An Act to clarify the net-worth measure of the corporate excise

This bill clarifies how Massachusetts calculates the net worth of corporations for excise tax purposes. It establishes that a company's own accounting treatment of items as debt or equity will generally control, unless tax officials prove the company is not following standard accounting rules like GAAP. Additionally, the law allows tax officials to reject any reserves they deem unreasonable when determining asset values. The changes also ensure that income from foreign corporations exempt from U.S. federal taxes is included in the state's net-worth calculation. These provisions apply to all open tax years once the bill is passed.