§ 12-6-3585 — Industry Partnership Fund tax credit.

South Carolina § 12-6-3585

• Jurisdiction: South Carolina
• Title 12: TAXATION
• Ch. 6: SOUTH CAROLINA INCOME TAX ACT

Text

(A) For each tax year beginning after 2022, a taxpayer may claim as a credit against state income tax imposed by Chapter 6, Title 12, bank tax imposed by Chapter 11, Title 12, license fees imposed by Chapter 20, Title 12, or insurance premiums imposed by Chapter 7, Title 38, or any combination of them, one hundred percent of an amount contributed to the Industry Partnership Fund at the South Carolina Research Authority (SCRA), or an SCRA-designated affiliate, or both, pursuant to Section 13-17-88(E), up to a maximum credit of five hundred thousand dollars for a single taxpayer, not to exceed an aggregate credit of twelve million dollars for all taxpayers. If the aggregate credit of twelve million dollars for all taxpayers is not met within sixty days of the annual opening date for the application for the credit, the single taxpayer maximum credit is automatically increased to one million dollars for the remainder of that year until the maximum aggregate credit of twelve million dollars is met. For purposes of determining a taxpayer's entitlement to the credit for qualified contributions for a given tax year in which more than the applicable aggregate annual limit on the credit is contributed by taxpayers for that year, taxpayers who have made contributions that are intended to be qualified contributions earlier in the applicable tax year than other taxpayers must be given priority entitlement to the credit. The SCRA shall certify to taxpayers who express a bona fide intention of making one or more qualified contributions as to whether the taxpayer is entitled to that priority. (B) The amount of the credit is equal to one hundred percent of the amount of the taxpayer's qualified contributions to the Industry Partnership Fund, subject to the limitations in this section. The credit is nonrefundable. (C) The use of the credit is limited to the taxpayer's applicable income or premium tax or license fee liability for the tax year of the taxpayer after the application of all other credits. An unused credit may be carried forward ten tax years after the tax year of the taxpayer during which the qualified contribution was made. (D) A contribution is not a qualified contribution if it is subject to conditions or limitations regarding the use of the contribution. (E) "Taxpayer" means an individual, corporation, partnership, trust, bank, insurance company, or other entity having a state income or insurance premium tax or license fee liability who has made a qualified contribution. However, for purposes of this section, any member of the SCRA board of trustees or the SC Launch!, Inc. board of directors is not considered a taxpayer, and may not claim the credit allowed by this section. (F) To qualify for the credit, the taxpayer shall retain a form provided by SCRA identifying the taxpayer and the year and amount of credit for which the taxpayer qualifies. The Department of Revenue may require a copy of the form be attached to the taxpayer's income tax return or be provided otherwise to the department. Also, to qualify for the credit, a taxpayer who is certified by SCRA under subsection (A) as having priority entitlement to the credit for an applicable year must make a commitment satisfactory to SCRA, at such time as SCRA may deem appropriate, but no later than April first of such year, to make the contribution during such year. (G) The department may require information and submissions by the taxpayer as it considers appropriate in relation to a taxpayer's claim of entitlement to the credit. (H) The merger, consolidation, or reorganization of a corporation where tax attributes survive does not create new eligibility in a succeeding corporation, but unused credits may be transferred and continued by the succeeding corporation. In addition, a corporation or partnership may assign its rights to its unused credit to another corporation or partnership if it transfers all, or substantially all, of the assets of the corporation or partnership or all, or substantially all, of the assets of the trade or business or operating division of the corporation or partnership to another corporation or partnership. (I) A taxpayer who claims the credit may not take a deduction in relation to the qualified contribution which gives rise to such credit. (J)(1) By March fifteenth of each year, the South Carolina Research Authority shall issue a report to the Chairman of the Senate Finance Committee, the Chairman of the House of Representatives Ways and Means Committee, and the Governor detailing the amount contributed to the Industry Partnership Fund in the previous tax year that entitled the taxpayer to the credit allowed by this section, the taxpayers that received the credit, and the manner in which such contributions were expended or are expected to be expended. (2) The report shall also include, by county, the number of taxpayers who express a bona fide intention to contribute to the Industry Partnership Fund, the number of taxpayers whom the SCRA certified as entitled to receive the Industry Partnership Fund tax credit, and the amount of Industry Partnership Fund contributions that received such certification from SCRA. (3) The report also must be posted in a conspicuous place on the website maintained by the South Carolina Research Authority.

Legislative History

HISTORY: 2006 Act No. 319, SECTION 3.A, eff June 1, 2006; 2007 Act No. 110, SECTION 16.A, eff June 21, 2007, applicable to tax years beginning after December 31, 2005; 2007 Act No. 110, SECTION 41, eff June 21, 2007; 2007 Act No. 116, SECTION 22.A, eff June 28, 2007, applicable to tax years beginning after December 31, 2005; 2019 Act No. 15 (H.3595), SECTION 1.A, eff March 28, 2019 and January 1, 2020; 2019 Act No. 15 (H.3595), SECTION 2, eff January 1, 2020; 2022 Act No. 172 (S.635), SECTION 4, eff May 16, 2022; 2024 Act No. 134 (H.3811), SECTION 1, eff May 13, 2024. Editor's Note 2006 Act No. 319, SECTION 1, provides as follows: "This act may be cited as the 'Industry Partners Act"'. 2019 Act No. 15, SECTIONS 1.B and 3, provide as follows: "[SECTION 1.]B. Notwithstanding the increase in the annual maximum credit amount for all taxpayers from six million dollars to nine million dollars in Section 12-6-3585, as amended by this SECTION, the increased maximum credit amount shall be phased in in three equal and cumulative installment amounts beginning in tax years beginning after 2018." "SECTION 3. This act takes effect upon approval by the Governor and applies to tax years beginning after 2018, except that the Section 1 amendment to Section 12-6-3585(F) and Section 2 shall not take effect until January 1, 2020." Effect of Amendment 2019 Act No. 15, SECTION 1.A, in (A), in the first sentence, substituted "For each tax year beginning after 2018, a taxpayer" for "A taxpayer", "Chapter 20, Title 12" for "Chapter 20 of Title 12", "two hundred fifty thousand dollars for a single taxpayer" for "six hundred fifty thousand dollars for a single taxpayer", and "nine million dollars for all taxpayers" for "two million dollars for all taxpayers in tax year 2006; up to a maximum credit of one million three hundred dollars for a single taxpayer, not to exceed an aggregate credit of four million dollars for all taxpayers in the year 2007; and up to a maximum credit of two million dollars for a single taxpayer, not to exceed an aggregate credit of six million dollars for all taxpayers for each tax year beginning after December 31, 2007"; in (E), added the second sentence; and in (F), added the third sentence. 2019 Act No. 15, SECTION 2, added (J). 2022 Act No. 172, SECTION 4, in (A), in the first sentence, substituted "2020" for "2018" and "five hundred thousand" for "two hundred fifty thousand", inserted the second sentence, and made a nonsubstantive change. 2024 Act No. 134, SECTION 1, in (A), in the first sentence, substituted "2022" for "2020", and "twelve million dollars" for "nine millions dollars", and in the second sentence, substituted "twelve million dollars" for "nine million dollars" in two places.