Current through Register Vol. XLI, No. 50, December 13, 2024
Section 117-5-5 - Application of the Tax Credit5.1. Business Franchise Tax. -- The tax credit is first applied to reduce taxes imposed upon the eligible taxpayer by W. Va. Code § 11-23-1 et seq. for the taxable year (determined after application of the credits against tax provided in W. Va. Code § 11-23-17, but before application of any other allowable credits against tax).5.2. Corporation Net Income Taxes. -- After application of subsection 5.1 of this Rule, any unused tax credit is next applied to reduce the taxes imposed upon the eligible taxpayer by W. Va. Code § 11-24-1 et seq. for the taxable year (determined before application of allowable credits against tax). 5.2.a. If the eligible taxpayer is a limited liability company, an electing small business corporation (as defined in section 1361 of the United States Internal Revenue Code of 1986, as amended), or a partnership, any unused tax credit remaining after application of subsections 5.1 and 5.2 of this Rule is allowed as a tax credit against the taxes imposed by W. Va. Code § 11-24-1 et seq. on owners of the eligible taxpayer. 5.2.a.1. Electing small business corporations, limited liability companies, and partnerships shall allocate the tax credit allowed by the Statute among their owners in the same manner as profits and losses are allocated for the taxable year.5.3. Personal Income Taxes. -- After application of subsections 5.1 and 5.2 of this Rule and subdivision 5.2.a of this Rule any unused tax credit is next applied to reduce the taxes imposed by W. Va. Code § 11-21-1 et seq. for the taxable year (determined before application of allowable credits against tax) of the eligible taxpayer.5.3.a. If the eligible taxpayer is a limited liability company, an electing small business corporation (as defined in section 1361 of the United States Internal Revenue Code of 1986, as amended), or a partnership, any unused tax credit remaining after application of subsections 5.1, 5.2 and 5.3 of this Rule and subdivision 5.2.a of this Rule is allowed as a tax credit against the taxes imposed by W. Va. Code § 11-21-1 et seq. on owners of the eligible taxpayer. 5.3.a.1. Electing small business corporations, limited liability companies, and partnerships shall allocate the tax credit allowed by the Statute among their owners in the same manner as profits and losses are allocated for the taxable year.5.4. Withholding tax -- No tax credit is allowed under the Statute against any withholding tax imposed by, or payable under, W. Va. Code § 11-21-1 et seq.5.5. Unused Credit Carry Forward. -- If the tax credit allowed under the Statute in any taxable year exceeds the sum of taxes enumerated in subsections 5.1, 5.2 and 5.3 of this Rule and subdivisions 5.2.a and 5.3.a of this Rule for that taxable year, the eligible taxpayer and owners of eligible taxpayers described in subdivisions 5.2.a and 5.3.a of this Rule may apply the excess as a tax credit against those taxes, in the order and manner stated in this section, for succeeding taxable years until the earlier of the following: 5.5.a. The full amount of the excess tax credit is used; or5.5.b. The expiration of the fourth taxable year after the taxable year in which the investment was made. The tax credit remaining thereafter is forfeited.