2018 Certain Machinery and Equipment Tax Law Changes

The entirety of Article 5F, Certain Machinery and Equipment, of Chapter 105 of the North Carolina General Statutes is repealed. Effective July 1, 2018, sales and purchases of qualifying mill machinery, mill machinery parts or accessories, and other items for specific industries included in Article 5F are no longer subject to the one percent (1%) privilege tax. The final Form E-500J, Machinery and Equipment Tax Return, should be filed for the month ending June 30, 2018 or the quarter ending June 30, 2018, depending on the existing filing frequency for the account number. The Department will programmatically close all active Certain Machinery and Equipment accounts as of June 30, 2018 in its system; therefore, the Form NC-BN, Outof-Business Notification, is not required to be submitted along with the final return for a filing period ending June 30, 2018.

See the sales and use tax exemptions under G.S. 105-164.13(5e) through (5n) under the Sales and Use Tax section of this publication for additional information. 

(Effective July 1, 2018, and applies to sales made on or after that date; SB 257, s. 38.8.(a), S.L. 2017-57.)

This subsection is amended to update a statutory reference and provides that “State agencies are exempted from the privilege taxes imposed by . . . Article [5F of Chapter 105 of the North Carolina General Statutes]. The exemption in G.S. 105-164.13(62) does not apply to an item used to maintain or repair tangible personal property pursuant to a service contract exempt from tax under G.S. 105-164.13(61a)a." [Emphasis added.]

(Effective June 12, 2018, S.B. 99, s. 38.5.(r), S.L. 2018-5.)

This subsection is repealed effective July 1, 2018.

(Effective July 1, 2018, and applies to sales made on or after that date; SB 257, s. 38.8.(a), S.L. 2017-57.)