§ 105-129.9A. (See Editor's note for repeal) Technology commercialization credit. - North Carolina Statutes

§ 105‑129.9A.  (SeeEditor's note for repeal) Technology commercialization credit.

(a)        Credit. – If ataxpayer that has purchased or leased eligible machinery and equipment placesit in service in this State during the taxable year, the taxpayer may qualifyfor a credit as provided in this section. If the taxpayer is also eligible forthe credit allowed under G.S. 105‑129.9 with respect to the eligiblemachinery and equipment, the taxpayer may choose instead of the credit allowedunder G.S. 105‑129.9 with respect to the machinery and equipment to takeone of the credits under this section for which the taxpayer qualifies. Thetwenty percent (20%) credit is a credit equal to twenty percent (20%) of theexcess of the eligible investment amount over the applicable threshold for thetaxable year. The fifteen percent (15%) credit is a credit equal to fifteenpercent (15%) of the excess of the eligible investment amount over theapplicable threshold for the taxable year.

Except as provided in thissection, the provisions of G.S. 105‑129.9 apply to the credits allowedunder this section. As used in this section, the term "researchuniversity" means an institution of higher education classified as aResearch I university or a Research II university in the most recent edition of"A Classification of Institutions of Higher Education," the officialreport of The Carnegie Foundation for the Advancement of Teaching.

A credit allowed under thissection must be taken for the taxable year in which the machinery and equipmentare placed in service. A taxpayer may take the twenty percent (20%) creditallowed under this section, the fifteen percent (15%) credit allowed under thissection, or the credit allowed in G.S. 105‑129.9 during a taxable yearwith respect to eligible machinery and equipment, but may not take more thanone of these credits with respect to the same machinery and equipment.

(b)        Eligible InvestmentAmount. – In calculating the eligible investment amount under this section, forthe purpose of determining the taxpayer's machinery and equipment in service inthis State during the taxable year and the three immediately preceding taxableyears, the following exceptions apply:

(1)        Machinery andequipment that were transferred to another taxpayer during the three‑yearperiod are considered the taxpayer's machinery and equipment if they are stillin service in this State during the taxable year, and the taxpayer to whom theywere transferred is ineligible under G.S. 105‑129.4(e) to claim a newcredit for the investment under this Article.

(2)        Machinery andequipment that were taken out of service during the three‑year period areconsidered the taxpayer's machinery and equipment in service if all of thefollowing conditions are met:

a.         The machinery andequipment were taken out of service by the taxpayer or by the person to whomthe taxpayer transferred them.

b.         The machinery andequipment were taken out of service at a location separate from any locationwith respect to which the taxpayer claims a credit under this section.

c.         The machinery andequipment were used in a business that was not and is not competitive with anybusiness with respect to which the taxpayer claimed a credit under thissection. For the purpose of this subdivision, two businesses are notcompetitive if both of the following conditions are met:

1.         Their products andservices lack reasonable interchangeability of use by the customer, based onuse but without regard to quality, price, condition, or availability.

2.         Their products andservices lack reasonable interchangeability of production in that thebusinesses could not readily switch production capabilities from one product orservice to the other.

(c)        Documentation. – Ifthe taxpayer claims the exception provided in subdivision (b)(2) of thissection, the taxpayer must first request a ruling by the Department of Revenueas to whether the taxpayer meets all of the conditions of subdivision (b)(2) ofthis section.

(d)        Twenty PercentCredit. – A taxpayer qualifies for a twenty percent (20%) credit under thissection if it meets all of the following conditions:

(1)        The eligiblemachinery and equipment are directly related to production based on technologydeveloped by and licensed from a research university or are used to produceresources essential to the taxpayer's production based on technology developedby and licensed from a research university.

(2)        The eligiblemachinery and equipment are placed in service in a tier one, two, or threeenterprise area.

(3)        The eligibleinvestment amount is at least ten million dollars ($10,000,000) for the taxableyear.

(4)        The Secretary ofCommerce has made a written determination that the taxpayer is expected toinvest at least one hundred fifty million dollars ($150,000,000) in eligiblemachinery and equipment in a tier one, two, or three enterprise area by the endof the fourth year after the year in which the taxpayer first places eligiblemachinery and equipment in service in the enterprise area.

(5)        No more than nineyears have passed since the first taxable year the taxpayer claimed a creditunder this section with respect to the same location.

(e)        Fifteen PercentCredit. – A taxpayer qualifies for a fifteen percent (15%) credit under thissection if it meets all of the following conditions:

(1)        The eligible machineryand equipment are directly related to production based on technology developedby and licensed from a research university, or are used to produce resourcesessential to the taxpayer's production based on technology developed by andlicensed from a research university.

(2)        The eligiblemachinery and equipment are placed in service in a tier one, two, or threeenterprise area.

(3)        The eligibleinvestment amount is at least ten million dollars ($10,000,000) for the taxableyear.

(4)        The Secretary ofCommerce has made a written determination that the taxpayer is expected toinvest at least one hundred million dollars ($100,000,000) in eligiblemachinery and equipment in a tier one, two, or three enterprise area by the endof the fourth year after the year in which the taxpayer first places eligiblemachinery and equipment in service in the enterprise area.

(5)        No more than nineyears have passed since the first taxable year the taxpayer claimed a creditunder this section with respect to the same location. (1999‑305, s. 2; 2001‑476,s. 11(a).)