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State Tax Credit News Briefs – September 2018

The Rhode Island Division of Taxation issued notice 2018-02 July 1, informing entities receiving specific tax credits and incentives that they must annually disclose certain information to the division. Included in the applicable tax credits and incentives are the Jobs Development Act, Distressed Areas Economic Revitalization Act and historic preservation tax credits.

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The Illinois Department of Revenue issued bulletin 2019-03 June 1 regarding the state natural disaster income tax credit extension for 2018. The extension is provided to taxpayers who sustained damages to qualified real property located in an Illinois-declared disaster area because of flooding in 2018 and who were issued a Natural Disaster Income Tax Credit Certificate from their township assessor or chief county assessment officer. The credit can be claimed against individual or business income tax for the 2017 or 2018 tax year.

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Missouri House Bill 1415 reauthorizes the Missouri Works program and the Missouri Works Training program. The programs are reinstated until Aug. 28, 2030. The Missouri Works program provides tax incentives through retained withholding taxes and refundable income and financial institutions tax credits to qualified companies. The Missouri Works Training program assists qualified companies in the training of employees in new jobs and the retraining or upgrading of skills of full-time employees in retained jobs.

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The Colorado Department of Revenue updated guidance for taxpayers taking the gross conservation easement credit. Colorado FYI Tax Publication No. Income 39 was issued June 1 and explains that if the taxpayer holds the property encumbered by the easement for less than a year before donating the easement, the value in the credit calculation is instead based on the taxpayer’s basis in the donated easement as determined pursuant to Internal Revenue Code (IRC) Section 170(e) and IRC section 170(h). In addition, for transfers made on or after June 7, 2005, but before May 29, 2018, a transferee must purchase the credit by the due date of the income tax return, not including extensions, on which the credit will be used. 

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The California Governor’s Office of Business and Economic Development (GO-Biz) issued a notice June 29 concerning application periods for fiscal year 2018-2019. Applications for the California Competes Tax Credit will be accepted online during the following periods: (1) July 30, 2018, through Aug. 20, 2018 ($70 million available); (2) Jan. 2, 2019, through Jan. 21, 2019 (amount available to be determined); and (3) March 4, 2019, through March 25, 2019 (amount available to be determined). GO-Biz also announced that the California Competes Tax Credit Committee meetings will be held Nov. 13, 2018; April 11, 2019; and June 13, 2019. 

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New Jersey Senate Bill 1968, effective June 28, extends document submission deadlines for tax credits by one year, to July 28, 2022. The tax credits are for qualified residential projects and mixed-use parking projects under the Economic Redevelopment and Growth Program in Garden State Growth Zones.

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Go-Biz issued July 24 updated frequently asked questions (FAQs) about and its application guide for the California Competes Tax Credit. FAQs were revised to reflect recent legislative changes to the credit. This includes the answer to Question 3, which now provides that the tentative amount of credits that can be allocated by Go-Biz is $180 million in each fiscal year 2018-19 through 2022-23. In addition, various questions have been revised to reflect that credits are no longer reserved for small businesses. The new Question 5 asks, “How much credit should I request?” The answer to Question 7 now includes that Go-Biz is required by statute to consider the extent to which the credit will influence the business’s ability, willingness or both, to create jobs in California that might not otherwise be created in California by the taxpayer or any other taxpayer. The new Question 8 asks and answers how a business demonstrates that ability/willingness.

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The Iowa Economic Development Authority (IEDA) announced $19.1 million in state historic tax credits (HTCs) June 29 for the preservation of 11 properties in seven communities throughout the state. IEDA received 21 applications requesting $70 million in HTCs for the May round. The next round for large projects will be late fall 2018. The list of awardees is available at www.historictaxcredits.com.

 

Journal Category:

State Tax Credits

Authors:

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