§6031. Louisiana Community Economic Development Act; tax credits; amount; duration; forfeit

A.(1)(a) Except as provided in Subsection B of this Section, a taxpayer may earn and apply for and, if qualified, be granted a credit on any income or corporation franchise tax liability owed to the state by the taxpayer seeking to claim the credit, in the amount approved by the secretary of the Department of Economic Development for the amount of money donated, contributed, or represented by a sale below cost by the taxpayer to a certified community development corporation or a certified community development financial institution, as defined in R.S. 33:130.751, et seq. The value of such tax credit shall not exceed five hundred thousand dollars per year per individual or one million dollars per year per business and one million total per individual and two million total per business.

(b) Except as otherwise provided in this Section, the credit shall be allowed against the income tax for the taxable period in which the credit is earned and the franchise tax for the taxable period following the period in which the credit is earned.

(2)(a) The credits approved by the Department of Economic Development shall be granted at the rate of twenty-five percent of the amount of the donation, contribution, or sale below cost, with the credit for businesses divided in equal portions for five years, subject to the limitations provided for in Paragraph (1) of this Subsection.

(b) After certifying the eligibility of the certified community development corporation or the certified community development financial institution and the amount of the donation, contribution or sale below cost, the Department of Economic Development shall issue a tax credit certificate, a copy of which is to be attached to the tax return of the taxpayer.

(c) The tax credit certificate shall contain the taxpayer's name, whether an individual or a corporation, address, social security or tax identification number, the amount of the credit and the name of the certified community development corporation or the certified community development financial institution, and other information required by the Department of Revenue.

(d) The tax credit certificate, unless rescinded by the Department of Economic Development, shall be accepted by the Department of Revenue as proof of the credit.

(e) The Department of Economic Development shall maintain a list of the tax credit certificates issued.

(3)(a) All entities taxed as corporations for Louisiana income or corporation franchise tax purposes shall claim any credit allowed under this Section on their corporate income and corporate franchise tax return.

(b) Individuals shall claim any credit allowed under this Section on their individual income tax return.

(c) Estates or trusts shall claim any tax credit allowed under this Section on their fiduciary income tax returns.

(d) Entities not taxed as corporations shall claim any credit allowed under this Section on the returns of the partners or members as follows:

(i) Corporate partners or members shall claim their share of the credit on their corporation income or corporation franchise tax returns.

(ii) Individual partners or members shall claim their share of the credit on their individual income tax returns.

(iii) Partners or members that are estates or trusts shall claim their share of the credit on their fiduciary income tax returns.

B. A tax credit granted pursuant to this Section shall expire and have no value or effect on tax liability beginning with the sixth tax year after the tax year in which it was originally granted.

C. Cash donation or contribution. Any donation or contribution of cash to a certified community development corporation or to a certified community development financial institution will not qualify for this tax credit unless approved and accepted by the governing board of the certified community development corporation or the certified community development financial institution, and certified by the Department of Economic Development.

D. Donation or sale below cost of tangible movable property.

(1) New property.

(a) The value of the credit against income tax liability shall be based upon the donor's or seller's actual cost of new items of property, not on retail value.

(b) An invoice or receipt showing the donor's or seller's actual purchase price shall accompany all donations or sales below cost of new tangible movable property valued at five thousand dollars or more.

(2) Used property.

(a) The value of the credit against income tax liability for used property donated or sold below cost shall be based upon an appraisal obtained by the certified community development corporation or the certified community development financial institution.

(b) Used property sold below cost shall mean a sale below the appraised value of the tangible movable property.

(3) Any donation or sale below cost of tangible movable property the cost or appraised value of which is greater than five thousand dollars shall be approved and accepted by the governing board of the certified community development corporation or the certified community financial institution and certified by the Department of Economic Development.

(4) The donor or seller shall attach the certification to the income tax return filed with the Department of Revenue.

(5) The amount of credit shall be the value of the credit as determined in this Subsection, less the price received by the tax payer from the certified community development corporation or the certified community financial institution.

E. Unless re-authorized by the legislature, the provisions of this Section shall expire on August 15, 2010 and this Section and all other laws and regulations governing, authorizing, and otherwise dealing with community development corporations and community development financial institutions are deemed repealed on that date. However, any tax credit earned pursuant to this Section may be carried forward as a tax credit against taxes as provided for herein.

Acts 2007, No. 374, §2, eff. July 10, 2007.