Section 23649-1 - The Manufacturers' Investment Credit(See Section 23649-0 for Table of Contents.)
(a)In General. The Manufacturers' Investment Credit (MIC) is allowed to any qualified taxpayer in an amount equal to six percent (6%) of any qualified costs paid or incurred on or after January 1, 1994, for qualified property that is placed in service in this state. A qualified taxpayer who leases qualified property for use in a qualified activity of the qualified taxpayer may also claim the MIC. Qualified property may be either new or used and must be placed in service in this state and used by a qualified taxpayer in a qualified activity for more than one year to avoid recapture of the MIC. The basis of any qualified property for which the MIC is claimed is not required to be reduced by the amount of any MIC claimed.(b)MIC for Qualified Costs Paid or Incurred in 1994 Must Be Claimedon Qualified Taxpayer's Return for First Income Year Beginning on orAfter January 1, 1995. In the case of any qualified costs paid or incurred on or after January 1, 1994, and prior to the first income year of the qualified taxpayer beginning on or after January 1, 1995, the MIC shall be treated as having been allowed as of the date the qualified property is placed in service in this state but shall not be claimed by the qualified taxpayer until the qualified taxpayer files its California tax return for its first income year beginning on or after January 1, 1995. No MIC shall be claimed on any return filed for any income year commencing prior to the qualified taxpayer's first income year beginning on or after January1, 1995. Fiscal year taxpayers who paid or incurred qualified costs on or after January 1, 1994, and during the qualified taxpayer's income year beginning in 1993, shall treat any such income year 1993 qualified costs as 1994 qualified costs to be claimed on the qualified taxpayer's 1995 income year return.(c)Cross References. Regulation 23649-2 contains definitions applicable to Regulations 23649-1 through 23649-11, inclusive, Regulation 23649-3 contains rules relating to qualified taxpayers, Regulation 23649-4 contains rules relating to qualified costs, Regulation 23649-5 contains rules relating to qualified property, Regulation 23649-6 contains rules applicable to leases of qualified property by qualified taxpayers, Regulation 23649-7 is reserved, Regulation 23649-8 contains recapture rules, Regulation 23649-9 contains rules relating to carryforwards, Regulation 23649-10 contains general recordkeeping requirements, and Regulation 23649-11 contains other miscellaneous provisions. For rules relating to the MIC allowed to taxpayers under the Personal Income Tax Law, see Revenue and Taxation Code Section 17053.49 and the regulations thereunder.(d)General References. For purposes of Regulations 23649-1 through 23649-11, inclusive, the following general references shall apply: (1) All citations to the Revenue and Taxation Code are to the California Revenue and Taxation Code.(2) All citations to the Internal Revenue Code are to the Internal Revenue Code of 1986.(3) The credits provided for in Revenue and Taxation Code Sections 17053.49 and 23649 shall be collectively referred to as the "Manufacturers' Investment Credit" or the "MIC."(4) Any reference to a taxpayer's income year shall means the income year as defined in Revenue and Taxation Code Section 23042.(5) Any reference to sales or use tax shall mean California sales or use tax imposed under Part 1 (commencing with Section 6001) of Division 2 of the Revenue and Taxation Code. Any discussion of California sales and use tax law in Regulations 23649-1 through 23649-11, inclusive, is based upon such law as in effect on the date these regulations become effective, and is generally intended to restate the requirements set forth in Revenue and Taxation Code Section 23649 and to be illustrative of, but have no effect on, the California sales and use tax law and the regulations thereunder. All examples which contain references to an amount of California sales or use tax shall be at an assumed hypothetical sales or use tax rate of eight percent (8%).(6) Any reference to "Division D of the SIC Manual" shall mean that portion of the SIC Manual which includes Codes 2011 through 3999, inclusive.Cal. Code Regs. Tit. 18, §§ 23649-1
1. New Section filed 5-1-96; operative 5-31-96 (Register 96, No. 18).
2. Change without regulatory effect amending subsection (d)(6) filed 8-14-97 pursuant to section 100, title 1, California Code of Regulations (Register 97, No. 33). Note: Authority cited: Section 19503, Revenue and Taxation Code. Reference: Section 23649, Revenue and Taxation Code.
1. New Section filed 5-1-96; operative 5-31-96 (Register 96, No. 18).
2. Change without regulatory effect amending subsection (d)(6) filed 8-14-97 pursuant to section 100, title 1, California Code of Regulations (Register 97, No. 33).