State Tax Credit News Briefs - December 2017

Monday, December 4, 2017

The Rhode Island Division of Taxation released Administrative Hearing Decision No. 2017-11, Sept. 25. The decision denied the taxpayer’s historic preservation tax credits because of the taxpayer’s failure to obtain a window contractor did not fall under the statutory and regulatory exemptions provided in the definition of remain idle or force majeure (an event that is reasonably unforeseen, outside the control of the applicant, and could not be avoided by the applicant’s exercise of due care). The project remained idle for six months, but the taxpayer contended that once the project’s window contractor went out of business, it was not able to obtain a new company until the spring. The taxpayer stated that since the windows could not be done in the winter, it was beyond the taxpayer’s control. The hearing officer determined that the failure of a window company was not an unanticipated physical condition. The decision stated that the inability of a subcontractor to perform is not a reasonably unforeseen event and the evidence did not show that there were unanticipated physical conditions. 

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The Iowa Economic Development Authority adopted amendments to the Iowa Administration Code Section 261–59.15 and 261–68.4, relating to the investment tax credit under Iowa’s high quality jobs program. The amendment to Iowa Administration Code Section 261–59.15 provides that the authority may amend an enterprise zone agreement for compliance reasons if the total award amount is not increased. The amendments to Iowa Administration Code Section 261–68.4 change the existing phrase “new investment directly related to jobs created or retained by the project” to “new investment.” The amendments were effective Nov. 15.

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The Kentucky Cabinet for Economic Development released in late October a revised Kentucky Business Investment Program fact sheet regarding the state’s business investment program credit and the list of enhanced incentive counties. The 2017-2018 enhanced incentive counties are Adair, Ballard, Bath, Bell, Boyd, Bracken, Breathitt, Breckinridge, Butler, Carlisle, Carter, Casey, Christian, Clay, Clinton, Crittenden, Cumberland, Edmonson, Elliott, Estill, Fleming, Floyd, Fulton, Grayson, Green, Greenup, Harlan, Hickman, Jackson, Johnson, Knott, Knox, Laurel, Lawrence, Lee, Leslie, Letcher, Lewis, Lincoln, Livingston, Lyon, Magoffin, Marion, Martin, Mason, McCreary, McLean, Menifee, Monroe, Montgomery, Morgan, Muhlenberg, Nicholas, Ohio, Owsley, Pendleton, Perry, Pike, Powell, Pulaski, Robertson, Rockcastle, Rowan, Russell, Taylor, Trigg, Trimble, Union, Wayne, Whitley and Wolfe. Any project located in an enhanced incentive county that has been decertified has until July 1 of the third year following the decertification to obtain final approval. Projects in June 30, 2017, decertified counties Boyle, Carroll, and Meade must have final approval by June 30, 2020. Projects in June 30, 2016, decertified enhanced incentive counties Gallatin, Garrard, Harrison, and Metcalfe must have final approval by June 30, 2019. Projects in June 30, 2015, decertified enhanced incentive counties Allen and Marshall, must have final approval by June 30, 2018. 

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