Utah Code 63N-2-304. Application for targeted business income tax credit

(1)

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Terms Used In Utah Code 63N-2-304

Business applicant: means a business that:
(1)(a) is a claimant, estate, or trust; and
(1)(b) meets the criteria established in Section 63N-2-304. See Utah Code 63N-2-302
Commission: means the Unified Economic Opportunity Commission created in Section 63N-1a-201. See Utah Code 63N-1a-102
Community investment project: means a project that includes one or more of the following criteria in addition to the normal operations of the business applicant:
(3)(a) significant new employment; or
(3)(b) significant new capital development. See Utah Code 63N-2-302
Enterprise zone: means an area within a county or municipality that has been designated as an enterprise zone by the office under Part 2, Enterprise Zone Act. See Utah Code 63N-2-302
Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
Person: means :
     (24)(a) an individual;
     (24)(b) an association;
     (24)(c) an institution;
     (24)(d) a corporation;
     (24)(e) a company;
     (24)(f) a trust;
     (24)(g) a limited liability company;
     (24)(h) a partnership;
     (24)(i) a political subdivision;
     (24)(j) a government office, department, division, bureau, or other body of government; and
     (24)(k) any other organization or entity. See Utah Code 68-3-12.5
State: when applied to the different parts of the United States, includes a state, district, or territory of the United States. See Utah Code 68-3-12.5
Targeted business income tax credit: means a refundable tax credit available under this part. See Utah Code 63N-2-302
Targeted business income tax credit eligibility certificate: means a document provided by the office to a business applicant before the applicant may claim a targeted business income tax credit under this part. See Utah Code 63N-2-302

(1)(a) For a taxable year that begins before January 1, 2023, a business applicant may apply to the office for a targeted business income tax credit eligibility certificate under this part if the business applicant:

(1)(a)(i) is located in:

(1)(a)(i)(A) an enterprise zone; and

(1)(a)(i)(B) a county with a population of less than 25,000;

(1)(a)(ii) meets the requirements of Section 63N-2-212;

(1)(a)(iii) provides a community investment project within the enterprise zone; and

(1)(a)(iv) is not engaged in the following:

(1)(a)(iv)(A) construction;

(1)(a)(iv)(B) retail trade; or

(1)(a)(iv)(C) public utility activities.

(1)(b) For a taxable year for which a business applicant claims a targeted business income tax credit available under this part, the business applicant may not claim or carry forward a tax credit available under Section 59-7-610, 59-10-1007, or 63N-2-213.

(2)

(2)(a) A business applicant seeking to claim a targeted business income tax credit under this part shall submit an application to the office by no later than June 1 of the taxable year in which the business applicant is seeking to claim the targeted business income tax credit.

(2)(b) The application described in Subsection (2)(a) shall include:

(2)(b)(i) any documentation required by the office to demonstrate that the business applicant meets the requirements of Subsection (1);

(2)(b)(ii) a plan developed by the business applicant that describes:

(2)(b)(ii)(A) if the community investment project includes significant new employment, the projected number and anticipated wage level of the jobs that the business applicant plans to create as the basis for qualifying for a targeted business income tax credit;

(2)(b)(ii)(B) if the community investment project includes significant new capital development, the capital development the business applicant plans to make as the basis for qualifying for a targeted business income tax credit;

(2)(b)(ii)(C) how the business applicant’s plan coordinates with the goals of the enterprise zone in which the business applicant is providing a community investment project;

(2)(b)(ii)(D) how the business applicant’s plan coordinates with the overall economic development goals of the county or municipality in which the business applicant is providing a community investment project;

(2)(b)(ii)(E) any matching funds that will be used for the community investment project;

(2)(b)(ii)(F) how any targeted business income tax credit incentives that were awarded in a previous year have been used for the community investment project by the business applicant; and

(2)(b)(ii)(G) the requested amount of the targeted business income tax credit; and

(2)(b)(iii) any additional information required by the office.

(3)

(3)(a) The office shall:

(3)(a)(i) evaluate an application filed under Subsection (2);

(3)(a)(ii) determine whether the business applicant is potentially eligible for a targeted business income tax credit; and

(3)(a)(iii) if the business applicant is potentially eligible for a targeted business income tax credit, determine performance benchmarks and the deadline for meeting those benchmarks that the business applicant must achieve before the office awards a targeted business income tax credit to the business applicant.

(3)(b) If the office determines that the business applicant is potentially eligible for a targeted business income tax credit, the office shall:

(3)(b)(i) notify the business applicant that the business applicant is eligible for a targeted business income tax credit if the business applicant meets the performance benchmarks by the deadline as determined by the office as described in Subsection (3)(a)(iii);

(3)(b)(ii) notify the business applicant of the potential amount of the targeted business income tax credit that may be awarded to the business applicant, which amount may be no more than $100,000 for the business applicant in a taxable year; and

(3)(b)(iii) monitor a business applicant to ensure compliance with this section and to measure the business applicant’s progress in meeting performance benchmarks.

(3)(c) If the business applicant provides evidence to the office, in a form prescribed by the office, that the business applicant has achieved the performance benchmarks by the deadline as determined by the office as described in Subsection (3)(a)(iii), the office shall:

(3)(c)(i) certify that the business applicant is eligible for a targeted business income tax credit;

(3)(c)(ii) issue a targeted business income tax credit eligibility certificate to the business applicant in accordance with:

(3)(c)(ii)(A) for a business applicant that files a return under Title 59, Chapter 7, Corporate Franchise and Income Taxes, Section 59-7-624; or

(3)(c)(ii)(B) for a business applicant that files a return under Title 59, Chapter 10, Individual Income Tax Act, Section 59-10-1112; and

(3)(c)(iii) provide a duplicate copy of the targeted business income tax credit eligibility certificate to the State Tax Commission.

(4) The total amount of the targeted business income tax credit eligibility certificates that the office issues under this part for all business applicants may not exceed $300,000 in any fiscal year.

(5)

(5)(a) A business applicant shall retain the targeted business income tax credit eligibility certificate as issued under Subsection (3) for the same time period that a person is required to keep books and records under Section 59-1-1406.

(5)(b) The office may audit a business applicant to ensure:

(5)(b)(i) eligibility for a targeted business income tax credit; and

(5)(b)(ii) compliance with this section.

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