Tax Credit Calculations

On or before January 31st of the following applicable tax year, the Commissioner shall determine the following values: 29.05: continued (a) Trigger Price; (b) Farm Price; (c) Trigger Percent; (d) Total Tax Credit; (e) Dairy Farmer Tax Credit Rate; and (f) Dairy Farmer Tax Credit. (2) Trigger Price. (a) The Trigger Price shall be calculated for each month during the year and shall equal the sum of the following per hundred weight components of the monthly milk cost of production as determined by UMass, and which shall be updated annually and be made available on the Department's website: total operating costs (which shall include all feed costs, interest and other operating costs), cost of hired labor, and opportunity cost of unpaid labor. Trigger = total operating costs + hired labor + opportunity cost of unpaid labor. (b) The Commissioner shall review this formula at least every five years as circumstances permit or sooner if there are changes in the milk market that require a review of the Trigger Price calculation. (c) In the absence of the monthly milk cost of production data as determined by UMass, the Commissioner shall estimate the total operating costs, costs of hired labor, and the opportunity cost of unpaid labor; such estimates shall then be used to calculate the Trigger Price as in 330 CMR 29.05(2)(a). (3) Farm Price. (a) The Farm Price shall be equal to the Statistical Uniform Price as announced monthly by the Northeast Federal Milk Marketing Order for the Northeast Marketing Area. (b) In the absence of a timely publication by the Northeast Federal Milk Marketing Order of the Statistical Uniform Price, the Commissioner shall estimate the monthly value of the farm price. (4) Trigger Percent shall be the sum of the number of months for which the Farm Price is less than or equal to the Trigger Price divided by 12. Total Tax Credit shall be calculated by multiplying the Trigger Percent by the Total Cumulative Value of Credits, not to exceed $6 million. (6) Dairy Farmer Tax Credit Rate shall be calculated by dividing the Total Tax Credit by the Total Milk Production. (7) Dairy Farmer Tax Credit shall be calculated by multiplying the Dairy Farmer Tax Credit Rate by the number of hundredweights of the Annual Milk Production of an Eligible Taxpayer.