Only the tax-related portions of S.B. 704 are shown. For the full text, please view the original source PDF.
]GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2019
SESSION LAW 2020-3
SENATE BILL 704
AN ACT TO PROVIDE AID TO NORTH CAROLINIANS IN RESPONSE TO THE CORONAVIRUS DISEASE 2019 (COVID-19) CRISIS.
The General Assembly of North Carolina enacts:
PART I. ECONOMIC SUPPORT
WAIVE ACCRUAL OF INTEREST ON DEFERRED PAYMENT OF CORPORATE INCOME AND FRANCHISE TAX AND INDIVIDUAL INCOME TAX AND EXTEND CERTAIN TAX-RELATED DEADLINES
SECTION 1.1.(a) Interest Waiver. — As a result of the COVID-19 outbreak, the Secretary of Revenue has extended the franchise, corporate income, and individual income tax payment deadline from April 15, 2020, to July 15, 2020, and pursuant to G.S. 105-249.2, the Secretary will not assess a penalty for failure to file a return or pay a tax due as long as the return is filed and the tax due is paid by July 15, 2020. Notwithstanding G.S. 105-241.21(b), the Secretary of Revenue shall also waive the accrual of interest from April 15, 2020, through July 15, 2020, on an underpayment of tax imposed on a franchise, corporate income, or individual income tax return, including a partnership and estate and trust tax return, due from April 15, 2020, through July 15, 2020. The relief from accrual of interest from April 15, 2020, through July 15, 2020, also includes interest imposed pursuant to G.S. 105-163.15 and G.S. 105-163.41 for payments due on or before July 15, 2020.
SECTION 1.1.(b) Refund Request. — For franchise, corporate income, and individual income tax, the statute of limitations for obtaining a refund is extended to July 15, 2020, for refund claims for which the statute of limitations to seek a refund expires on or after April 15, 2020, and before July 15, 2020.
SECTION 1.1.(c) Time-Sensitive Actions. — Certain actions required to be taken by a taxpayer on or after April 1, 2020, and before July 15, 2020, will be considered timely if the request or petition is filed on or before July 15, 2020. This subsection applies to requests for Departmental review under G.S. 105-241.11, petitions for a contested case hearing at the Office of Administrative Hearings under Article 3 of Chapter 150B of the General Statutes and G.S. 105-241.15, and petitions for judicial review under Article 4 of Chapter 150B of the General Statutes and G.S. 105-241.16.
SECTION 1.1.(d) This section is effective when it becomes law.
FLEXIBILITY TO ADMINISTER UNEMPLOYMENT COMPENSATION AND SUTA TAX CREDIT
SECTION 1.2.(a) Chapter 96 of the General Statutes is amended by adding a new section to read:
"§ 96-14.15. Emergency unemployment benefits and tax credit to respond to the coronavirus emergency of 2020.
(a) Benefits Payable. — Unemployment benefits are payable in response to the coronavirus emergency in any of the following circumstances:
(1) An employer temporarily ceases operations due to the coronavirus, preventing the individual from going to work.
(2) An employer reduces the hours of employment due to the coronavirus.
(3) An individual has a current diagnosis of the coronavirus.
(4) An individual is quarantined at the instruction of a health care provider or a local, State, or federal official.
(b) Exceptions Allowed. — The provisions of this Chapter apply to benefits payable under this section except as follows:
(1) Waiting week. — No waiting week applies to a claim for unemployment under this section.
(2) Work search. — The work search requirements do not apply to an individual who is eligible for unemployment under this section.
(3) Non-charging. — Benefits paid to an individual under this section are not charged to the account of any base period employer of the individual.
(4) Attached claim. — An employer may file an attached claim for benefits allowed under this section. The restrictions for filing an attached claim under G.S. 96-15(a1) do not apply to an employer-filed claim under this section and a claim filed by an employer under this section is not an attached claim filed under G.S. 96-15(a1).
(c) Tax Credit. — An employer is allowed a tax credit for a contribution to the Unemployment Insurance Fund payable under G.S. 96-9.2 for contributions due for the calendar year 2020. The amount of the credit is equal to the amount of contributions payable on the report filed by the employer on or before April 30, 2020.
If an employer remitted the contributions payable with the report due on or before April 30, 2020, the credit will be applied to the contributions payable on the report due on or before July 31, 2020. An employer must file the report to receive the credit. If the amount of the credit exceeds the amount of contributions due on the report, the excess credit amount is considered an overpayment and will be refunded pursuant to G.S. 96-9.15(b).
(d) Coronavirus. — For purposes of this section, the term "coronavirus" has the same meaning as defined in section 506 of the Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020.
(e) Applicability. — This section applies for unemployment benefits filed for periods beginning on or after March 10, 2020, and expires for unemployment benefits filed for periods beginning on or after the earlier of the following: (i) the date the Governor signs an executive order rescinding Executive Order No. 116, Declaration of a State of Emergency to Coordinate Response and Protective Actions to Prevent the Spread of COVID-19, or (ii) December 31, 2020."
SECTION 1.2.(b) Notwithstanding G.S. 96-14.9, an individual may meet the reporting requirements of that section by telephone or via the Internet for the period beginning March 10, 2020, and ending on the earlier of the following: (i) the date the Governor signs an executive order rescinding Executive Order No. 116, Declaration of a State of Emergency to Coordinate Response and Protective Actions to Prevent the Spread of COVID-19, or (ii) December 31, 2020.
SECTION 1.2.(c) This section is effective when it becomes law.
CHANGES TO THE UNEMPLOYMENT INSURANCE LAWS, AS RECOMMENDED BY THE DIVISION OF EMPLOYMENT SECURITY AND THE JOINT LEGISLATIVE OVERSIGHT COMMITTEE ON UNEMPLOYMENT INSURANCE
SECTION 1.3.(a) G.S. 96-14.9(e) reads as rewritten:
"(e) Actively Seeking Work. — The Division's determination of whether an individual is actively seeking work is based upon the following:
. . .
(3) The individual has made at least three job contacts with potential employers during the week. An individual may satisfy one of the weekly job contacts by attending a reemployment activity offered by a local career center. The Division shall verify the suitability of the activity for the credit and the claimant's attendance at the activity.
. . . . "
SECTION 1.3.(b) This section becomes effective July 1, 2020.
SECTION 1.4.(a) G.S. 96-15 is amended by adding a new subsection to read:
"(a2) Federal Disaster Declaration. — An employer may file claims for employees through the use of automation in the case of unemployment due directly to a disaster covered by a federal disaster declaration."
SECTION 1.4.(b) G.S. 105-356(a) reads as rewritten:
"(a) On Real Property. — The lien of taxes imposed on real and personal property shall attach to real property at the time prescribed in G.S. 105-355(a). The priority of that lien shall be determined in accordance with the following rules:
(1) Subject to the provisions of the Revenue Act prescribing the priority of the lien for State taxes, the lien of taxes imposed under the provisions of this Subchapter shall be superior to all other liens, assessments, charges, rights, and claims of any and every kind in and to the real property to which the lien for taxes attaches regardless of the claimant and regardless of whether acquired prior or subsequent to the attachment of the lien for taxes. For purposes of this subdivision, the term "lien for State taxes" includes a lien for contributions under G.S. 96-10.
. . . ."
SECTION 1.4.(c) G.S. 120-70.158 is repealed.
SECTION 1.4.(d) This section is effective when it becomes law.
USE OF BUNCOMBE COUNTY OCCUPANCY TAX PROCEEDS
SECTION 1.5.(a) Program. — The Buncombe County Tourism Development Authority (TDA) may, from available funds credited to its Tourism Product Development Fund and without regard for the provisions typically required for the expenditure of monies in that Fund, provide up to five million dollars ($5,000,000) to an agency experienced in emergency management funding for grants to assist small businesses that have closed or been otherwise significantly affected due to the economic hardship occasioned by the COVID-19 pandemic with the costs of recommencing business activities. The following shall apply to the grants made under the program:
(1) Grants shall be available only to businesses meeting all of the following requirements:
a. Prior to January 1, 2020, the business has been engaged in Buncombe County primarily in an activity that, in the determination of the TDA, promotes tourism and patronage of lodging facilities in the county, including, at a minimum, restaurants, retail establishments, studios and galleries, visitor attractions, tours and activities, breweries, wineries, cideries, distilleries, entertainment and event venues, and other providers of food, drink, or entertainment to patrons. A business engaged, in whole or in part, in providing lodging is not eligible for a grant.
b. The business employed at least two but not more than 200 full-time equivalent employees, determined as of the state of emergency.
c. The business has, after the state of emergency, ceased and not recommenced operations as a result of demonstrable economic loss in revenue due to the COVID-19 pandemic at the time of application or can otherwise demonstrate significant economic loss and change in operations due to the COVID-19 pandemic at the time of application.
d. The business certifies in writing that it (i) will use the grant for employee compensation, inventory, mortgage, rent, utilities, and other operating costs and expenses incurred in reopening or otherwise resuming normal operations of a business and hiring employees in Buncombe County and (ii) will report on the financial condition of the business and use of funds received six months and one year following the receipt of funds.
e. The business applies for funds detailing the business's plans to recommence operations or resume normal operations following the end of the state of emergency. The plans must, to the satisfaction of the TDA, show the ongoing business concern is sustainable for at least one year.
f. The recommenced operations of the business will, in the determination of the TDA, significantly increase patronage of lodging facilities in Buncombe County.
(2) A grant provided under the program is limited to no more than fifty thousand dollars ($50,000) per business.
(3) In awarding the grant, the TDA shall (i) prioritize independently owned businesses and (ii) state, with specificity, the reasons for the determination that the recommenced operations of the business will significantly increase patronage of lodging facilities in Buncombe County.
(4) The TDA shall establish and publish a method for determining compliance with the program.
(5) The TDA shall recapture grants for noncompliance with the program if the TDA determines there is a reasonable expectation that the recovery of funds will exceed the cost of recovery.
(6) The awarding of grants made available in this section shall cease six months following the date the state of emergency ends.
(7) Every six months until six months following the date the state of emergency ends, the TDA shall submit a report on the program to the Buncombe County Board of Commissioners containing all of the following:
a. The number of recipients of grants for each represented North American Industry Classification System Code.
b. The number of jobs retained.
c. The number of grants awarded.
d. The average grant amount.
e. The total amount granted to date.
f. The number of recipients who have failed to comply with the requirements of the program and the total amount of grant funds that have been recaptured, if any.
SECTION 1.5.(b) This section is effective when it becomes law.
* * * * *
PART VI. EFFECTIVE DATE
SECTION 6. Except as otherwise provided, this act is effective when it becomes law. If House Bill 1043, 2019 Regular Session, is vetoed, this act is repealed. If the veto of House Bill 1043, 2019 Regular Session, is overridden, this act is reenacted.
In the General Assembly read three times and ratified this the 2nd day of May, 2020.
Philip E. Berger
President Pro Tempore of the Senate
Tim Moore
Speaker of the House of Representatives
Roy Cooper
Governor
Approved 11:45 a.m. this 4th day of May, 2020