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7 LONG TITLE
8 General Description:
9 This bill repeals and amends provisions related to income taxes.
10 Highlighted Provisions:
11 This bill:
12 ▸ repeals provisions related to corporate and individual income tax credits;
13 ▸ exempts a tax credit for a combat related death from certain provisions that require
14 the State Tax Commission to remove a tax credit from a tax return and prohibit a
15 taxpayer from claiming or carrying forward a tax credit;
16 ▸ repeals provisions related to individual income tax contributions; and
17 ▸ makes technical and conforming changes.
18 Money Appropriated in this Bill:
19 None
20 Other Special Clauses:
21 This bill provides a special effective date.
22 This bill provides for retrospective operation.
23 Utah Code Sections Affected:
24 AMENDS:
25 23-14-13, as last amended by Laws of Utah 2010, Chapter 278
26 59-7-105, as last amended by Laws of Utah 2010, Chapters 6 and 198
27 59-7-106, as last amended by Laws of Utah 2014, Chapter 273
28 59-7-614, as last amended by Laws of Utah 2014, Chapter 407
29 59-10-1002.1, as renumbered and amended by Laws of Utah 2008, Chapter 389
30 59-10-1304, as last amended by Laws of Utah 2013, Chapters 235 and 338
31 63M-1-1102, as renumbered and amended by Laws of Utah 2008, Chapter 382
32 REPEALS:
33 59-7-602, as last amended by Laws of Utah 2011, Chapter 366
34 59-7-603, as enacted by Laws of Utah 1993, Chapter 169
35 59-7-608, as last amended by Laws of Utah 2003, Chapter 198
36 59-7-614.3, as last amended by Laws of Utah 2011, Chapter 384
37 59-10-1011, as last amended by Laws of Utah 2011, Chapter 366
38 59-10-1305, as renumbered and amended by Laws of Utah 2008, Chapter 389
39
40 Be it enacted by the Legislature of the state of Utah:
41 Section 1. Section 23-14-13 is amended to read:
42 23-14-13. Wildlife Resources Account.
43 (1) There is created a restricted account within the General Fund known as the
44 "Wildlife Resources Account."
45 (2) The following money shall be deposited into the Wildlife Resources Account:
46 (a) revenue from the sale of licenses, permits, tags, and certificates of registration
47 issued under this title or a rule or proclamation of the Wildlife Board, except as otherwise
48 provided by this title;
49 (b) revenue from the sale, lease, rental, or other granting of rights of real or personal
50 property acquired with revenue specified in Subsection (2)(a);
51 (c) revenue from fines and forfeitures for violations of this title or any rule,
52 proclamation, or order of the Wildlife Board, minus court costs not to exceed the schedule
53 adopted by the Judicial Council;
54 (d) funds appropriated from the General Fund by the Legislature pursuant to Section
55 23-19-39;
56 (e) other money received by the division under any provision of this title, except as
57 otherwise provided by this title; and
58 [
59 [
60 (3) Money in the Wildlife Resources Account shall be used for the administration of
61 this title.
62 Section 2. Section 59-7-105 is amended to read:
63 59-7-105. Additions to unadjusted income.
64 In computing adjusted income the following amounts shall be added to unadjusted
65 income:
66 (1) interest from bonds, notes, and other evidences of indebtedness issued by any state
67 of the United States, including any agency and instrumentality of a state of the United States;
68 (2) the amount of any deduction taken on a corporation's federal return for taxes paid
69 by a corporation:
70 (a) to Utah for taxes imposed by this chapter; and
71 (b) to another state of the United States, a foreign country, a United States possession,
72 or the Commonwealth of Puerto Rico for taxes imposed for the privilege of doing business, or
73 exercising its corporate franchise, including income, franchise, corporate stock and business
74 and occupation taxes;
75 (3) the safe harbor lease adjustment required under Subsections 59-7-111(1)(a) and
76 (2)(a);
77 (4) capital losses that have been deducted on a Utah corporate return in previous years;
78 (5) any deduction on the federal return that has been previously deducted on the Utah
79 return;
80 [
81 [
82
83 [
84 determining federal taxable income;
85 [
86 target corporation under Section 338, Internal Revenue Code, unless such gain or loss has
87 already been included in the unadjusted income of the target corporation;
88 [
89 corporations treated for federal purposes as having disposed of its assets under Section 336(e),
90 Internal Revenue Code, unless such gain or loss has already been included in the unadjusted
91 income of the target corporation;
92 [
93 similar items due to a difference between basis for federal purposes and basis as computed
94 under Section 59-7-107;
95 [
96 Savings Plan, from the account of a corporation that is an account owner as defined in Section
97 53B-8a-102, for the taxable year for which the amount is withdrawn, if that amount withdrawn
98 from the account of the corporation that is the account owner:
99 (a) is not expended for:
100 (i) higher education costs as defined in Section 53B-8a-102; or
101 (ii) a payment or distribution that qualifies as an exception to the additional tax for
102 distributions not used for educational expenses provided in Sections 529(c) and 530(d),
103 Internal Revenue Code; and
104 (b) is subtracted by the corporation:
105 (i) that is the account owner; and
106 (ii) in accordance with Subsection 59-7-106 (1)(r); and
107 [
108 Internal Revenue Code, that is allowed under Section 857(b)(2)(B), Internal Revenue Code, in
109 computing the taxable income of a captive real estate investment trust, if that captive real estate
110 investment trust is subject to federal income taxation.
111 Section 3. Section 59-7-106 is amended to read:
112 59-7-106. Subtractions from unadjusted income.
113 (1) In computing adjusted income the following amounts shall be subtracted from
114 unadjusted income:
115 (a) the foreign dividend gross-up included in gross income for federal income tax
116 purposes under Section 78, Internal Revenue Code;
117 (b) subject to Subsection (2), the net capital loss, as defined for federal purposes, if the
118 taxpayer elects to deduct the net capital loss on the return filed under this chapter for the
119 taxable year for which the net capital loss is incurred;
120 (c) the decrease in salary expense deduction for federal income tax purposes due to
121 claiming the federal work opportunity credit under Section 51, Internal Revenue Code;
122 (d) the decrease in qualified research and basic research expense deduction for federal
123 income tax purposes due to claiming the federal credit for increasing research activities under
124 Section 41, Internal Revenue Code;
125 (e) the decrease in qualified clinical testing expense deduction for federal income tax
126 purposes due to claiming the federal credit for clinical testing expenses for certain drugs for
127 rare diseases or conditions under Section 45C, Internal Revenue Code;
128 (f) any decrease in any expense deduction for federal income tax purposes due to
129 claiming any other federal credit;
130 (g) the safe harbor lease adjustment required under Subsections 59-7-111(1)(b) and
131 (2)(b);
132 (h) any income on the federal corporation income tax return that has been previously
133 taxed by Utah;
134 (i) an amount included in federal taxable income that is due to a refund of a tax,
135 including a franchise tax, an income tax, a corporate stock and business tax, or an occupation
136 tax:
137 (i) if that tax is imposed for the privilege of:
138 (A) doing business; or
139 (B) exercising a corporate franchise;
140 (ii) if that tax is paid by the corporation to:
141 (A) Utah;
142 (B) another state of the United States;
143 (C) a foreign country;
144 (D) a United States possession; or
145 (E) the Commonwealth of Puerto Rico; and
146 (iii) to the extent that tax was added to unadjusted income under Section 59-7-105;
147 (j) a charitable contribution, to the extent the charitable contribution is allowed as a
148 subtraction under Section 59-7-109;
149 (k) subject to Subsection (3), 50% of a dividend considered to be received or received
150 from a subsidiary that:
151 (i) is a member of the unitary group;
152 (ii) is organized or incorporated outside of the United States; and
153 (iii) is not included in a combined report under Section 59-7-402 or 59-7-403;
154 (l) subject to Subsection (4) and Section 59-7-401, 50% of the adjusted income of a
155 foreign operating company;
156 (m) the amount of gain or loss that is included in unadjusted income but not recognized
157 for federal purposes on stock sold or exchanged by a member of a selling consolidated group as
158 defined in Section 338, Internal Revenue Code, if an election has been made in accordance
159 with Section 338(h)(10), Internal Revenue Code;
160 (n) the amount of gain or loss that is included in unadjusted income but not recognized
161 for federal purposes on stock sold, exchanged, or distributed by a corporation in accordance
162 with Section 336(e), Internal Revenue Code, if an election under Section 336(e), Internal
163 Revenue Code, has been made for federal purposes;
164 (o) subject to Subsection (5), an adjustment to the following due to a difference
165 between basis for federal purposes and basis as computed under Section 59-7-107:
166 (i) an amortization expense;
167 (ii) a depreciation expense;
168 (iii) a gain;
169 (iv) a loss; or
170 (v) an item similar to Subsections (1)(o)(i) through (iv);
171 (p) an interest expense that is not deducted on a federal corporation income tax return
172 under Section 265(b) or 291(e), Internal Revenue Code;
173 (q) 100% of dividends received from a subsidiary that is an insurance company if that
174 subsidiary that is an insurance company is:
175 (i) exempt from this chapter under Subsection 59-7-102(1)(c); and
176 (ii) under common ownership;
177 (r) subject to Subsection 59-7-105[
178 defined in Section 53B-8a-102 that:
179 (i) a corporation that is an account owner as defined in Section 53B-8a-102 makes
180 during the taxable year;
181 (ii) the corporation described in Subsection (1)(r)(i) does not deduct on a federal
182 corporation income tax return; and
183 (iii) does not exceed the maximum amount of the qualified investment that may be
184 subtracted from unadjusted income for a taxable year in accordance with Subsection
185 53B-8a-106(1);
186 (s) for purposes of income included in a combined report under Part 4, Combined
187 Reporting, the entire amount of the dividends a member of a unitary group receives or is
188 considered to receive from a captive real estate investment trust; and
189 (t) the increase in income for federal income tax purposes due to claiming a:
190 (i) qualified tax credit bond credit under Section 54A, Internal Revenue Code; or
191 (ii) qualified zone academy bond under Section 1397E, Internal Revenue Code.
192 (2) For purposes of Subsection (1)(b):
193 (a) the subtraction shall be made by claiming the subtraction on a return filed:
194 (i) under this chapter for the taxable year for which the net capital loss is incurred; and
195 (ii) by the due date of the return, including extensions; and
196 (b) a net capital loss for a taxable year shall be:
197 (i) subtracted for the taxable year for which the net capital loss is incurred; or
198 (ii) carried forward as provided in Sections 1212(a)(1)(B) and (C), Internal Revenue
199 Code.
200 (3) (a) For purposes of calculating the subtraction provided for in Subsection (1)(k), a
201 taxpayer shall first subtract from a dividend considered to be received or received an expense
202 directly attributable to that dividend.
203 (b) For purposes of Subsection (3)(a), the amount of an interest expense that is
204 considered to be directly attributable to a dividend is calculated by multiplying the interest
205 expense by a fraction:
206 (i) the numerator of which is the taxpayer's average investment in the dividend paying
207 subsidiaries; and
208 (ii) the denominator of which is the taxpayer's average total investment in assets.
209 (c) (i) For purposes of calculating the subtraction allowed by Subsection (1)(k), in
210 determining income apportionable to this state, a portion of the factors of a foreign subsidiary
211 that has dividends that are partially subtracted under Subsection (1)(k) shall be included in the
212 combined report factors as provided in this Subsection (3)(c).
213 (ii) For purposes of Subsection (3)(c)(i), the portion of the factors of a foreign
214 subsidiary that has dividends that are partially subtracted under Subsection (1)(k) that shall be
215 included in the combined report factors is calculated by multiplying each factor of the foreign
216 subsidiary by a fraction:
217 (A) not to exceed 100%; and
218 (B) (I) the numerator of which is the amount of the dividend paid by the foreign
219 subsidiary that is included in adjusted income; and
220 (II) the denominator of which is the current year earnings and profits of the foreign
221 subsidiary as determined under the Internal Revenue Code.
222 (4) (a) For purposes of Subsection (1)(l), a taxpayer may not make a subtraction under
223 Subsection (1)(l):
224 (i) if the taxpayer elects to file a worldwide combined report as provided in Section
225 59-7-403; or
226 (ii) for the following:
227 (A) income generated from intangible property; or
228 (B) a capital gain, dividend, interest, rent, royalty, or other similar item that is
229 generated from an asset held for investment and not from a regular business trading activity.
230 (b) In calculating the subtraction provided for in Subsection (1)(l), a foreign operating
231 company:
232 (i) may not subtract an amount provided for in Subsection (1)(k) or (l); and
233 (ii) prior to determining the subtraction under Subsection (1)(l), shall eliminate a
234 transaction that occurs between members of a unitary group.
235 (c) For purposes of the subtraction provided for in Subsection (1)(l), in determining
236 income apportionable to this state, the factors for a foreign operating company shall be
237 included in the combined report factors in the same percentages as the foreign operating
238 company's adjusted income is included in the combined adjusted income.
239 (d) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
240 commission may by rule define what constitutes:
241 (i) income generated from intangible property; or
242 (ii) a capital gain, dividend, interest, rent, royalty, or other similar item that is
243 generated from an asset held for investment and not from a regular business trading activity.
244 (5) (a) For purposes of the subtraction provided for in Subsection (1)(o), the amount of
245 a reduction in basis shall be allowed as an expense for the taxable year in which a federal tax
246 credit is claimed if:
247 (i) there is a reduction in federal basis for a federal tax credit; and
248 (ii) there is no corresponding tax credit allowed in this state.
249 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
250 commission may by rule define what constitutes an item similar to Subsections (1)(o)(i)
251 through (iv).
252 Section 4. Section 59-7-614 is amended to read:
253 59-7-614. Renewable energy systems tax credit -- Definitions -- Limitations --
254 Certification -- Rulemaking authority.
255 (1) As used in this section:
256 (a) "Active solar system":
257 (i) means a system of equipment capable of collecting and converting incident solar
258 radiation into thermal, mechanical, or electrical energy, and transferring these forms of energy
259 by a separate apparatus to storage or to the point of use; and
260 (ii) includes water heating, space heating or cooling, and electrical or mechanical
261 energy generation.
262 (b) "Biomass system" means any system of apparatus and equipment for use in
263 converting material into biomass energy, as defined in Section 59-12-102, and transporting that
264 energy by separate apparatus to the point of use or storage.
265 (c) "Business entity" means any sole proprietorship, estate, trust, partnership,
266 association, corporation, cooperative, or other entity under which business is conducted or
267 transacted.
268 (d) "Commercial energy system" means any active solar, passive solar, geothermal
269 electricity, direct-use geothermal, geothermal heat-pump system, wind, hydroenergy, or
270 biomass system used to supply energy to a commercial unit or as a commercial enterprise.
271 (e) "Commercial enterprise" means a business entity whose purpose is to produce
272 electrical, mechanical, or thermal energy for sale from a commercial energy system.
273 (f) (i) "Commercial unit" means any building or structure that a business entity uses to
274 transact its business.
275 (ii) Notwithstanding Subsection (1)(f)(i):
276 (A) in the case of an active solar system used for agricultural water pumping or a wind
277 system, each individual energy generating device shall be a commercial unit; and
278 (B) if an energy system is the building or structure that a business entity uses to
279 transact its business, a commercial unit is the complete energy system itself.
280 (g) "Direct-use geothermal system" means a system of apparatus and equipment
281 enabling the direct use of thermal energy, generally between 100 and 300 degrees Fahrenheit,
282 that is contained in the earth to meet energy needs, including heating a building, an industrial
283 process, and aquaculture.
284 (h) "Geothermal electricity" means energy contained in heat that continuously flows
285 outward from the earth that is used as a sole source of energy to produce electricity.
286 (i) "Geothermal heat-pump system" means a system of apparatus and equipment
287 enabling the use of thermal properties contained in the earth at temperatures well below 100
288 degrees Fahrenheit to help meet heating and cooling needs of a structure.
289 (j) "Hydroenergy system" means a system of apparatus and equipment capable of
290 intercepting and converting kinetic water energy into electrical or mechanical energy and
291 transferring this form of energy by separate apparatus to the point of use or storage.
292 (k) "Individual taxpayer" means any person who is a taxpayer as defined in Section
293 59-10-103 and an individual as defined in Section 59-10-103.
294 (l) "Office" means the Office of Energy Development created in Section 63M-4-401.
295 (m) "Passive solar system":
296 (i) means a direct thermal system that utilizes the structure of a building and its
297 operable components to provide for collection, storage, and distribution of heating or cooling
298 during the appropriate times of the year by utilizing the climate resources available at the site;
299 and
300 (ii) includes those portions and components of a building that are expressly designed
301 and required for the collection, storage, and distribution of solar energy.
302 (n) "Residential energy system" means any active solar, passive solar, biomass,
303 direct-use geothermal, geothermal heat-pump system, wind, or hydroenergy system used to
304 supply energy to or for any residential unit.
305 (o) "Residential unit" means any house, condominium, apartment, or similar dwelling
306 unit that serves as a dwelling for a person, group of persons, or a family but does not include
307 property subject to a fee under:
308 (i) Section 59-2-404;
309 (ii) Section 59-2-405;
310 (iii) Section 59-2-405.1;
311 (iv) Section 59-2-405.2; or
312 (v) Section 59-2-405.3.
313 (p) "Wind system" means a system of apparatus and equipment capable of intercepting
314 and converting wind energy into mechanical or electrical energy and transferring these forms of
315 energy by a separate apparatus to the point of use, sale, or storage.
316 (2) (a) (i) A business entity that purchases and completes or participates in the
317 financing of a residential energy system to supply all or part of the energy required for a
318 residential unit owned or used by the business entity and located in the state may claim a
319 nonrefundable tax credit as provided in this Subsection (2)(a).
320 (ii) (A) The tax credit is equal to 25% of the reasonable costs of each residential energy
321 system installed with respect to each residential unit the business entity owns or uses, including
322 installation costs, against any tax due under this chapter for the taxable year in which the
323 energy system is completed and placed in service.
324 (B) The total amount of each tax credit under this Subsection (2)(a) may not exceed
325 $2,000 per residential unit.
326 (C) The tax credit under this Subsection (2)(a) is allowed for any residential energy
327 system completed and placed in service on or after January 1, 2007.
328 (iii) If a business entity sells a residential unit to an individual taxpayer before making
329 a claim for the tax credit under this Subsection (2)(a), the business entity may:
330 (A) assign its right to this tax credit to the individual taxpayer; and
331 (B) if the business entity assigns its right to the tax credit to an individual taxpayer
332 under Subsection (2)(a)(iii)(A), the individual taxpayer may claim the tax credit as if the
333 individual taxpayer had completed or participated in the costs of the residential energy system
334 under Section 59-10-1014.
335 (b) (i) A business entity that purchases or participates in the financing of a commercial
336 energy system situated in Utah may claim a refundable tax credit as provided in this Subsection
337 (2)(b) if the commercial energy system does not use wind, geothermal electricity, solar, or
338 biomass equipment capable of producing a total of 660 or more kilowatts of electricity or if the
339 commercial energy system does not use solar equipment capable of producing 2,000 or more
340 kilowatts of electricity, and:
341 (A) the commercial energy system supplies all or part of the energy required by
342 commercial units owned or used by the business entity; or
343 (B) the business entity sells all or part of the energy produced by the commercial
344 energy system as a commercial enterprise.
345 (ii) (A) A business entity is entitled to a tax credit of up to 10% of the reasonable costs
346 of any commercial energy system installed, including installation costs, against any tax due
347 under this chapter for the taxable year in which the commercial energy system is completed and
348 placed in service.
349 (B) Notwithstanding Subsection (2)(b)(ii)(A), the total amount of the tax credit under
350 this Subsection (2)(b) may not exceed $50,000 per commercial unit.
351 (C) The tax credit under this Subsection (2)(b) is allowed for any commercial energy
352 system completed and placed in service on or after January 1, 2007.
353 (iii) A business entity that leases a commercial energy system installed on a
354 commercial unit is eligible for the tax credit under this Subsection (2)(b) if the lessee can
355 confirm that the lessor irrevocably elects not to claim the tax credit.
356 (iv) Only the principal recovery portion of the lease payments, which is the cost
357 incurred by a business entity in acquiring a commercial energy system, excluding interest
358 charges and maintenance expenses, is eligible for the tax credit under this Subsection (2)(b).
359 (v) A business entity that leases a commercial energy system is eligible to use the tax
360 credit under this Subsection (2)(b) for a period no greater than seven years from the initiation
361 of the lease.
362 (vi) A tax credit allowed by this Subsection (2)(b) may not be carried forward or
363 carried back.
364 (c) (i) A business entity that owns a commercial energy system located in the state
365 using wind, geothermal electricity, or biomass equipment capable of producing a total of 660 or
366 more kilowatts of electricity may claim a refundable tax credit as provided in this Subsection
367 (2)(c) if:
368 (A) the commercial energy system supplies all or part of the energy required by
369 commercial units owned or used by the business entity; or
370 (B) the business entity sells all or part of the energy produced by the commercial
371 energy system as a commercial enterprise.
372 (ii) (A) A business entity may claim a tax credit under this section equal to the product
373 of:
374 (I) 0.35 cents; and
375 (II) the kilowatt hours of electricity produced and either used or sold during the taxable
376 year.
377 (B) (I) The tax credit calculated under Subsection (2)(c)(ii)(A) may be claimed for
378 production occurring during a period of 48 months beginning with the month in which the
379 commercial energy system is placed in commercial service.
380 (II) The tax credit allowed by this Subsection (2)(c) for each year may not be carried
381 forward or carried back.
382 (C) The tax credit under this Subsection (2)(c) is allowed for any commercial energy
383 system completed and placed in service on or after January 1, 2007.
384 (iii) A business entity that leases a commercial energy system installed on a
385 commercial unit is eligible for the tax credit under this Subsection (2)(c) if the lessee can
386 confirm that the lessor irrevocably elects not to claim the tax credit.
387 (d) (i) A tax credit under Subsection (2)(a) or (b) may be claimed for the taxable year
388 in which the energy system is completed and placed in service.
389 (ii) Additional energy systems or parts of energy systems may be claimed for
390 subsequent years.
391 (iii) If the amount of a tax credit under Subsection (2)(a) exceeds a business entity's tax
392 liability under this chapter for a taxable year, the amount of the tax credit exceeding the
393 liability may be carried forward for a period that does not exceed the next four taxable years.
394 (3) (a) A business entity that owns a commercial energy system located in the state that
395 uses solar equipment capable of producing a total of 660 or more kilowatts of electricity may
396 claim a refundable tax credit as provided in this Subsection (3) if:
397 (i) (A) the commercial energy system supplies all or part of the energy required by
398 commercial units owned or used by the business entity; or
399 (B) the business entity sells all or part of the energy produced by the commercial
400 energy system as a commercial enterprise; and
401 (ii) the business entity does not claim a tax credit under Subsection (2)(b).
402 (b) A business entity may claim a tax credit under this section equal to the product of:
403 (i) 0.35 cents; and
404 (ii) the kilowatt hours of electricity produced and either used or sold during the taxable
405 year.
406 (c) The tax credit under this Subsection (3) may be claimed for production occurring
407 during a period of 48 months beginning with the month in which the commercial energy
408 system is placed in commercial service.
409 (d) The tax credit under this Subsection (3) may not be carried forward or carried back.
410 (e) The tax credit under this Subsection (3) is allowed for a commercial energy system
411 completed and placed in service on or after January 1, 2015.
412 (f) A business entity that leases a commercial energy system installed on a commercial
413 unit may claim a tax credit under this Subsection (3) if the business entity that is the lessee can
414 confirm that the lessor irrevocably elects not to claim the tax credit.
415 (4) (a) [
416 under Subsection (2) or (3) are in addition to any tax credits provided under the laws or rules
417 and regulations of the United States.
418 [
419
420
421 [
422 claiming a tax credit under Subsections (2)(a) and (b) that cover the safety, reliability,
423 efficiency, leasing, and technical feasibility of the systems to ensure that the systems eligible
424 for the tax credit use the state's renewable and nonrenewable energy resources in an appropriate
425 and economic manner.
426 (ii) The office may set standards for residential and commercial energy systems that
427 establish the reasonable costs of an energy system, as used in Subsections (2)(a)(ii)(A) and
428 (2)(b)(ii)(A), as an amount per unit of energy production.
429 (iii) A tax credit may not be taken under Subsection (2) or (3) until the office has
430 certified that the energy system has been completely installed and is a viable system for saving
431 or production of energy from renewable resources.
432 [
433 Chapter 3, Utah Administrative Rulemaking Act, that are necessary to implement this section.
434 (5) (a) On or before October 1, 2012, and every five years thereafter, the Revenue and
435 Taxation Interim Committee shall review each tax credit provided by this section and report its
436 recommendations to the Legislative Management Committee concerning whether the tax credit
437 should be continued, modified, or repealed.
438 (b) The Revenue and Taxation Interim Committee's report under Subsection (5)(a)
439 shall include information concerning the cost of the tax credit, the purpose and effectiveness of
440 the tax credit, and the state's benefit from the tax credit.
441 Section 5. Section 59-10-1002.1 is amended to read:
442 59-10-1002.1. Removal of tax credit from tax return and prohibition on claiming
443 or carrying forward a tax credit -- Conditions for removal and prohibition on claiming or
444 carrying forward a tax credit -- Exception -- Commission reporting requirements.
445 (1) As used in this section, "tax return" means a tax return filed in accordance with this
446 chapter.
447 (2) [
448 after the requirements of Subsection (3) are met:
449 (a) the commission shall remove a tax credit allowed under this part from each tax
450 return on which the tax credit appears; and
451 (b) a claimant, estate, or trust filing a tax return may not claim or carry forward the tax
452 credit.
453 (3) [
454 credit allowed under this part from a tax return and a claimant, estate, or trust filing a tax return
455 may not claim or carry forward the tax credit as provided in Subsection (2) if:
456 (a) the total amount of the tax credit claimed or carried forward by all claimants,
457 estates, or trusts filing tax returns is less than $10,000 per year for three consecutive taxable
458 years beginning on or after January 1, 2002; and
459 (b) less than 10 claimants, estates, and trusts per year for the three consecutive taxable
460 years described in Subsection (3)(a), file a tax return claiming or carrying forward the tax
461 credit.
462 (4) This section does not apply to a tax credit under Section 59-10-1027.
463 [
464 after the taxable year in which the requirements of Subsection (3) are met:
465 (a) report to the Revenue and Taxation Interim Committee that in accordance with this
466 section:
467 (i) the commission is required to remove a tax credit from each tax return on which the
468 tax credit appears; and
469 (ii) a claimant, estate, or trust filing a tax return may not claim or carry forward the tax
470 credit; and
471 (b) notify each state agency required by statute to assist in the administration of the tax
472 credit that in accordance with this section:
473 (i) the commission is required to remove a tax credit from each tax return on which the
474 tax credit appears; and
475 (ii) a claimant, estate, or trust filing a tax return may not claim or carry forward the tax
476 credit.
477 Section 6. Section 59-10-1304 is amended to read:
478 59-10-1304. Removal of designation and prohibitions on collection for certain
479 contributions on income tax return -- Conditions for removal and prohibitions on
480 collection -- Commission reporting requirements.
481 (1) (a) If a contribution or combination of contributions described in Subsection (1)(b)
482 generate less than $30,000 per year for three consecutive years, the commission shall remove
483 the designation for the contribution from the individual income tax return and may not collect
484 the contribution from a resident or nonresident individual beginning two taxable years after the
485 three-year period for which the contribution generates less than $30,000 per year.
486 (b) The following contributions apply to Subsection (1)(a):
487 [
488 [
489 [
490 [
491 [
492 [
493 [
494 (A) Section 59-10-1316; and
495 (B) Section 59-10-1317; or
496 [
497 (2) If the commission removes the designation for a contribution under Subsection (1),
498 the commission shall report to the Revenue and Taxation Interim Committee that the
499 commission removed the designation on or before the November interim meeting of the year in
500 which the commission determines to remove the designation.
501 Section 7. Section 63M-1-1102 is amended to read:
502 63M-1-1102. Definitions.
503 As used in this part:
504 (1) "Composting" means the controlled decay of landscape waste or sewage sludge and
505 organic industrial waste, or a mixture of these, by the action of bacteria, fungi, molds, and other
506 organisms.
507 (2) "Postconsumer waste material" means any product generated by a business or
508 consumer that has served its intended end use, and that has been separated from solid waste for
509 the purposes of collection, recycling, and disposition and that does not include secondary waste
510 material.
511 (3) (a) "Recovered materials" means waste materials and by-products that have been
512 recovered or diverted from solid waste.
513 (b) "Recovered materials" does not include those materials and by-products generated
514 from, and commonly reused within, an original manufacturing process.
515 (4) (a) "Recycling" means the diversion of materials from the solid waste stream and
516 the beneficial use of the materials and includes a series of activities by which materials that
517 would become or otherwise remain waste are diverted from the waste stream for collection,
518 separation, and processing, and are used as raw materials or feedstocks in lieu of or in addition
519 to virgin materials in the manufacture of goods sold or distributed in commerce or the reuse of
520 the materials as substitutes for goods made from virgin materials.
521 (b) "Recycling" does not include burning municipal solid waste for energy recovery.
522 (5) "Recycling market development zone" or "zone" means an area designated by the
523 office as meeting the requirements of this part.
524 (6) (a) "Secondary waste material" means industrial by-products that go to disposal
525 facilities and waste generated after completion of a manufacturing process.
526 (b) "Secondary waste material" does not include internally generated scrap commonly
527 returned to industrial or manufacturing processes, such as home scrap and mill broke.
528 (7) [
529 [
530 59-7-610 or 59-10-1007.
531 Section 8. Repealer.
532 This bill repeals:
533 Section 59-7-602, Credit for cash contributions to sheltered workshops.
534 Section 59-7-603, Credit for sophisticated technological equipment donated to
535 schools.
536 Section 59-7-608, Targeted jobs tax credit.
537 Section 59-7-614.3, Nonrefundable tax credit for qualifying solar projects.
538 Section 59-10-1011, Tutoring tax credits for dependents with a disability.
539 Section 59-10-1305, Nongame wildlife contribution -- Credit to Wildlife Resources
540 Account.
541 Section 9. Effective date.
542 (1) Except as provided in Subsection (2), this bill takes effect on May 12, 2015.
543 (2) The actions affecting the following have retrospective operation for a taxable year
544 beginning on or after January 1, 2015:
545 (a) Section 59-7-105;
546 (b) Section 59-7-106;
547 (c) Section 59-7-602;
548 (d) Section 59-7-603;
549 (e) Section 59-7-608;
550 (f) Section 59-7-614;
551 (g) Section 59-7-614.3;
552 (h) Section 59-10-1002.1;
553 (i) Section 59-10-1011;
554 (j) Section 59-10-1304;
555 (k) Section 59-10-1305; and
556 (l) Section 63M-1-1102.