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Massachusetts Agencies

Corporate Lien Waiver: Chapter 180 Corporation

Title Standard No. 66 states (Comment, paragraph 1) that the provisions of G.L.c. 62C, §51 do not apply to Chapter 180 corporations. This standard will be outdated for sales that occur in tax years beginning on or after January 1, 2009:

G.L.c. 62C, §51 (effective July 3. 2008 for tax years beginning on or after January 1, 2009) provides that any sale “otherwise than in the ordinary course of business” of all or substantially all of the assets in Massachusetts “of a business corporation as defined in section 30 of chapter 63" is subject to the excise tax.

G.L.c. 63, §30 (as effective July 3. 2008 for tax years beginning on or after January 1, 2009) defines business corporation as “any” corporation or any “other entity” as defined in G.L.c. 156D, §1.40. The term “any” corporation would include all corporations (business and nonprofit alike) and the term “other entity” is defined in §1.40 as “any association or entity” (other than enumerated corporations), “includ[ing], without limitation, limited partnerships, general partnerships, limited liability partnerships, limited liability companies, joint ventures, joint stock companies, business trusts and profit and not‑for‑profit unincorporated associations.”

The result here is that for sales of “all or substantially all” of the assets of any business entity occurring after tax years beginning after December 31, 2008 are subject to the excise tax lien, unless the sale is in the ordinary course of business.

The changes in the statute don’t affect how the excise law is applied, but rather to what entities it is applied to.