H. B. 4606
(By Delegates Campbell, Varner,
Cann, Cowles and Carmichael)
[Introduced
February 22, 2010
; referred to the
Committee on Finance.]
A BILL to amend and reenact §11-24-11b of the Code of West
Virginia, 1931, as amended, relating to the corporation net
income tax; credit for utility taxpayers with net operating
loss carryovers; and providing a different procedure for
determining the credit.
Be it enacted by the Legislature of West Virginia:
That §11-24-11b of the Code of West Virginia, 1931, as
amended, be amended and reenacted to read as follows:
ARTICLE 24. CORPORATION NET INCOME TAX.
§11-24-11b. Credit for utility taxpayers with net operating loss
carryovers.
(a)
General. -- There shall be allowed to every eligible
taxpayer a nonrefundable credit against its primary tax liability
imposed under this article for any net operating loss carryovers
that exist as of December 31, 2006.
(b) (1) "Eligible taxpayer" means any person subject to the
business and occupation taxes prescribed by article thirteen of
this chapter and exercising any privilege taxable under section
two-o of this article.
(2) "Eligible taxpayer" also includes an affiliated group of
taxpayers if:
(i) For tax years beginning on or before December 31, 2008,
the group elects to file a consolidated corporation net income tax
return under this article if one or more affiliates included in the
affiliated group would qualify as an eligible taxpayer under
subdivision (1) of this subsection;
or
(ii) For tax years beginning on or before January 1, 2009, the
group is required to file a combined corporate net income tax
return under this article if one or more affiliated included in the
affiliated group would qualify as an eligible taxpayer under
subdivision (1) of this subsection.
(c)
Amount of credit. -- The amount of credit allowed shall be
equal to one-quarter percent of the
remaining current balance of
the eligible taxpayer's West Virginia net operating loss carryovers
allowed by subsection (d), section six of this article that
exist
existed as of December 31, 2006,
decreased by the net operating
loss used or applied in each tax year beginning on or after January
1, 2007. Effective for tax years beginning on or after January 1,
2009, the amount of credit allowed shall be equal to the difference between the current year tax rate as defined by section four of
this article and nine percent of the remaining balance of the
eligible taxpayer's West Virginia net operating loss carryovers
allowed by subsection (d), section six of this article that existed
as of December 31, 2006, decreased by net operating loss used or
applied in each tax year beginning on or after January 1, 2007.
(d)
Application of credit. -- The amount of credit allowed
shall be taken against the tax liabilities of the eligible taxpayer
under this article as shown on its annual return for the
taxable
tax year in which its net operating loss carryovers are utilized,
as provided in subsection (d), section six of this article. Any
credit remaining after application against the eligible taxpayer's
tax liabilities for the current
tax year may be carried forward to
subsequent tax years until
used the tax year when the remaining
current balance of the eligible taxpayer's West Virginia net
operating loss carryovers allowed by subsection (d), section six of
this article that existed as of the December 31, 2006, decreased by
net operating loss used or applied in each tax year beginning on or
after January 1, 2007 is zero. For purposes of determining the
remaining current balance of the eligible taxpayer's West Virginia
net operating loss allowed by subsection (d), section six of this
article that existed as of December 31, 2006, decreased by net
operating loss used or applied in each tax year beginning on or
after January 1, 2007 under this section, a first in, first out, net operating loss usage computation shall apply.
NOTE: The purpose of this bill is to provide a different
procedure for determining the credit for utility taxpayers with net
operating loss carryovers relating to the corporation net income
tax.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.