2024 Legislative Summaries
Elimination of Franchise Tax Property Measure
Public Chapter 950 eliminates the property measure from the franchise tax calculation for tax years ending on or after January 1, 2024. It also authorizes the Department of Revenue (the “Department”) to issue franchise tax refunds to eligible taxpayers who paid the franchise tax based on the property measure for tax years ending on or after March 31, 2020, for which a return was filed with the department on or after January 1, 2021.
For more information, please see the Department’s
Franchise Tax Property Measure (Schedule G) Refunds webpage here.
Effective Date: May 10, 2024
Tennessee Rural and Workforce Housing Franchise and Excise Tax Credit
Public Chapter 971 creates a Tennessee Rural and Workforce Housing Tax Credit for eligible taxpayers who receive a federal low-income housing tax credit allocation. The credit may be used against the tax liability of Tennessee franchise and excise, gross premiums tax, or retaliatory taxes. The credit may not exceed a taxpayer’s tax liability and may be apportioned to any direct member, partner, or shareholder. Any unused credit may be carried forward for 25 years.
The Tennessee General Assembly must authorize implementation of this credit before it can be administered by the Department.
Effective Date: July 1, 2025
Hydrogen Fuel Tax
Public Chapter 859 adds hydrogen gas to the definition of “alternative fuel” for the purposes of fuel tax law, subjecting hydrogen gas to the compressed natural gas tax rate, and exempts hydrogen gas from sales and use tax.
Effective Date: January 1, 2025
Alcoholic Beverage Sales on Commercial Passenger Buses
Public Chapter 926 authorizes the sale and consumption of alcoholic beverages on certain licensed commercial passenger buses during routes of 100 miles or more one-way and subjects such sales to the liquor-by-the-drink tax.
Effective Date: May 6, 2024
Minimum Liquor-by-the-Drink Bond Amount
Public Chapter 1069 requires that tax bonds for liquor-by-the-drink licensees be no less than $10,000.
Effective Date: July 1, 2024
Paper Filings Allowed for Professional Privilege Tax
Public Chapter 672 authorizes persons who are 65 years of age or older to file and remit professional privilege tax in paper form in lieu of electronic form.
Effective Date: April 11, 2024
Qualified Data Center Sales and Use Tax Exemption
Public Chapter 886 expands the definition of a “qualified data center” to include a data center that made a capital investment in excess of $100 million during an investment period of three years or less, previously created at least 15 new full-time jobs, and was transferred to an affiliate pursuant to a corporate reorganization under § 368(a) of the Internal Revenue Code.
Effective Date: May 1, 2024
Local Option Sales and Use Tax Rate on Food and Food Ingredients
Public Chapter 917 authorizes a municipality with a local option sales tax rate that exceeds its county’s local option sales tax rate to reduce or eliminate its local option sales tax rate on the retail sale of food and food ingredients by local ordinance.
If a municipality chooses to modify its rate, that modification applies only to tax periods beginning on or after October 1, 2024.
Please see the Department's important notice for more information.
Effective Date: May 3, 2024
Deadline Extension for Commercial Development District Applications
Public Chapter 920 extends the deadline by which a distressed rural county must apply for the commercial development district designation, which allows the county to retain the sales and use tax generated within the district, from December 31, 2024, to December 31, 2030.
Effective Date: May 3, 2024
Morgan County Natural Disaster Sales Tax Relief
Public Chapter 979 authorizes natural disaster sales tax refunds to individuals whose primary residence was damaged or destroyed as a result of the Morgan County tornadoes that occurred between April 1, 2024, and April 3, 2024. Claims must be filed with the Department by November 1, 2024.
Please see the Department’s important notice for more information.
Effective Date: May 21, 2024
Border Region and Regional Retail Tourism Development Districts
Public Chapter 1006 clarifies the types of costs that are ineligible for reimbursement in Border Region and Regional Retail Tourism Development Districts. Ineligible costs include travel, meals, and entertainment expenses; motor vehicle expenses; meeting expenses; office expenses; developer salaries; taxes; or commissions, fees, or other costs paid to or received from an affiliated entity.
This public chapter also requires Districts that have incurred costs in excess of $3 million to have an independent certified public accountant compile and certify the District’s summary of costs before submitting those costs to the Department for reimbursement.
Effective Date: May 28, 2024
Certification of Disability by Chiropractors
Public Chapter 519 authorizes licensed chiropractic physicians to issue a certified statement of disability, in the same manner as medical and osteopathic physicians, to accompany a person’s application for a disabled person license plate, decal, or placard.
Effective Date: March 1, 2024
Disabled Person Decal for Motorcycle License Plates
Public Chapter 520 authorizes the Department to issue disabled person decals to eligible owners or lessees of a registered motorcycle to affix to their new specialty earmarked, cultural, or other special purpose motorcycle license plate.
Effective Date: March 1, 2024
Precious Cargo Act
Public Chapter 521 expands the Precious Cargo Act of 2021, which allows the owner or lessee of a motor vehicle who needs assistance communicating needs to a first responder, or who needs assistance with exiting a motor vehicle, to request a designation of such a need on their motor vehicle registration. This public chapter expands the law to allow the owner or lessee of a motor vehicle who is the parent, legal guardian, or conservator of a person with such needs and who may be operating the owner or lessee’s vehicle, to request a designation of such needs on their motor vehicle registration.
Effective Date: January 1, 2025
Salvage Certificates of Title for Certain Unclaimed Vehicles
Public Chapter 528 authorizes the Department to issue, upon request, a lien-free salvage certificate of title to a salvage pool operator in possession of a salvage vehicle that is the subject of an insurance claim and is not picked up by the vehicle owner or lienholder after a 30-day notice period.
Effective Date: July 1, 2024
Vintage License Plates on Antique Motor Vehicles
Public Chapter 569 permits antique motor vehicle owners to display an unregistered vintage license plate on an antique motor vehicle from an era when the vehicle was manufactured while the vehicle is stationary but requires antique motor vehicle owners to display the current registered license plate on the vehicle while the vehicle is being operated on any public roadway.
Effective Date: July 1, 2024
Disabled Person Placard Verification
Public Chapter 726 requires the Department, beginning January 1, 2025, to annually verify the status of the owner of each disabled person placard and invalidate placards associated with a deceased owner.
Effective Date: April 19, 2024
Tennessee Electronic Title and Lien System
Public Chapter 745 requires the Department to procure and implement an electronic title and lien system on or before June 30, 2026.
Effective Date: April 22, 2024
New License Plates
Public Chapter 804 designates various new specialty license plates including:
- Blacksmithing
- Prince Hall Affiliated Masonic Family
- Rolling Thunder
- Historic Rutherford
- Flatrock Motorsports Park
- Volunteerism and Service
- Nashville Humane Association
- Respiratory Care
- End Overdose
- Tennessee Grocers & Convenience Store Association
- Adaptive Racing
- Ovarian Cancer Awareness
- Muse Knoxville
- Childhood Cancer Awareness
- Tennessee Ronald McDonald House Charities
- Grand Ole Opry
- The Hermitage
- Northeast State Community College
This public chapter designates new military license plates:
- Combat Action Medal
- Combat Action Ribbon, Navy and Marine Corps
- Combat Action Ribbon, Coast Guard
This public chapter changes the beneficiary of the Promote Peace specialty license plate to the Promote Peace Foundation and requires the license plate to be designed in consultation with representatives of the Madison/Goodlettsville Rotary club and the Promote Peace Foundation.
This public chapter removes the requirement for a recipient of the Duck Unlimited license plate to be a certified member of Ducks Unlimited.
In addition, this public chapter extends until July 1, 2025, the timeframe for meeting the issuance requirement of 1,000 plates for the following license plates:
- Golfer
- Niswonger Children's Hospital
- Special Olympics
- Service Dogs Changing Lives
- Historic Maury
- Tennessee Councils of the Boy Scouts of America
- Fighting for the Bullys
- University of North Carolina
- Look Twice Save a Life
- Historic Jonesborough
- Bays Mountain
- A Soldier's Child
Effective Date: July 1, 2024
Prorated Freight Motor Vehicle Registration Refund
Public Chapter 963 authorizes the Department to issue a refund of the unused prorated portion of the registration fee for freight motor vehicles operated for commercial purposes upon the death on an eligible operator of the freight motor vehicle. This refund is available to deaths of eligible operators occurring on or after June 1, 2023.
Effective Date: May 9, 2024
Unclaimed or Abandoned Motor Vehicle Portal
Public Chapter 1017 requires, among other things, the Department, on or after July 1, 2025, to establish an electronic database for law enforcement and other entities to report unclaimed or abandoned vehicle information for public notice when the owner or lienholder cannot be located or does not respond to previous notices.
This public chapter also requires the notification from police departments, garagekeepers, and tow companies to owners and lienholders of abandoned, immobile, or unattended vehicles to be sent using a nationally recognized overnight delivery carrier, other than the United States postal service, with proof of delivery.
Effective Date: July 1, 2024