HB 4162 Text

Introduced Version House Bill 4162 History

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hb4162 intr H. B. 4162

(By Delegates Guthrie, Hartman, Craig and Campbell)
[Introduced January 22, 2010; referred to the
Committee on Energy, Industry and Labor, Economic Development and Small Business then Finance.]

A BILL to amend the Code of West Virginia, 1931, as amended, by adding thereto a new section, designated §11-24-11c, relating to providing a tax credit for obtaining certain certifications by the United States Green Building Council Leadership in Energy and Environmental Design (LEED) green building rating system or the Green Globes Building Initiative green building rating standard; setting forth the amount of the credit; establishing who may take the credit; establishing the amount of the credit; establishing the criteria for taking the credit; providing rulemaking authority; and defining terms .

Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended by adding thereto a new section, designated §11-24-11c, to read as follows:
ARTICLE 24. CORPORATION NET INCOME TAX.

§11-24-11c. Credit for becoming certified by the Leadership in Energy and Environmental Design (LEED) Green Building Rating System or Green Globes Building Rating Standard.
(a) General. -- A credit shall be allowed against the tax liability of an eligible taxpayer for the cost to become certified by the United States Green Building Council Leadership in Energy and Environmental Design (LEED) green building rating system or the Green Globes Building Initiative green building rating standard .
(b) Definitions. -- For purposes of this section, the term:
(1) "Cost to become certified by the United States Green Building Council Leadership in Energy and Environmental Design (LEED) Green Building Rating System or the Green Globes Building Initiative green building rating standard " means the reasonable and necessary sums of money spent by the taxpayer in receiving that certification .
(2) "Eligible taxpayer" means either:
(A) The owner of a sawmill that has had the product the sawmill manufactured certified;
(B) The owner of timberland or a tree farm that is certified;
(C) The owner of a wood product manufacturer that has had the product the wood product manufacturer intends to sell certified; or
(D) The owner of a concentration yard that has had the product the concentration yard intends to sell certified .
(3) "Owner" means the person who is possessed of the freehold, whether in fee or for life. A person seized or entitled in fee subject to a mortgage or trust takes possession, after which such mortgagee or trustee shall be deemed the owner. A person who has an equitable estate or freehold, or is a purchaser of a freehold estate who is in possession before transfer of legal title is also deemed the owner.
(4) "Timberland" means surface real property, except farm woodlots as defined in section two, article one-c of this chapter, of not less than ten contiguous acres which is primarily in forest and which, in consideration of their size, has sufficient numbers of commercially valuable species of trees to constitute at least forty percent normal stocking of forest trees which are well distributed over the growing site.
(c) Amount of credit. -- The amount of the credit available to any eligible taxpayer shall be equal to its cost of becoming certified by the United States Green Building Council Leadership in Energy and Environmental Design (LEED) Green Building Rating System or the Green Globes Building Initiative green building rating standard , less any reimbursement of said cost which the taxpayer has received through any other means.
(d) When credit may be taken. -- An eligible taxpayer may claim a credit allowed under this section on its annual return for the taxable year in which it receives certification.
(e) Application of credit. --
(1) Corporation net income taxes. -- The credit is first applied to reduce the taxes imposed by this article for the taxable year.
(2) Business franchise tax. -- After application of subdivision (1) of this subsection, any unused credit is next applied to reduce the taxes imposed by article twenty-three of this chapter for the taxable year, determined before application of allowable credits against tax.
(3) If the eligible taxpayer is a limited liability company, small business corporation or a partnership, then any unused credit after application of subdivisions (1) and (2) of this subsection is allowed as a credit against the taxes imposed by this article on owners of the eligible taxpayer on the conduit income directly derived from the eligible taxpayer by its owners. Only those portions of the tax imposed by article twenty-four of this chapter that are imposed on income directly derived by the owner from the eligible taxpayer are subject to offset by this credit.
(A) Small business corporations, limited liability companies, partnerships and other unincorporated organizations shall allocate the credit allowed by this article among their members in the same manner as profits and losses are allocated for the taxable year.
(B) No credit is allowed under this article against any withholding tax imposed by, or payable under, article twenty-one of this chapter.
(4) Personal income tax taxes. -- After application of subdivisions (1), (2) and (3) of this subsection, any unused credit is next applied to reduce the taxes imposed by article twenty-one of this chapter for the taxable year determined before application of allowable credits against tax of the eligible taxpayer.
(5) If the eligible taxpayer is a limited liability company, small business corporation or a partnership, then any unused credit after application of subsections (1), (2), (3) and (4) of this section is allowed as a credit against the taxes imposed by article twenty-one of this chapter on owners of the eligible taxpayer on the conduit income directly derived from the eligible taxpayer by its owners. Only those portions of the tax imposed by article twenty-one of this chapter that are imposed on income directly derived by the owner from the eligible taxpayer are subject to offset by this credit.
(A) Small business corporations, limited liability companies, partnerships and other unincorporated organizations shall allocate the credit allowed by this article among their members in the same manner as profits and losses are allocated for the taxable year.
(B) No credit is allowed under this article against any withholding tax imposed by, or payable under, article twenty-one of this chapter.
(f) Unused credit carry forward. -- Any unused credit may be carried over to each of the next three taxable years following the unused credit year until used or forfeited due to lapse of time.
(g) Application for certification. -- No credit is allowed or may be applied under this section until the taxpayer seeking to claim the credit has filed a written application from the Tax Commissioner. This application shall be filed, in the form prescribed by the Tax Commissioner, no later than the last day for filing tax returns, determined by including any authorized extension of time for filing the return, required under article twenty-one or twenty-four of this chapter for the taxable year in which the certification is received, and all information required by the form shall be provided by the taxpayer.
(1) In the case of owners of eligible taxpayers described in subdivision (3) or (5), subsection (e) of this section, the application filed under this section by the limited liability company, small business corporation or partnership owned by the person is considered to be filed on behalf of the owner and no separate filing of the application is required of the owner.
(2) Form of application. -- The application must be filed in the form as the Tax Commissioner prescribes and shall contain the information as the Tax Commissioner requires to determine whether it should be approved and the taxpayer should be eligible for credit under this article.
(3) Requirements for application. -- The application shall require the attachment of a copy of the certification by the United States Green Building Council Leadership in Energy and Environmental Design (LEED) Green Building Rating System or the Green Globes Building Initiative green building rating standard and other information as the Tax Commissioner requires.
(4) Approval. -- The Tax Commissioner may approve applications if it appears to the Tax Commissioner that the applicant has met the requirements of this section and all rules and requirements applicable thereto.
(5) Failure to file. -- The failure to timely file the application for credit under this section results in forfeiture of one hundred percent of the credit otherwise allowable under this article.
(6) Failure to comply with provisions of section or rules and requirement applicable thereto. -- If a person has received approval for credit under this section from the Tax Commissioner, but fails to conform to the terms of the approval, no credit is allowed under this section by the eligible taxpayer.
(h) Transfer to successors. --
(1) Mere change in form of business. -- The successor is allowed to claim the amount of credit still available with respect to the sawmill, tree farm, timberland, wood product manufacturing facility or concentration yard transferred, and the transferor business may not be required to redetermine the amount of credit allowed in earlier years.
(2) Transfer or sale to successor. -- Upon transfer or sale, the successor shall acquire the amount of credit that remains available under this article for each subsequent taxable year and the transferor business.
(i) Cessation of operation. -- If during any taxable year the taxpayer ceases operation of the activity for which he or she obtained the certification required for the credit allowed under this section, then the unused portion of the allowed credit is forfeited for the taxable year and for all ensuing years.
(j) When recapture applies. --
(1) Any taxpayer who fails to maintain certification for the period of time over which tax credits allowed under this section the taxpayer shall pay the recapture tax imposed by subsection (k) of this subsection.
(2) This subsection does not apply when subsection (h) of this section applies. However, the successor, or the successors, and the taxpayer, who previously claimed credit under this section, are jointly and severally liable for payment of any recapture tax subsequently imposed under this section.
(k) Recapture tax imposed. --
If the taxpayer fails to maintain certification required in order to qualify for the credit, the taxpayer shall recapture the amount of credit claimed for the taxable year, and all preceding taxable years. The amount of tax due under this subsection is an amount equal to the amount of credit that is recaptured under this subdivision. The amount of tax recaptured under this subsection is due and payable on the day the taxpayer's annual return against which the credit was applied is due for the taxable year. When the employer is a partnership, limited liability company or S corporation for federal income tax purposes, the recapture tax shall be paid by those persons who are partners in the partnership, members in the company, or shareholders in the S corporation, in the taxable year in which recapture occurs under this subsection.
(l) Rules. -- The commissioner may promulgate such rules as may be useful or necessary to carry out the purpose of this section and to implement the intent of the Legislature. Rules shall be promulgated in accordance with the provisions of article three, chapter twenty-nine-a of this code.
(m) Effective date. -- The credit authorized pursuant to this section shall be available for tax years beginning on and after January 1, 2011.

NOTE: The purpose of this bill is to provide a tax credit for obtaining certain certifications by the United States Green Building Council Leadership in Energy and Environmental Design (LEED) green building rating system or the Green Globes Building Initiative green building rating standard . The bill sets forth the amount of the credit, who may take the credit, the criteria for taking the credit and the amount of the credit. The bill also provides rulemaking authority and defines terms .

Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.