Looking for a North Dakota Tax Forms And Templates? Download it for free!

North Dakota Office of State Tax Commissioner

2003 Schedule RZ instructions

Line 15

Purchase

The tax credit is equal to $2,000 per year

•

—If the zone project

(investment income only)

Five-

over a five-year credit period—see

consists of the purchase of a business,

If you qualified for the investment income

year credit period

on this page. The

the 60-month credit period begins with

exemption, enter the following on this line:

credit is allowed on Form ND-1 and

the month in which the individual takes

•

Rents, less related expenses, from your

Form ND-2 (Optional Method). If the

title to the property.

zone project property that you received

allowable credit for any tax year exceeds

Purchase with major

•

during the months you were eligible for

the individual’s tax liability for that tax

improvements

—If the zone project

the exemption during the tax year.

year, the excess of the credit over the tax

consists of the purchase of a business,

•

liability is not refundable and may not be

Taxable portion of a gain from the sale or

but major improvements to the property

used to offset the individual’s tax liability

exchange of your zone project property

are necessary before any income-

for any other tax year. For this purpose,

during the exemption period. In the case

producing activity can take place, the

“tax liability” means the tax calculated for

of an installment sale contract, the

60-month credit period begins with the

the tax year less any other income tax

taxpayer may exempt the taxable portion

month in which the improvement work

credits allowed under the Act or North

of the gain recognized in each tax year

is completed, as determined by the local

Dakota law that the individual chooses to

over the life of the contract, even

zone authority.

use before applying the business purchase

though the exemption period or

Expansion

•

—If the zone project

Priority of

or expansion tax credit. See

renaissance zone expires before all

consists of the expansion of an existing

exemptions/credits

on page 3 for more

installments are received. However,

business already owned by the

information on the order in which to claim

interest income derived from the

individual, the 60-month credit period

multiple tax credits.

installment sale contract is not eligible

begins with the month in which the

for the exemption.

expansion work is completed, as

One tax credit allowed per zone project

determined by the local zone authority.

property. The tax credit is allowed only

one time with respect to a zone project

Once the 60-month credit period begins to

Instructions for

property over the life of the zone. The full

run with respect to the zone project

five-year credit period is available even

property, it runs uninterrupted through the

Part 2

though the zone itself expires before the

end of the 60-month credit period. The

end of the five-year credit period—see

credit is allowed over the entire 60-month

Business

Five-year credit period

on this page.

credit period even if the renaissance zone

purchase or

itself expires before the end of the 60-

Making the election

month credit period. If the property is

To make the election, the zone project

expansion tax

permanently withdrawn from business use,

application submitted to the local zone

the individual is ineligible for the credit

credit

authority must include a statement

starting on the first day of the month in

specifically electing to claim the tax credit

which the withdrawal occurs.

under N.D.C.C. § 40-63-04(3) in lieu of

General instructions

Transfer of zone project property. The tax

the business income exemption under

credit and its 60-month credit period attach

N.D.C.C. § 40-63-04(2). Once made, the

to the zone project property. If title to the

election is irrevocable and binding upon

Eligibility

zone project property is transferred to

the individual for the entire five-year credit

An individual who qualifies for the

another individual before the end of the 60-

period.

business income exemption under N.D.C.C.

month credit period, the individual

Instructions for

§ 40-63-04(2)—see

Five-year credit period

transferring the property is ineligible for

Part 1

on page 3—may elect to take an

the credit starting on the first day of the

The credit is allowed in each year of a

income tax credit in lieu of the business

month in which title passes. If the zone

five-year credit period. For purposes of

income exemption if all of the following

project property is transferred to another

the Act, the five-year credit period is

conditions are met:

qualifying individual before the end of the

deemed to be a period of sixty consecutive

• The zone project for which the

60-month credit period, the individual

months, consisting of five 12-month

individual qualified for the income

acquiring the zone project property is

periods. The $2,000 credit is allowed in

exemption consists of either the

eligible for the credit for the unexpired

each of the five 12-month periods. If the

purchase of a new business or the

portion of the 60-month credit period.

individual is not eligible for the credit for

expansion of an existing business

the entire tax year, a credit equal to $166.67

already owner by the individual.

($2,000 divided by 12) is allowed for each

•

The cost of the purchase or expansion is

month of eligibility during the tax year. For

more than $75,000.

this purpose, the 60-month credit period

•

The business is located in a city with a

begins as follows:

population equal to or less than 2,500.

Log - Schedule Rz Instructions Renaissance Zone Act Exemptions And Tax Credits - North Dakota Office Of State Tax Commissioner - 2003 Page 9

Related Articles

Related forms

Related Categories