North Carolina SB 706: Extend Renewable Energy Tax Credit Carryover.

Bill Text

GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2013
S 1
SENATE BILL 706

Short Title: Extend Renewable Energy Tax Credit Carryover. (Public)
Sponsors: Senators McKissick (Primary Sponsor); and Parmon.
Referred to: Finance.
April 4, 2013
*S706-v-1*
A BILL TO BE ENTITLED 1
AN ACT TO MODIFY THE TAX CREDIT FOR INVESTING IN RENEWABLE ENERGY 2
PROPERTY TO ALLOW CERTAIN INDIVIDUAL TAXPAYERS A 3
CARRYFORWARD GREATER THAN FIVE YEARS. 4
The General Assembly of North Carolina enacts: 5
SECTION 1. G.S. 105-129.17(b) reads as rewritten: 6
"(b) Cap. – The credits allowed in this Article may not exceed fifty percent (50%) of the 7
tax against which they are claimed for the taxable year, reduced by the sum of all other credits 8
allowed against that tax, except tax payments made by or on behalf of the taxpayer. This 9
limitation applies to the cumulative amount of credit, including carryforwards, claimed by the 10
taxpayer under this Article against each tax for the taxable year. Any Except as provided in 11
G.S. 105-129.16A, any unused portion of the credits may be carried forward for the succeeding 12
five years." 13
SECTION 2. G.S. 105-129.16A reads as rewritten: 14
"§ 105-129.16A. Credit for investing in renewable energy property. 15
(a) Credit. – If a taxpayer that has constructed, purchased, or leased renewable energy 16
property places it in service in this State during the taxable year, the taxpayer is allowed a 17
credit equal to thirty-five percent (35%) of the cost of the property. In the case of renewable 18
energy property that serves a nonbusiness purpose, the credit must be taken for the taxable year 19
in which the property is placed in service. For all other renewable energy property, the entire 20
credit may not be taken for the taxable year in which the property is placed in service but must 21
be taken in five equal installments beginning with the taxable year in which the property is 22
placed in service. Upon request of a taxpayer that leases renewable energy property, the lessor 23
of the property must give the taxpayer a statement that describes the renewable energy property 24
and states the cost of the property. No credit is allowed under this section to the extent the cost 25
of the renewable energy property was provided by public funds. For the purposes of this 26
section, "public funds" does not include grants made under section 1603 of the American 27
Recovery and Reinvestment Tax Act of 2009. 28
(b) Expiration. – If, in one of the years in which the installment of a credit accrues, the 29
renewable energy property with respect to which the credit was claimed is disposed of, taken 30
out of service, or moved out of State, the credit expires and the taxpayer may not take any 31
remaining installment of the credit. The taxpayer may, however, take the portion of an 32
installment that accrued in a previous year and was carried forward to the extent permitted 33
under G.S. 105-129.17.subsection (c1) of this section. 34
... 35

General Assembly of North Carolina Session 2013
Page 2 S706 [Edition 1]
(c1) Carryforward. – Any unused portion of a credit allowed in this section may be 1
carried forward for the succeeding five taxable years, unless an extended carryforward period 2
of seven years applies. An extended carryforward period applies if the taxpayer meets all of the 3
following: 4
(1) The taxpayer elects to take the credit against the individual income tax 5
levied in Part 2 of Article 4 of this Chapter. 6
(2) The top tax rate imposed by G.S. 105-134.2 on the taxpayer's income during 7
all years of the carryforward is no greater than seven percent (7%). If the 8
taxpayer fails to meet this requirement at any point during the carryforward 9
period, the taxpayer will forfeit the remaining amount of the credit. 10
...." 11
SECTION 3. This act is effective for taxes imposed for taxable years beginning on 12
or after July 1, 2013. 13