§ 105-129.5. (See note for repeal) Tax election; cap; carryforwards; limitations. - North Carolina Statutes

§ 105‑129.5.  (See notefor repeal) Tax election; cap; carryforwards; limitations.

(a)        Tax Election. – Thecredits provided in this Article are allowed against the franchise tax leviedin Article 3 of this Chapter, the income taxes levied in Article 4 of thisChapter, and the gross premiums tax levied in Article 8B of this Chapter. Thetaxpayer may divide the technology commercialization credit allowed in G.S. 105‑129.9Abetween the taxes against which it is allowed. The taxpayer shall elect thepercentage of the credit that will be taken against each tax when filing thereturn on which the credit is first taken. This election is binding. Thepercentage of the credit elected to be taken against each tax may be carriedforward only against the same tax.

The taxpayer must take anyother credit allowed in this Article against only one of the taxes againstwhich it is allowed. The taxpayer shall elect the tax against which a creditwill be claimed when filing the return on which the first installment of thecredit is claimed. This election is binding. Any carryforwards of the creditmust be claimed against the same tax.

(b)        Cap. – The creditsallowed under this Article may not exceed fifty percent (50%) of the taxagainst which they are claimed for the taxable year, reduced by the sum of allother credits allowed against that tax, except tax payments made by or onbehalf of the taxpayer. This limitation applies to the cumulative amount ofcredit, including carryforwards, claimed by the taxpayer under this Article againsteach tax for the taxable year.

(c)        Carryforward. – Anyunused portion of a credit with respect to a large investment, with respect tothe technology commercialization credit allowed in G.S. 105‑129.9A, orwith respect to substantial investment in other property under G.S. 105‑129.12Amay be carried forward for the succeeding 20 years. Any unused portion of acredit with respect to research and development activities under G.S. 105‑129.10may be carried forward for the succeeding 15 years. Any unused portion of acredit may be carried forward for the succeeding 10 years if, before thetaxpayer claims the credit, the Secretary of Commerce makes a writtendetermination that the taxpayer is expected to purchase or lease, and place inservice in connection with the eligible business within a two‑yearperiod, at least fifty million dollars ($50,000,000) worth of one or more ofthe following: real property, machinery and equipment, or central office oraircraft facility property. In the case of an interstate air courier that hasor is constructing a hub in this State and in the case of an eligible majorindustry, this investment may be placed in service in connection with theeligible business within a seven‑year period. If the taxpayer fails tomake the required level of investment within the applicable period, thetaxpayer forfeits this enhanced carryforward period. Any unused portion of anyother credit may be carried forward for the succeeding five years.

(d)        Statute ofLimitations. – Notwithstanding Article 9 of this Chapter, a taxpayer must claima credit under this Article within six months after the date set by statute forthe filing of the return, including any extensions of that date. (1996, 2nd Ex. Sess., c. 13,s. 3.3; 1997‑277, s. 1; 1998‑55, s. 1; 1999‑305, s. 4; 1999‑360,ss. 1, 2; 2000‑56, s. 2; 2001‑476, s. 7(b); 2002‑146, s. 5;2003‑435, 2nd Ex. Sess., s. 3.5.)