Ga. Comp. R. & Regs. R. 560-7-8-.63 - Agribusiness and Rural Jobs Tax Credit

(1) Purpose. This regulation provides guidance concerning the implementation and administration of the income tax credit under O.C.G.A. § 33-1-25.

(2) Coordination of Agencies. The Department of Community Affairs is the state agency responsible for certifying taxpayers for the income tax credit under O.C.G.A. § 33-1-25.

(3) Definitions.

(a) The terms "affiliate","applicable percentage","credit allowance date","eligible business","eligible distribution","principal business operations","purchase price","qualified investment","rural area","rural fund", and "rural investor" as used in this regulation shall have the same meaning as in O.C.G.A. § 33-1-25.

(b) For purposes of Title 48 "state tax liability" means the income tax liability imposed on a taxpayer under O.C.G.A. §§ 48-7-21 and 48-7-20(O.C.G.A. § 48-7-27 provides how income is computed while O.C.G.A. § 48-7-20 imposes the income tax). If the O.C.G.A. is ever amended such that the taxes imposed by 48-7-20 or 48-7-21 are eliminated or reduced, the term shall also mean any tax liability imposed on an entity or other person that had tax liability under the laws of this state.

(4) Credit Amount. A rural investor that makes a capital investment in a rural fund, under O.C.G.A. § 33-1-25, may claim a tax credit in an amount equal to the applicable percentage for such credit allowance date multiplied by the purchase price paid to the rural fund for the capital investment.

(5) Claiming the Credit. For a rural investor to claim the agribusiness and rural jobs tax credit against income tax liability, the rural investor must submit Form IT-ARJ and their certification(s) from the Department of Community Affairs, and any other information that the Commissioner may request, with the rural investor's Georgia income tax return each year the income tax credit is claimed.

(6) Carry forward. In no event shall the agribusiness and rural jobs tax credit for a taxable year exceed the rural investor's income tax liability. Any unused income tax credit in a taxable year may be carried forward to subsequent taxable years.

(7) Pass-Through Entities. When the rural investor is a pass-through entity, and has no income tax liability of its own, the income tax credit will pass to individual members, shareholders, or partners of that entity in accordance with the provisions of any agreement among the partners, members, or shareholders of that entity provided that the entity or person that claims the income tax credit must be subject to Georgia income tax. The credit forms will initially be filed with the tax return of the pass-through entity to establish the amount of the credit available for pass through. The credit will then pass through to its individual shareholders, members, or partners to be applied against the tax liability on their income tax returns. The credits are initially available for use as a credit by the individual shareholders, members, or partners for their tax year in which the income tax year of the pass-through entity ends. For example: A partnership earns the credit for its tax year ending January 31, 2019. The partnership passes the credit to a calendar year partner. The credit is available for use by the individual partner beginning with the calendar 2019 tax year.

(8) Recapture. The Department of Community Affairs can recapture the agribusiness and rural jobs tax credit as provided in Department of Community Affairs Regulation 110-35-1-.08.

(9) Effective Date. This regulation shall be applicable to taxable years beginning on or after January 1, 2018.

Notes

Ga. Comp. R. & Regs. R. 560-7-8-.63

O.C.G.A. §§ 33-1-25, 48-2-12.

Original Rule entitled "Agribusiness and Rural Jobs Tax Credit" adopted. F. May 25, 2018; eff. June 14, 2018.