The commissioner of revenue has the authority to conduct audits or require the filing of additional information necessary to substantiate or adjust the information contained in the business plan and to determine that the taxpayer has complied with all statutory requirements so as to be entitled to the credit pursuant to this subdivision (9);
(E) In order to receive the credit, the taxpayer must submit a claim for the credit, along with documentation as required by the commissioner showing that the capital investment was made toward the qualified development project during the investment period. The taxpayer shall not be eligible to receive the credit until the minimum capital investment required by subdivision (9)(B)(iv) has been met;
(F) The commissioner shall review the claim for the credit and notify the taxpayer of the approved tax credit amount. The taxpayer may not take the credit until the commissioner has notified the taxpayer of the approved amount;
(G) Notwithstanding any provision of this subdivision (9) to the contrary, no credit shall be allowed unless the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development determine, in their sole discretion, that the credit is in the best interest of the state. For purposes of this subdivision (9)(G), "best interest of the state" means a determination by the commissioner of finance and administration, the commissioner of revenue, and the commissioner of economic and community development that the qualified development project is a result of the credit provided in subdivision (9)(A) and that the economic benefits to this state resulting from the qualified development project outweigh the anticipated amount of the credit; and
(H) For a qualified development project in which the taxpayer receives the brownfield property from a county, municipality, or industrial development board as defined in § 7-53-101 for a sale price of less than one dollar ($1.00), the amount of any credit authorized under this subdivision (9) is seventy-five percent (75%) of the most recent purchase price of the brownfield property that was paid by the county, municipality, or industrial development board;
(10) (A) For purposes of this subdivision (10): (i) "Capital investment" has the same meaning as defined in subdivision (9)(B)(ii); (ii) "Investment period" has the same meaning as defined in subdivision (9)(B)(iii); (iii) "Qualified development project" has the same meaning as defined in subdivision (9)(B)(iv); and (iv) "Remediation costs" means costs that are directly related to the investigation, remediation, or mitigation of a brownfield property as required by a voluntary agreement or consent order pursuant to § 68-212-224 ; (B) Notwithstanding subdivision (9), there is allowed against the sum total of the taxes imposed by the Franchise Tax Law of 1999 and by this part, a credit equal to the remediation costs for a brownfield property for a qualified development project in a tier 3 or tier 4 enhancement county in this state; provided, however, that the credit must not exceed five hundred thousand dollars ($500,000), and provided, further, that the credit, together with any carry forward thereof, taken on a franchise and excise tax return must not exceed one hundred percent (100%) of the combined franchise and excise tax liability shown on the return before a credit is taken. An unused credit may be carried forward in a tax period until the credit is taken; provided, however, that the credit may not be carried forward for more than fifteen (15) years; provided, however, that credits earned in tax years ending on or after December 31, 2008, may be carried forward for twenty-five (25) years; (C) In order to receive the credit, the taxpayer must submit a claim for the credit, along with documentation as required by the commissioner showing that the capital investment was made toward the qualified development project during the investment period and that the costs claimed are remediation costs. The taxpayer is not eligible to receive the credit until the minimum capital investment has been met and the commissioner has approved the tax credit amount; (D) The commissioner shall review the claim for the credit in consultation with the commissioner of environment and conservation and notify the taxpayer of the approved tax credit amount; and
(A) For purposes of this subdivision (10): (i) "Capital investment" has the same meaning as defined in subdivision (9)(B)(ii); (ii) "Investment period" has the same meaning as defined in subdivision (9)(B)(iii); (iii) "Qualified development project" has the same meaning as defined in subdivision (9)(B)(iv); and (iv) "Remediation costs" means costs that are directly related to the investigation, remediation, or mitigation of a brownfield property as required by a voluntary agreement or consent order pursuant to § 68-212-224 ;
(i) "Capital investment" has the same meaning as defined in subdivision (9)(B)(ii);
(ii) "Investment period" has the same meaning as defined in subdivision (9)(B)(iii);
(iii) "Qualified development project" has the same meaning as defined in subdivision (9)(B)(iv); and
(iv) "Remediation costs" means costs that are directly related to the investigation, remediation, or mitigation of a brownfield property as required by a voluntary agreement or consent order pursuant to § 68-212-224 ;
(B) Notwithstanding subdivision (9), there is allowed against the sum total of the taxes imposed by the Franchise Tax Law of 1999 and by this part, a credit equal to the remediation costs for a brownfield property for a qualified development project in a tier 3 or tier 4 enhancement county in this state; provided, however, that the credit must not exceed five hundred thousand dollars ($500,000), and provided, further, that the credit, together with any carry forward thereof, taken on a franchise and excise tax return must not exceed one hundred percent (100%) of the combined franchise and excise tax liability shown on the return before a credit is taken. An unused credit may be carried forward in a tax period until the credit is taken; provided, however, that the credit may not be carried forward for more than fifteen (15) years; provided, however, that credits earned in tax years ending on or after December 31, 2008, may be carried forward for twenty-five (25) years;
(C) In order to receive the credit, the taxpayer must submit a claim for the credit, along with documentation as required by the commissioner showing that the capital investment was made toward the qualified development project during the investment period and that the costs claimed are remediation costs. The taxpayer is not eligible to receive the credit until the minimum capital investment has been met and the commissioner has approved the tax credit amount;
(D) The commissioner shall review the claim for the credit in consultation with the commissioner of environment and conservation and notify the taxpayer of the approved tax credit amount; and
(11) (A) For tax years ending on or after December 31, 2023, but before December 31, 2025, there is allowed against the sum total of the taxes imposed by the Franchise Tax Law of 1999, compiled in part 21 of this chapter, and by this part, a credit equal to the federal employer tax credit in Section 45S of the Internal Revenue Code of 1986 ( 26 U.S.C. § 45S ), as amended, as a result of compensation paid in this state during the tax period by the taxpayer as determined consistent with § 67-4-2012 ; (B) The credit allowed pursuant to this subdivision (11) taken on a franchise and excise tax return must not exceed fifty percent (50%) of the combined franchise and excise tax liability shown by the return before the credit is taken. A credit authorized under this subdivision (11) that is unused may be carried forward in a tax period until the credit is taken; provided, however, that the credit may not be carried forward for more than twenty-five (25) years.
(A) For tax years ending on or after December 31, 2023, but before December 31, 2025, there is allowed against the sum total of the taxes imposed by the Franchise Tax Law of 1999, compiled in part 21 of this chapter, and by this part, a credit equal to the federal employer tax credit in Section 45S of the Internal Revenue Code of 1986 ( 26 U.S.C. § 45S ), as amended, as a result of compensation paid in this state during the tax period by the taxpayer as determined consistent with § 67-4-2012 ;
(B) The credit allowed pursuant to this subdivision (11) taken on a franchise and excise tax return must not exceed fifty percent (50%) of the combined franchise and excise tax liability shown by the return before the credit is taken. A credit authorized under this subdivision (11) that is unused may be carried forward in a tax period until the credit is taken; provided, however, that the credit may not be carried forward for more than twenty-five (25) years.
Amended by 2023 Tenn. Acts, ch. 86, s 8, eff. 7/1/2023.
Amended by 2023 Tenn. Acts, ch. 86, s 7, eff. 7/1/2023.
Amended by 2023 Tenn. Acts, ch. 377, s 40, eff. 5/11/2023.
Amended by 2023 Tenn. Acts, ch. 377, s 18, eff. 5/11/2023.
Amended by 2021 Tenn. Acts, ch. 517, s 1, eff. 5/25/2021.
Amended by 2020 Tenn. Acts, ch. 606, Secs.s 2, s 3, s 4, s 5, s 6, s 7, s 8, s 9, s 10, s 11, s 12, s 13, s 14, s 15 eff. 7/1/2020.
Amended by 2020 Tenn. Acts, ch. 606, s 1, eff. 7/1/2020.
Amended by 2019 Tenn. Acts, ch. 501, s 2, eff. 7/1/2019.
Amended by 2017 Tenn. Acts, ch. 228, s 15, eff. 4/24/2017.
Amended by 2015 Tenn. Acts, ch. 504, s 5, eff. 7/1/2015.
Amended by 2015 Tenn. Acts, ch. 504, s 4, eff. 7/1/2015.
Acts 1999, ch. 406, § 3; 2000, ch. 973, § 1; 2000, ch. 982, §§ 19, 54; 2003 , ch. 202, § 2; 2006, ch. 1019, § 1; 2007 , ch. 602, § 1; 2008 , ch. 1106, §§ 56, 57; 2009 , ch. 530, §§ 2, 5-7, 15, 23; 2010 , ch. 1134, § 65; 2011 , ch. 508, §§ 24, 28, 29; 2012 , ch. 937, § 1.
This section is set out more than once due to postponed, multiple, or conflicting amendments.
Tenn. Code Ann. § 67-5-1506 — TN Code / Title 67 / Chapter 5 / Section 67-5-1506
Action on hearing examiner's report
Status: in_force

(a) In the absence of an exception to the recommendation of the hearing examiner by either the property owner or the property owner's agent, or the county assessor of property or the taxing jurisdiction, the state board of equalization may adopt the recommendation of its hearing examiner as its final decision without the necessity of a hearing before the board. (b) If an exception to the recommendation of the hearing examiner is taken by either the property owner or the property owner's agent, or the county assessor of property or the taxing jurisdiction, or if the state board of equalization does not adopt the recommendation of the hearing examiner, the state board of equalization may determine to review all issues, to review some but not all issues, or not to exercise any review. If the state board of equalization does not exercise its discretion to review a matter, then the board shall issue a notice pursuant to § 67-5-1512(a)(3) . The date of the notice or certificate commences the period for seeking judicial review pursuant to § 67-5-1511 . (c) If the state board of equalization determines to exercise review, then a hearing may be scheduled before final action is taken. Unless the board shall otherwise direct, the review is confined to the record except that additional proof may be taken in cases involving alleged irregularities in procedure that are not shown in the record. (d) The state board of equalization may affirm the decision of the hearing examiner or remand the case for further proceedings. The state board of equalization may reverse or modify the decision if the rights of the petitioner have been prejudiced because the administrative findings, inferences, conclusions, or decisions are: (1) In violation of constitutional or statutory provisions; (2) Made upon unlawful procedure; (3) Arbitrary and capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion; or (4) Unsupported by evidence that is both substantial and material in light of the entire record. (e) In determining the substantiality of evidence, the state board of equalization shall take into account whatever in the record fairly detracts from its weight, but shall not substitute its judgment for that of the hearing examiner as to the weight of evidence on questions of fact. Amended by 2023 Tenn. Acts, ch. 184, s 5, eff. 7/1/2023. Amended by 2017 Tenn. Acts, ch. 133, s 2, eff. 7/1/2017. Acts 1973, ch. 226, § 10; 1975, ch. 171, § 5; T.C.A., § 67-835.
(a) In the absence of an exception to the recommendation of the hearing examiner by either the property owner or the property owner's agent, or the county assessor of property or the taxing jurisdiction, the state board of equalization may adopt the recommendation of its hearing examiner as its final decision without the necessity of a hearing before the board.
(b) If an exception to the recommendation of the hearing examiner is taken by either the property owner or the property owner's agent, or the county assessor of property or the taxing jurisdiction, or if the state board of equalization does not adopt the recommendation of the hearing examiner, the state board of equalization may determine to review all issues, to review some but not all issues, or not to exercise any review. If the state board of equalization does not exercise its discretion to review a matter, then the board shall issue a notice pursuant to § 67-5-1512(a)(3) . The date of the notice or certificate commences the period for seeking judicial review pursuant to § 67-5-1511 .
(c) If the state board of equalization determines to exercise review, then a hearing may be scheduled before final action is taken. Unless the board shall otherwise direct, the review is confined to the record except that additional proof may be taken in cases involving alleged irregularities in procedure that are not shown in the record.
(d) The state board of equalization may affirm the decision of the hearing examiner or remand the case for further proceedings. The state board of equalization may reverse or modify the decision if the rights of the petitioner have been prejudiced because the administrative findings, inferences, conclusions, or decisions are: (1) In violation of constitutional or statutory provisions; (2) Made upon unlawful procedure; (3) Arbitrary and capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion; or (4) Unsupported by evidence that is both substantial and material in light of the entire record.
(1) In violation of constitutional or statutory provisions;
(2) Made upon unlawful procedure;
(3) Arbitrary and capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion; or
(4) Unsupported by evidence that is both substantial and material in light of the entire record.
(e) In determining the substantiality of evidence, the state board of equalization shall take into account whatever in the record fairly detracts from its weight, but shall not substitute its judgment for that of the hearing examiner as to the weight of evidence on questions of fact.
Amended by 2023 Tenn. Acts, ch. 184, s 5, eff. 7/1/2023.
Amended by 2017 Tenn. Acts, ch. 133, s 2, eff. 7/1/2017.
Acts 1973, ch. 226, § 10; 1975, ch. 171, § 5; T.C.A., § 67-835.
Tenn. Code Ann. § 67-5-902 — TN Code / Title 67 / Chapter 5 / Section 67-5-902
Schedules generally
Status: in_force

(a) Unless otherwise provided for, those owners and lessees of taxable tangible personal property who are required by rules and regulations of the state board of equalization to report to the assessor shall report on such schedule as the state board of equalization may require. The schedule adopted by the board shall provide that a value different from standard depreciated cost may be used where such value more closely approximates fair market value, and the assessor may request supportive information in such instances from the taxpayer. (b) If a taxpayer would be liable for additional tax due to back assessment of property omitted from a reporting schedule, or due to reassessment of property included in the schedule, the taxpayer may offset this liability by showing that other property listed on the schedule was over reported, or by providing information that the reassessed property or other property listed on the schedule should be valued using a nonstandard method that more closely approximates fair market value. (c) With approval of the director of property assessments, the assessor may require electronic filing for tangible personal property schedules and for any year in which electronic filing is required in the county, the filing deadline is extended to April 15, and tangible personal property assessments may be appealed directly to the state board of equalization until forty-five (45) days after the assessment change notice is sent. Amended by 2014 Tenn. Acts, ch. 938,s 2, eff. 5/19/2014. Acts 1973, ch. 226, § 6, T.C.A., § 67-617; Acts 1990, ch. 1075, § 3; 2005, ch. 201, § 1.
(a) Unless otherwise provided for, those owners and lessees of taxable tangible personal property who are required by rules and regulations of the state board of equalization to report to the assessor shall report on such schedule as the state board of equalization may require. The schedule adopted by the board shall provide that a value different from standard depreciated cost may be used where such value more closely approximates fair market value, and the assessor may request supportive information in such instances from the taxpayer.
(b) If a taxpayer would be liable for additional tax due to back assessment of property omitted from a reporting schedule, or due to reassessment of property included in the schedule, the taxpayer may offset this liability by showing that other property listed on the schedule was over reported, or by providing information that the reassessed property or other property listed on the schedule should be valued using a nonstandard method that more closely approximates fair market value.
(c) With approval of the director of property assessments, the assessor may require electronic filing for tangible personal property schedules and for any year in which electronic filing is required in the county, the filing deadline is extended to April 15, and tangible personal property assessments may be appealed directly to the state board of equalization until forty-five (45) days after the assessment change notice is sent.
Amended by 2014 Tenn. Acts, ch. 938,s 2, eff. 5/19/2014.
Acts 1973, ch. 226, § 6, T.C.A., § 67-617; Acts 1990, ch. 1075, § 3; 2005, ch. 201, § 1.
Tenn. Code Ann. § 67-3-814 — TN Code / Title 67 / Chapter 3 / Section 67-3-814
Prohibition on tampering with meters at retail outlets
Status: in_force

(a) A person operating petroleum products dispensing equipment accessible by the general public shall provide metering devices for each dispenser, and shall maintain records sufficient to enable the department to determine the volumes dispensed with reasonable accuracy. (b) No person shall exchange, replace, roll back or otherwise tamper with any such metering equipment without following procedures provided by the department for legitimate maintenance, repairs and replacement purposes. (c) The department has the authority to seal any dispenser meter or totalizer. (d) The commissioner may assess a civil penalty in an amount equal to the taxes and fees on the storage capacity of the facility, without regard to any exemption or dye, or one thousand dollars ($1,000), whichever is greater, against a person who fails to comply with this section. Acts 1997, ch. 316, § 1; T.C.A., § 67-3-1914.
(a) A person operating petroleum products dispensing equipment accessible by the general public shall provide metering devices for each dispenser, and shall maintain records sufficient to enable the department to determine the volumes dispensed with reasonable accuracy.
(b) No person shall exchange, replace, roll back or otherwise tamper with any such metering equipment without following procedures provided by the department for legitimate maintenance, repairs and replacement purposes.
(c) The department has the authority to seal any dispenser meter or totalizer.
(d) The commissioner may assess a civil penalty in an amount equal to the taxes and fees on the storage capacity of the facility, without regard to any exemption or dye, or one thousand dollars ($1,000), whichever is greater, against a person who fails to comply with this section.
Acts 1997, ch. 316, § 1; T.C.A., § 67-3-1914.
Tenn. Code Ann. § 67-6-604 — TN Code / Title 67 / Chapter 6 / Section 67-6-604
Revocation of certificate - Procedure
Status: in_force

Whenever any person fails to comply with any provision of this chapter or any rule or regulation of the commissioner relating to this chapter, the commissioner, upon hearing, after giving the person ten (10) days' notice in writing, specifying the time and place of a hearing and requiring the person to show cause why the person's certificate of registration should not be revoked, may revoke or suspend any one (1) or more of the certificates of registration held by the person. The notice may be served personally or by certified mail directed to the last known address of the person. The commissioner may designate a hearing officer from the department to conduct the hearings provided for in this section, who shall make findings of fact, conclusions of law, and proposed orders based thereon. The commissioner, if concurring, shall issue the order; or may, upon review of the record, make such findings, conclusions, and issue such orders as, in the commissioner's discretion, the record justifies. Acts 1947, ch. 3, § 16; C. Supp. 1950, § 1248.88 (Williams, § 1328.38); Acts 1951, ch. 168, § 1; 1955, ch. 51, § 14; 1955, ch. 242, § 9; 1961, ch. 136, § 1; 1963, ch. 92, § 1; 1969, ch. 109, § 1; 1971, ch. 55, § 1; 1971, ch. 92, § 1; 1971, ch. 186, § 1; T.C.A. (orig. ed.), § 67-3041.
Whenever any person fails to comply with any provision of this chapter or any rule or regulation of the commissioner relating to this chapter, the commissioner, upon hearing, after giving the person ten (10) days' notice in writing, specifying the time and place of a hearing and requiring the person to show cause why the person's certificate of registration should not be revoked, may revoke or suspend any one (1) or more of the certificates of registration held by the person. The notice may be served personally or by certified mail directed to the last known address of the person. The commissioner may designate a hearing officer from the department to conduct the hearings provided for in this section, who shall make findings of fact, conclusions of law, and proposed orders based thereon. The commissioner, if concurring, shall issue the order; or may, upon review of the record, make such findings, conclusions, and issue such orders as, in the commissioner's discretion, the record justifies.
Acts 1947, ch. 3, § 16; C. Supp. 1950, § 1248.88 (Williams, § 1328.38); Acts 1951, ch. 168, § 1; 1955, ch. 51, § 14; 1955, ch. 242, § 9; 1961, ch. 136, § 1; 1963, ch. 92, § 1; 1969, ch. 109, § 1; 1971, ch. 55, § 1; 1971, ch. 92, § 1; 1971, ch. 186, § 1; T.C.A. (orig. ed.), § 67-3041.
Tenn. Code Ann. § 67-1-1002 — TN Code / Title 67 / Chapter 1 / Section 67-1-1002
Grounds
Status: in_force

(a) Any property or properties included in this part or chapter 5 of this title shall be back assessed or reassessed for the period provided by law, viz.: (1) When the property or properties have been omitted from or escaped taxation; (2) When the property or properties have been assessed by the assessor or computed by the board of equalization at less than actual cash value by reason of any fraud, deception, misrepresentation, misstatement, or omission of full statements of the owner of the property or the owner's agent or attorney; or (3) When the owner of the property connives at or fraudulently procures or induces an assessment to be made by the assessor or computed by the board of equalization at less than its actual cash value; provided, that in all cases where there is a grossly inadequate assessment, fraud shall be presumed. (b) In all cases where any taxes or assessments may be set aside or declared void by any court by reason of any irregularity or neglect to comply with the law in the proceedings; by reason of the illegality of the act constituting the power or authority to assess and levy such taxes or assessments; for want of authority in the board or authority acting in lieu of the county legislative bodies or the duly authorized and legally constituted authorities of the state, for state and county purposes; and such other purposes as may be authorized by law, and the taxes still remain unpaid, the county legislative body of any county, whenever such taxes or assessments have been made or attempted to be made, shall have the power to reassess back taxes upon any lot or parcel of lots or parcels of land subject to or chargeable with taxes for state and county purposes, and relevy the lots or parcels, and the reassessment and levies for such purposes shall be and remain liens upon the lots or parcels of land, with interest from the date when the taxes were properly leviable and assessable where such original assessments remain due and unpaid. Acts 1873, ch. 40, § 1; 1907, ch. 602, § 30; Shan., §§ 820a1, 822a1; Code 1932, §§ 1493, 1496; modified; impl. am. Acts 1978, ch. 934, §§ 7, 36; Acts 1982, ch. 774, § 3; T.C.A. (orig. ed.), §§ 67-1201(a), 67-1220.
(a) Any property or properties included in this part or chapter 5 of this title shall be back assessed or reassessed for the period provided by law, viz.: (1) When the property or properties have been omitted from or escaped taxation; (2) When the property or properties have been assessed by the assessor or computed by the board of equalization at less than actual cash value by reason of any fraud, deception, misrepresentation, misstatement, or omission of full statements of the owner of the property or the owner's agent or attorney; or (3) When the owner of the property connives at or fraudulently procures or induces an assessment to be made by the assessor or computed by the board of equalization at less than its actual cash value; provided, that in all cases where there is a grossly inadequate assessment, fraud shall be presumed.
(1) When the property or properties have been omitted from or escaped taxation;
(2) When the property or properties have been assessed by the assessor or computed by the board of equalization at less than actual cash value by reason of any fraud, deception, misrepresentation, misstatement, or omission of full statements of the owner of the property or the owner's agent or attorney; or
(3) When the owner of the property connives at or fraudulently procures or induces an assessment to be made by the assessor or computed by the board of equalization at less than its actual cash value; provided, that in all cases where there is a grossly inadequate assessment, fraud shall be presumed.
(b) In all cases where any taxes or assessments may be set aside or declared void by any court by reason of any irregularity or neglect to comply with the law in the proceedings; by reason of the illegality of the act constituting the power or authority to assess and levy such taxes or assessments; for want of authority in the board or authority acting in lieu of the county legislative bodies or the duly authorized and legally constituted authorities of the state, for state and county purposes; and such other purposes as may be authorized by law, and the taxes still remain unpaid, the county legislative body of any county, whenever such taxes or assessments have been made or attempted to be made, shall have the power to reassess back taxes upon any lot or parcel of lots or parcels of land subject to or chargeable with taxes for state and county purposes, and relevy the lots or parcels, and the reassessment and levies for such purposes shall be and remain liens upon the lots or parcels of land, with interest from the date when the taxes were properly leviable and assessable where such original assessments remain due and unpaid.
Acts 1873, ch. 40, § 1; 1907, ch. 602, § 30; Shan., §§ 820a1, 822a1; Code 1932, §§ 1493, 1496; modified; impl. am. Acts 1978, ch. 934, §§ 7, 36; Acts 1982, ch. 774, § 3; T.C.A. (orig. ed.), §§ 67-1201(a), 67-1220.
Tenn. Code Ann. § 67-7-208 — TN Code / Title 67 / Chapter 7 / Section 67-7-208
Tax inapplicable as to certain existing contracts
Status: in_force

(a) Any tax levied by authority of this part shall not apply to any sand, gravel, sandstone, chert and limestone severed to meet the obligations of any written contract for sale of the product entered into prior to June 5, 1984. (b) Any sand, gravel, sandstone, chert or limestone that has been severed and on which any severance tax has accrued prior to June 5, 1984, in the county in which the severance has occurred shall be exempt from this part, if such tax has been paid. Acts 1984, ch. 953, §§ 6, 7; 1985, ch. 410, § 5.
(a) Any tax levied by authority of this part shall not apply to any sand, gravel, sandstone, chert and limestone severed to meet the obligations of any written contract for sale of the product entered into prior to June 5, 1984.
(b) Any sand, gravel, sandstone, chert or limestone that has been severed and on which any severance tax has accrued prior to June 5, 1984, in the county in which the severance has occurred shall be exempt from this part, if such tax has been paid.
Acts 1984, ch. 953, §§ 6, 7; 1985, ch. 410, § 5.
Tenn. Code Ann. § 67-5-510 — TN Code / Title 67 / Chapter 5 / Section 67-5-510
Establishment of county tax rate
Status: in_force

It is the duty of the county legislative bodies, on the first Monday in July, or as soon thereafter as practicable, to fix the tax rates on all properties within their respective jurisdictions for all county purposes, except that in any county having a population in excess of seven hundred thousand (700,000), according to the 1980 federal census or any subsequent federal census, establishing tax due dates other than the first Monday in October each year, in accordance with § 67-1-701(a) , shall have the authority to fix tax rates for all county purposes at dates prior to the first Monday in July. Acts 1921, ch. 113, § 19; Shan. Supp., § 809a26; Code 1932, § 1461; Acts 1983, ch. 430, § 1; T.C.A. (orig. ed.), § 67-1004.
It is the duty of the county legislative bodies, on the first Monday in July, or as soon thereafter as practicable, to fix the tax rates on all properties within their respective jurisdictions for all county purposes, except that in any county having a population in excess of seven hundred thousand (700,000), according to the 1980 federal census or any subsequent federal census, establishing tax due dates other than the first Monday in October each year, in accordance with § 67-1-701(a) , shall have the authority to fix tax rates for all county purposes at dates prior to the first Monday in July.
Acts 1921, ch. 113, § 19; Shan. Supp., § 809a26; Code 1932, § 1461; Acts 1983, ch. 430, § 1; T.C.A. (orig. ed.), § 67-1004.
Tenn. Code Ann. § 67-4-2107 — TN Code / Title 67 / Chapter 4 / Section 67-4-2107
Tax diminished by operating deficits or business losses deemed impairment of capital
Status: in_force

(a) Where a corporation doing business without surplus or undivided profits has had the value of its capital stock impaired by operating deficits or other business losses, such as fire, flood, tornado, or other natural disasters, and where such deficit or loss is carried upon the books and records of the corporation as an impairment of capital, the measure of the tax shall be diminished by such loss or deficit. (b) If the capital stock of a corporation that is a subsidiary of another corporation or closely affiliated with another corporation by stock ownership is inadequate for its business needs apart from credit extended or indebtedness guaranteed by the parent or an affiliated corporation, in determining the amount of capital, surplus and undivided profit of such corporation with respect to its liability for the tax imposed by this part, there shall be included in the measure of the tax the indebtedness owed to or guaranteed by the parent or an affiliated corporation. If necessary to apportion such indebtedness, the methods of allocation set forth in this part shall be used. Amended by 2013 Tenn. Acts, ch. 321, Secs.s 4, s 5 eff. 5/13/2013. Acts 1999, ch. 406, § 4; 2000, ch. 982, § 32; 2002, ch. 729, § 1; 2004, ch. 932, § 6.
(a) Where a corporation doing business without surplus or undivided profits has had the value of its capital stock impaired by operating deficits or other business losses, such as fire, flood, tornado, or other natural disasters, and where such deficit or loss is carried upon the books and records of the corporation as an impairment of capital, the measure of the tax shall be diminished by such loss or deficit.
(b) If the capital stock of a corporation that is a subsidiary of another corporation or closely affiliated with another corporation by stock ownership is inadequate for its business needs apart from credit extended or indebtedness guaranteed by the parent or an affiliated corporation, in determining the amount of capital, surplus and undivided profit of such corporation with respect to its liability for the tax imposed by this part, there shall be included in the measure of the tax the indebtedness owed to or guaranteed by the parent or an affiliated corporation. If necessary to apportion such indebtedness, the methods of allocation set forth in this part shall be used.
Amended by 2013 Tenn. Acts, ch. 321, Secs.s 4, s 5 eff. 5/13/2013.
Acts 1999, ch. 406, § 4; 2000, ch. 982, § 32; 2002, ch. 729, § 1; 2004, ch. 932, § 6.
Tenn. Code Ann. § 67-4-410 — TN Code / Title 67 / Chapter 4 / Section 67-4-410
Establishments selling mixed drinks or setups
Status: in_force

(a) As used in this section, unless the context otherwise requires: (1) "Gross receipts" means and includes the total receipts from the sale of any item included in subdivision (a)(2), without any deductions for any cost of sales, expense, or any other charge whatsoever. "Gross receipts" also includes all receipts of a person liable for tax imposed by this section, except where a person can and does show to the satisfaction of the commissioner what receipts, other than from sales of alcoholic beverages, mixed drinks and/or setups are included in the total gross receipts, and that they are accounted for and maintained separately on the books and records of such person; (2) "Mixed drinks and/or setups for mixed drinks" means and includes any sales of beverages containing any alcoholic content, other than beer, and includes sales of water, soft drinks, ice or any item capable of being used to prepare a mixed drink at a place of business of a person liable for the tax imposed by this section; and (3) "Person selling mixed drinks and/or setups for mixed drinks" means and includes any person deriving receipts from the sale of mixed drinks and/or setups for mixed drinks or alcoholic beverages whether or not consumed on the premises, and includes any country club, night club or private club in the nature of any social, dinner, athletic, or sporting club or organization, and any fraternal society, order, or association making sales and charges for any of these items: (A) Sales of mixed drinks taxed under chapter 211 of the Public Acts of 1967 and sales of alcoholic beverages made by persons licensed under §§ 57-3-203 and 57-3-205 shall not be taxed under this section; and (B) The term does not include sales of setups by cafes, cafeterias, and restaurants where such sales are merely incidental to the principal business and where no bar, lounge, or separate facility is maintained for the purpose of serving or selling mixed drinks and/or setups for mixed drinks. (b) Each person selling mixed drinks and/or setups for mixed drinks, as defined in subdivision (a)(3), which sale of setups for mixed drinks is declared to be lawful in localities where the sale of packaged alcoholic beverages is lawful, shall, for the privilege of doing such business, pay to the state for state purposes an amount equal to fifteen percent (15%) of the gross receipts, as defined in subdivision (a)(1), in this state. This section also includes the sale of setups for mixed drinks for consumption by persons supplying alcoholic beverages from their own bottle or other container on the premises of persons holding licenses under title 57, chapter 4 to dispense alcoholic beverages for consumption on the premises. (c) The tax imposed shall be administered and collected on a monthly basis and shall be paid on or before the twentieth day of the month following each month in which the taxpayer's gross receipts are derived. The tax levied by this section shall be deemed to be for the privilege of making sales for the month or part of the month in which such privilege was exercised. Every person exercising this privilege shall monthly, on or before the twentieth day of the following month, make and deliver to the commissioner, upon such forms as the commissioner may prescribe, a statement verified by such person, or agent making such report and statement, which statement shall contain the following information: (1) The total gross receipts of the taxpayer from sales for the preceding month; and (2) Such further information as the commissioner may require. (d) In no case shall any collector or the collector's deputy fail or refuse to collect the tax imposed under this section because of the collector's doubt with reference to the legality of the business engaged in, but the case of the legality of such business shall be determined by the proper judicial authorities. (e) Any person required under this section to pay any tax or required by law or regulations made under authority thereof to make a return, keep any records or supply any information for the purpose of the computation, assessment or collection of any tax imposed by this section, who willfully fails to pay such tax, make such return, keep such records or supply such information at the time or times required by law or regulations, or who willfully attempts in any manner to evade or defeat any tax imposed by this section or the payment of the tax, in addition to the other penalties provided by law, commits a Class A misdemeanor. Acts 1967, ch. 296, § 1; 1969, ch. 273, § 1; 1970, ch. 354, § 1; T.C.A., § 67-4102, Item U; Acts 1988, ch. 526, § 31; 1989, ch. 591, §§ 1, 6.
(a) As used in this section, unless the context otherwise requires: (1) "Gross receipts" means and includes the total receipts from the sale of any item included in subdivision (a)(2), without any deductions for any cost of sales, expense, or any other charge whatsoever. "Gross receipts" also includes all receipts of a person liable for tax imposed by this section, except where a person can and does show to the satisfaction of the commissioner what receipts, other than from sales of alcoholic beverages, mixed drinks and/or setups are included in the total gross receipts, and that they are accounted for and maintained separately on the books and records of such person; (2) "Mixed drinks and/or setups for mixed drinks" means and includes any sales of beverages containing any alcoholic content, other than beer, and includes sales of water, soft drinks, ice or any item capable of being used to prepare a mixed drink at a place of business of a person liable for the tax imposed by this section; and (3) "Person selling mixed drinks and/or setups for mixed drinks" means and includes any person deriving receipts from the sale of mixed drinks and/or setups for mixed drinks or alcoholic beverages whether or not consumed on the premises, and includes any country club, night club or private club in the nature of any social, dinner, athletic, or sporting club or organization, and any fraternal society, order, or association making sales and charges for any of these items: (A) Sales of mixed drinks taxed under chapter 211 of the Public Acts of 1967 and sales of alcoholic beverages made by persons licensed under §§ 57-3-203 and 57-3-205 shall not be taxed under this section; and (B) The term does not include sales of setups by cafes, cafeterias, and restaurants where such sales are merely incidental to the principal business and where no bar, lounge, or separate facility is maintained for the purpose of serving or selling mixed drinks and/or setups for mixed drinks.
(1) "Gross receipts" means and includes the total receipts from the sale of any item included in subdivision (a)(2), without any deductions for any cost of sales, expense, or any other charge whatsoever. "Gross receipts" also includes all receipts of a person liable for tax imposed by this section, except where a person can and does show to the satisfaction of the commissioner what receipts, other than from sales of alcoholic beverages, mixed drinks and/or setups are included in the total gross receipts, and that they are accounted for and maintained separately on the books and records of such person;
(2) "Mixed drinks and/or setups for mixed drinks" means and includes any sales of beverages containing any alcoholic content, other than beer, and includes sales of water, soft drinks, ice or any item capable of being used to prepare a mixed drink at a place of business of a person liable for the tax imposed by this section; and
(3) "Person selling mixed drinks and/or setups for mixed drinks" means and includes any person deriving receipts from the sale of mixed drinks and/or setups for mixed drinks or alcoholic beverages whether or not consumed on the premises, and includes any country club, night club or private club in the nature of any social, dinner, athletic, or sporting club or organization, and any fraternal society, order, or association making sales and charges for any of these items: (A) Sales of mixed drinks taxed under chapter 211 of the Public Acts of 1967 and sales of alcoholic beverages made by persons licensed under §§ 57-3-203 and 57-3-205 shall not be taxed under this section; and (B) The term does not include sales of setups by cafes, cafeterias, and restaurants where such sales are merely incidental to the principal business and where no bar, lounge, or separate facility is maintained for the purpose of serving or selling mixed drinks and/or setups for mixed drinks.
(A) Sales of mixed drinks taxed under chapter 211 of the Public Acts of 1967 and sales of alcoholic beverages made by persons licensed under §§ 57-3-203 and 57-3-205 shall not be taxed under this section; and
(B) The term does not include sales of setups by cafes, cafeterias, and restaurants where such sales are merely incidental to the principal business and where no bar, lounge, or separate facility is maintained for the purpose of serving or selling mixed drinks and/or setups for mixed drinks.
(b) Each person selling mixed drinks and/or setups for mixed drinks, as defined in subdivision (a)(3), which sale of setups for mixed drinks is declared to be lawful in localities where the sale of packaged alcoholic beverages is lawful, shall, for the privilege of doing such business, pay to the state for state purposes an amount equal to fifteen percent (15%) of the gross receipts, as defined in subdivision (a)(1), in this state. This section also includes the sale of setups for mixed drinks for consumption by persons supplying alcoholic beverages from their own bottle or other container on the premises of persons holding licenses under title 57, chapter 4 to dispense alcoholic beverages for consumption on the premises.
(c) The tax imposed shall be administered and collected on a monthly basis and shall be paid on or before the twentieth day of the month following each month in which the taxpayer's gross receipts are derived. The tax levied by this section shall be deemed to be for the privilege of making sales for the month or part of the month in which such privilege was exercised. Every person exercising this privilege shall monthly, on or before the twentieth day of the following month, make and deliver to the commissioner, upon such forms as the commissioner may prescribe, a statement verified by such person, or agent making such report and statement, which statement shall contain the following information: (1) The total gross receipts of the taxpayer from sales for the preceding month; and (2) Such further information as the commissioner may require.
(1) The total gross receipts of the taxpayer from sales for the preceding month; and
(2) Such further information as the commissioner may require.
(d) In no case shall any collector or the collector's deputy fail or refuse to collect the tax imposed under this section because of the collector's doubt with reference to the legality of the business engaged in, but the case of the legality of such business shall be determined by the proper judicial authorities.
(e) Any person required under this section to pay any tax or required by law or regulations made under authority thereof to make a return, keep any records or supply any information for the purpose of the computation, assessment or collection of any tax imposed by this section, who willfully fails to pay such tax, make such return, keep such records or supply such information at the time or times required by law or regulations, or who willfully attempts in any manner to evade or defeat any tax imposed by this section or the payment of the tax, in addition to the other penalties provided by law, commits a Class A misdemeanor.
Acts 1967, ch. 296, § 1; 1969, ch. 273, § 1; 1970, ch. 354, § 1; T.C.A., § 67-4102, Item U; Acts 1988, ch. 526, § 31; 1989, ch. 591, §§ 1, 6.
Tenn. Code Ann. § 67-5-2103 — TN Code / Title 67 / Chapter 5 / Section 67-5-2103
Nature of proceedings
Status: in_force

(a) The whole proceeding for the enforcement of property tax liens, from the assessment to sale for delinquency, shall be a proceeding in rem, and shall not be invalid on account of such land having been listed or assessed for taxation to anyone as owner or owners or to any person or persons not the owner or owners or to unknown owner or owners. (b) All interested persons shall be deemed to have constructive notice of the proceedings by virtue of the seizure of the parcel occurring upon the filing of a complaint for the purpose of enforcement of the first lien. However, interested persons who do not have an obligation to pay the taxes on the parcel, such as lienholders, need not be joined as parties nor served with process so long as a diligent effort to give actual notice of the proceedings, as defined in § 67-5-2502(c)(1) , is made to such persons. (c) The filing of a complaint for the purpose of enforcement of the first lien provided for in § 67-5-2101 , shall create a lien lis pendens as to each parcel which is included in the proceeding, during the pendency of the proceeding, affecting all subsequent owners, without the recording of any copy or abstract thereof in the office of the register of deeds. (d) The general assembly finds and determines that: (1) The collection of property taxes is an essential and necessary function of counties and municipal corporations in the state; (2) This chapter provides for a specific and comprehensive scheme for the collection of delinquent property taxes; (3) This chapter is intended to be procedural and remedial in application and, unless a contrary intent is expressed in an act amending this chapter, such amendments are also intended to be procedural and remedial in application; (4) The economy of the state has evolved from one primarily based upon the agrarian use of real property to an economy based more upon the improvement of real property by the construction of residential, commercial, and industrial structures thereon. Such improvements require the investments of significant funds and resources; (5) A purpose of this chapter is to promote and encourage the development of improvements upon real estate that have been conveyed pursuant to this chapter through the enforcement of tax liens; (6) The certainty and finality of the titles to real estate that have been conveyed pursuant to this chapter through the enforcement of tax liens is a necessary prerequisite to the development of improvements thereon; and (7) Statutes that are not consistent with the statutory scheme for the collection of delinquent property taxes set out in this chapter should not be applicable to tax proceedings, tax liens, or the enforcement of such tax liens. (e) This chapter shall be construed liberally in favor of the certainty and finality of property titles transferred pursuant to this chapter. (f) Title 21, chapter 1, part 4, is not applicable to tax proceedings, tax liens, or the enforcement of such tax liens. (g) Sections 29-6-161 - 29-6-165 are not applicable to tax proceedings, tax liens, or the enforcement of such tax liens. (h) Chapter 1, part 18 of this title is not applicable to property tax proceedings, property tax liens, or the enforcement of such property tax liens. (i) Other statutes that are not consistent with the statutory scheme for the collection of delinquent property taxes set out in this chapter shall not be applicable to tax proceedings, tax liens, or the enforcement of such tax liens. (j) All interested persons, as defined in this chapter, are charged with the knowledge that the parcel is subject to property taxes, which are required to be paid to the trustee or collector on an annual basis, and which taxes become a first lien on the parcel from January 1 of each year. All interested persons have an affirmative duty to inquire as to the amounts of such taxes and their payment status. Under no circumstances shall a claim that the interested party did not receive a tax bill or any prelawsuit notice constitute a valid defense to the enforcement of the lien, the personal debt for the taxes, or the amount of taxes owed, including penalty, interest, cost, and fees. (k) Section 67-1-707 does not apply to property taxes. (l) Title 35, chapter 5 does not apply to property tax proceedings, tax liens, or the enforcement of such tax liens. (m) An interested person shall not file as a defense, a counterclaim, a cross claim or for another purpose, a defense or cause of action not directly related to the tax proceeding, or a claim of a set off. (n) The failure of a defendant or interested person in a tax proceeding to have exhausted all administrative remedies bars the defendant from contesting an issue in the tax proceeding that could have been decided in such manner. Amended by 2024 Tenn. Acts, ch. 967,s 23, eff. 5/21/2024. Amended by 2015 Tenn. Acts, ch. 414, Secs.s 6, s 7 eff. 5/8/2015. Amended by 2014 Tenn. Acts, ch. 883, s 5, eff. 7/1/2014. Amended by 2013 Tenn. Acts, ch. 353, s 13, eff. 5/13/2013. Acts 1907, ch. 602, § 31; Shan., § 758a2; Code 1932, § 1332; T.C.A. (orig. ed.), § 67-1804.
(a) The whole proceeding for the enforcement of property tax liens, from the assessment to sale for delinquency, shall be a proceeding in rem, and shall not be invalid on account of such land having been listed or assessed for taxation to anyone as owner or owners or to any person or persons not the owner or owners or to unknown owner or owners.
(b) All interested persons shall be deemed to have constructive notice of the proceedings by virtue of the seizure of the parcel occurring upon the filing of a complaint for the purpose of enforcement of the first lien. However, interested persons who do not have an obligation to pay the taxes on the parcel, such as lienholders, need not be joined as parties nor served with process so long as a diligent effort to give actual notice of the proceedings, as defined in § 67-5-2502(c)(1) , is made to such persons.
(c) The filing of a complaint for the purpose of enforcement of the first lien provided for in § 67-5-2101 , shall create a lien lis pendens as to each parcel which is included in the proceeding, during the pendency of the proceeding, affecting all subsequent owners, without the recording of any copy or abstract thereof in the office of the register of deeds.
(d) The general assembly finds and determines that: (1) The collection of property taxes is an essential and necessary function of counties and municipal corporations in the state; (2) This chapter provides for a specific and comprehensive scheme for the collection of delinquent property taxes; (3) This chapter is intended to be procedural and remedial in application and, unless a contrary intent is expressed in an act amending this chapter, such amendments are also intended to be procedural and remedial in application; (4) The economy of the state has evolved from one primarily based upon the agrarian use of real property to an economy based more upon the improvement of real property by the construction of residential, commercial, and industrial structures thereon. Such improvements require the investments of significant funds and resources; (5) A purpose of this chapter is to promote and encourage the development of improvements upon real estate that have been conveyed pursuant to this chapter through the enforcement of tax liens; (6) The certainty and finality of the titles to real estate that have been conveyed pursuant to this chapter through the enforcement of tax liens is a necessary prerequisite to the development of improvements thereon; and (7) Statutes that are not consistent with the statutory scheme for the collection of delinquent property taxes set out in this chapter should not be applicable to tax proceedings, tax liens, or the enforcement of such tax liens.
(1) The collection of property taxes is an essential and necessary function of counties and municipal corporations in the state;
(2) This chapter provides for a specific and comprehensive scheme for the collection of delinquent property taxes;
(3) This chapter is intended to be procedural and remedial in application and, unless a contrary intent is expressed in an act amending this chapter, such amendments are also intended to be procedural and remedial in application;
(4) The economy of the state has evolved from one primarily based upon the agrarian use of real property to an economy based more upon the improvement of real property by the construction of residential, commercial, and industrial structures thereon. Such improvements require the investments of significant funds and resources;
(5) A purpose of this chapter is to promote and encourage the development of improvements upon real estate that have been conveyed pursuant to this chapter through the enforcement of tax liens;
(6) The certainty and finality of the titles to real estate that have been conveyed pursuant to this chapter through the enforcement of tax liens is a necessary prerequisite to the development of improvements thereon; and
(7) Statutes that are not consistent with the statutory scheme for the collection of delinquent property taxes set out in this chapter should not be applicable to tax proceedings, tax liens, or the enforcement of such tax liens.
(e) This chapter shall be construed liberally in favor of the certainty and finality of property titles transferred pursuant to this chapter.
(f) Title 21, chapter 1, part 4, is not applicable to tax proceedings, tax liens, or the enforcement of such tax liens.
(g) Sections 29-6-161 - 29-6-165 are not applicable to tax proceedings, tax liens, or the enforcement of such tax liens.
(h) Chapter 1, part 18 of this title is not applicable to property tax proceedings, property tax liens, or the enforcement of such property tax liens.
(i) Other statutes that are not consistent with the statutory scheme for the collection of delinquent property taxes set out in this chapter shall not be applicable to tax proceedings, tax liens, or the enforcement of such tax liens.
(j) All interested persons, as defined in this chapter, are charged with the knowledge that the parcel is subject to property taxes, which are required to be paid to the trustee or collector on an annual basis, and which taxes become a first lien on the parcel from January 1 of each year. All interested persons have an affirmative duty to inquire as to the amounts of such taxes and their payment status. Under no circumstances shall a claim that the interested party did not receive a tax bill or any prelawsuit notice constitute a valid defense to the enforcement of the lien, the personal debt for the taxes, or the amount of taxes owed, including penalty, interest, cost, and fees.
(k) Section 67-1-707 does not apply to property taxes.
(l) Title 35, chapter 5 does not apply to property tax proceedings, tax liens, or the enforcement of such tax liens.
(m) An interested person shall not file as a defense, a counterclaim, a cross claim or for another purpose, a defense or cause of action not directly related to the tax proceeding, or a claim of a set off.
(n) The failure of a defendant or interested person in a tax proceeding to have exhausted all administrative remedies bars the defendant from contesting an issue in the tax proceeding that could have been decided in such manner.
Amended by 2024 Tenn. Acts, ch. 967,s 23, eff. 5/21/2024.
Amended by 2015 Tenn. Acts, ch. 414, Secs.s 6, s 7 eff. 5/8/2015.
Amended by 2014 Tenn. Acts, ch. 883, s 5, eff. 7/1/2014.
Amended by 2013 Tenn. Acts, ch. 353, s 13, eff. 5/13/2013.
Acts 1907, ch. 602, § 31; Shan., § 758a2; Code 1932, § 1332; T.C.A. (orig. ed.), § 67-1804.
Tenn. Code Ann. § 67-1-702 — TN Code / Title 67 / Chapter 1 / Section 67-1-702
Payment to trustee
Status: in_force

(a) Every taxpayer shall pay state, county, municipal, highway, school and all of such taxpayer's property taxes to the county trustee, except when otherwise provided by law, and such taxes shall be due and payable on the first Monday in October of each year. (b) Notwithstanding any law to the contrary, upon adoption of a resolution by the county legislative body, the county trustee may accept property taxes at any time after July 10, prior to the first Monday in October established by § 67-1-701 , on which date trustees are required to accept property tax payments, and after the tax rates are finally set, the trustee's tax rolls are received and the trustee's receipts are prepared. County trustees may begin accepting tax relief applications on the same date on which the trustee accepts property tax payments. Acts 1907, ch. 602, § 48; Shan., § 865a2; Acts 1923, ch. 77, § 1; mod. Code 1932, § 1547; Acts 1971, ch. 380, § 1; 1976, ch. 429, § 1; modified; Acts 1982, ch. 883, §§ 1-3; 1983, ch. 62, §§ 1, 2; 1983, ch. 430, § 2; T.C.A. (orig. ed.), § 67-1105; Acts 1988, ch. 795, § 20; 1989, ch. 291, § 5; 1989, ch. 550, §§ 5, 23; 1996, ch. 717, § 1; 1997, ch. 313, § 1.
(a) Every taxpayer shall pay state, county, municipal, highway, school and all of such taxpayer's property taxes to the county trustee, except when otherwise provided by law, and such taxes shall be due and payable on the first Monday in October of each year.
(b) Notwithstanding any law to the contrary, upon adoption of a resolution by the county legislative body, the county trustee may accept property taxes at any time after July 10, prior to the first Monday in October established by § 67-1-701 , on which date trustees are required to accept property tax payments, and after the tax rates are finally set, the trustee's tax rolls are received and the trustee's receipts are prepared. County trustees may begin accepting tax relief applications on the same date on which the trustee accepts property tax payments.
Acts 1907, ch. 602, § 48; Shan., § 865a2; Acts 1923, ch. 77, § 1; mod. Code 1932, § 1547; Acts 1971, ch. 380, § 1; 1976, ch. 429, § 1; modified; Acts 1982, ch. 883, §§ 1-3; 1983, ch. 62, §§ 1, 2; 1983, ch. 430, § 2; T.C.A. (orig. ed.), § 67-1105; Acts 1988, ch. 795, § 20; 1989, ch. 291, § 5; 1989, ch. 550, §§ 5, 23; 1996, ch. 717, § 1; 1997, ch. 313, § 1.
Tenn. Code Ann. § 67-3-409 — TN Code / Title 67 / Chapter 3 / Section 67-3-409
Aviation fuel exemption
Status: in_force

There shall be exempt from the taxes imposed in §§ 67-3-201 and 67-3-202 taxable motor fuel sold for use in aircraft; provided, that the buyer must be registered to purchase jet fuel subject to federal taxes applicable to jet fuel, and the vendor must obtain certification of such fact satisfactory to the department prior to making the sale. Acts 1997, ch. 316, § 1; T.C.A., § 67-3-1509.
There shall be exempt from the taxes imposed in §§ 67-3-201 and 67-3-202 taxable motor fuel sold for use in aircraft; provided, that the buyer must be registered to purchase jet fuel subject to federal taxes applicable to jet fuel, and the vendor must obtain certification of such fact satisfactory to the department prior to making the sale.
Acts 1997, ch. 316, § 1; T.C.A., § 67-3-1509.
Tenn. Code Ann. § 67-8-703 — TN Code / Title 67 / Chapter 8 / Section 67-8-703
In-kind payment of transfer taxes - Appraisal
Status: in_force

(a) Any donor may make application to transfer qualified property to a receiving entity as an in-kind payment of transfer taxes. (b) The donor shall first obtain a written appraisal of the qualified property. The donor shall then notify the receiving entity in writing of the desire to offer the qualified property to the receiving entity. The receiving entity shall within a reasonable period of time notify the donor in writing as to whether it is willing to accept the qualified property. Any decision by a receiving entity not to accept the qualified property shall be final and not appealable. (c) If a receiving entity indicates its willingness to accept the qualified property, the donor shall then submit an application to the department for approval of an in-kind payment containing the following information: (1) Name and address of donor; (2) Copy of transfer tax return for which tax is payable, if prepared; otherwise, information concerning taxes to be paid; (3) Copy of appraisal; (4) Statement of how the qualified property meets the statutory definition; (5) A copy of the correspondence with the receiving entity evidencing its willingness to accept the qualified property; and (6) A statement from the donor or the receiving entity outlining the proposed and potential uses of the qualified property, and the source of funds for support and maintenance of the qualified property. (d) The department shall have ninety (90) days from the date of receipt of a completed application for in-kind payment to approve or deny the application. The department may request that the donor amend the application, including the valuation, as a condition of approval. If the department approves the application, the receiving entity shall assume title to the property as soon as practicable. (e) If the department fails to respond to an application for in-kind payment within ninety (90) days of its receipt, the application shall be deemed to be denied. The approval or denial of an application for in-kind payment shall be within the absolute discretion of the department. A denial of an application, either by response or by failure to respond, shall be final, and such a decision shall not be appealable under the Uniform Administrative Procedures Act, compiled in title 4, chapter 5, nor shall such decision be appealable to any court. (f) The department in its discretion may require the donor to pay for a second appraisal by an appraiser selected by the department whenever the qualified property is unusual or outside of the normal expertise of the department to appraise. Acts 1989, ch. 236, § 4.
(a) Any donor may make application to transfer qualified property to a receiving entity as an in-kind payment of transfer taxes.
(b) The donor shall first obtain a written appraisal of the qualified property. The donor shall then notify the receiving entity in writing of the desire to offer the qualified property to the receiving entity. The receiving entity shall within a reasonable period of time notify the donor in writing as to whether it is willing to accept the qualified property. Any decision by a receiving entity not to accept the qualified property shall be final and not appealable.
(c) If a receiving entity indicates its willingness to accept the qualified property, the donor shall then submit an application to the department for approval of an in-kind payment containing the following information: (1) Name and address of donor; (2) Copy of transfer tax return for which tax is payable, if prepared; otherwise, information concerning taxes to be paid; (3) Copy of appraisal; (4) Statement of how the qualified property meets the statutory definition; (5) A copy of the correspondence with the receiving entity evidencing its willingness to accept the qualified property; and (6) A statement from the donor or the receiving entity outlining the proposed and potential uses of the qualified property, and the source of funds for support and maintenance of the qualified property.
(1) Name and address of donor;
(2) Copy of transfer tax return for which tax is payable, if prepared; otherwise, information concerning taxes to be paid;
(3) Copy of appraisal;
(4) Statement of how the qualified property meets the statutory definition;
(5) A copy of the correspondence with the receiving entity evidencing its willingness to accept the qualified property; and
(6) A statement from the donor or the receiving entity outlining the proposed and potential uses of the qualified property, and the source of funds for support and maintenance of the qualified property.
(d) The department shall have ninety (90) days from the date of receipt of a completed application for in-kind payment to approve or deny the application. The department may request that the donor amend the application, including the valuation, as a condition of approval. If the department approves the application, the receiving entity shall assume title to the property as soon as practicable.
(e) If the department fails to respond to an application for in-kind payment within ninety (90) days of its receipt, the application shall be deemed to be denied. The approval or denial of an application for in-kind payment shall be within the absolute discretion of the department. A denial of an application, either by response or by failure to respond, shall be final, and such a decision shall not be appealable under the Uniform Administrative Procedures Act, compiled in title 4, chapter 5, nor shall such decision be appealable to any court.
(f) The department in its discretion may require the donor to pay for a second appraisal by an appraiser selected by the department whenever the qualified property is unusual or outside of the normal expertise of the department to appraise.
Acts 1989, ch. 236, § 4.
Tenn. Code Ann. § 67-6-515 — TN Code / Title 67 / Chapter 6 / Section 67-6-515
Collection of taxes by marketplace facilitator - Reports - Audit - Relief from liability
Status: in_force

(a) A marketplace facilitator that collects and remits the taxes imposed by this chapter shall collect taxes on sales through its marketplace based upon the address to which the tangible personal property or things taxable under this chapter are shipped; provided, however, that taxes collected by the marketplace facilitator on services sold through its marketplace shall be collected as otherwise provided in this chapter. (b) A marketplace facilitator shall report the sales and use taxes on sales through its marketplace separately from any sales and use taxes collected on sales made directly by the marketplace facilitator or affiliates of the marketplace facilitator. (c) The commissioner may, in the commissioner's sole discretion, audit a marketplace facilitator for sales made by marketplace sellers and facilitated by the marketplace facilitator, except with respect to transactions that are subject to § 67-6-501(f)(1)-(3) . The commissioner shall not audit or otherwise assess taxes against marketplace sellers for sales facilitated by a marketplace facilitator except to the extent the marketplace facilitator seeks relief as provided below or with respect to transactions that are subject to § 67-6-501(f)(1)-(3) . (d) A marketplace facilitator shall be relieved of liability for failure to collect and remit the correct amount of taxes to the extent that the error was due to incorrect or insufficient information given to the marketplace facilitator by the marketplace seller if the marketplace facilitator demonstrates that it made a reasonable effort to obtain correct and sufficient information from the marketplace seller. This subsection (d) shall not apply if the marketplace facilitator and the marketplace seller are affiliates. (e) No class action lawsuit may be brought against a marketplace facilitator in this state on behalf of purchasers relating to overcollection of sales or use taxes by the marketplace facilitator, regardless of whether that claim is characterized as a tax refund claim. (f) Nothing in this section affects the obligation of any purchaser to remit sales or use taxes for any taxable transaction for which a marketplace facilitator or seller does not collect and remit sales and use taxes. Added by 2020 Tenn. Acts, ch. 646,s 9, eff. 10/1/2020.
(a) A marketplace facilitator that collects and remits the taxes imposed by this chapter shall collect taxes on sales through its marketplace based upon the address to which the tangible personal property or things taxable under this chapter are shipped; provided, however, that taxes collected by the marketplace facilitator on services sold through its marketplace shall be collected as otherwise provided in this chapter.
(b) A marketplace facilitator shall report the sales and use taxes on sales through its marketplace separately from any sales and use taxes collected on sales made directly by the marketplace facilitator or affiliates of the marketplace facilitator.
(c) The commissioner may, in the commissioner's sole discretion, audit a marketplace facilitator for sales made by marketplace sellers and facilitated by the marketplace facilitator, except with respect to transactions that are subject to § 67-6-501(f)(1)-(3) . The commissioner shall not audit or otherwise assess taxes against marketplace sellers for sales facilitated by a marketplace facilitator except to the extent the marketplace facilitator seeks relief as provided below or with respect to transactions that are subject to § 67-6-501(f)(1)-(3) .
(d) A marketplace facilitator shall be relieved of liability for failure to collect and remit the correct amount of taxes to the extent that the error was due to incorrect or insufficient information given to the marketplace facilitator by the marketplace seller if the marketplace facilitator demonstrates that it made a reasonable effort to obtain correct and sufficient information from the marketplace seller. This subsection (d) shall not apply if the marketplace facilitator and the marketplace seller are affiliates.
(e) No class action lawsuit may be brought against a marketplace facilitator in this state on behalf of purchasers relating to overcollection of sales or use taxes by the marketplace facilitator, regardless of whether that claim is characterized as a tax refund claim.
(f) Nothing in this section affects the obligation of any purchaser to remit sales or use taxes for any taxable transaction for which a marketplace facilitator or seller does not collect and remit sales and use taxes.
Added by 2020 Tenn. Acts, ch. 646,s 9, eff. 10/1/2020.
Tenn. Code Ann. § 67-3-410 — TN Code / Title 67 / Chapter 3 / Section 67-3-410
Refinery exemptions
Status: in_force

(a) None of the laws relating to the inspection of petroleum products as set forth in §§ 60-3-103 - 60-3-114, or the taxes and fees imposed by this chapter upon petroleum products, shall be applicable or collectible in the following cases: (1) Upon any of the products while being transported from, inside or outside the state to a petroleum refinery inside the state, for the purpose of there being refined, further refined or processed; (2) Upon any of the products while being refined, further refined, processed or stored at a petroleum refinery inside this state. Refinery exemptions are applicable to all petroleum activities, exchanges and transactions that are customarily performed by or engaged in by a refinery, but specifically excluded are exemptions applicable to the storage of petroleum or petroleum products for others, whether by lease or otherwise; (3) Upon any of the products while being transported from a refinery inside this state to another petroleum refinery inside this state; and (4) Upon any of the products while being transported from a petroleum refinery inside this state to a place outside this state, excluding commercial marine vessels, even though delivery is made in midstream of waterways constituting geographical boundaries of this state. For any product transported from refinery storage via marine vessel as an export, but in fact coming to rest at a nonexempt destination in this state, for which the taxes and fees are not reported and paid by a bonded importer, the refinery shall bear responsibility to this state for the payment of taxes, fees, and applicable interest and penalty. (b) All refinery exemptions granted to petroleum refineries shall apply to refiners or manufacturers of fuel alcohol who have a refinery or a manufacturing facility in Tennessee. (c) Where gasoline is exchanged or sold within the bulk transfer/terminal system between refiners who hold a bonded importer's license, the first transferee, after the gasoline is imported into this state, shall be primarily liable for the taxes and fees that have accrued pursuant to §§ 67-3-201 , 67-3-203 and 67-3-204 . With respect to a refinery, gasoline may be exchanged or sold tax free by a refinery within refinery-held storage; however, the transferee shall be liable for taxes and fees on gasoline that crosses the terminal rack; provided, that the refinery is responsible for the taxes and fees on gasoline that crosses the terminal rack that is not otherwise exchanged or sold within the refinery. (d) For the purposes of the exemptions provided by this section, an entity, other than a retailer, affiliated with an entity which owns a refinery located in this state, shall be treated as the refinery and shall not be considered as the transferee. As used in this subsection (d), entities are affiliated with one another, if either, directly or indirectly wholly owns the other, or if the entities are directly or indirectly, wholly owned by a common parent. Acts 1997, ch. 316, § 1; 1999, ch. 419, § 1; T.C.A., § 67-3-1510.
(a) None of the laws relating to the inspection of petroleum products as set forth in §§ 60-3-103 - 60-3-114, or the taxes and fees imposed by this chapter upon petroleum products, shall be applicable or collectible in the following cases: (1) Upon any of the products while being transported from, inside or outside the state to a petroleum refinery inside the state, for the purpose of there being refined, further refined or processed; (2) Upon any of the products while being refined, further refined, processed or stored at a petroleum refinery inside this state. Refinery exemptions are applicable to all petroleum activities, exchanges and transactions that are customarily performed by or engaged in by a refinery, but specifically excluded are exemptions applicable to the storage of petroleum or petroleum products for others, whether by lease or otherwise; (3) Upon any of the products while being transported from a refinery inside this state to another petroleum refinery inside this state; and (4) Upon any of the products while being transported from a petroleum refinery inside this state to a place outside this state, excluding commercial marine vessels, even though delivery is made in midstream of waterways constituting geographical boundaries of this state. For any product transported from refinery storage via marine vessel as an export, but in fact coming to rest at a nonexempt destination in this state, for which the taxes and fees are not reported and paid by a bonded importer, the refinery shall bear responsibility to this state for the payment of taxes, fees, and applicable interest and penalty.
(1) Upon any of the products while being transported from, inside or outside the state to a petroleum refinery inside the state, for the purpose of there being refined, further refined or processed;
(2) Upon any of the products while being refined, further refined, processed or stored at a petroleum refinery inside this state. Refinery exemptions are applicable to all petroleum activities, exchanges and transactions that are customarily performed by or engaged in by a refinery, but specifically excluded are exemptions applicable to the storage of petroleum or petroleum products for others, whether by lease or otherwise;
(3) Upon any of the products while being transported from a refinery inside this state to another petroleum refinery inside this state; and
(4) Upon any of the products while being transported from a petroleum refinery inside this state to a place outside this state, excluding commercial marine vessels, even though delivery is made in midstream of waterways constituting geographical boundaries of this state. For any product transported from refinery storage via marine vessel as an export, but in fact coming to rest at a nonexempt destination in this state, for which the taxes and fees are not reported and paid by a bonded importer, the refinery shall bear responsibility to this state for the payment of taxes, fees, and applicable interest and penalty.
(b) All refinery exemptions granted to petroleum refineries shall apply to refiners or manufacturers of fuel alcohol who have a refinery or a manufacturing facility in Tennessee.
(c) Where gasoline is exchanged or sold within the bulk transfer/terminal system between refiners who hold a bonded importer's license, the first transferee, after the gasoline is imported into this state, shall be primarily liable for the taxes and fees that have accrued pursuant to §§ 67-3-201 , 67-3-203 and 67-3-204 . With respect to a refinery, gasoline may be exchanged or sold tax free by a refinery within refinery-held storage; however, the transferee shall be liable for taxes and fees on gasoline that crosses the terminal rack; provided, that the refinery is responsible for the taxes and fees on gasoline that crosses the terminal rack that is not otherwise exchanged or sold within the refinery.
(d) For the purposes of the exemptions provided by this section, an entity, other than a retailer, affiliated with an entity which owns a refinery located in this state, shall be treated as the refinery and shall not be considered as the transferee. As used in this subsection (d), entities are affiliated with one another, if either, directly or indirectly wholly owns the other, or if the entities are directly or indirectly, wholly owned by a common parent.
Acts 1997, ch. 316, § 1; 1999, ch. 419, § 1; T.C.A., § 67-3-1510.