Adds new subdivision (23) to GS 105-134.6(b) to expand taxpayer deductions in calculating North Carolina taxable income for qualified businesses.
Recodifies GS 105-163.013 as 105-163.010A and GS 105-163.015 as 105-163.010B. Makes conforming changes to GS 105-163.010 (Definitions).
Amends the title for Part 5 of Article 4 of GS Chapter 105 (Part 5) to read, Tax Incentives (was, Credits) for Qualified Business Investments.
Amends the list of requirements in GS 105-163.010A(b) that a business must meet to be a qualified business venture to require that the business cannot have been formed for the primary purpose of acquiring any ownership interest of an existing business. Also amends the requirements for qualifying as a qualified grantee business. Provides that no credit or exclusion of gain is allowed for an investment made before the effective date of the registration as a qualified business venture or as a qualified grantee business or after either registration is revoked. Provides that application forms must be signed by the owners, a manager, or an executive officer of the business (was, for a corporation, the president, vice president, or secretary).
Extends the sunset date for Part 5 to January 1, 2016 (was, January 1, 2013). Amends GS 105-163.012 to increase the amount of total tax credits allowed under GS 105-163.011 for investments in a single calendar to be no more than $10 million (was, $7.5 million).
Enacts new GS 105-163.020 providing criteria for when an exclusion of gain from the sale of qualified securities is allowed to the taxpayer. Includes criteria relevant to pass-through entities, the recapture of credit, and qualified securities. Sets out requirements for qualified securities, including that it was originally issued by the business on or after January 1, 2012. Also provides rules regarding limitations as to contributions and exchanges of property, and transactions that substantially reduce the risk of loss.
Effective for taxable years beginning on or after January 1, 2012.
Bill H 1118 (2011-2012)Summary date: May 23 2012 - View summary