Instructions For Form 332 - Arizona Credits For Healthy Forest Enterprises

Arizona Form 332

notified of a credit recapture for a credit it passed through to

claimed the employment credit for a healthy forest enterprise,

its shareholders, it must also complete line 40 and line 41, as

you must recapture a percentage of the total employment

applicable, separately for each shareholder.

credit you took in all prior years. How much credit you must

recapture depends on the year you first received the credit,

Each S corporation shareholder is entitled to only a pro rata

and how long ago it was. The percentage of credit you must

share of pass-through credit based on ownership interest in

the S corporation. The total of the credit allowed to all

recapture is shown in the following table.

shareholders may not exceed the amount that would have

If you first received the credit

The percentage is

been allowed for a sole owner.

Immediately preceding year

100% (1.00)

The S corporation must furnish each shareholder with a copy

Two taxable years ago

80%

(.80)

of pages 1 through 5 of Form 332. Each shareholder would

Three taxable years ago

60%

(.60)

then complete Parts 11 through 15, as applicable.

Four taxable years ago

40%

(.40)

Part 10 - Partner’s Share of Credits and Credit

Five taxable years ago

20%

(.20)

Recaptures

Six or more taxable years ago

No recapture

A partnership must complete Form 332, Parts 1 through 8,

If the qualification was revoked due to reasons beyond the

then complete Part 10, lines 42 through 45, separately for

control of the business as determined by Commerce, you do

each partner. If the partnership has been notified of a credit

not have to recapture the credit.

recapture, it must also complete line 46 and line 47, as

applicable, separately for each partner.

If you are required to recapture the employment credit,

complete Part 7 as instructed on the form.

Each partner is entitled to only a pro rata share of the credit

based on the partner’s ownership interest in the partnership.

Part 8 - Recapture of the Training Credit

The total of the credit allowed to all partners may not exceed

Lines 28 through 33 -

the amount that would have been allowed for a sole owner.

If your healthy forest enterprise has had its qualification

The partnership must furnish each partner with a copy of

terminated or revoked within five taxable years after you first

pages 1 through 5 of Form 332. Each partner would then

claimed the training credit for a healthy forest enterprise, you

complete Parts 11 through 15, as applicable.

must recapture a percentage of the total training credit you

Part 11 - Recapture Summary for Employment

took in all prior years. How much credit you must recapture

Credit

depends on the year you first received the credit, and how

Use lines 48 through 53 to determine whether you have any

long ago it was. The percentage of credit you must recapture

allowable employment credit remaining, even if you have to

is shown in the following table.

recapture some of it. Complete Part 11 as instructed on the form.

If you first received the credit

The percentage is

Part 12 - Recapture Summary for Training

Immediately preceding year

100% (1.00)

Credit

Two taxable years ago

80%

(.80)

Use lines 54 through 59 to determine whether you have any

Three taxable years ago

60%

(.60)

allowable training credit remaining, even if you have to recapture

Four taxable years ago

40%

(.40)

some of it. Complete Part 12 as instructed on the form.

Five taxable years ago

20%

(.20)

Part

Available

Employment

Credit

Six or more taxable years ago

No recapture

Carryover

If the qualification was revoked due to reasons beyond the

Lines 60 through 65 -

control of the business as determined by Commerce, you do

Use Part 13 to figure your available employment credit carryover.

not have to recapture the credit.

Complete lines 60 through 65 if you claimed the employment

credit on a prior year return and your employment credit was more

If you are required to recapture the training credit, complete

than your tax.

Part 8 as instructed on the form.

Enter the taxable year(s) from which you are carrying over

Part 9 - S Corporation Credit Elections and

the employment credit in column (a) on lines 60 through 64.

Shareholder’s Share of Credits and Credit

In column (b), enter the employment credit originally

Recaptures

computed for that taxable year. In column (c), enter the

The S corporation must complete this portion of Form 332 in

amount of the employment credit from that taxable year

order for the S corporation or its shareholders to claim the

which you have already used. Subtract the amount in

credit(s). The S corporation must make an irrevocable election

column (c) from the amount in column (b) and enter the

either to claim the credit(s) or to pass the credit(s) through to its

difference in column (d). Add the amounts entered on

shareholders. The election statements on line 34 and line 35 must

lines 60 through 64 in column (d). Enter the total on line 65,

be signed by one of the officers of the S corporation who is also

column (d). This is the available employment credit carryover

a signatory to Arizona Form 120S.

available for the current taxable year.

If the S corporation elects to pass the credits through to its

Part 14 - Available Training Credit Carryover

shareholders, it must first complete Form 332, Parts 1

Lines 66 through 71 -

through 8, then complete Part 9, lines 36 through 39,

Use Part 14 to figure your available training credit carryover.

separately for each shareholder. If the S corporation has been

Complete lines 66 through 71 if you claimed the training

Instructions For Form 332 - Arizona Credits For Healthy Forest Enterprises - 2014 Page 4

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