Ala. Admin. Code r. 460-X-23-.10

Current through Register Vol. 42, No. 12, September 30, 2024

Section 460-X-23-.10 - Taking The Tax Credit

(1) The Alabama Department of Revenue (Department) shall grant a tax credit against any state tax due which is specified in the Act to an Owner holding a Tax Credit Certificate issued by the Commission, or its partners, members, or multiple owners as set forth in the portion of the Tax Credit Certificate completed by the Applicant, or one or more transferees holding a Tax Credit Certificate issued by the Department in accordance with Section 40-9F-4(e). This credit shall be applicable to tax due and payable to the Department by the owner, transferee, partner, or member under Title 40, chapters 16 and 18, Code of Alabama 1975, in the amount stated in the Tax Credit Certificate. The Department shall apply such credits claimed by the taxpayers only against the portion of such taxes retained, deposited or distributed to the State of Alabama. To receive the credit, the Owner of the completed Project, transferee, partner or member will file the Tax Credit Certificate with the taxpayer's Alabama state tax return. For the purposes of these regulations, a Project's completion will be the date that it is placed in service. For the purpose of these regulations, placed in service generally means that all work described in an approved Part B Application has been completed, and the appropriate work has been completed that would allow occupancy of either the entire building or some identifiable portion of the building. A Certificate of Occupancy is one means of verifying the placed in service date for the entire building (or part thereof).

(2) The Department shall have the right to audit and reassess any credit improperly obtained by the Owner. This right extends to the Owner initially awarded the tax credit certificate, and not any subsequent transferee of the tax credit certificate or person to whom tax credits have been passed through pursuant to Section 40-9F-4(d).

(3) The entire tax credit may be taken in the taxable year in which the Certified Rehabilitation is placed in service. If taxes owed by the taxpayer are less than the credit, the amount of the credit may be carried forward for up to ten (10) additional years. The taxpayer shall not be entitled to claim any unused credits as a tax refund.

(4) Tax credits granted to a partnership, limited liability company, or multiple Owners shall be passed through to the partners, members or Owners, including any not-for-profit entity which is a partner, respectively pro rata or pursuant to an executed agreement among the partners, members, or Owners who have an alternate distribution method, as indicated on the Tax Credit Certificate to be completed by the Applicant. Any partner, member or Owner to whom the credits were passed-through may transfer or assign all or part of their credits to one or more transferees by providing the completed Tax Credit Certificate to the Department and otherwise satisfying the requirements under Section 40-9F-4(e).

(5) Recapture of any of the credit shall apply against the taxpayer who utilizes the credit, and any required adjustments to basis due to recapture shall be governed by Title 26, Section 50 of the Internal Revenue code.

Ala. Admin. Code r. 460-X-23-.10

New Rule: Filed December 13, 2013; effective December 20, 2013.

Amended by Alabama Administrative Monthly Volume XXXII, Issue No. 12, September 30, 2014, eff. 10/8/2014.

Authors: Chloe Mercer, David Schneider, Jennifer Bailey

Statutory Authority: Act 2013-241; 2014-452.