(a) A taxpayer that is a fisheries business may claim a salmon utilization tax credit of 50 percent of the amount of the qualified expenditure in the state in the tax year for full utilization of salmon.
(b) The amount of the tax credit applied against taxes under this section may not
(1) exceed 50 percent of the taxpayer's tax liability incurred under this chapter for salmon during the tax year; or
(2) be claimed for property first placed into service, or for expenditures incurred, after December 31, 2005.
(c) If the tax credit is claimed for installation or operation of new equipment on a vessel, the amount of the qualified expenditure under (a) of this section is determined by multiplying the cost of the installation or operation of the equipment by a fraction, the numerator of which is the weight of raw salmon processed on the vessel by the taxpayer in the state in the tax year in which the equipment is first placed into service, and the denominator of which is the weight of raw salmon processed on the vessel by the taxpayer in and outside of the state in the tax year in which the equipment is first placed into service.
(d) An unused credit under this section may be carried forward and applied against the tax liability incurred on salmon in the following three tax years.
(e) Qualified expenditures for which a tax credit is claimed under this section may not be considered for another tax credit in this title. A tax credit applied under this section together with a tax credit applied under AS 43.75.035 may not exceed 50 percent of the taxpayer's tax liability incurred for the processing of salmon during the tax year.
(f) A taxpayer may not claim the tax credit allowed under this section if the taxpayer is in arrears in the payment of assessments under AS 16.51.120 , contributions under AS 23.20, or taxes or assessments collected or owed under this title. For purposes of this subsection, a taxpayer is not in arrears if the liability for the assessment, contribution, or tax is under administrative or judicial appeal.
(g) If, during a tax year, equipment for which a credit was claimed under this section is disposed of by the taxpayer, ceases to be a qualified expenditure, or is removed from service in the state, the tax due under this chapter is increased by the recapture percentage of the aggregate decrease in the credit allowed under this section for all prior tax years that would have resulted solely from reducing to zero the credit allowed for the qualified expenditure under this section. The amount of tax credit attributable to the qualified expenditure that is carried forward from prior tax years is terminated as of the first day of the tax year in which the equipment is disposed of by the taxpayer, ceases to be a qualified expenditure, or is removed from service in the state. For purposes of this subsection,
(1) the recapture percentage during the year in which the equipment is first placed into service or during the first year following the year in which the equipment is first placed into service is 100 percent;
(2) the recapture percentage during the second year following the year in which the equipment is first placed into service is 75 percent;
(3) the recapture percentage during the third year following the year in which the equipment is first placed into service is 50 percent;
(4) the recapture percentage during the fourth or subsequent year following the year in which the equipment is first placed into service is zero percent;
(5) equipment used on a vessel is considered to have been removed from the state on the first day of a tax year in which the proportion of raw salmon processed in the state on the vessel is less than 50 percent of total weight of raw salmon processed on the vessel in and outside of the state.
(h) The amount of a tax credit recaptured under (g)(1) - (3) of this section may not be included in the determination of the amount of that tax credit that is allowable under this section or AS 43.75.035 .
(i) In this section,
(1) "first placed into service" means the moment when equipment is first used for its intended purpose;
(2) "new equipment" means tangible, depreciable personal property with a useful life of three years or more whose original use commences with the taxpayer and does not include property first used by another person;
(3) "qualified expenditure" means
(A) the direct and incremental cost of the development, manufacture, or purchase of new equipment by a taxpayer to produce marketable products in the state using salmon waste;
(B) reasonable custom processing or disposal fees paid to another fisheries business in the state that does not claim a credit under this section or AS 43.75.035 and that produces marketable products from salmon waste, less the market value of the products produced for the taxpayer; or
(C) the direct and incremental cost of transporting salmon waste to a facility in the state that produces a marketable product from salmon waste;
(4) "tax liability" means the liability for all taxes under this chapter before all credits allowed by this chapter;
(5) "useful life" means the useful life of equipment that is or would be applicable for purposes of depreciation.
Section: Previous 43.75.011 43.75.015 43.75.017 43.75.018 43.75.019 43.75.020 43.75.030 43.75.032 43.75.034 43.75.035 43.75.036 43.75.050 43.75.055 43.75.060 NextLast modified: November 15, 2016