Page 1 of 2 141.432 Definitions for KRS 141.432 to 141.434. As used in KRS 141.432 to 141.434, unless the context requires otherwise: <br>(1) "Applicable percentage" means zero percent (0%) for each of the first two (2) credit allowance dates, seven percent (7%) for the third credit allowance date, and eight <br>percent (8%) for the next four (4) credit allowance dates; (2) "Credit allowance date" means, with respect to any qualified equity investment: (a) The date on which the investment is initially made; and <br>(b) Each of the six (6) anniversary dates of that date thereafter; (3) "Long-term debt security" means any debt instrument issued by a qualified community development entity, at par value or a premium, with an original maturity <br>date of at least seven (7) years from the date of its issuance, with no acceleration of <br>repayment, amortization, or prepayment features prior to its original maturity date. <br>The qualified community development entity that issues the debt instrument may <br>not make cash interest payments on the debt instrument during the period <br>commencing with its issuance and ending on its final credit allowance date in <br>excess of the cumulative operating income, as defined in the regulations <br>promulgated under 26 U.S.C. sec. 45D, of the qualified community development <br>entity for the same period. The foregoing shall in no way limit the holder's ability to <br>accelerate payments on the debt instrument in situations where the qualified <br>community development entity has defaulted on covenants designed to ensure <br>compliance with KRS 141.432 to 141.434 or 26 U.S.C. sec. 45D; (4) "Purchase price" means the amount paid to a qualified community development entity that issues a qualified equity investment for the qualified equity investment; (5) "Qualified active low-income community business" has the same meaning given that term in 26 U.S.C. sec. 45D. A business shall be considered a qualified active <br>low-income community business for the duration of the qualified community <br>development entity's investment in, or loan to, the business if the entity reasonably <br>expects, at the time it makes the investment or loan, that the business will continue <br>to satisfy the requirements for being a qualified active low-income community <br>business throughout the entire period of the investment or loan. The term excludes <br>any business that derives or projects to derive fifteen percent (15%) or more of its <br>annual revenue from the rental or sale of real estate. This exclusion does not apply <br>to a business that is controlled by, or under common control with, another business <br>if the second business: <br>(a) Does not derive or project to derive fifteen percent (15%) or more of its annual revenue from the rental or sale of real estate; and (b) Is the primary tenant of the real estate leased from the first business; (6) "Qualified community development entity" has the same meaning given that term in 26 U.S.C. sec. 45D; provided that the entity has entered into, or is controlled by an <br>entity that has entered into, an allocation agreement with the Community <br>Development Financial Institutions Fund of the United States Treasury Department <br>with respect to credits authorized by 26 U.S.C. sec. 45D, which includes the Page 2 of 2 Commonwealth of Kentucky within the service area set forth in such allocation <br>agreement; (7) "Qualified equity investment" means any equity investment in, or long-term debt security issued by, a qualified community development entity that: <br>(a) Is acquired after June 4, 2010, at its original issuance solely in exchange for cash; (b) Has at least eighty-five percent (85%) of its cash purchase price used by the issuer to make qualified low-income community investments in qualified <br>active low-income community businesses located in the Commonwealth of <br>Kentucky by the second anniversary of the initial credit allowance date; and (c) Is designated by the issuer as a qualified equity investment under this subsection and is certified by the department as not exceeding the limitation <br>contained in KRS 141.434. This term shall include any qualified equity <br>investment that does not meet the provisions of paragraph (a) of this <br>subsection if the investment was a qualified equity investment in the hands of <br>a prior holder. The qualified community development entity shall keep <br>sufficiently detailed books and records with respect to the investments made <br>with the proceeds of the qualified equity investments to allow the direct <br>tracing of the proceeds into qualified low-income community investments in <br>qualified active low-income community businesses in the Commonwealth of <br>Kentucky; (8) "Qualified low-income community investment" means any capital or equity investment in, or loan to, any qualified active low-income community business <br>made after June 4, 2010. With respect to any one (1) qualified active low-income <br>community business, the maximum amount of qualified low-income community <br>investments that may be made in the business, on a collective basis with all of its <br>affiliates, with the proceeds of qualified equity investments that have been certified <br>under KRS 141.433 shall be ten million dollars ($10,000,000) whether made by one <br>(1) or several qualified community development entities; (9) "Tax credit" means a nonrefundable credit against the taxes imposed by KRS 141.020, 141.040, 141.0401, 136.320, 136.330, 136.340, 136.350, 136.370, <br>136.390, or 304.3-270. For the credit against the taxes imposed by KRS 141.020, <br>141.040, or 141.0401, the ordering of the credits shall be as provided in KRS <br>141.0205. An insurance company claiming a tax credit against the insurance <br>premium tax is not required to pay additional retaliatory tax levied pursuant to KRS <br>304.3-270; and (10) "Taxpayer" means any individual or entity subject to the tax imposed by KRS 141.020, 141.040, 141.0401, 136.320, 136.330, 136.340, 136.350, 136.370, <br>136.390, or 304.3-270. Effective: June 4, 2010 <br>History: Created 2010 (1st Extra. Sess.) Ky. Acts ch. 2, sec. 16, effective June 4, 2010.
Page 1 of 2 141.432 Definitions for KRS 141.432 to 141.434. As used in KRS 141.432 to 141.434, unless the context requires otherwise: <br>(1) "Applicable percentage" means zero percent (0%) for each of the first two (2) credit allowance dates, seven percent (7%) for the third credit allowance date, and eight <br>percent (8%) for the next four (4) credit allowance dates; (2) "Credit allowance date" means, with respect to any qualified equity investment: (a) The date on which the investment is initially made; and <br>(b) Each of the six (6) anniversary dates of that date thereafter; (3) "Long-term debt security" means any debt instrument issued by a qualified community development entity, at par value or a premium, with an original maturity <br>date of at least seven (7) years from the date of its issuance, with no acceleration of <br>repayment, amortization, or prepayment features prior to its original maturity date. <br>The qualified community development entity that issues the debt instrument may <br>not make cash interest payments on the debt instrument during the period <br>commencing with its issuance and ending on its final credit allowance date in <br>excess of the cumulative operating income, as defined in the regulations <br>promulgated under 26 U.S.C. sec. 45D, of the qualified community development <br>entity for the same period. The foregoing shall in no way limit the holder's ability to <br>accelerate payments on the debt instrument in situations where the qualified <br>community development entity has defaulted on covenants designed to ensure <br>compliance with KRS 141.432 to 141.434 or 26 U.S.C. sec. 45D; (4) "Purchase price" means the amount paid to a qualified community development entity that issues a qualified equity investment for the qualified equity investment; (5) "Qualified active low-income community business" has the same meaning given that term in 26 U.S.C. sec. 45D. A business shall be considered a qualified active <br>low-income community business for the duration of the qualified community <br>development entity's investment in, or loan to, the business if the entity reasonably <br>expects, at the time it makes the investment or loan, that the business will continue <br>to satisfy the requirements for being a qualified active low-income community <br>business throughout the entire period of the investment or loan. The term excludes <br>any business that derives or projects to derive fifteen percent (15%) or more of its <br>annual revenue from the rental or sale of real estate. This exclusion does not apply <br>to a business that is controlled by, or under common control with, another business <br>if the second business: <br>(a) Does not derive or project to derive fifteen percent (15%) or more of its annual revenue from the rental or sale of real estate; and (b) Is the primary tenant of the real estate leased from the first business; (6) "Qualified community development entity" has the same meaning given that term in 26 U.S.C. sec. 45D; provided that the entity has entered into, or is controlled by an <br>entity that has entered into, an allocation agreement with the Community <br>Development Financial Institutions Fund of the United States Treasury Department <br>with respect to credits authorized by 26 U.S.C. sec. 45D, which includes the Page 2 of 2 Commonwealth of Kentucky within the service area set forth in such allocation <br>agreement; (7) "Qualified equity investment" means any equity investment in, or long-term debt security issued by, a qualified community development entity that: <br>(a) Is acquired after June 4, 2010, at its original issuance solely in exchange for cash; (b) Has at least eighty-five percent (85%) of its cash purchase price used by the issuer to make qualified low-income community investments in qualified <br>active low-income community businesses located in the Commonwealth of <br>Kentucky by the second anniversary of the initial credit allowance date; and (c) Is designated by the issuer as a qualified equity investment under this subsection and is certified by the department as not exceeding the limitation <br>contained in KRS 141.434. This term shall include any qualified equity <br>investment that does not meet the provisions of paragraph (a) of this <br>subsection if the investment was a qualified equity investment in the hands of <br>a prior holder. The qualified community development entity shall keep <br>sufficiently detailed books and records with respect to the investments made <br>with the proceeds of the qualified equity investments to allow the direct <br>tracing of the proceeds into qualified low-income community investments in <br>qualified active low-income community businesses in the Commonwealth of <br>Kentucky; (8) "Qualified low-income community investment" means any capital or equity investment in, or loan to, any qualified active low-income community business <br>made after June 4, 2010. With respect to any one (1) qualified active low-income <br>community business, the maximum amount of qualified low-income community <br>investments that may be made in the business, on a collective basis with all of its <br>affiliates, with the proceeds of qualified equity investments that have been certified <br>under KRS 141.433 shall be ten million dollars ($10,000,000) whether made by one <br>(1) or several qualified community development entities; (9) "Tax credit" means a nonrefundable credit against the taxes imposed by KRS 141.020, 141.040, 141.0401, 136.320, 136.330, 136.340, 136.350, 136.370, <br>136.390, or 304.3-270. For the credit against the taxes imposed by KRS 141.020, <br>141.040, or 141.0401, the ordering of the credits shall be as provided in KRS <br>141.0205. An insurance company claiming a tax credit against the insurance <br>premium tax is not required to pay additional retaliatory tax levied pursuant to KRS <br>304.3-270; and (10) "Taxpayer" means any individual or entity subject to the tax imposed by KRS 141.020, 141.040, 141.0401, 136.320, 136.330, 136.340, 136.350, 136.370, <br>136.390, or 304.3-270. Effective: June 4, 2010 <br>History: Created 2010 (1st Extra. Sess.) Ky. Acts ch. 2, sec. 16, effective June 4, 2010.
Page 1 of 2 141.432 Definitions for KRS 141.432 to 141.434. As used in KRS 141.432 to 141.434, unless the context requires otherwise: <br>(1) "Applicable percentage" means zero percent (0%) for each of the first two (2) credit allowance dates, seven percent (7%) for the third credit allowance date, and eight <br>percent (8%) for the next four (4) credit allowance dates; (2) "Credit allowance date" means, with respect to any qualified equity investment: (a) The date on which the investment is initially made; and <br>(b) Each of the six (6) anniversary dates of that date thereafter; (3) "Long-term debt security" means any debt instrument issued by a qualified community development entity, at par value or a premium, with an original maturity <br>date of at least seven (7) years from the date of its issuance, with no acceleration of <br>repayment, amortization, or prepayment features prior to its original maturity date. <br>The qualified community development entity that issues the debt instrument may <br>not make cash interest payments on the debt instrument during the period <br>commencing with its issuance and ending on its final credit allowance date in <br>excess of the cumulative operating income, as defined in the regulations <br>promulgated under 26 U.S.C. sec. 45D, of the qualified community development <br>entity for the same period. The foregoing shall in no way limit the holder's ability to <br>accelerate payments on the debt instrument in situations where the qualified <br>community development entity has defaulted on covenants designed to ensure <br>compliance with KRS 141.432 to 141.434 or 26 U.S.C. sec. 45D; (4) "Purchase price" means the amount paid to a qualified community development entity that issues a qualified equity investment for the qualified equity investment; (5) "Qualified active low-income community business" has the same meaning given that term in 26 U.S.C. sec. 45D. A business shall be considered a qualified active <br>low-income community business for the duration of the qualified community <br>development entity's investment in, or loan to, the business if the entity reasonably <br>expects, at the time it makes the investment or loan, that the business will continue <br>to satisfy the requirements for being a qualified active low-income community <br>business throughout the entire period of the investment or loan. The term excludes <br>any business that derives or projects to derive fifteen percent (15%) or more of its <br>annual revenue from the rental or sale of real estate. This exclusion does not apply <br>to a business that is controlled by, or under common control with, another business <br>if the second business: <br>(a) Does not derive or project to derive fifteen percent (15%) or more of its annual revenue from the rental or sale of real estate; and (b) Is the primary tenant of the real estate leased from the first business; (6) "Qualified community development entity" has the same meaning given that term in 26 U.S.C. sec. 45D; provided that the entity has entered into, or is controlled by an <br>entity that has entered into, an allocation agreement with the Community <br>Development Financial Institutions Fund of the United States Treasury Department <br>with respect to credits authorized by 26 U.S.C. sec. 45D, which includes the Page 2 of 2 Commonwealth of Kentucky within the service area set forth in such allocation <br>agreement; (7) "Qualified equity investment" means any equity investment in, or long-term debt security issued by, a qualified community development entity that: <br>(a) Is acquired after June 4, 2010, at its original issuance solely in exchange for cash; (b) Has at least eighty-five percent (85%) of its cash purchase price used by the issuer to make qualified low-income community investments in qualified <br>active low-income community businesses located in the Commonwealth of <br>Kentucky by the second anniversary of the initial credit allowance date; and (c) Is designated by the issuer as a qualified equity investment under this subsection and is certified by the department as not exceeding the limitation <br>contained in KRS 141.434. This term shall include any qualified equity <br>investment that does not meet the provisions of paragraph (a) of this <br>subsection if the investment was a qualified equity investment in the hands of <br>a prior holder. The qualified community development entity shall keep <br>sufficiently detailed books and records with respect to the investments made <br>with the proceeds of the qualified equity investments to allow the direct <br>tracing of the proceeds into qualified low-income community investments in <br>qualified active low-income community businesses in the Commonwealth of <br>Kentucky; (8) "Qualified low-income community investment" means any capital or equity investment in, or loan to, any qualified active low-income community business <br>made after June 4, 2010. With respect to any one (1) qualified active low-income <br>community business, the maximum amount of qualified low-income community <br>investments that may be made in the business, on a collective basis with all of its <br>affiliates, with the proceeds of qualified equity investments that have been certified <br>under KRS 141.433 shall be ten million dollars ($10,000,000) whether made by one <br>(1) or several qualified community development entities; (9) "Tax credit" means a nonrefundable credit against the taxes imposed by KRS 141.020, 141.040, 141.0401, 136.320, 136.330, 136.340, 136.350, 136.370, <br>136.390, or 304.3-270. For the credit against the taxes imposed by KRS 141.020, <br>141.040, or 141.0401, the ordering of the credits shall be as provided in KRS <br>141.0205. An insurance company claiming a tax credit against the insurance <br>premium tax is not required to pay additional retaliatory tax levied pursuant to KRS <br>304.3-270; and (10) "Taxpayer" means any individual or entity subject to the tax imposed by KRS 141.020, 141.040, 141.0401, 136.320, 136.330, 136.340, 136.350, 136.370, <br>136.390, or 304.3-270. Effective: June 4, 2010 <br>History: Created 2010 (1st Extra. Sess.) Ky. Acts ch. 2, sec. 16, effective June 4, 2010.
