43-1169

43-1169. Credit for construction costs of
qualified environmental technology facility

A. A credit is allowed against the taxes imposed by this title for expenses
incurred in constructing a qualified environmental technology manufacturing, producing or
processing facility as described in section 41-1514.02. The amount of the credit is equal
to ten per cent of the amount spent during the taxable year to construct the facility,
including land acquisition, improvements, building improvements, machinery and equipment,
but not exceeding seventy-five per cent of the tax liability under this title for the
taxable year determined without applying the credit.

B. Amounts qualifying for the credit under this section must be includible in the
taxpayer's adjusted basis for the facility. The adjusted basis of any asset with respect
to which the taxpayer has claimed a credit shall be reduced by the amount of credit
claimed with respect to that asset. This credit does not affect the deductibility for
depreciation or amortization of the remaining adjusted basis of the asset.

C. A taxpayer may claim a credit under this section with respect to new qualifying
construction within ten years after the start of the facility's initial construction, but
a credit is not allowed under this section for any amount spent more than ten years after
the start of the facility's initial construction.

D. A taxpayer qualifies for the credit under this section if the taxpayer owns the
facility or leases the facility or any component of the facility for a term of five or
more years.

E. If the allowable tax credit exceeds seventy-five per cent of 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 claim not used to offset taxes under this title may be carried
forward for not more than fifteen taxable years as a credit against subsequent years'
income tax liability.

F. Co-owners of a business, including 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 for a sole owner of the business.

G. If either of the following circumstances occurs with respect to a qualified
environmental technology manufacturing, producing or processing facility, the tax imposed
by this title for the taxable year in which the circumstance occurs shall be increased by
the full amount of all credits previously allowed under this section with respect to that
facility:

1. The taxpayer abandons construction before the facility is placed in service.

2. Before the facility is placed in service, the taxpayer changes plans in such a
manner as to no longer qualify as an environmental technology manufacturing, producing or
processing facility under section 41-1514.02.

H. If, within five years after being placed in service, an operating environmental
technology manufacturing, producing or processing facility with respect to which a credit
has been allowed under this section ceases for any reason to operate as an environmental
technology manufacturing, producing or processing facility as described in section
41-1514.02, the tax imposed by this title for the taxable year shall be increased by an
amount determined by multiplying the full amount of all credits previously allowed under
this section with respect to that facility by a percentage determined as follows:

1. If the facility was placed in service less than one year before ceasing to
operate as an environmental technology manufacturing, producing or processing facility,
one hundred per cent.

2. If the facility was placed in service at least one year but not more than two
years before ceasing to operate as an environmental technology manufacturing, producing
or processing facility, eighty per cent.

3. If the facility was placed in service at least two years but less than three
years before ceasing to operate as an environmental technology manufacturing, producing
or processing facility, sixty per cent.

4. If the facility was placed in service at least three years but less than four
years before ceasing to operate as an environmental technology manufacturing, producing
or processing facility, forty per cent.

5. If the facility was placed in service at least four years but less than five
years before ceasing to operate as an environmental technology manufacturing, producing
or processing facility, twenty per cent.

I. The department by rule shall prescribe record keeping requirements for taxpayers
who claim a credit under this section.