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A386, R389, S1245
STATUS INFORMATION
General Bill
Sponsors: Senators Thomas, Fair, Cromer, Ritchie, Anderson, Verdin, Setzler, Ryberg and Knotts
Document Path: l:\council\bills\bbm\9331mm06.doc
Companion/Similar bill(s): 1065, 4530, 4913
Introduced in the Senate on March 14, 2006
Introduced in the House on April 6, 2006
Last Amended on May 31, 2006
Passed by the General Assembly on June 1, 2006
Governor's Action: June 13, 2006, Vetoed
Legislative veto action(s): Veto overridden
Summary: Pogo Bill
HISTORY OF LEGISLATIVE ACTIONS
Date Body Action Description with journal page number
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3/14/2006 Senate Introduced and read first time SJ-17
3/14/2006 Senate Referred to Committee on Finance SJ-17
3/29/2006 Senate Committee report: Favorable Finance SJ-14
3/30/2006 Scrivener's error corrected
4/5/2006 Senate Read second time SJ-32
4/6/2006 Senate Amended SJ-8
4/6/2006 Senate Read third time and sent to House SJ-8
4/6/2006 House Introduced and read first time HJ-48
4/6/2006 House Referred to Committee on Ways and Means HJ-49
4/7/2006 Scrivener's error corrected
5/24/2006 House Recalled from Committee on Ways and Means HJ-110
5/25/2006 House Debate adjourned until Tuesday, May 30, 2006 HJ-103
5/30/2006 House Amended HJ-120
5/30/2006 House Read second time HJ-162
5/31/2006 House Read third time and returned to Senate with amendments
HJ-29
5/31/2006 Senate House amendment amended SJ-269
5/31/2006 Senate Returned to House with amendments SJ-269
6/1/2006 House Concurred in Senate amendment and enrolled HJ-7
6/7/2006 Ratified R 389
6/13/2006 Vetoed by Governor
6/14/2006 Senate Veto overridden by originating body Yeas-31 Nays-6 SJ-97
6/14/2006 House Veto overridden Yeas-102 Nays-1 HJ-204
6/22/2006 Copies available
6/22/2006 Effective date See Act for Effective Date
6/23/2006 Act No. 386
View the latest legislative information at the LPITS web site
VERSIONS OF THIS BILL
3/14/2006
3/29/2006
3/30/2006
4/6/2006
4/7/2006
5/24/2006
5/30/2006
5/31/2006
(A386, R389, S1245)
AN ACT TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION 12-54-126 SO AS TO PROVIDE FOR THE RETURN BY A BUSINESS OF A LICENSE ISSUED BY THE DEPARTMENT OF REVENUE AND PAYMENT OF TAXES DUE UPON THE CLOSING OR TRANSFER OF THE BUSINESS; BY ADDING SECTION 12-54-196 SO AS TO PROVIDE FOR A PENALTY FOR A RETAILER COLLECTING AN EXCESSIVE STATE OR LOCAL SALES TAX AND TO PROVIDE FOR MITIGATION OF THE PENALTY; BY REDESIGNATING SECTION 12-4-780, RELATING TO ACCEPTANCE BY THE DEPARTMENT OF REVENUE OF PAYMENT OF TAXES BY CREDIT CARD AS SECTION 12-4-395, SO AS TO CORRECTLY REFLECT IT AS A GENERAL POWER OF THE DEPARTMENT; TO AMEND SECTION 12-6-40, AS AMENDED, RELATING TO APPLICATION OF THE FEDERAL INTERNAL REVENUE CODE TO THIS STATE'S TAX LAWS, SO AS TO REFER TO THE IRC AS AMENDED THROUGH DECEMBER 31, 2005; TO AMEND SECTION 12-6-545, AS AMENDED, RELATING TO INCOME TAX RATES FOR ACTIVE TRADE OR BUSINESS INCOME OF A PASS-THROUGH BUSINESS, SO AS TO PROVIDE FOR ROYALTIES TREATED AS PERSONAL HOLDING COMPANY INCOME AND AMOUNTS PAID AS GUARANTEED PAYMENTS REASONABLY RELATED TO PERSONAL SERVICES, TO DESCRIBE INCOME REASONABLY RELATED TO PERSONAL SERVICES, AND TO PROVIDE FOR ELECTIONS AS TO TREATMENT OF INCOME FOR PERSONAL SERVICES; TO AMEND SECTION 12-6-3350, RELATING TO TAX CREDIT FOR A STATE CONTRACTOR USING MINORITY SUBCONTRACTORS, SO AS TO CONFORM THE TERM "MINORITY FIRM" TO LANGUAGE USED ELSEWHERE IN THE SOUTH CAROLINA CODE OF LAWS AND TO MAKE TECHNICAL CHANGES; TO AMEND SECTION 12-6-3360, AS AMENDED, RELATING TO THE JOB TAX CREDIT, SO AS TO DELETE THE REQUIREMENT THAT THE TAXPAYER HAVE ONE HUNDRED OR MORE EMPLOYEES, AND TO REVISE THE DEFINITION OF "DISTRIBUTION FACILITY"; TO AMEND SECTION 12-37-220, AS AMENDED, RELATING TO PROPERTY TAX EXEMPTIONS, SO AS TO CONFORM THE DEFINITION OF DISTRIBUTION FACILITY TO THE REVISED DEFINITION PROVIDED BY THE AMENDMENT TO THE TARGETED JOBS TAX CREDIT IN THIS ACT; TO AMEND SECTION 12-6-3375, RELATING TO CREDITS AGAINST THE STATE INCOME TAX FOR AN INCREASE IN PORT CARGO VOLUME, SO AS TO PROVIDE FOR DETERMINATION OF THE BASE PORT CARGO VOLUME, THAT THE TAXPAYER APPLY TO THE COORDINATING COUNCIL FOR ECONOMIC DEVELOPMENT TO QUALIFY, THAT THE COUNCIL DETERMINE THE AMOUNT OF THE CREDIT UP TO A MAXIMUM OF EIGHT MILLION DOLLARS FOR ALL TAXPAYERS FOR EACH CALENDAR YEAR, THAT THE ENTIRE MAXIMUM AMOUNT BE PRORATED AMONG QUALIFYING TAXPAYERS IN A CALENDAR YEAR, AND FOR CARRYOVER OF EXCESS CREDIT FOR THE NEXT FIVE YEARS; TO AMEND SECTION 12-54-240, AS AMENDED, RELATING TO PERMITTED DISCLOSURES OF INFORMATION BY THE DEPARTMENT OF REVENUE, SO AS TO ALLOW THE EXCHANGE OF INFORMATION BETWEEN THE DEPARTMENT AND THE DEPARTMENT OF COMMERCE IN CONNECTION WITH THE CREDIT FOR INCREASED PORT CARGO VOLUME; TO AMEND SECTION 12-6-3385, RELATING TO A REFUNDABLE INCOME TAX CREDIT FOR A TUITION PAYMENT, SO AS TO SUSPEND THE FOUR-YEAR CREDIT PERIOD IF A STUDENT IS DEPLOYED BY THE MILITARY ON ACTIVE DUTY DURING THE PERIOD AND RE-ENROLLS UPON DEMOBILIZATION; TO AMEND SECTION 12-6-3535, AS AMENDED, RELATING TO THE STATE INCOME TAX CREDIT ALLOWED A TAXPAYER MAKING QUALIFIED REHABILITATION EXPENDITURES FOR A CERTIFIED HISTORIC STRUCTURE IN THIS STATE, SO AS TO ADD TECHNICAL REFERENCES AND TO DEFINE "PARTNER" FOR PURPOSES OF THE APPLICATION OF THE CREDIT TO PASS-THROUGH ENTITIES; TO AMEND SECTION 12-6-5030, AS AMENDED, RELATING TO THE FILING OF A COMPOSITE CORPORATE INCOME TAX RETURN, SO AS TO FURTHER PROVIDE FOR THE COMPUTATION OF A NONRESIDENT PARTICIPANT'S PRO RATA SHARE OF SOUTH CAROLINA INCOME TAX; TO AMEND SECTION 12-10-80, AS AMENDED, RELATING TO JOB DEVELOPMENT TAX CREDITS, SO AS TO DELETE UNNECESSARY REFERENCES AND TO CORRECT A REFERENCE; TO AMEND SECTIONS 12-23-810, 12-23-830, AND 12-23-840, RELATING TO TAX ON LICENSED HOSPITALS FOR INDIGENT HEALTH CARE, SO AS TO PROVIDE FOR AN INITIAL TAX AND FOR TAXES FOR SECOND AND SUCCESSIVE FISCAL YEARS, TO PROVIDE FOR CALCULATION OF THE TAX, AND TO PROVIDE THAT THE MONIES BE USED FOR HEALTH CARE COVERAGE FOR CERTAIN POPULATIONS IN THIS STATE; TO AMEND SECTION 12-28-110, AS AMENDED, RELATING TO DEFINITIONS FOR PURPOSES OF THE USER FEE FOR MOTOR FUELS, SO AS TO FURTHER DEFINE "DIESEL FUEL" TO INCLUDE BIODIESEL FUEL AND "MOTOR FUEL" TO INCLUDE SUBSTITUTE FUEL, TO DEFINE "SUBSTITUTE FUEL", "BIODIESEL", AND "BIODIESEL BLEND", AND TO MAKE CERTAIN CLARIFICATIONS; TO AMEND SECTION 12-28-310, AS AMENDED, RELATING TO THE IMPOSITION OF THE USER FEE, SO AS TO INCLUDE BLENDED, SUBSTITUTED, AND ALTERNATIVE FUELS; TO AMEND SECTION 12-28-330, AS AMENDED, RELATING TO PRESUMPTION OF USE OF FUEL IN THIS STATE, SO AS TO INCLUDE BLENDED, SUBSTITUTE, AND ALTERNATIVE FUELS; TO AMEND SECTION 12-28-790, AS AMENDED, RELATING TO REFUNDS OF THE USER FEE, SO AS TO DELETE THE CREDIT ALLOWANCE TO A SUPPLIER; TO AMEND SECTION 12-28-970, AS AMENDED, RELATING TO THE IMPOSITION OF A BACKUP USER FEE ON MOTOR FUEL USED BY AN END USER, SO AS TO INCLUDE THE USE OF A SUBSTITUTE FUEL AND TO ADD A TAX ON A LIQUID OR GAS THAT IS NOT OTHERWISE SUBJECT TO THE MOTOR FUEL USER FEE, BY PROVIDING FOR A BACKUP TAX EQUAL TO THE USER FEE PAYABLE BY THE FIRST PERSON WHO RECEIVES THE PRODUCT INTO THIS STATE AND PAYABLE BY THE PRODUCER UPON THE FIRST SALE OR FIRST USE IN THIS STATE; TO AMEND SECTION 12-28-975, AS AMENDED, RELATING TO THE DIVERSION OF MOTOR FUEL FROM AN OUT-OF-STATE DESTINATION, SO AS TO REQUIRE NOTIFICATION AND PAYMENT OF THE USER FEE; TO AMEND SECTION 12-28-990, AS AMENDED, RELATING TO THE LIABILITY OF A BLENDER OF FUELS, SO AS TO PROVIDE FOR A USER FEE AGAINST BLENDED FUELS, PAYABLE BY THE BLENDER OR MANUFACTURER; TO AMEND SECTION 12-28-1120, AS AMENDED, RELATING TO A TRANSPORTER OF MOTOR FUEL SUBJECT TO THE USER FEE, SO AS TO REQUIRE A TRANSPORTER'S LICENSE; TO AMEND SECTION 12-28-1370, AS AMENDED, RELATING TO A LICENSED TRANSPORTER, SO AS TO CLARIFY THE REPORTABLE TRANSPORTS; TO AMEND SECTION 12-33-245, AS AMENDED, RELATING TO THE IMPOSITION OF AN EXCISE TAX ON THE PROCEEDS OF THE SALE OF ALCOHOLIC LIQUOR BY THE DRINK, SO AS TO PROVIDE FOR SALES MADE AT A LOCATION HOLDING A TEMPORARY LICENSE OR PERMIT, AND TO FURTHER DEFINE THE TERM "GROSS PROCEEDS OF SALE" TO INCLUDE THE VALUE OF COMPLIMENTARY ALCOHOLIC LIQUOR, ICE, AND MIXERS; BY ADDING SECTION 61-6-720 SO AS TO PROVIDE FOR A SPECIAL BAKERY FOOD MANUFACTURER'S LICENSE FOR BAKERIES USING ALCOHOLIC BEVERAGES IN FOOD PREPARATION; TO AMEND SECTION 12-36-90, AS AMENDED, RELATING TO THE DEFINITION OF "GROSS PROCEEDS OF SALE" FOR PURPOSES OF THE STATE SALES AND USE TAX, SO AS TO PROVIDE THAT THE TERM DOES NOT INCLUDE THE PROCEEDS OF THE SALE OF PERSONAL PROPERTY PURCHASED PURSUANT TO A WARRANTY, MAINTENANCE, OR SIMILAR SERVICE CONTRACT UNDER CERTAIN CONDITIONS; TO AMEND SECTION 12-36-910, AS AMENDED, RELATING TO APPLICATION OF THE FIVE PERCENT SOUTH CAROLINA SALES TAX, SO AS TO PROVIDE THAT THE TAX APPLIES TO THE GROSS PROCEEDS OF THE SALE OF A WARRANTY, MAINTENANCE, OR OTHER SERVICE CONTRACTS FOR TANGIBLE PERSONAL PROPERTY; TO AMEND SECTION 12-36-2120, AS AMENDED, RELATING TO EXEMPTIONS FROM THE SALES TAX, SO AS TO CLARIFY THE TYPE OF MATERIAL HANDLING SYSTEMS AND EQUIPMENT INCLUDED IN THE EXEMPTIONS, AND TO EXEMPT THE GROSS PROCEEDS FROM A SALE OF A WARRANTY, MAINTENANCE, OR OTHER SERVICE CONTRACT FOR TANGIBLE PERSONAL PROPERTY IF THE GROSS PROCEEDS FROM THE SALE OF THE SUBJECT TANGIBLE PERSONAL PROPERTY IS EXEMPT; TO AMEND SECTION 12-37-2740, RELATING TO SUSPENSION OF A DRIVER'S LICENSE AND VEHICLE REGISTRATION FOR FAILURE TO PAY PERSONAL PROPERTY TAX, SO AS TO CHANGE REFERENCES FROM THE "DEPARTMENT" TO THE "DEPARTMENT OF MOTOR VEHICLES", AND TO PROVIDE FOR A MAXIMUM PENALTY FOR A THIRD AND SUBSEQUENT OFFENSE TO A FIVE HUNDRED-DOLLAR FINE OR THIRTY DAYS IN PRISON, OR BOTH; TO AMEND SECTION 12-37-2890, RELATING TO SUSPENSION OF THE DRIVER'S LICENSE AND VEHICLE REGISTRATION OF A PERSON WHO FAILS TO PAY THE MOTOR CARRIER PROPERTY TAX ON A VEHICLE, SO AS TO PROVIDE THAT THE SUSPENSION BE MADE BY THE DEPARTMENT OF MOTOR VEHICLES AFTER ELECTRONIC NOTICE AND FOR SPECIFIC PENALTIES FOR FIRST AND SUBSEQUENT OFFENSES; TO AMEND SECTION 12-43-335, AS AMENDED, RELATING TO THE CLASSIFICATION OF ASSESSED PROPERTY FOR PURPOSES OF EQUALIZATION AND REASSESSMENT, SO AS TO CHANGE A REFERENCE TO CERTAIN SECTOR 22 CLASSIFICATIONS; TO AMEND SECTION 12-54-155, RELATING TO PENALTIES FOR SUBSTANTIAL UNDERSTATEMENT OF TAXES, SO AS TO CLARIFY THAT THE PROVISION REFERS TO AN UNDERPAYMENT OF TAXES BASED ON AN UNDERSTATEMENT OF TAX OR A MISSTATEMENT OF VALUATION, TO PROVIDE THAT CERTAIN PENALTIES DO NOT APPLY TO UNDERPAYMENTS ATTRIBUTABLE TO FRAUD, BUSINESS-RELATED PROPERTY, OR A TAX SHELTER, WHICH ARE PENALIZED ELSEWHERE, TO DEFINE "SUBSTANTIAL VALUATION MISSTATEMENT", AND TO PROVIDE FOR REASONABLENESS AND GOOD FAITH ON THE PART OF THE TAXPAYER AND IN CONNECTION WITH CHARITABLE DEDUCTION PROPERTY; TO AMEND SECTION 12-60-30, AS AMENDED, RELATING TO DEFINITIONS IN CONNECTION WITH THE REVENUE PROCEDURES ACT, SO AS TO MAKE TECHNICAL CHANGES; TO AMEND SECTION 12-60-470, AS AMENDED, RELATING TO REFUND CLAIMS BY A STATE TAXPAYER, SO AS TO FURTHER PROVIDE FOR THE LIMITED CIRCUMSTANCES UNDER WHICH A PERSON OTHER THAN THE TAXPAYER LEGALLY LIABLE FOR THE TAX MAY CLAIM OR RECEIVE A REFUND, INCLUDING THE REQUIREMENT THAT AN ASSIGNMENT OF THE CLAIM OR REFUND BE IN WRITING, THE REFUND CLAIM OF A FOREIGN MISSION OR DIPLOMAT, THE APPLICATION OF SECTION 12-60-490, AND THE DISCLOSURE TO ANOTHER PERSON OF THE EFFECT OF OTHER TAX LIABILITIES OF THE TAXPAYER ON THE AMOUNT OF THE REFUND; TO REPEAL SECTIONS 12-4-770, RELATING TO PROCEDURES FOR APPEALING THE PROPOSED ASSESSMENT OF PROPERTY FOR TAXATION AND 12-36-530, RELATING TO RETURN OF LICENSE UPON CLOSING OF BUSINESS; TO AMEND SECTION 12-6-5590, RELATING TO DETERMINING DONATIVE INTENT, SO AS TO DELETE THE EXCLUSION FOR CONSERVATION CONTRIBUTION IN CONNECTION WITH A GOLF COURSE; TO AMEND SECTION 12-58-160, RELATING TO THE RELEASE OF AN ERRONEOUSLY FILED LIEN, SO AS TO PROVIDE THAT NOTICE OF THE RELEASE DOES NOT BREACH THE DEPARTMENT'S NONDISCLOSURE RULES; TO AMEND SECTION 12-37-250, AS AMENDED, RELATING TO THE HOMESTEAD EXEMPTION, SO AS TO DELETE THE AGE REQUIREMENT FOR A SURVIVING SPOUSE TO BE ELIGIBLE FOR THE EXEMPTION; BY ADDING SECTION 12-37-714 SO AS TO PROVIDE FOR THE TAXATION OF BOATS WITH A SITUS IN THIS STATE; BY ADDING SECTION 12-37-717 SO AS TO PROVIDE FOR A THREE PERCENT SURCHARGE ON A RENTAL CONTRACT FOR HEAVY EQUIPMENT AND TO DEFINE "HEAVY EQUIPMENT"; TO AMEND SECTION 12-51-150, RELATING TO THE VOIDING OF A TAX SALE, SO AS TO REQUIRE THE REFUND ALSO OF THE AMOUNT OF INTEREST ACTUALLY EARNED; BY ADDING SECTION 12-6-3600 SO AS TO PROVIDE FOR A TAX CREDIT FOR A FACILITY THAT PRODUCES ETHANOL OR BIODIESEL UNDER CERTAIN TIME CONSTRAINTS; BY ADDING SECTION 12-6-3610 SO AS TO PROVIDE FOR A TAX CREDIT FOR A FACILITY PROCESSING AND DISPENSING RENEWABLE FUEL THROUGH 2011; TO AMEND SECTION 12-28-110, AS AMENDED, RELATING TO DEFINITIONS FOR PURPOSES OF MOTOR FUEL SUBJECT TO THE USER FEE, SO AS TO REDEFINE "MOTOR FUEL" AND TO DEFINE "BIODIESEL" AND "RENEWABLE FUEL"; TO AMEND SECTION 12-28-990, AS AMENDED, RELATING TO BLENDING MATERIALS, SO AS TO PROVIDE FOR RENEWABLE FUELS; BY ADDING SECTION 12-6-3587 AND SECTION 12-6-3620 SO AS TO PROVIDE FOR A TAX CREDIT FOR A TAXPAYER WHO, RESPECTIVELY, INSTALLS A SOLAR ENERGY HEATING OR COOLING SYSTEM OR USES METHANE GAS TAKEN FROM A LANDFILL; TO AMEND SECTION 12-37-224, RELATING TO A MOTOR HOME USED AS A RESIDENCE FOR PROPERTY TAX PURPOSES, SO AS TO PROVIDE THAT A COUNTY ORDINANCE MAY PROVIDE FOR SIMILAR TREATMENT OF A BOAT USED AS A RESIDENCE; TO AMEND SECTION 12-10-88, RELATING TO REDEVELOPMENT FEES, SO AS TO PROVIDE FOR AN EXTENSION; TO AMEND SECTION 12-37-220, AS AMENDED, RELATING TO GENERAL EXEMPTIONS FROM TAXES, SO AS TO PROVIDE THAT AN EXEMPT PASSENGER VEHICLE OWNED BY A MILITARY PERSON MUST BE REGISTERED IN THIS STATE TO QUALIFY FOR THE EXEMPTION; TO AMEND SECTION 12-6-545, RELATING TO INCOME TAX RATES FOR ACTIVE AND PASSIVE BUSINESSES INCOME, SO AS TO PROVIDE FOR THE APPLICATION OF THE TAX CREDIT; TO AMEND SECTION 12-6-3515, RELATING TO THE TAX CREDIT FOR A CONSERVATION CONTRIBUTION, SO AS TO PROVIDE THAT IT IS NOT ALLOWED IF THE UNDERLYING PROPERTY IS USED FOR THE PLAYING OF GOLF; TO AMEND SECTION 12-51-130, AS AMENDED, RELATING TO A TAX SALE, SO AS TO PROVIDE FOR THE COSTS TO INCLUDE THE ACTUAL COST OF THE TAX DEED PREPARATION; TO AMEND SECTION 12-37-712, RELATING TO ACCESS TO THE RECORDS OF A MARINA, SO AS TO DEFINE AND LIMIT BUSINESS RECORDS; TO AMEND SECTION 61-6-510 AND SECTION 61-6-2000, AS AMENDED, BOTH RELATING TO THE ISSUANCE OF A TEMPORARY LIQUOR LICENSE, BOTH SO AS TO ALLOW A CRIMINAL BACKGROUND CHECK; TO AMEND SECTION 12-6-3360, AS AMENDED, RELATING TO THE TARGETED JOB TAX CREDIT, SO AS TO INCLUDE AS AN ELIGIBLE TAXPAYER AN EXTRAORDINARY RETAIL ESTABLISHMENT AND TO DEFINE "EXTRAORDINARY RETAIL ESTABLISHMENT"; TO AMEND SECTION 12-21-6520, RELATING TO THE TOURISM INFRASTRUCTURE ACT, SO AS TO INCLUDE AN EXTRAORDINARY RETAIL ESTABLISHMENT WITH ADJOINING AQUARIUM OR NATURAL HISTORY MUSEUM AS A "TOURISM OR RECREATIONAL FACILITY" AND TO DEFINE QUALIFYING INFRASTRUCTURE IN THAT CONNECTION; BY ADDING SECTION 12-21-6590, SO AS TO LIMIT THE DESIGNATION OF EXTRAORDINARY RETAIL ESTABLISHMENTS TO FOUR IN THIS STATE; BY ADDING SECTIONS 12-49-1190 THROUGH 12-49-1290 SO AS TO PROVIDE FOR THE TAX SALE OF A MOBILE OR MANUFACTURED HOME INCLUDING NOTICE TO ALL LIENHOLDERS AND THE FORM OF THE NOTICE; TO AMEND SECTION 12-49-1110, RELATING TO DEFINITIONS IN CONNECTION WITH REAL PROPERTY MORTGAGES IN CONNECTION WITH THE ENFORCED COLLECTION OF PROPERTY TAXES, SO AS TO ADD ADDITIONAL DEFINITIONS; TO AMEND SECTION 12-51-130, AS AMENDED, RELATING TO A TAX SALE, SO AS TO INCLUDE IN THE COSTS THE ACTUAL EXPENSE FOR THE TAX DEED PREPARATION; TO AMEND SECTION 12-51-150, RELATING TO THE REFUND AMOUNT IN A FAILED TAX SALE, SO AS TO INCLUDE IN THE REFUND AMOUNT THE ACTUAL INTEREST EARNED BY THE COUNTY; TO AMEND SECTION 61-6-20, AS AMENDED, RELATING TO DEFINITIONS IN CONNECTION WITH THE ALCOHOLIC BEVERAGE CONTROL ACT, SO AS TO FURTHER DEFINE "BONA FIDE ENGAGED PRIMARILY AND SUBSTANTIALLY IN THE PREPARATION AND SERVING OF MEALS"; TO AMEND SECTION 61-6-50, RELATING TO VIOLATIONS OF THE ABC ACT, SO AS TO PROVIDE FOR THE DETERMINATION OF A WILFUL ACT; TO AMEND SECTION 61-6-1610, AS AMENDED, RELATING TO FOOD SERVICE ESTABLISHMENTS AND PLACES OF LODGING, SO AS TO FURTHER DEFINE SUCH WHEN LICENSED PURSUANT TO THE ABC ACT; TO AMEND SECTION 12-6-3360, AS AMENDED, RELATING TO THE JOB TAX CREDIT, SO AS TO FURTHER PROVIDE FOR THE APPROPRIATE CREDIT TIER IN CERTAIN COUNTIES; TO AMEND SECTION 12-6-3410, AS AMENDED, RELATING TO THE TAX CREDIT FOR A CORPORATE HEADQUARTERS, SO AS TO PROVIDE FOR THE ASSIGNMENT OF UNUSED CREDIT TO A TRANSFEREE OF THE TAXPAYER; TO AMEND SECTIONS 12-2-60, 12-4-520, 12-37-250, AS AMENDED, 12-37-251, 12-37-255, 12-37-266, 12-37-270, 12-37-275, 12-37-280, 12-37-450, 12-39-15, 12-39-150, 12-39-180, 12-39-190, 12-39-200, 12-39-270, 12-39-310, 12-45-15, 12-45-35, 12-45-70, AND 12-49-85, ALL RELATING TO CERTAIN POWERS AND RESPONSIBILITIES OF THE COMPTROLLER GENERAL IN CONNECTION WITH THE OPERATIONS OF A COUNTY TREASURER AND A COUNTY AUDITOR, SO AS TO DEVOLVE THOSE POWERS AND RESPONSIBILITIES ONTO THE DEPARTMENT OF REVENUE, AND TO REPEAL SECTIONS 11-3-60, 11-3-200, 11-3-220, AND 12-39-320 ALL RELATING TO CERTAIN POWERS AND RESPONSIBILITIES OF THE COMPTROLLER GENERAL IN CONNECTION WITH THE OPERATIONS OF A COUNTY TREASURER OR COUNTY AUDITOR; TO AMEND SECTION 61-6-2010, AS AMENDED, RELATING TO A LOCAL REFERENDUM IN CONNECTION WITH THE ABC ACT, SO AS TO PROVIDE FOR THE CALLING OF THE REFERENDUM AS WELL AS THE PETITION OF A REFERENDUM; TO AMEND SECTIONS 4-12-30, AS AMENDED, AND 4-29-67, AS AMENDED, BOTH RELATING TO THE FEE IN LIEU OF PROPERTY TAX IN CONNECTION WITH AN INDUSTRIAL PARK, BOTH SO AS TO PROVIDE THAT COUNTY-OWNED PROPERTY IN THE PARK IS CONSIDERED PRIVATELY OWNED FOR PURPOSES OF EXEMPTION FROM CERTAIN REGULATED UTILITY SERVICES; TO PROVIDE FOR IMPLEMENTATION AND POSTPONEMENT OF IMPLEMENTATION OF THE VALUES DETERMINED IN A COUNTYWIDE ASSESSMENT AND EQUALIZATION PROGRAM; AND TO REPEAL A 2006 ACT BEARING RATIFICATION NO. 227 RELATING TO THE POSTPONEMENT OF SUCH AN IMPLEMENTATION IN GREENVILLE COUNTY.
Be it enacted by the General Assembly of the State of South Carolina:
Return of license
SECTION 1.A. Chapter 54, Title 12 of the 1976 Code is amended by adding:
"Section 12-54-126. A person operating a business within this State who has been issued a license or licenses by the department, after closing, selling, or otherwise transferring the business to another person, shall return all licenses issued by the department to the department for cancellation and remit unpaid or accrued taxes. The department may refuse to issue a license to a person and may revoke one or more licenses held by a person who has failed to comply with the provisions of this section."
B. This section is effective October 1, 2006.
Penalty for excessive collection
SECTION 2.A. Chapter 54 of Title 12 of the 1976 Code is amended by adding:
"Section 12-54-196. (A) If a retailer collects from the purchaser a state or local sales tax in an amount that exceeds the amount authorized pursuant to Section 12-36-940, or the amount required to be collected pursuant to Section 12-36-1350, the retailer may be held liable for a penalty equal to one hundred fifty percent of the amount of tax collected that exceeds the amount authorized to be collected from the purchaser pursuant to Section 12-36-940 or required to be collected from the purchaser pursuant to Section 12-36-1350. The assessment or remittance of this penalty does not relieve the retailer of an obligation the retailer has to repay the purchaser tax collected that exceeds the amount authorized or required to be collected from the purchaser pursuant to Chapter 36 of this title.
(B) Notwithstanding the provisions of subsection (A), a retailer is not subject to this penalty if the retailer:
(1) made a good faith effort to determine the proper tax rate;
(2) made a good faith effort to determine whether or not an exemption or exclusion was applicable; or
(3) refunds to the purchaser the amount that exceeded the amount authorized or required to be collected on a particular sale within ninety days of being notified and receiving documentation of the proper tax rate or the applicability of the exemption or exclusion.
(C) The department, at its discretion, may extend the time for issuing a refund pursuant to subsection (B)(3) to avoid the penalty if the retailer makes a request in writing to the department.
(D) The imposition of the penalty must be based on the facts and circumstances and is at the sole discretion of the department."
B. This section takes effect upon approval by the Governor and applies to taxes collected beginning in tax year 2006.
Payment by credit card
SECTION 3. Section 12-4-780 of the 1976 Code, as added by Act 399 of 2000, is redesignated as follows:
"Section 12-4-395. The department may accept, on terms and conditions it establishes, payments to it by credit cards. This authority includes a determination not to accept credit card payments or to accept credit card payments only for certain classes of payments as specified by the department. Notwithstanding another provision of law, the State Treasurer may enter into contracts on behalf of the department by which the department may accept credit card payments. The department may withhold the actual cost of processing credit card payments from deposits of the payments and may treat these withholdings as reimbursements of the associated expenditures."
Applicable IRC provisions
SECTION 4. Section 12-6-40(A)(1)(a) of the 1976 Code, as last amended by Act 145 of 2005, is further amended to read:
"(a) Except as otherwise provided, 'Internal Revenue Code' means the Internal Revenue Code of 1986, as amended through December 31, 2005, and includes the effective date provisions contained in it."
Income tax rates for pass-through trade and business income
SECTION 5.A. Section 12-6-545 of the 1976 Code, as last amended by an act of 2006 bearing ratification number 306, is further amended to read:
"Section 12-6-545. (A) As used in this section:
(1) 'Active trade or business income or loss' means income or loss of an individual, estate, trust, or any other entity except those taxed or exempted from tax pursuant to Sections 12-6-530 through 12-6-550 resulting from the ownership of an interest in a pass-through business. Active trade or business income or loss does not include:
(a)(i) passive investment income as defined in Internal Revenue Code Section 1362(d) generated by a pass-through business and income of the same type regardless of the type of pass-through business generating it; and
(ii) expenses related to passive investment;
(b) capital gains and losses;
(c) payments for services referred to in Internal Revenue Code Section 707(c);
(d) amounts reasonably related to personal services. All amounts paid as compensation and all guaranteed payments for services, but not for the use of capital, as defined in Internal Revenue Code Section 707(c) are deemed to be reasonably related to personal services. In addition, if an owner of a pass-through entity who performs personal services for the entity is not paid a reasonable amount for those personal services as compensation or payments referred to in Internal Revenue Code Section 707(c), all of the owner's income from the entity is presumed to be amounts reasonably related to personal services. For purposes of this section, amounts reasonably related to personal services include amounts reasonably related to the personal services of the owner, the owner's spouse, and any person claimed as a dependent on the owner's income tax return.
(2) 'Pass-through businesses' mean sole proprietorships, partnerships, and 'S' corporations, including limited liability companies taxed as sole proprietorships, partnerships, or 'S' corporations.
(B)(1) Notwithstanding Section 12-6-510, a taxpayer may elect annually to have the income tax at the rate provided in item (2) of this subsection imposed annually on the active trade or business income received by the owner of a pass-through business. For joint returns, the election is effective for both spouses. The amount subject to tax pursuant to this section is not subject to tax pursuant to Section 12-6-510.
(2) The rate of the income tax imposed pursuant to this subsection is:
Taxable Year Beginning in Rate of Tax
2006 6.5 percent
2007 6 percent
2008 5.5 percent
after 2008 5 percent
(C) Notwithstanding any other provision of this chapter, active trade or business loss must first be deducted, dollar for dollar against active trade or business income. Any remaining active trade or business loss is deductible from income taxed under Section 12-6-510 if otherwise allowable.
(D) The department may issue guidance as to what expenses reduce active trade or business income.
(E)(1) Notwithstanding item (A)(1)(e) of this section, if a taxpayer owns an interest in one or more pass-through businesses that have a total gross income of less than one million dollars and taxable income of less than one hundred thousand dollars, then the taxpayer may elect, instead of determining the actual amount of active trade or business income related to his personal services, to treat fifty percent of his active trade or business income as not related to his personal services. For purposes of this item, the term taxpayer includes both taxpayers who file a joint return.
(2) The department may provide other methods that may be used to determine an amount that is considered to be unrelated to the owner's personal services if it determines that the benefits to the State of taxing income from personal services at a higher rate are insufficient to justify the burdens imposed on the taxpayer."
B. This section takes effect for tax years beginning on or after January 1, 2006.
Tax credit for use of a minority subcontractor
SECTION 6.A. Section 12-6-3350 of the 1976 Code is amended to read:
"Section 12-6-3350. (A) A taxpayer having a contract with this State who subcontracts with a socially and economically disadvantaged small business is eligible for an income tax credit equal to four percent of the payments to that subcontractor for work pursuant to the contract. The subcontractor must be certified as a socially and economically disadvantaged small business as defined in Section 11-35-5010 and regulations pursuant to it.
(B) The credit is limited to a maximum of twenty-five thousand dollars annually. A taxpayer is eligible to claim the credit for six consecutive taxable years beginning with the taxable year in which the first payment is made to the subcontractor that qualifies for the credit. After the above six consecutive taxable years, the taxpayer is no longer eligible for the credit.
(C) A taxpayer claiming the credit shall maintain evidence of work performed for the contract by the subcontractor."
B. This section takes effect upon approval by the Governor and applies to taxable years beginning after December 31, 2006.
Job tax credit
SECTION 7.A. Section 12-6-3360(C)(1) of the 1976 Code, as last amended by Act 157 of 2005, is further amended to read:
"(1) Subject to the conditions provided in subsection (N) of this section, a job tax credit is allowed for five years beginning in year two after the creation of the job for each new full-time job created if the minimum level of new jobs is maintained. The credit is available to taxpayers that increase employment by ten or more full-time jobs, and no credit is allowed for the year or any subsequent year in which the net employment increase falls below the minimum level of ten. The amount of the initial job credit is as follows:
(a) Eight thousand dollars for each new full-time job created in distressed counties.
(b) Four thousand five hundred dollars for each new full-time job created in least developed counties.
(c) Three thousand five hundred dollars for each new full-time job created in underdeveloped counties.
(d) Two thousand five hundred dollars for each new full-time job created in moderately developed counties.
(e) One thousand five hundred dollars for each new full-time job created in developed counties."
B. This section takes effect upon approval by the Governor and applies to taxable years beginning on and after January 1, 2006.
Definitions
SECTION 8. Section 12-6-3360(M)(8) of the 1976 Code is amended to read:
"(8) 'Distribution facility' means an establishment where shipments of tangible personal property are processed for delivery to customers. The term does not include an establishment where retail sales of tangible personal property are made to retail customers on more than twelve days a year except for a facility which processes customer sales orders by mail, telephone, or electronic means, if the facility also processes shipments of tangible personal property to customers and if at least seventy-five percent of the dollar amount of goods sold through the facility are sold to customers outside of South Carolina. Retail sales made inside the facility to employees working at the facility are not considered for purposes of the twelve-day and seventy-five percent limitation. For purposes of this definition, 'retail sale' and 'tangible personal property' have the meaning provided in Chapter 36 of this title."
Definitions
SECTION 9. Section 12-37-220(B)(32)(7) of the 1976 Code is amended to read:
"(7) 'distribution facility' has the meaning provided pursuant to Section 12-6-3360(M)(8)."
Tax credit for increased port cargo volume
SECTION 10.A. Section 12-6-3375 of the 1976 Code, as added by Act 124 of 2005, is amended to read:
"Section 12-6-3375. (A)(1) A taxpayer engaged in manufacturing, warehousing, or distribution which uses port facilities in this State and which increases its port cargo volume at these facilities by a minimum of five percent in a single calendar year over its base year port cargo volume is eligible to claim a tax credit in the amount determined by the Coordinating Council for Economic Development (council).
(2) The maximum amount of tax credits allowed to all qualifying taxpayers pursuant to this section may not exceed eight million dollars for each calendar year. A qualifying taxpayer may not receive more than one million dollars for each calendar year except as provided in subsection (B)(2). The council has sole discretion in allocating credits provided by this section, taking into consideration the following factors:
(a) the amount of base year port cargo volume;
(b) the total and percentage increase in port cargo volume;
(c) the number of qualifying taxpayers;
(d) the type of cargo transported; and
(e) other factors related to the economic benefit of the State, as determined by the council.
(3) If the credit exceeds the taxpayer's tax liability for the taxable year, the excess amount may be carried forward and claimed against income taxes in the next five succeeding taxable years.
(4) The credit may be claimed by the taxpayer as provided in (A)(1) only if the taxpayer owns the cargo at the time the port facilities are used.
(B)(1) For every year in which a taxpayer claims the credit, the taxpayer shall submit an application to the council by March first of the calendar year after the calendar year in which the increase in port cargo volume occurs. The taxpayer shall attach a schedule to the taxpayer's application to the council with the following information and information requested by the council or the department:
(a) a description of how the base year port cargo volume and the increase in port cargo volume was determined;
(b) the amount of the base year port cargo volume;
(c) the amount of the increase in port cargo volume for the taxable year stated both as a percentage increase and as a total increase in net tons of noncontainerized cargo and TEUs of cargo, including information which demonstrates an increase in port cargo volume in excess of the minimum amount required to claim the tax credits pursuant to this section;
(d) any tax credit utilized by the taxpayer in prior years; and
(e) the amount of tax credit carried over from prior years.
(2) If on March fifteenth of each year, the eight-million-dollar amount of credit is not fully allocated among qualifying taxpayers, then those taxpayers who have been allocated the maximum one million dollar credit for a year must be allowed a pro rata share of the remaining allocated credit up to eight million dollars.
(3) To receive the credit the taxpayer shall claim the credit on its income tax return in a manner prescribed by the department. The department may require a copy of the certification form issued by the council be attached to the return or otherwise provided.
(C) As used in this section:
(1) 'TEU' means a 'twenty-foot equivalent unit'; a volumetric measure based on the size of a container twenty feet long by eight feet wide by eight feet, six inches high.
(2) 'Base year port cargo volume' initially means the total amount of net tons of noncontainerized cargo or TEUs of cargo actually transported by way of a waterborne ship through a port facility during the period from January 1, 2005, through December 31, 2005. Base year port cargo volume must be at least seventy-five net tons of noncontainerized cargo or ten TEUs for a taxpayer to be eligible for the credits provided in this section. For a taxpayer that does not ship that amount in the year ending December 31, 2005, including a taxpayer who locates in South Carolina after December 31, 2005, its base cargo volume will be measured by the initial January first through December thirty-first calendar year in which it meets the requirements of seventy-five net tons of noncontainerized cargo or ten loaded TEUs. Base year port cargo volume must be recalculated each calendar year after the initial base year.
(3) 'Port facility' means any publicly or privately owned facility located within this State through which cargo is transported by way of a waterborne ship or vehicle to or from destinations outside this State and which handles cargo owned by third parties in addition to cargo owned by the port facility's owner.
(4) 'Port cargo volume' means the total amount of net tons of noncontainerized cargo or containers measured in twenty-foot equivalent units (TEUs) of cargo transported by way of a waterborne ship or vehicle through a port facility.
(D) Notwithstanding Section 12-54-240, the department and the Department of Commerce may exchange information submitted by a taxpayer pursuant to this section."
B. Section 12-54-240(B) of the 1976 Code, as last amended by Act 145 of 2005, is further amended by adding an appropriately numbered item at the end to read:
"( ) exchange of information between the department and the Department of Commerce pursuant to Section 12-6-3375."
C. This section takes effect upon approval by the Governor and applies to tax years beginning after December 31, 2004.
Tax credit for tuition payment
SECTION 11.A. Section 12-6-3385(A) of the 1976 Code is amended to read:
"(A)(1) A student is allowed a refundable individual income tax credit equal to twenty-five percent, not to exceed eight hundred fifty dollars in the case of four-year institutions and twenty-five percent, not to exceed three hundred fifty dollars in the case of two-year institutions for tuition paid an institution of higher learning or a designated institution as provided in this section during a taxable year. The amount of the tax credit claimed up to the limits authorized in this section for any taxable year may not exceed the amount of tuition paid during that taxable year.
(2)(a) Tuition credits may not be claimed for more than four consecutive years after the student enrolls in an eligible institution.
(b) The credit period is suspended for a qualifying student required to withdraw from an institution of higher learning to serve on active military duty if the service member re-enrolls in an eligible institution within twelve months upon demobilization and provides official documentation from the Armed Forces to verify the dates of active duty military service.
(c) An extension of the credit period may be granted due to medical necessity as defined by the Commission on Higher Education.
(3) The credit may be claimed by the student or by an individual eligible to claim the student as a dependent on his federal income tax return, whoever actually paid the tuition. The department shall prescribe a form for claiming the credit."
B. This section takes effect upon approval by the Governor and applies to qualifying students required to withdraw from a qualifying institution to serve on active military duty on or after January 1, 2000.
Tax credit for rehabilitation expenses
SECTION 12.A. Section 12-6-3535(A) of the 1976 Code, as last amended by Act 138 of 2005, is amended to read:
"(A) A taxpayer who is allowed a federal income tax credit pursuant to Section 47 of the Internal Revenue Code for making qualified rehabilitation expenditures for a certified historic structure located in this State is allowed to claim a credit against income taxes imposed by Sections 12-6-510 and 12-6-530 and license fees imposed by Chapter 20 of Title 12. For the purposes of this section, 'qualified rehabilitation expenditures' and 'certified historic structure' are defined as provided in the Internal Revenue Code Section 47 and the applicable treasury regulations. The amount of the credit is ten percent of the expenditures that qualify for the federal credit. To claim the credit allowed by this subsection, the taxpayer must attach to the return a copy of the section of the federal income tax return showing the credit claimed, along with any other information that the Department of Revenue determines is necessary for the calculation of the credit provided by this subsection."
B. Section 12-6-3535(C)(2) of the 1976 Code, as last amended by Act 138 of 2005, is amended to read:
"(2) The credit earned pursuant to this section by an 'S' corporation owing corporate level income tax must be used first at the entity level. Remaining credit passes through to each shareholder in a percentage equal to each shareholder's percentage of stock ownership. The credit earned pursuant to this section by a general partnership, limited partnership, limited liability company, or other entity taxed as a partnership must be passed through to its partners and may be allocated among partners, including without limitation, an allocation of the entire credit to one partner, in a manner agreed by the partners that is consistent with Subchapter K of the Internal Revenue Code. As used in this item the term 'partner' means a partner, member, or owner of an interest in the pass-through entity, as applicable."
C. This section takes effect upon approval by the Governor and applies to tax years beginning in 2006.
Composite corporate income tax return
SECTION 13.A. Section 12-6-5030(B) of the 1976 Code, as last amended by Act 145 of 2005, is further amended to read:
"(B)(1) A composite return is a single return for two or more taxpayers having the same tax year in which each participant's share of the partnerships or 'S' Corporation's tax is computed separately and added together to arrive at the total tax due on the composite return. The partnership or 'S' Corporation may elect to determine each participant's tax due by one of the following methods:
(a) for a participant who provides an affidavit to the department through the entity stating that he has no income other than the income from the entity:
(i) compute the participant's South Carolina income tax using the pro rata share of the standard deduction or itemized deductions and personal exemptions for each participant pursuant to Section 12-6-1720(2) in the same manner as if it were being separately reported; or
(ii) compute the participant's South Carolina income tax without regard to any deductions or exemptions in the same manner as if it were being separately reported; or
(b) for a participant who does not provide an affidavit to the department through the entity stating that he has no income other than the income from the entity, compute each participant's share of South Carolina income tax without regard to deductions or exemptions by using the active trade or business income rate provided in Section 12-6-545 on his active trade or business income, and using the highest marginal rate in Section 12-6-510 for other income.
(2) The composite return is signed by an authorized partner, an authorized officer of the 'S' Corporation, or an authorized member of a limited liability company taxed as a partnership or 'S' Corporation."
B. This section takes effect upon approval by the Governor for taxable years beginning after 2005.
Job development tax credits
SECTION 14. Section 12-10-80(D)(2) of the 1976 Code, as last amended by Act 399 of 2000, is further amended to read:
"(2) The amount that may be claimed as a job development credit by a qualifying business is limited by this subsection and by the revitalization agreement. The council may approve a waiver of ninety-five percent of the limits provided in item (1) for a qualifying business making a significant capital investment as defined in Section 12-44-30(7)."
Tax on hospitals
SECTION 15. Section 12-23-810 of the 1976 Code is amended to read:
"Section 12-23-810. (A) Every hospital licensed as a general hospital by the Department of Health and Environmental Control is subject to the payment of an excise, license, or privilege tax. Each hospital's tax must be based on the total expenditures of each hospital as a percentage of total hospital expenditures statewide.
(B) [Reserved].
(C) Total annual revenues from the tax, exclusive of penalties and interest, in subsection (A) of this section initially must equal two hundred sixty-four million dollars. The amount of a general hospital's tax must be derived from Schedule B, Part 1 of the hospital's cost report. The initial annual tax must be collected, beginning July 1, 2006, based upon the reconciled account of a general hospital subject to this article, considering partial payments and an uncollected portion of the previous assessment pursuant to this article for the fiscal year ending June 30, 2006. Upon notification from the Department of Revenue, on behalf of and based on calculations performed by the Department of Health and Human Services, a general hospital shall remit the balance due based on a payment schedule as determined by the Department of Health and Human Services."
Tax on hospitals
SECTION 16. Section 12-23-830 of the 1976 Code is amended to read:
"Section 12-23-830. (A) On the first day of each quarter, each general hospital shall remit one-fourth of its annual tax to the Department of Revenue. The tax must be paid for each quarter a hospital is in operation. If a hospital ceases operations, the taxes not paid as a result of the cessation of operations must be apportioned among other hospitals in operation.
(B) Beginning July 1, 2006, on the first day of each quarter, a general hospital shall remit to the Department of Revenue one-fourth of a second, and each successive, annual tax as calculated pursuant to subsection (A), based upon operations conducted during fiscal year ending June 30, 2007, and each successive state fiscal year. The tax must be paid for each quarter a hospital is in operation. If a hospital ceases operation, the taxes unpaid as a result of the cessation of operation, must be apportioned among other hospitals remaining in operation."
Tax on hospitals; use of revenues
SECTION 17. Section 12-23-840 of the 1976 Code is amended to read:
"Section 12-23-840. Revenues derived under the provisions of this article must be deposited in the Medicaid Expansion Fund created by Section 44-6-155. In addition to the purposes specified in Section 44-6-155, monies in the Medicaid Expansion Fund must be used to provide health care coverage to the Medicaid-eligible and uninsured populations in South Carolina."
Definitions; motor fuel subject to the user fee
SECTION 18.A. Items (15), (39), (55), (61), and (62), as last amended by Act 69 of 2003, all of Section 12-28-110 of the 1976 Code, are amended to read:
"(15) 'Diesel fuel' means a liquid, including biodiesel and a biodiesel blend that is commonly or commercially known or sold as a fuel that is suitable for use in a diesel-powered highway vehicle. A liquid meets this requirement if, without further processing or blending, the liquid has practical and commercial fitness for use in the propulsion engine of a diesel-powered highway vehicle. However, a liquid does not possess this practical and commercial fitness solely by reason of its possible or rare use as a fuel in the propulsion engine of a diesel-powered highway vehicle. 'Diesel fuel' does not include jet fuel if the buyer is registered to purchase jet fuel subject to federal taxes applicable to jet fuel and the seller obtains certification of that fact satisfactory to the Internal Revenue Service before making the sale.
(39) 'Motor fuel' means gasoline, diesel fuel, substitute fuel, and blended fuel.
(55) 'Motor fuel subject to the user fee' means gasoline, diesel fuel, kerosene, blended fuel, substitute fuel, and blends of them and any other substance blended with them.
(61) 'Transport truck' means a semitrailer or trailer combination rig designed or used to transport liquid motor fuel over the highways.
(62) 'Transporter' means a person engaged in the business of transporting motor fuels subject to the user fee."
B. Section 12-28-110 of the 1976 Code, as last amended by Act 69 of 2003, is further amended by adding at the end:
"(69) 'Substitute fuel' means a liquid that is commonly and commercially known or sold as a fuel that is suitable for use in a highway vehicle. The fuel meets this requirement if, without further processing or blending, the fuel is a fluid and has practical and commercial fitness for use in the propulsion of a highway vehicle. This includes all liquids regardless of temperature or pressure.
(70) 'Biodiesel' means a fuel composed of mono-alkyl esters of long chain fatty acids generally derived from vegetable oils or animal fats, commonly known as B100, that is commonly and commercially known or sold as a fuel that is suitable for use in a highway vehicle. The fuel meets this requirement if, without further processing or blending, the fuel is a fluid and has practical and commercial fitness for use in the propulsion of a highway vehicle.
(71) 'Biodiesel blend' means a blend of biodiesel fuel with petroleum based diesel fuel, commonly designated Bxx where xx represents the volume percentage of biodiesel fuel in the blend (for example B20 is 20 percent biodiesel, 80 percent petro diesel), and that is commonly and commercially known or sold as a fuel that is suitable for use in a highway vehicle. The fuel meets this requirement if, without further processing or blending, the fuel is a fluid and has practical and commercial fitness for use in the propulsion of a highway vehicle."
C. Section 12-28-310(A) of the 1976 Code, as last amended by Act 161 of 2005, is further amended to read:
"(A) Subject to the exemptions provided in this chapter, a user fee of sixteen cents a gallon is imposed on:
(1) all gasoline, gasohol, or blended fuels containing gasoline that are used or consumed for any purpose in this State; and
(2) all diesel fuel, substitute fuels, or alternative fuels, or blended fuels containing diesel fuel that are used or consumed in this State in producing or generating power for propelling motor vehicles."
D. Section 12-28-330 of the 1976 Code, as last amended by Act 161 of 2005, is further amended to read:
"Section 12-28-330. The department considers it a rebuttable presumption, subject to proof of exemption pursuant to Article 7 of this chapter, that all motor fuel subject to the user fee removed from a terminal in this State, or imported into this State other than by a bulk transfer within the bulk transfer terminal system or delivered into an end user's storage tank, is to be used or consumed in this State, in the case of gasoline, gasohol, or blended fuels containing gasoline and is to be used or consumed on the highways in this State in producing or generating power for propelling motor vehicles in the case of all other motor fuel."
E. Section 12-28-790(C) and (D) of the 1976 Code is amended to read:
"(C) To facilitate efficient administration and instead of the individual refund procedures, the department may provide by regulation an alternative election by the applicant for a refund by way of credit against state income tax liability."
F. Section 12-28-970(A) of the 1976 Code, as last amended by Act 69 of 2003, is further amended to read:
"(A) A backup user fee equal to the user fee imposed by Section 12-28-310 is imposed and must be administered in accordance with procedures established by the department on the use on the highways of motor fuel subject to the user fee by an end user, including operators of state and local government vehicles, American Red Cross vehicles, and buses, and other persons exempted from the full federal highway tax, unless the person is exempted otherwise under Section 12-28-710(A)(12), upon the delivery in this State into the fuel supply tank of a highway vehicle of:
(1) diesel fuel that contains a dye;
(2) motor fuel subject to the user fee on which a claim for refund has been made;
(3) alternative fuels; or
(4) substitute fuel on which a user fee previously has not been imposed by this chapter."
G. Section 12-28-970 of the 1976 Code, as last amended by Act 69 of 2003, is further amended by adding:
"(C)(1) A back-up user fee equal to the user fee imposed by Section 12-28-310 is imposed on a liquid or gas that is not otherwise taxed pursuant to this chapter and that is commonly or commercially known or sold as a fuel suitable for use in a highway vehicle. The user fee is due upon the first receipt of the product when received from a source outside of South Carolina by any wholesaler, retailer, or end-user and the user fee is imposed upon, and is the liability of, the wholesaler, retailer, or end-user who first received the product into the State.
(2) A back-up user fee equal to the user fee imposed by Section 12-28-310 is imposed on any liquid or gas that is not otherwise taxed pursuant to this chapter and that is commonly or commercially known or sold as a fuel suitable for use in a highway vehicle. The user fee is due upon the first sale or use of the product when produced in this State by a person and the user fee is imposed upon the first in-state sale or use by that person. The user fee is imposed upon, and is the liability of, the producer of the product."
H. Section 12-28-975(A) and (C) of the 1976 Code, as last amended by Act 69 of 2003, is further amended to read:
"(A) If an exporter diverts motor fuel subject to the user fee removed from a terminal in this State from an intended destination outside South Carolina as shown on the terminal-issued shipping papers to a destination within this State, the exporter, in addition to compliance with the notification provided for by Section 12-28-780, shall notify and pay the user fee imposed by Section 12-28-310 to the State upon the same terms and conditions as if the exporter were an occasional importer licensed under Section 12-28-905(A) without deduction for the allowances provided by Section 12-28-960.
(C) If an unlicensed importer diverts motor fuel subject to the user fee from a destination outside this State to a destination inside this State after having removed the product from a terminal outside South Carolina, the importer, in addition to compliance with the notification provided for by Section 12-28-1525, shall notify the State and shall pay the user fee imposed by this chapter to South Carolina upon the same terms and conditions as if the unlicensed importer were a licensed occasional importer subject to Section 12-28-905(A) without deduction for the allowances provided by Section 12-28-960."
I. Section 12-28-990 of the 1976 Code, as last amended by Act 69 of 2003, is further amended to read:
"Section 12-28-990. (A) A person (i) blending materials including blendstocks, additives, and fuel grade ethanol on which the user fee has not been paid, with motor fuels subject to the user fee for which the user fee has been paid or accrued; or (ii) manufacturing or otherwise producing a substitute fuel or diesel fuel, unless dye was added in a manner that conforms to federal requirements established by the Internal Revenue Code and regulations exempting the product from the motor fuel tax pursuant to Section 12-28-710(11) shall remit the user fee imposed by this chapter.
(B) A fuel vendor subject to the user fee under subsection (A) shall remit the user fee with the report required pursuant to Section 12-28-1390(B).
(C) A person other than a fuel vendor liable for the user fee payable pursuant to subsection (A) shall remit the user fee directly to the department within thirty days of the blending or manufacturing event in accordance with procedures established by the department.
(D) A person subject to the user fee payable pursuant to subsection (A) must be licensed by the department as a blender or a manufacturer."
J. Section 12-28-1120 of the 1976 Code, as last amended by Act 69 of 2003, is further amended to read:
"Section 12-28-1120. A transporter who is not licensed as a supplier shall obtain a transporter's license before transporting motor fuel subject to the user fee. The registration fee for a transporter's license is fifty dollars."
K. Section 12-28-1370(A) of the 1976 Code, as last amended by Act 69 of 2003, is further amended to read:
"(A) A person licensed as a transporter in this State engaged in interstate commerce shall file monthly reports with the department, on forms prescribed and furnished by the department, concerning the amount of motor fuel subject to the user fee transported from a point outside this State to a point inside South Carolina, from a point inside this State to a point outside South Carolina, or between two points in this State."
L. This section takes effect July 1, 2006.
Excise tax on sale of liquor by the drink
SECTION 19.A. Section 12-33-245(A) of the 1976 Code, as last amended by Act 139 of 2005, is further amended to read:
"(A)    In addition to taxes imposed pursuant to the provisions of Sections 12-33-230, 12-33-240, Article 5 of this chapter, and Chapter 36, Title 12, there is imposed an excise tax equal to five percent of the gross proceeds of the sales of alcoholic liquor by the drink for on-premises consumption in an establishment licensed for sales pursuant to Article 5, Chapter 6, Title 61 or at a location holding a temporary license or permit that authorizes the sale of liquor by the drink. All proceeds of this excise tax must be deposited to the credit of the general fund of the State. Except with respect to the distribution of the revenue of this tax, this excise tax is considered to be imposed pursuant to Chapter 36, Title 12. For purposes of this subsection, 'gross proceeds of sales' has the meaning as provided in Section 12-36-90, except that the sales tax imposed under Chapter 36, Title 12 is not included in 'gross proceeds of sales'. The term 'gross proceeds of sales' also includes, but is not limited to, the retail value of a complimentary or discounted beverage containing alcoholic liquor, an amount charged for ice for a drink containing alcoholic liquor, and an amount charged for a nonalcoholic beverage that is sold or used as a mixer for a drink containing alcoholic liquor. This section does not apply to nonprofit organizations that are issued a temporary permit to allow possession, sale, and consumption of alcoholic liquors pursuant to Section 61-6-510 or subarticle 5, Article 5, Chapter 6, Title 61."
B. Chapter 6, Title 61 of the 1976 Code is amended by adding:
"Section 61-6-720. Notwithstanding any other provision of this title, a person who operates in this State a bakery for the preparation of food items, in which food items alcoholic beverages are used as ingredients, and which food items are manufactured for and sold at wholesale, must apply for a special bakery food manufacturer's license from the department, in accordance with Section 61-2-100, to purchase the alcoholic beverages from a wholesaler licensed pursuant to Section 61-6-100(2), or from a retailer licensed pursuant to Section 61-6-100(3), or from a manufacturer in containers holding greater quantities of alcoholic liquor than wholesalers or retailers have authority to sell. The department must establish the form of the application for the special bakery food manufacturer's license. The license fee for this biennial license is one thousand dollars. Alcoholic liquor purchased pursuant to this section may only be used in the preparation of food items. The department must revoke the special bakery food manufacturer's license of any operator which permits the consumption of alcoholic liquor as a beverage of liquor purchased pursuant to this section or which transfers alcoholic liquor purchased pursuant to this section to any other person."
Sales not subject to the sales tax
SECTION 20.A. Section 12-36-90(2) of the 1976 Code, as last amended by Act 139 of 2005, is further amended by adding an appropriately lettered item at the end to read:
"( ) tangible personal property purchased by a person engaged in the business of servicing a warranty, maintenance, or similar service contract for use in replacing a defective part under the contract if tax was paid on the sale or the renewal of the contract and the customer is not charged for labor or material when the part is replaced."
B. This section takes effect October 1, 2005.
Transactions subject to the sales tax
SECTION 21.A. Section 12-36-910(B) of the 1976 Code, as last amended by Act 161 of 2005, is further amended by adding an appropriately numbered item to read:
"( ) gross proceeds accruing or proceeding from the sale or renewal of warranty, maintenance, or similar service contracts for tangible personal property, whether or not the contracts are purchased in conjunction with the sale of tangible personal property."
B. This section takes effect October 1, 2005.
Exemptions from the sales tax
SECTION 22. Section 12-36-2120(51) of the 1976 Code, as last amended by Act 399 of 2000, is further amended to read:
"(51) material handling systems and material handling equipment used in the operation of a distribution facility or a manufacturing facility including, but not limited to, racks used in the operation of a distribution facility or a manufacturing facility and either used or not used to support a facility structure or part of it. To qualify for this exemption, the taxpayer shall notify the department before the first month it uses the exemption and shall invest at least thirty-five million dollars in real or personal property in this State over the five-year period beginning on the date provided by the taxpayer to the department in its notices. The taxpayer shall notify the department in writing that it has met the thirty-five million dollar investment requirement or, after the expiration of the five years, that it has not met the thirty-five million dollar investment requirement. The department may assess any tax due on material handling systems and material handling equipment purchased tax-free pursuant to this item but due the State as a result of the taxpayer's failure to meet the thirty-five million dollar investment requirement. The running of the periods of limitations for assessment of taxes provided in Section 12-54-85 is suspended for the time period beginning with notice to the department before the taxpayer uses the exemption and ending with notice to the department that the taxpayer either has met or has not met the thirty-five million dollar investment requirement."
Exemptions from the sales tax
SECTION 23.A. Section 12-36-2120 of the 1976 Code, as last amended by Act 164 of 2005, is further amended by adding an appropriately numbered item at the end to read:
"( ) the sale or renewal of a warranty, maintenance, or similar service contract for tangible personal property if the sale or purchase of the tangible personal property covered by the contract is exempt or excluded from the tax imposed by this chapter."
B. This section takes effect October 1, 2005.
Suspension of driving privileges
SECTION 24. Section 12-37-2740 of the 1976 Code, as added by Act 101 of 2001, is amended to read:
"Section 12-37-2740. (A) The Department of Motor Vehicles shall suspend the driver's license and vehicle registration of a person who fails to pay personal property tax on a vehicle. The request to suspend must be an electronic notification from the county treasurer of the county in which the tax is delinquent. Before the electronic notification is sent to the Department of Motor Vehicles, the county treasurer shall notify the delinquent taxpayer of the pending suspension by letter. The letter must be developed by the county treasurers in conjunction with the Department of Motor Vehicles and used uniformly throughout the State. The letter must advise the person of the pending suspension and the steps necessary to prevent the suspension from being entered on the person's driving and registration records. A county must allow thirty days for the payment of taxes before the county notifies the Department of Motor Vehicles to suspend the person's driver's license and vehicle registration.
(B) Notwithstanding the provisions of Sections 56-1-460 and 56-9-500, a charge of driving under suspension if the suspension is solely for failure to pay property taxes or the reinstatement fee required for the property tax suspension does not require proof of financial responsibility. A person is not subject to a custodial arrest solely for being under suspension pursuant to provisions contained in this section. Upon conviction:
(1) For a first offense under this section, the penalty is a fine not to exceed fifty dollars.
(2) For a second offense under this section, the penalty is a fine not to exceed two hundred fifty dollars.
(3) For a third or subsequent offense under this section, the penalty is a fine not to exceed five hundred dollars, or imprisonment not to exceed thirty days, or both.
(C) Notwithstanding the provisions of subsections (A) and (B) of this section or the provisions of Section 56-1-460, a charge of driving under suspension issued solely as a result of this section must be dismissed if the person provides proof on the person's court date that the personal property taxes on the vehicle which resulted in the charge being issued have been paid.
(D) Before the reinstatement of a driver's license or vehicle registration suspended pursuant to this section, a fee of fifty dollars must be paid to the Department of Motor Vehicles. The Department of Motor Vehicles may retain revenues generated by payment of the reinstatement fees pursuant to this section for use in defraying costs associated with suspension and reinstatement actions pursuant to this section. Fees collected in excess of actual departmental direct costs related to suspension and reinstatement actions pursuant to this section must be deposited to the credit of the general fund of the State at the end of each fiscal year."
Suspension of driving privileges
SECTION 25. Section 12-37-2890 of the 1976 Code, as added by Act 161 of 2005, is amended to read:
"Section 12-37-2890. (A) Upon request by the Department of Revenue, and after the time period for all appeals of tax due is exhausted, the Department of Motor Vehicles shall suspend the driver's license and vehicle registration of a person that fails to file or pay a motor carrier property tax on a vehicle, pursuant to this article. The request to suspend must be an electronic notification from the Department of Revenue to the Department of Motor Vehicles. Before notification is sent to the Department of Motor Vehicles, the Department of Revenue shall notify the delinquent taxpayer by certified letter of the pending suspension and of the steps necessary to prevent the suspension from being entered on the taxpayer's driving and registration records. The department shall allow thirty days for payment of taxes before notifying the Department of Motor Vehicles to suspend the driver's license and vehicle registration.
(B) Notwithstanding the provisions of Sections 56-1-460 and 56-9-500, a charge of driving under suspension when the suspension is solely for failure to file or pay a motor carrier property tax or the reinstatement fee required for the property tax does not require proof of financial responsibility. A person is not subject to a custodial arrest solely for being under suspension pursuant to this section. Upon conviction of a violation of this section, the taxpayer is subject to:
(1) for a first offense a fine not to exceed fifty dollars;
(2) for a second offense a fine not to exceed two hundred fifty dollars; and
(3) for a third or subsequent offense under this section, the penalty is a fine not to exceed five hundred dollars or imprisonment not to exceed thirty days, or both.
(C) Notwithstanding the provisions of subsections (A) and (B) of this section or the provisions of Section 56-1-460, a charge of driving under suspension issued solely as a result of this section must be dismissed if the taxpayer provides proof on the taxpayer's court date that the personal property taxes on the vehicle which resulted in the charge being issued have been paid.
(D) Before the reinstatement of a driver's license or vehicle registration suspended due to a violation of this section, a fee of fifty dollars must be paid to the Department of Motor Vehicles. The Department of Motor Vehicles may retain revenues generated by payment of the reinstatement fees pursuant to this section for use in defraying costs associated with suspension and reinstatement actions pursuant to this section. Fees collected in excess of actual departmental direct costs related to suspension and reinstatement actions pursuant to this section must be deposited to the credit of the general fund of the State at the end of each fiscal year."
Classification of property
SECTION 26. Section 12-43-335(C) of the 1976 Code, as last amended by Act 69 of 2003, is further amended to read:
"(C) For the purpose of assessing property of railroads, private carlines, airlines, water, power, telephone, cable television, sewer and pipeline companies, as provided in Section 12-4-540(A), the department shall follow the Sector 22 classification of the most recent North American Industry Classification System Manual, as follows:
(1) Sector 482;
(2) Sector 485, except subsectors 4851, 48521, 48531, 48541, 4859, and 488490;
(3) Sector 424, except subsectors 48411, 48422, 492, 493, and 488490;
(4) Sector 483, except subsectors 48311, 483113, 483211, and 483114;
(5) Sector 481, except subsectors 4812 and 48811;
(6) Sector 486;
(7) Sector 51, except subsectors 51511 and 51512;
(8) Sector 22, except subsectors 56292, 562211, 562212, 562213, 562219, 488119, 56291, 56171, 562998, 22133, and 22131."
Penalties for understatement of taxes owed
SECTION 27.A. Section 12-54-155 of the 1976 Code is amended to read:
"Section 12-54-155. (A)(1) If there is an underpayment attributable to either a substantial understatement of tax for a taxable period or a substantial valuation misstatement, there must be added to the tax an amount equal to twenty-five percent of the amount of the underpayment.
(2) This section does not apply to a portion of an underpayment attributable to fraud on which a penalty is imposed pursuant to Section 12-54-43(G).
(3) This section does not apply to a portion of an underpayment on which a penalty for underpayment of property tax on business-related property is imposed pursuant to Section 12-54-43(L).
(B)(1)(a) For purposes of this section, there is a substantial understatement of tax for a taxable period if the amount of the understatement for the taxable period exceeds the greater of ten percent of the tax required to be shown on the return for the taxable period or five thousand dollars.
(b) In the case of a corporation other than an 'S' Corporation or a personal holding company, as defined in Internal Revenue Code Section 542, item (1) must be applied by substituting 'ten thousand dollars' for 'five thousand dollars'.
(2)(a) For purposes of item (1), 'understatement' means the excess of the amount of the tax required to be shown on the return for the taxable period over the amount of the tax imposed which is shown on the return.
(b) The amount of the understatement under subitem (a) must be reduced by that portion of the understatement which is attributable to the tax treatment of an item: (i) by the taxpayer if there is or was substantial authority for that treatment, or (ii) with respect to which the relevant facts affecting the item's tax treatment are adequately disclosed in the return or in a statement attached to the return and there is a reasonable basis for the tax treatment of the item by the taxpayer. For purposes of subsection (B)(2)(b)(ii) a corporation must not be treated as having a reasonable basis for its tax treatment of an item attributable to a multiple-party financing transaction if the treatment does not clearly reflect the income of the corporation. For purposes of this paragraph, the words 'substantial authority' and 'adequately disclosed' must be interpreted in accordance with Treasury Regulation Section 1.6662-4 as of the date on which the Internal Revenue Code is applied to state tax laws pursuant to Section 12-6-40.
(c)(i) Subitem (b) does not apply to an item attributable to a tax shelter.
(ii) For purposes of subsubitem (i), 'tax shelter' means:
(A) a partnership or other entity;
(B) an investment plan or arrangement; or
(C) another plan or arrangement if the principal purpose of the partnership, entity, plan, or arrangement is the avoidance or evasion of income tax.
(C) For purposes of this section, there is a substantial valuation misstatement if the:
(1) value of property or the adjusted basis of property claimed on a return of tax imposed in Title 12 is two hundred percent or more of the amount determined to be the correct amount of the valuation or adjusted basis; or
(2)(a) price for property or services for use of property claimed on the return in connection with a transaction between persons described in Internal Revenue Code Section 482 is two hundred percent or more, or fifty percent or less, of the amount determined pursuant to Section 482 to be the correct amount of the price; or
(b) net Internal Revenue Code Section 482 transfer price adjustment for the taxable year exceeds the lesser of five million dollars or ten percent of the taxpayer's South Carolina gross receipts.
(D)(1) A penalty must not be imposed pursuant to this section with respect to a portion of an underpayment if it is shown that there was a reasonable cause for the portion and that the taxpayer acted in good faith with respect to the portion. For purposes of this item, the words 'reasonable cause' and 'good faith' must be interpreted in accordance with Treasury Regulation Section 1.6664-4 as of the date on which the Internal Revenue Code is applied to state tax laws pursuant to Section 12-6-40.
(2) In the case of underpayment attributable to a substantial valuation misstatement with respect to charitable deduction property, item (1) does not apply if:
(a) the claimed value of the property was based on a qualified appraisal made by a qualified appraiser; and
(b) in addition to obtaining the appraisal, the taxpayer made a good faith investigation of the value of the contributed property.
(3) For purposes of this subsection, the term 'charitable deduction property' means property contributed by the taxpayer in a contribution for which a deduction was claimed under Internal Revenue Code Section 170. For purposes of item (2) the term does not include securities for which as of the date of the contribution, market quotations are readily available on an established securities market.
(E) As used in this section, 'Internal Revenue Code' refers to the Internal Revenue Code as applied to state tax laws pursuant to Section 12-6-40."
B. This section takes effect upon approval by the Governor and applies for tax periods beginning after December 31, 2006.
Definitions
SECTION 28. Section 12-60-30(10) of the 1976 Code, as last amended by Act 69 of 2003, is further amended to read:
"(10) 'Department determination' means the final determination within the department from which a person may request a contested case hearing before the Administrative Law Court."
Refund claims by taxpayers
SECTION 29.A. Section 12-60-470(C) of the 1976 Code, as last amended by Act 69 of 2003, is further amended to read:
"(C)(1) Only the taxpayer legally liable for the tax may file a claim for refund or receive a refund, except that:
(a) a person who acts as a collector and remitter of state taxes may claim a credit or refund of the tax collected, but only if the person establishes that he has paid the tax in question to the State; and
(i) repaid the tax to the person from whom he collected it; or
(ii) obtained the written consent of the person from whom he collected the tax to the allowance of the credit or refund;
(b) a purchaser who has paid sales tax to a retailer for a specific transaction may claim a refund if the retailer who paid the sales tax to the State has assigned, in writing, the right to a refund of that sales tax to the purchaser.
(2) The taxpayer legally liable for the tax may assign a refund to another person only after the taxpayer's claim is allowed, the amount of the refund is finally decided, and the department has approved the refund. The assignment must be in writing.
(3) A credit card or debit card issuer may claim a refund on behalf of a foreign mission or a foreign diplomat for purchases exempt from the sales and use tax imposed pursuant to Chapter 36 of this title as a result of treaties signed by the United States if the: (i) credit card or debit card issuer is authorized by the United States Department of State to participate in a diplomatic tax exemption program allowing the card or card issuer to seek refunds in accordance with procedures established by the United States Department of State; (ii) sale to the foreign mission or foreign diplomat qualifies as exempt under treaties signed by the United States; (iii) Department of Revenue approves the refund; and (iv) credit or debit card issuer credits the foreign mission's or foreign diplomat's credit card or debit card account to reflect the issuance of the refund.
(4) The provisions of Section 12-60-490 also apply to a person claiming or receiving a refund pursuant to this section, except for a credit card or debit card issuer seeking a sales and use tax refund on behalf of a foreign mission or foreign diplomat pursuant to subsection (C)(3) above. A refund may be issued only after the application of Section 12-60-490 against the taxpayer legally liable for the tax and, if applicable, against another person claiming or receiving the refund pursuant to this subsection.
(5) In case of a claim for refund filed by, or a refund assigned to, a person other than the taxpayer legally liable for the tax, the department may advise the person who filed the claim or who was assigned the refund that, if applicable, the refund was reduced or eliminated as a result of taxes owed by the taxpayer legally liable for the tax and the application of Section 12-60-490 and the amount by which the refund was reduced by taxes owed by the taxpayer legally liable for the tax."
B. This section takes effect July 1, 2006.
SECTION 30. Sections 12-4-770 and 12-36-530 of the 1976 Code are repealed.
Determining donative intent
SECTION 31. Section 12-6-5590(E) and (F) of the 1976 Code, as added by Act 145 of 2005, is amended to read:
"(E) The department shall examine the substance, rather than merely the form, of the contribution and related and surrounding transactions, and may use the step transaction, economic reality, quid pro quo, personal benefit, and other judicially developed doctrines in determining whether the requisite donative intent is present."
Release of lien filed in error
SECTION 32. Section 12-58-160(B) of the 1976 Code, as added by Act 76 of 1995, is amended to read:
"(B) When the department releases a lien erroneously filed, notice of that fact must be mailed to the taxpayer and upon the request of the taxpayer, a copy of the release must be forwarded to the major credit reporting companies. Submission of data under this section does not constitute a violation of Section 30-2-50."
Homestead exemption for 65 years and older, disabled, or blind
SECTION 33. The fourth paragraph of Section 12-37-250 of the 1976 Code is amended to read:
"When any person who was entitled to a homestead tax exemption under this section dies or any person who was not sixty-five years of age or older, blind, or disabled on or before December thirty-first preceding the application period, but was at least sixty-five years of age, blind, or disabled at the time of his death and was otherwise entitled dies and the surviving spouse acquires complete fee simple title or a life estate to the dwelling place within nine months after the death of the spouse, the dwelling place is exempt from real property taxes to the same extent and obtained in accordance with the same procedures as are provided for in this section for an exemption from real property taxes so long as the spouse remains unmarried and the dwelling place is utilized as the permanent home and legal residence of the spouse. A surviving spouse who disposes of the dwelling place and acquires another residence in this State for use as a dwelling place may apply for and receive the exemption on the newly acquired dwelling place. The spouse shall inform the county auditor of the change in address of the dwelling place."
Taxing of boats with a situs in this State; heavy equipment rental surcharge
SECTION 34.A. Chapter 37, Title 12 of the 1976 Code is amended by adding:
"Section 12-37-714. In addition to any other provisions of law subjecting boats and boat motors to property tax in this State:
(1) A boat, including its motor if separately taxed, used in interstate commerce having a tax situs in this State and at least one other state is subject to property tax in this State. The value of such a boat must be determined based on the fair market value of the boat multiplied by a fraction representing the number of days present in this State. The fraction is determined by dividing the number of days the boat was present in this State by three hundred and sixty-five days. A boat used in interstate commerce must be physically present in this State for thirty days in the aggregate in a property tax year to become subject to ad valorem taxation.
(2) A boat, including its motor if the motor is separately taxed, which is not currently taxed in this State and is not used exclusively in interstate commerce, is subject to property tax in this State if it is present within this State for sixty consecutive days or for ninety days in the aggregate in a property tax year. Upon written request by a tax official, the owner must provide documentation or logs relating to the whereabouts of the boat in question. Failure to produce requested documents creates a rebuttable presumption that the boat in question is taxable within this State."
B. Article 5, Chapter 37 of Title 12 of the 1976 Code is amended by adding:
"Section 12-37-717. The provisions of Section 56-31-50 as to the imposition of a surcharge on a rental contract for certain motor vehicles applies in the same manner to the rental of heavy equipment by a person in the business of renting heavy equipment to the public, mutatis mutandis, except that the rate is three percent. For the purposes of this section, 'heavy equipment' means vehicles weighing more than three thousand pounds or heavy equipment that is rented without an operator by persons engaged in the heavy equipment business, which equipment or vehicles may be used for construction, mining, industrial, or forestry purposes, including, but not limited to, bulldozers, earthmoving equipment, material handling equipment, well drilling machinery and equipment, and cranes."
Official may void a tax sale
SECTION 35. Section 12-51-150 of the 1976 Code is amended to read:
"Section 12-51-150. In the case that the official in charge of the tax sale discovers before a tax title has passed, the failure of any action required to be properly performed, the official may void the tax sale and refund the amount paid, and the actual interest earned, to the successful bidder. If the full amount of the taxes, assessments, penalties, and costs have not been paid, the property must be brought to tax sale as soon as practicable."
Tax credit for ethanol or biodiesel production
SECTION 36.A. Article 25, Chapter 6, Title 12 of the 1976 Code is amended by adding:
"Section 12-6-3600. (A) For taxable years beginning after 2006, and before 2014, there is allowed a credit against the tax imposed pursuant to this chapter for any ethanol or biodiesel facility which is in production at the rate of at least twenty-five percent of its name plate design capacity for the production of ethanol or biodiesel, before denaturing, on or before December 31, 2009. The facility must be placed in use after 2006. The credit equals twenty cents a gallon of ethanol or biodiesel produced and is allowed for sixty months beginning with the first month for which the facility is eligible to receive the credit and ending not later than December 31, 2014. The credit only may be claimed if the ethanol or biodiesel facility maintains an average production rate of at least twenty-five percent of its name plate design capacity for at least six months after the first month for which it is eligible to receive the credit.
(B) As used in this section:
(1) 'Ethanol facility' means a plant or facility primarily engaged in the production of ethanol or ethyl alcohol derived from grain components, coproducts, or byproducts;
(2) 'Biodiesel facility' means a plant or facility primarily engaged in the production of vegetable or animal based fuels used as a substitute for diesel fuel; and
(3) 'Name plate design capacity' means the original designed capacity of an ethanol or biodiesel facility. Capacity may be specified as bushels of grain ground or gallons of ethanol or biodiesel produced a year.
(C) An ethanol or biodiesel facility eligible for a tax credit under subsection (A) of this section also shall receive a credit against the tax imposed pursuant to this chapter the amount of twenty cents a gallon of ethanol or biodiesel produced in excess of the original name plate design capacity which results from expansion of the facility completed after 2006 and before 2009. The tax credit is allowed for sixty months beginning with the first month for which production from the expanded facility is eligible to receive the tax credit and ending not later than 2014.
(D)(1) Pursuant to this chapter, beginning January 1, 2014, an ethanol or biodiesel facility must receive a credit against the tax imposed in the amount of seven and one-half cents a gallon of ethanol or biodiesel, before denaturing, for new production for a period not to exceed thirty-six consecutive months.
(2) For purposes of this subsection, 'new production' means production which results from a new facility, a facility which has not received credits before 2014, or the expansion of the capacity of an existing facility by at least two million gallons first placed into service after 2014, as certified by the design engineer of the facility to the Department of Revenue.
(3) For expansion of the capacity of an existing facility, 'new production' means annual production in excess of twelve times the monthly average of the highest three months of ethanol or biodiesel production at an ethanol or biodiesel facility during the twenty-four-month period immediately preceding certification of the facility by the design engineer.
(4) Credits are not allowed pursuant to this subsection for expansion of the capacity of an existing facility until production is in excess of twelve times the three-month average amount determined pursuant to this subsection during any twelve-consecutive month period beginning no sooner than January 1, 2014.
(5) The amount of a credit granted pursuant to this section based on new production must be approved by the Department of Revenue based on the ethanol or biodiesel production records as may be necessary to reasonably determine the level of new production.
(E)(1) The credits described in this section are allowed only for ethanol or biodiesel produced at a plant in this State at which all fermentation, distillation, and dehydration takes place. Credit is not allowed for ethanol or biodiesel produced or sold for use in the production of distilled spirits.
(2) Not more than twenty-five million gallons of ethanol or biodiesel produced annually at an ethanol or biodiesel facility is eligible for the credits in subsections (A) and (C) of this section, and the credits only may be claimed by a producer for the periods specified in subsections (A) and (C) of this section.
(3) Not more than ten million gallons of ethanol or biodiesel produced during a twelve-consecutive month period at an ethanol or biodiesel facility is eligible for the credit described in subsection (D) of this section, and the credit only may be claimed by a producer for the periods specified in subsection (D) of this section.
(4) Not more than one hundred twenty-five million gallons of ethanol or biodiesel produced at an ethanol or biodiesel facility by the end of the sixty-month period set forth in subsection (A) or (C) of this section is eligible for the credit under the subsection. An ethanol or biodiesel facility which receives a credit for ethanol or biodiesel produced under subsection (A) or (C) of this section may not receive a credit pursuant to subsection (D) of this section until its eligibility to receive a credit under subsection (A) or (C) of this section has been completed.
(F) The Department of Revenue shall prescribe an application form and procedures for claiming credits under this section.
(G) For purposes of ascertaining the correctness of any application for claiming a credit allowed pursuant to this section, the Department of Revenue may examine or cause to have examined, by any agent or representative designated for that purpose, any books, papers, records, or memoranda bearing upon these matters."
B.1. Article 25, Chapter 6, Title 12 of the 1976 Code is amended by adding:
"Section 12-6-3610. (A) As used in this section, renewal fuel means liquid nonpetroleum based fuels that can be placed in motor vehicle fuel tanks and used as a fuel in a highway vehicle. It includes all forms of fuel commonly or commercially known or sold as biodiesel and ethanol.
(B) A taxpayer that constructs and installs and places in service in this State a qualified commercial facility for distribution or dispensing renewable fuel is allowed a credit equal to twenty-five percent of the cost to the taxpayer against the taxpayer's liability for a tax imposed pursuant to this chapter constructing and installing the part of the distribution facility or dispensing facility, including pumps, storage tanks, and related equipment, that is directly and exclusively used for distribution, dispensing, or storing renewable fuel. A facility is qualified if the equipment used to store, distribute, or dispense renewable fuel is labeled for this purpose and clearly identified as associated with renewable fuel. The entire credit may not be taken for the taxable year in which the facility is placed in service but must be taken in three equal annual installments beginning with the taxable year in which the facility is placed in service. If, in one of the years in which the installment of a credit accrues, the portion of the facility directly and exclusively used for distributing, dispensing, or storing renewable fuel is disposed of or taken out of service, the credit expires and the taxpayer may not take any remaining installment of the credit. The unused portion of an unexpired credit may be carried forward for not more than ten succeeding taxable years.
(C) A taxpayer that constructs and places in service in this State a commercial facility for processing renewable fuel is allowed a credit equal to twenty-five percent of the cost to the taxpayer of constructing and equipping the facility. The entire credit may not be taken for the taxable year in which the facility is placed in service but must be taken in seven equal annual installments beginning with the taxable year in which the facility is placed in service. If, in one of the years in which the installment of a credit accrues, the facility with respect to which the credit was claimed is disposed of or taken out of service, the credit expires and the taxpayer may not take any remaining installment of the credit. The unused portion of an unexpired credit may be carried forward for not more than ten succeeding taxable years.
(D) A taxpayer that claims any other credit allowed under this article with respect to the costs of constructing and installing a facility may not take the credit allowed in this section with respect to the same costs."
B.2. Section 12-6-3610 of the 1976 Code, as added by this section, is repealed effective for facilities placed in service after 2011.
B.3. Notwithstanding the general effective date of this act, this section takes effect upon approval of this act by the Governor and applies for facilities placed in service after 2006.
C.1. Section 12-28-110(39) of the 1976 Code is amended to read:
"(39) 'Motor fuel' means gasoline, diesel fuel, renewable fuel, and blended fuel."
C.2. Section 12-28-110 of the 1976 Code is amended by adding at the end:
"(69) 'Biodiesel' means vegetable or animal based fuels used as a substitute for diesel fuel.
(70) 'Renewable fuel' means liquid nonpetroleum based fuels that can be placed in vehicle fuel tanks and used as a fuel in a highway vehicle. It includes all forms of fuel commonly or commercially known or sold as biodiesel and ethanol."
D. Section 12-28-990(A) of the 1976 Code, as last amended by Act 69 of 2003, is further amended to read:
"(A) Each person blending materials on which the user fee has not been paid including blendstocks, additives, and renewable fuels with motor fuels subject to the user fee as to which the user fee has been paid or accrued shall remit the user fee imposed by this chapter."
E. Except where otherwise provided, this section takes effect upon approval by the Governor.
Tax credit for installation of solar energy heating or cooling system
SECTION 37.A. Article 25, Chapter 6, Title 12 of the 1976 Code is amended by adding:
"Section 12-6-3587. (A) There is allowed as a tax credit against the income tax liability of a taxpayer imposed by this chapter an amount equal to twenty-five percent of the costs incurred by the taxpayer in the installation of a solar energy heating or cooling system, or both, in a building owned by the taxpayer. The tax credit allowed by this section must not be claimed before the completion of the installation, and must be claimed for the year that the costs are incurred. The amount of the credit may not exceed three thousand five hundred dollars or fifty percent of the taxpayer's tax liability for that taxable year, whichever is less. If the amount of the credit exceeds three thousand five hundred dollars, the taxpayer may carry forward the excess for up to ten years.
(B) 'System' includes all controls, tanks, pumps, heat exchangers, and other equipment used directly and exclusively for the conversion of solar energy for heating or cooling. The term 'system' does not include any land or structural elements of the building such as walls and roofs or other equipment ordinarily contained in the structure."
B. This section takes effect upon approval by the Governor and applies to installation costs incurred in taxable years beginning on or after January 1, 2006.
Tax credit for use of methane gas taken from a landfill
SECTION 38. Article 25, Chapter 6, Title 12 of the 1976 Code is amended by adding:
"Section 12-6-3620. (A) For taxable years beginning after 2006, there is allowed a tax credit against the tax imposed pursuant to Section 12-6-530 for twenty-five percent of the costs incurred by a taxpayer for use of methane gas taken from a landfill to provide power for a manufacturing facility.
(B) The tax credit allowed by this section may not exceed fifty percent of the liability of the taxpayer for the tax imposed pursuant to Section 12-6-530. Unused credits may be carried forward for ten years.
(C) For purposes of this section, manufacturing facility is as defined in Section 12-6-3360(M)(5)."
Boat taxed as a residence
SECTION 39.A. Section 12-37-224 of the 1976 Code, as added by Act 114 of 1999, is amended to read:
"Section 12-37-224. A motor home on which the interest portion of indebtedness is deductible pursuant to the Internal Revenue Code as an interest expense on a qualified primary or second residence is also a primary or second residence for purposes of ad valorem property taxation in this State and is considered real property rather than personal property for property tax purposes. By ordinance, the governing body of a county may extend the provisions of this section to a boat that meets the same qualifications required for motor homes pursuant to this section."
B. Article 5, Chapter 37, Title 12 of the 1976 Code is amended by adding:
"Section 12-37-712. In addition to any other provisions of law subjecting boats and boat motors to property tax in this State:
(1) A boat, including its motor if separately taxed, used in interstate commerce having a tax situs in this State and at least one other state is subject to property tax in this State. The value of such a boat must be determined based on the fair market value of the boat multiplied by a fraction representing the number of days present in this State. The fraction is determined by dividing the number of days the boat was present in this State by three hundred and sixty-five days. A boat used in interstate commerce must be physically present in this State for thirty days in the aggregate in a property tax year to become subject to ad valorem taxation.
(2) A boat, including its motor if the motor is separately taxed, which is not currently taxed in this State and is not used exclusively in interstate commerce, is subject to property tax in this State if it is present within this State for sixty consecutive days or on ninety days in the aggregate in a property tax year. Upon written request by a tax official, the owner must provide documentation or logs relating to the whereabouts of the boat in question. Failure to produce requested documents creates a rebuttable presumption that the boat in question is taxable within this State."
C. This section takes effect upon approval by the Governor and applies for property tax years beginning after 2005.
Redevelopment fees
SECTION 40. Section 12-10-88(B) of the 1976 Code is amended to read:
"(B) The department shall remit the redevelopment fees during the period described in subsection (C) for each calendar quarter for which the redevelopment authority provides the department with a timely statement from the federal employer that employs the employees working at the closed or realigned military installation setting forth the number of employees employed at the installation, the total wages paid to these employees, and the total amount of South Carolina withholding withheld from the employees for each quarter. In order to receive the redevelopment fees for the applicable quarter, the redevelopment authority shall submit the statement within thirty days of the later of the date that the federal employer's South Carolina withholding tax return is due or the date the federal employer files the withholding tax return. The department may extend the time for submission of the statement at its discretion."
General exemptions from taxes
SECTION 41. Section 12-37-220(B)(45), as added by Act 69 of 2003, is amended to read:
"(45) a private passenger motor vehicle leased by a member of the armed forces of the United States stationed in this State when that service member's home of record is in another state and the leased vehicle is registered in South Carolina."
Income tax
SECTION 42. Section 12-6-545 of the 1976 Code is amended by adding an appropriately lettered item at the end to read:
"( ) An income tax credit available to offset taxes due pursuant to Section 12-6-510 also apply against taxes imposed by this section."
Tax credit for conservation contributions
SECTION 43. Section 12-6-3515(B)(1)(c) of the 1976 Code, as added by Act 145 of 2005, is amended to read:
"(c) No credit is allowed pursuant to this section unless the contribution meets the requirements of Section 170 of the Internal Revenue Code, this section, and Section 12-6-5590. Property used for or associated with the playing of golf, or is planned to be so used or associated, is not eligible for the credits allowed by this section."
Execution and delivery of tax title
SECTION 44. Section 12-51-130 of the 1976 Code, as last amended by Act 238 of 2006, is further amended to read:
"Section 12-51-130. Upon failure of the defaulting taxpayer, a grantee from the owner, a mortgagee, a judgment creditor, or a lessee of the property to redeem realty within the time period allowed for redemption, the person officially charged with the collection of delinquent taxes, within thirty days or as soon after that as possible, shall make a tax title to the purchaser or the purchaser's assignee. Delivery of the tax title to the clerk of court or register of deeds is considered 'putting the purchaser, or assignee, in possession'. The tax title must include, among other things, the name of the defaulting taxpayer, the name of any grantee of record of the property, the date of execution, the date the realty was posted and by whom, and the dates each certified notice was mailed to the party or parties of interest, to whom mailed and whether or not received by the addressee. The successful purchaser, or assignee, is responsible for the actual cost of preparing the tax title plus documentary stamps necessary to be affixed and recording fees. The successful purchaser, or assignee, shall pay the amounts to the person officially charged with the collection of delinquent taxes before delivery of the tax title to the clerk of court or register of deeds and, upon payment, the person officially charged with the collection of delinquent taxes is responsible for promptly transmitting the tax title to the clerk of court or register of deeds for recording and remitting the recording fee and documentary stamps cost. If the tax sale of an item produced more cash than the full amount due in taxes, assessments, penalties, and costs, the overage must be applied to any outstanding municipal tax liens on the property. Any remaining overage belongs to the owner of record immediately before the end of the redemption period to be claimed or assigned according to law. These sums are payable ninety days after execution of the deed unless a judicial action is instituted during that time by another claimant. If neither claimed nor assigned within five years of date of public auction tax sale, the overage shall escheat to the general fund of the governing body. Before the escheat date unclaimed overages must be kept in a separate account and must be invested so as not to be idle and the governing body of the political subdivision is entitled to the earnings for keeping the overage. On escheat date the overage must be transferred to the general funds of the governing body."
Access to marina records
SECTION 45. Section 12-37-712 of the 1976 Code, as added by Act 145 of 2005, is amended to read:
"Section 12-37-712. A marina must provide immediate access to its business records and premises to city, county, and state tax authority employees for the purpose of making a property tax assessment. For the purposes of this section, 'marina' means a facility that provides mooring or dry storage for watercraft on a leased or rental basis, and 'business records' means only the name and billing address of the person leasing or renting space for a boat in a marina, as well as the make, model, and year, if available."
Temporary liquor permit
SECTION 46. Section 61-6-510 of the 1976 Code, as added by Act 415 of 1996, is amended to read:
"Section 61-6-510. (A) The department may issue a temporary permit to allow the possession, sale, and consumption of alcoholic liquors. This permit is valid for a period not to exceed twenty-four hours, and may be issued only to bona fide nonprofit organizations that have been in existence and operating for at least twelve months before the date of application, to nonprofit educational foundations, and to political parties and their affiliates duly certified by the Secretary of State. The department must charge a nonrefundable filing fee of thirty-five dollars for processing each application. The department in its discretion must specify the terms and conditions of the permit. For purposes of this section, 'nonprofit organization' means an organization not open to the general public, but with a limited membership and established for social, benevolent, patriotic, recreational, or fraternal purposes.
(B) The department may require the applicant to obtain a criminal background check conducted by the State Law Enforcement Division within thirty days prior to an initial application. Background checks for subsequent applications are not required unless the officers of the nonprofit organization change."
Temporary liquor license for nonprofit
SECTION 47. Section 61-6-2000 of the 1976 Code, as last amended by Act 139 of 2005, is further amended to read:
"Section 61-6-2000. (A) In addition to the licenses authorized pursuant to the provisions of subarticle 1 of this article, the department also may issue a temporary license for a period not to exceed twenty-four hours to a nonprofit organization which authorizes an organization to purchase and sell at a single social occasion alcoholic liquors by the drink. Notwithstanding another provision of this article, the issuance of this permit authorizes the organization to purchase alcoholic liquors from licensed retail dealers in the same manner that a person with a biennial license is issued pursuant to the provisions of subarticle 1 of this article are authorized to make these purchases. The fee for the permit is thirty-five dollars payable at the time of application. The permit application must include a statement by the applicant as to the amount of alcoholic liquors to be purchased and the nature and date of the social occasion at which they are to be sold. The issuance or nonissuance of permits authorized pursuant to the provisions of this section is within the discretion of the department.
(B) The department may require the applicant to obtain a criminal background check conducted by the State Law Enforcement Division within thirty days prior to an initial application. Background checks for subsequent applications are not required unless the officers of the nonprofit organization change."
Targeted job tax credit
SECTION 48.A. Section 12-6-3360(A) of the 1976 Code, as last amended by Act 332 of 2002, is further amended to read:
"(A) Taxpayers that operate manufacturing, tourism, processing, warehousing, distribution, research and development, corporate office, qualifying service-related facilities, extraordinary retail establishment, and qualifying technology intensive facilities are allowed an annual job tax credit as provided in this section. In addition, taxpayers that operate retail facilities and service-related industries qualify for an annual jobs tax credit in counties designated as least developed or distressed. Credits under this section may be claimed against income taxes imposed by Section 12-6-510 or 12-6-530, and insurance premium taxes imposed pursuant to Chapter 7 of Title 38, and are limited in use to fifty percent of the taxpayer's South Carolina income tax, insurance premium tax liability. In computing any tax payable by a taxpayer under Section 38-7-90, the credit allowable under this section must be treated as a premium tax paid under Section 38-7-20."
B. Section 12-6-3360(M) of the 1976 Code, as last amended by Act 157 of 2005, is further amended by adding at the end:
"(15) 'Extraordinary retail establishment' as defined in Sections 12-21-6520 and 12-21-6590."
C. Section 12-21-6520 of the 1976 Code is amended by adding:
"(14) 'Tourism or recreational facility' also means an aquarium or natural history exhibit or museum located within or directly contiguous to an extraordinary retail establishment as defined below. An extraordinary retail establishment is a single store located in a county with at least three and one-half million visitors a year, and it must be a destination retail establishment which attracts at least two million visitors a year with at least thirty-five percent of those visitors traveling at least fifty miles to the establishment. The extraordinary retail establishment must have a capital investment of at least twenty-five million including land, buildings and site prep, and one or more hotels must be built to service the establishments with three years of occupancy. Only establishments which receive a certificate of occupancy after July 1, 2006, qualify. The Department of Parks, Recreation and Tourism shall determine and annually certify whether a retail establishment meets these criteria and its judgment is conclusive. The extraordinary retail establishment annually must collect and remit at least two million in sales taxes but is not required to collect or remit admission taxes."
D. Chapter 21 of Title 12 is amended by adding:
"Section 12-21-6590. The Department of Parks, Recreation and Tourism may designate no more than four extraordinary retail establishments as defined in Section 12-21-6520(14), and for purposes of this section, sales taxes must be substituted for admissions taxes wherever admission tax appears in this Tourism Infrastructure Admissions Tax Act. For purposes of this section, additional infrastructure improvements include any aquarium or natural history exhibits or museum located within or directly contiguous to the extraordinary retail establishment which are dedicated to public use and enjoyment under such terms and conditions as may be required by the municipality or county in which they are located. Additional infrastructure improvements shall also include site prep, construction of real or personal property, parking, roadways, ingress and egress, utilities and other expenditures on the extraordinary retail establishment which directly support or service the aquarium or natural history museum or exhibits. The certification application made under this section must be executed by both the extraordinary retail establishment as well as the county or municipality."
Tax sale of a mobile or manufactured home; notice; forms
SECTION 49.A. Article 9, Chapter 49 of Title 12 of the 1976 Code, as added by Act 238 of 2006, is amended by adding:
"Section 12-49-1190. When a mobile or manufactured home is levied upon for taxes by the tax collector, the tax collector shall give at least forty-five days' written notice before the date of the tax sale to lienholders by following the procedures provided in Section 12-49-1220, except as otherwise provided in Section 12-49-1220(D). The period of forty-five days begins to run from the time the notice is delivered personally or from the date of its mailing. The notice must contain a description of the mobile or manufactured home levied upon, including the year, make or model, size and serial number, the name of the owner, the address and zip code where the mobile or manufactured home is located, the year or years for which the taxes were assessed, and a statement of the amount of the taxes with the accrued costs. The notice must be delivered to the lienholders, either personally or by certified mail with return receipt requested, at the addresses obtained by the tax collector by following the procedures provided for in Section 12-49-1220. If delivered personally, the tax collector shall obtain a signed receipt from the lienholder. Although a separate notice must be prepared for each mobile or manufactured home to be sold, a tax collector may enclose in the same package or envelope multiple notices to be given to the same lienholder at the same address.
Section 12-49-1200. (A) Except as provided in subsection (B), the form of the notice required by Section 12-49-1190 must be substantially as follows:
'DELINQUENT TAXES
NOTICE TO LIENHOLDER
Notice is given to ________________as the holder of a certain lien on the mobile or manufactured home below described, that there are now due and unpaid taxes for the year(s) ________________ in the amount of $___________ with accrued costs of $ ___________ for which a tax execution has been issued and levy made upon the described home owned by __________________________. The home will be sold unless the taxes are paid within forty-five days from delivery of this notice as provided by law.
Description of Mobile or Manufactured Home Levied Upon
___________________________________________________
Make or Model of Mobile or Manufactured Home
___________________________________________________
Year of Home and Full Serial Number
___________________________________________________
Owner's Name and Address
___________________________________________________
Tax Collector
___________________________________________________
Address
___________________________________________________
Date _____________________.'
(B) For liens created before January 1, 1995, the form of the notice required by Section 12-49-1190 must be substantially as follows:
'DELINQUENT TAXES
NOTICE TO LIENHOLDER
Notice is given to ________________as the holder of a certain lien on the mobile or manufactured home below described, that there are now due and unpaid taxes for the year(s) ________________ in the amount of $___________ with accrued costs of $ ___________ for which a tax execution has been issued and levy made upon the described home owned by __________________________. The home will be sold unless the taxes are paid within forty-five days from delivery of this notice as provided by law.
Description of Collateral
___________________________________________________
Vin Number
___________________________________________________
Owner's Name and Address
___________________________________________________
Tax Collector
___________________________________________________
Address
___________________________________________________
Date _____________________.'
Section 12-49-1210. The tax collector shall keep a record of each notice given pursuant to Section 12-49-1190 which must contain the date the notice was delivered, the method of delivery, the address to which the notice was delivered, and the name of the addressee of the notice.
Section 12-49-1220. (A) In providing the notice of levy and sale required in Section 12-49-1190 relating to mobile or manufactured homes, the tax collector shall comply with the procedures provided for in subsections (B) or (C) and (D). This section does not require the tax collector to send more than one notice of levy to a single lienholder at the same mailing address that is revealed multiple times by compliance with the different procedures provided for in this section. If a single lienholder's name at different mailing addresses is revealed or would have been revealed by compliance with the procedures provided pursuant to this section, notice of levy must be sent to the lienholder at all these mailing addresses.
(B) For liens created before January 1, 1995, the tax collector shall provide the notice of levy and sale to the lienholders contained on the certificate of title issued by the department. To obtain the name and address of the lienholders, the tax collector shall either: (a) forward to the department a form provided below requesting the name and address of all lienholders shown on the certificate of title or (b) obtain from official department records the names and addresses of all lienholders shown on the certificate of title, to include the information listed on the form below. The delinquent tax collector may not sell the property without either a return of this form or official department records if records reflect the existence of a lienholder.
To the Department of ______________________:
I have been instructed by the county treasurer to levy and sell the following personal property:
Please provide me with the lienholders' name and address as shown on the certificate of title:
NAME: ________________________________________________
ADDRESS: _____________________________________________ DESCRIPTION OF COLLATERAL:_________________________
VIN NUMBER: _________________________________________
LIENHOLDER: _________________________________________
LIENHOLDERS' ADDRESS: ______________________________.
(C) For liens created on or after January 1, 1995, the tax collector shall provide the notice of levy and sale to the lienholders identified on the forms provided to the county auditor pursuant to the licensing and moving permit procedures provided for in Chapter 17 of Title 31 or official department records if the records reflect the existence of a lienholder.
(D)(1) In addition to complying with the procedures provided in either subsection (B) or (C), for tax years beginning January 1, 2007, and after that time, the tax collector shall send the notice of levy and sale required by this article to the lienholders at the addresses shown on the most current collateral list provided by the lienholders holding a lien on the mobile or manufactured home to the tax collector pursuant to Section 12-49-1230. If a lienholder's most current collateral list, including any supplement, fails to disclose to the tax collector the lienholder's lien on a home that is to be sold, the lienholder is not entitled to notice pursuant to this subsection. If the collateral lists of two or more lienholders show the same mobile or manufactured home as their collateral, all the lienholders must be notified of the tax sale.
(2) If a lienholder provides the tax collector with a supplemental collateral list as described in Section 12-49-1230(B) after July first of any given year and the tax collector intends to sell a mobile or manufactured home shown on that supplemental list for which the lienholder could not be identified properly by the tax collector's compliance with the procedures provided in subsections (B) or (C) and (D)(1), the tax collector shall give a newly identified lienholder or to a lienholder at the newly identified address, or both, the notice required by this subsection.
(a) If there are sixty-five or more days between the receipt by the tax collector of the supplemental collateral list and the date of the scheduled tax sale, the tax collector shall deliver to the newly identified lienholder or at the newly identified address, or both, the notice required by Section 12-49-1190 in the same manner and under the same timelines as provided in that section.
(b) If there are fewer than sixty-five days, but at least forty-five days between the receipt by the tax collector of the supplemental collateral list and the date of the scheduled tax sale, the tax collector shall deliver to the newly identified lienholder or at the newly identified address, or both, the notice required by Section 12-49-1190 in the same manner as required pursuant to that section, except that the notice must be given no fewer than twenty days before the date of the scheduled tax sale.
(c) If the tax sale has already occurred by the time the tax collector receives the supplemental collateral list, or if there are fewer than forty-five days between the receipt by the tax collector of the supplemental collateral list and the date of the scheduled tax sale, the tax collector is not required to deliver to the newly identified lienholder or at the newly identified address, or both, a notice pursuant to subsection (D)(2). Except to the extent that they are entitled to receive notice pursuant to subsections (B) or (C) and (D)(1), the only notice the newly identified lienholders, or known lienholders at a newly identified address, are entitled to receive pursuant to this subitem is a notice of their right of redemption pursuant to the provisions of Chapter 51 of Title 12.
Section 12-49-1230. (A) By July first of each year, each lienholder may provide a written collateral list to the tax collector of each county in which the lienholder's collateral is located. The collateral list sent to a particular county must be derived by a lienholder sorting its accounts by United States Postal Zip Codes and by sorting those zip codes by the counties that have geographical areas covered by those zip codes. The zip codes used must be those shown in the lienholder's records as the mailing addresses where the collateral is situate. For those zip codes covering geographical areas that extend into multiple counties, the collateral list sent to all counties sharing the same zip codes must contain the information required by Section 12-49-1250.
(B) Any collateral list provided by a lienholder to a tax collector after July first and no later than December thirty-first of any year is considered a supplemental collateral list for purposes of the lienholder's right to receive notice of a tax levy and sale pursuant to Section 12-49-1190 for that same calendar year.
(C) A lienholder is not required to provide to the tax collector a collateral list annually or periodically. If a particular lienholder does not provide a collateral list to the tax collector in a timely manner for the year in which the tax collector intends to sell real property on which that lienholder holds a lien, the tax collector may rely on the most current information obtained pursuant to Section 12-49-1190 including, but not limited to, a collateral list from a previous year.
Section 12-49-1240. The form of the collateral list and a supplement for mobile or manufactured homes must be substantially as follows:
Collateral List For__________________________________County
Lienholder:_____________________________________________
Address for Notice:_______________________________________
Date:__________________________________________________
Name(s) of Owner(s): Address of Home:______________________
Other Address of Owner(s):____________________