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Legislation Document
SPONSOR:
Rep. Harris
HOUSE OF REPRESENTATIVES
153rd GENERAL ASSEMBLY
HOUSE AMENDMENT NO. 2
TO
HOUSE BILL NO. 364
AMEND House Bill No. 364 on line 22 by deleting “
projects,
” as it appears therein.
FURTHER AMEND House Bill No. 364 on line 73 by deleting “
$500,000
” as it appears therein and inserting in lieu thereof “
$100,000
”.
FURTHER AMEND House Bill No. 364 by deleting lines 95 through 104 in their entirety and inserting in lieu thereof the following:
“
A production company or its authorized payroll service company shall withhold Delaware income tax at the rate of 6.6% on all payments to loan-out companies for services performed in Delaware by the loan-out company's employees and shall deposit such amounts with the State of Delaware. The amounts so withheld shall be deemed to have been withheld by the loan-out company on wages paid to its employees for services performed in Delaware and shall be allocated to the loan-out company’s employees in proportion to the payments made by the loan-out company to its employees for services performed in Delaware. The production company or the authorized payroll service company which withheld payment under this section shall provide and remit such information, records, documentation, and reports as the Director of Revenue may require to identify the entity or individuals associated with such withholdings. For purposes of this chapter and notwithstanding any other provision in this chapter to the contrary, loan-out company nonresident employees performing services in Delaware shall be considered taxable nonresidents and shall be subject to income taxation in the taxable year in which the loan-out company's employees perform services in Delaware.
”.
FURTHER AMEND House Bill No. 364 after line 152 and before line 153 by inserting the following:
“
(b) Audits must include verification that all payments required to be made on behalf of a loan-out company pursuant to § 2004F of this title were timely and properly remitted and reported to the Division of Revenue, and that each loan-out company was duly licensed, registered, qualified, and otherwise authorized to conduct business in Delaware as required by Title 30.
”.
FURTHER AMEND House Bill No. 364 on line 153 by deleting “
(b)
” as it appears therein and inserting in lieu thereof “
(c)
”.
FURTHER AMEND House Bill No. 364 on line 204 by deleting “
Department
” as it appears therein and inserting in lieu thereof “
Division
”.
FURTHER AMEND House Bill No. 364 after line 207 and before line 208 by inserting the following:
“
(c) Notwithstanding any law to the contrary, the sharing of data related to payments made and records and returns filed on behalf of a loan-out company and its employees, may be shared with the Department of State and Division of Small Business.
”.
SYNOPSIS
This Amendment to HB 364 does the following:
(1) Removes the term "projects" from those activities considered qualified activities.
(2) Decreases the minimum expenditure amount for tax credit eligibility from $500,000 to $100,000.
(3) Updates the provision relating to loan-out companies and tax compliance to provide administrative clarity.
(4) Adjusts the withholding rate for loan-out companies from 6% to 6.6%.
(5) Clarifies that audits must include veritfication that all payments required on behalf of a loan-out company were timely and properly remitted and reported to the Division of Revenue, and that the loan-out company was duly licensed, registered, qualified, and otherwise authorized to conduct business in Delaware.
(6) Authorizes the sharing of data related to payments made and records and returns filed on behalf of a loan-out company and its employees with the Department of State and Division of Small Business.
(7) Makes other technical, nonsubstantive changes to conform to the Delaware Legislative Drafting Manual.