58.1-439.7 - Tax credit for purchase of machinery and equipment for processing recyclable materials. - Virginia Statutes

§ 58.1-439.7. Tax credit for purchase of machinery and equipment forprocessing recyclable materials.

A. For taxable years beginning on and after January 1, 1999, but beforeJanuary 1, 2015, a taxpayer shall be allowed a credit against the tax imposedpursuant to Articles 2 (§ 58.1-320 et seq.) and 10 (§ 58.1-400 et seq.) ofChapter 3 of this title, in an amount equal to 10 percent of the purchaseprice paid during the taxable year for machinery and equipment usedexclusively in or on the premises of manufacturing facilities or plant unitswhich manufacture, process, compound, or produce items of tangible personalproperty from recyclable materials, within the Commonwealth, for sale. Forpurposes of determining "purchase price paid" under this section, thetaxpayer may use the original total capitalized cost of such machinery andequipment, less capitalized interest. The Department of Environmental Qualityshall certify that such machinery and equipment are integral to the recyclingprocess before the taxpayer shall be entitled to the tax credit under thissection. The taxpayer shall also submit purchase receipts, invoices, and suchother documentation as may be necessary to confirm the taxpayer's statementof purchase price paid, with the income tax return to verify the amount ofpurchase price paid for the recycling machinery and equipment.

B. The total credit allowed under this section in any taxable year shall notexceed 40 percent of the Virginia income tax liability of such taxpayer.

C. Any tax credit not used for the taxable year in which the purchase priceon recycling machinery and equipment was paid may be carried over for creditagainst the taxpayer's income taxes in the 10 succeeding taxable years untilthe total credit amount is used.

D. In the event a corporation converts to a partnership, limited liabilitycompany, or electing small business corporation (S corporation), suchbusiness entity shall be entitled to any unused credits of the corporation.Credits earned by a partnership, limited liability company, electing smallbusiness corporation (S corporation), or a predecessor corporation entitledto such credits, shall be allocated to the individual partners, members, orshareholders, respectively, in proportion to their ownership or interest insuch business entities.

(1998, c. 253; 2001, c. 91; 2004, c. 611; 2007, cc. 529, 593; 2009, c. 34.)