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State Tax Credit News Briefs - March 2017
In early February, the Wisconsin Department of Revenue issued Publication 123, which provides information about the expiration or carryforward of Wisconsin tax incentives for taxable years beginning in 2016. The tax incentives include the community rehabilitation program credit, development zones credits, economic development tax credit, enterprise zone jobs credit, jobs tax credit and supplement to federal historic rehabilitation tax credit (HTC). The tax incentives may be available to corporations, tax-option (S) corporations, partnerships, limited liability companies and sole proprietorships doing business in Wisconsin. The information in the publication reflects the position of the department concerning laws enacted by the Wisconsin Legislature effective Dec. 31, 2016. Publication 123 is available at the Wisconsin Department of Revenue.
The Hawaii Department of Business, Economic Development and Tourism (DBEDT) issued a notice Jan. 11, informing taxpayers that it is now accepting notifications from renewable fuels producers planning to pursue Hawaii’s new renewable fuels tax credit. Taxpayers who wish to claim the credit must provide written notification to DBEDT of their intent to begin production of renewable fuels. Taxpayers are also required to file a notification 30 days before to the start of production. The bill, S. 2652 (Act 202), was signed into law in July 2016 and allows producers of renewable fuels from a variety of feedstocks to claim a renewable fuels production tax credit (PTC) for up to five consecutive years. In order to qualify, taxpayers must produce at least 15 billion British thermal units (BTU) of renewable fuels each year. The credit is equal to 20 cents per 76,000 BTU of renewable fuels and has an annual cap of $3 million per taxpayer, as well as $3 million in the aggregate. The notification forms and instructions are available at the Hawaii State Energy Office.
Preservation Virginia announced Feb. 6 that two bills that would have capped and phased down the Virginia state HTC were unanimously defeated in the state Senate finance committee in January. S.B. 1540 would have reduced the total aggregate caps of the state HTC over a period of 10 years, so that no credits would have been available beginning in 2027. S.B. 1485 would have added a sunset date of Jan. 1, 2022, to all existing tax credits that do not have a sunset date. Additionally, the state Senate amended and passed a bill (S.B. 1034) that would limit the amount of state HTCs that can be claimed by each taxpayer to $5 million per year, including any carryover amounts, for tax years beginning Jan. 1, 2017. The amendment adds a one-year sunset to S.B. 1034, so that the future implementation of the program can be discussed. All three bills can be viewed at www.historictaxcredits.com.
On Feb. 6, Oklahoma Sen. Joe Newhouse (R) introduced S.B. 556, a bill that would set a $5 million cap on the state HTC. This cap would begin in 2018. SB556 would create a formula to determine a percentage that would be applied to HTC application amounts to keep annual total below the cap. Oklahoma currently has no HTC cap and in 2015, slightly more than $17 million in credits were claimed, according to a state report. The bill is available at www.historicttaxcredits.com.