43-1182. Credit for water conservation system plumbing stub outs installed in houses constructed by taxpayer; definition

A. Subject to subsections F and G, for taxable years beginning from and after December 31, 2006 and ending before January 1, 2012, a credit is allowed against the taxes imposed by this title for costs incurred during the taxable year of installing or including in one or more houses or dwelling units located in this state and constructed by the taxpayer a water conservation system plumbing stub out that collects all graywater sources that end at a plumbing stub out that is separate and distinct from the regular plumbing system. To qualify for the credit the stub out must:

1. Comply with rules that are adopted by the department of environmental quality and that relate to the direct reuse of reclaimed water.

2. Meet applicable local building codes.

B. The credit shall not exceed two hundred dollars for each separate house or dwelling unit in which the water conservation system plumbing stub outs are installed.

C. If the allowable credit exceeds the taxes otherwise due under this title on the claimant's income, or if there are no taxes due under this title, the amount of the credit not used to offset taxes under this title may be carried forward to the next five consecutive taxable years as a credit against subsequent years' income tax liability.

D. Co-owners of a business, including corporate partners in a partnership, may each claim only the pro rata share of the credit allowed under this section based on the ownership interest. The total of the credits allowed all such owners may not exceed the amount that would have been allowed a sole owner.

E. The credit allowed under this section is in lieu of any expenses taken for installing water conservation system plumbing stub outs in computing Arizona taxable income.

F. Beginning from and after December 31, 2006, the department shall receive and evaluate applications that are submitted by taxpayers to receive a water conservation system plumbing stub out credit under this section. A taxpayer shall apply for the credit to the department on a form prescribed by the department. The application shall be filed with the department and the department shall issue a receipt to the applicant. The application shall include:

1. The name, address and social security number or federal employer identification number of the applicant.

2. The amount of the cost of the water conservation system plumbing stub out and the amount for which the credit is claimed.

3. Any additional information that the department requires.

G. The department shall review each application under subsection F and certify to the taxpayer the amount of the credit that is authorized. The department shall not certify tax credits under this subsection exceeding five hundred thousand dollars for any calendar year. If qualifying applications exceed five hundred thousand dollars, the department shall authorize credits in the order of the date that the applications are received by the department. If an application is received that, if authorized, would require the department to exceed the five hundred thousand dollar limit, the department shall grant the applicant only the remaining credit amount that would not exceed the five hundred thousand dollar limit. After the department authorizes five hundred thousand dollars in tax credits, the department shall deny any subsequent applications that are received. The department shall not authorize any additional tax credits that exceed the five hundred thousand dollar limit even if the amounts that have been certified to any taxpayer were not claimed or a taxpayer otherwise fails to meet the requirements to claim the additional credit.

H. The department may verify that a water conservation system plumbing stub out has been installed by the taxpayer.

I. For the purposes of this section, "water conservation system" means a system or a series of components or mechanisms that are designed to provide for the collection of rainwater or residential graywater. Water conservation system includes a system that is capable of storing rainwater or residential graywater for future use and reusing the collected water for the same residential property.

43-1182. Credit for water conservation system plumbing stub outs installed in houses constructed by taxpayer; definition

A. Subject to subsections F and G, for taxable years beginning from and after December 31, 2006 and ending before January 1, 2012, a credit is allowed against the taxes imposed by this title for costs incurred during the taxable year of installing or including in one or more houses or dwelling units located in this state and constructed by the taxpayer a water conservation system plumbing stub out that collects all graywater sources that end at a plumbing stub out that is separate and distinct from the regular plumbing system. To qualify for the credit the stub out must:

1. Comply with rules that are adopted by the department of environmental quality and that relate to the direct reuse of reclaimed water.

2. Meet applicable local building codes.

B. The credit shall not exceed two hundred dollars for each separate house or dwelling unit in which the water conservation system plumbing stub outs are installed.

C. If the allowable credit exceeds the taxes otherwise due under this title on the claimant's income, or if there are no taxes due under this title, the amount of the credit not used to offset taxes under this title may be carried forward to the next five consecutive taxable years as a credit against subsequent years' income tax liability.

D. Co-owners of a business, including corporate partners in a partnership, may each claim only the pro rata share of the credit allowed under this section based on the ownership interest. The total of the credits allowed all such owners may not exceed the amount that would have been allowed a sole owner.

E. The credit allowed under this section is in lieu of any expenses taken for installing water conservation system plumbing stub outs in computing Arizona taxable income.

F. Beginning from and after December 31, 2006, the department shall receive and evaluate applications that are submitted by taxpayers to receive a water conservation system plumbing stub out credit under this section. A taxpayer shall apply for the credit to the department on a form prescribed by the department. The application shall be filed with the department and the department shall issue a receipt to the applicant. The application shall include:

1. The name, address and social security number or federal employer identification number of the applicant.

2. The amount of the cost of the water conservation system plumbing stub out and the amount for which the credit is claimed.

3. Any additional information that the department requires.

G. The department shall review each application under subsection F and certify to the taxpayer the amount of the credit that is authorized. The department shall not certify tax credits under this subsection exceeding five hundred thousand dollars for any calendar year. If qualifying applications exceed five hundred thousand dollars, the department shall authorize credits in the order of the date that the applications are received by the department. If an application is received that, if authorized, would require the department to exceed the five hundred thousand dollar limit, the department shall grant the applicant only the remaining credit amount that would not exceed the five hundred thousand dollar limit. After the department authorizes five hundred thousand dollars in tax credits, the department shall deny any subsequent applications that are received. The department shall not authorize any additional tax credits that exceed the five hundred thousand dollar limit even if the amounts that have been certified to any taxpayer were not claimed or a taxpayer otherwise fails to meet the requirements to claim the additional credit.

H. The department may verify that a water conservation system plumbing stub out has been installed by the taxpayer.

I. For the purposes of this section, "water conservation system" means a system or a series of components or mechanisms that are designed to provide for the collection of rainwater or residential graywater. Water conservation system includes a system that is capable of storing rainwater or residential graywater for future use and reusing the collected water for the same residential property.