Instructions For Arizona Form 306 - Military Reuse Zone Credit - 2014

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Arizona Form
2014 Military Reuse Zone Credit
306
c.
Revenue to require the taxpayer to file appropriate
CONTACTS FOR MILITARY REUSE ZONE CREDIT
amended tax returns reflecting the recapture of the
Arizona Commerce Authority
tax credit.
Application forms Military Reuse Zone program guidelines
The net increase in the number of employees shall be
determined by comparing the taxpayer's average employment
website:
in the military reuse zone during the taxable year with the
Program Manager
(602) 845-1200
taxpayer's previous year's fourth quarter employment in the
zone, based on the taxpayer's report to the Arizona
Department of Revenue
Department of Economic Security for unemployment
Tax forms and instructions Information and assistance
insurance purposes, but considering only employment in the
zone.
website:
A credit is not allowed with respect to an employee whose
Taxpayer assistance
(602) 255-3381
place of employment is relocated by the taxpayer from a
From area codes 520 and 928, toll-free
(800) 352-4090
location in this state to the military reuse zone, unless the
General Instructions
employee is engaged in providing aviation or aerospace
services, or in manufacturing, assembling, or fabricating
Arizona Revised Statutes (A.R.S.) §§ 43-1079 and 43-1167
aviation or aerospace products, and the taxpayer maintains at
provide nonrefundable individual and corporate income tax
least the same number of employees in this state but outside
credits for net increases in employment of full-time
the zone.
employees by a taxpayer in a military reuse zone, established
The military reuse zone credit is in lieu of the following
under Title 41, chapter 10, article 3, of the Arizona Revised
credits, with respect to the same employees:
Statutes. These employees must be engaged primarily in
providing aviation or aerospace services, or in manufacturing,
The credit for new employment, under A.R.S.
assembling, or fabricating aviation or aerospace products.
§§ 43-1074 or 43-1161 (claimed on Arizona Form 345);
There are two military reuse zones. The first, Williams
The employment credit for healthy forest enterprises,
Gateway Airport, was established on August 2, 1996. There
under A.R.S. §§ 43-1076 or 43-1162 (claimed on
is no available credit or carryforward before that date. The
Arizona Form 332); and
current zone designation expires in October 2016.
The credit for renewable energy industry, under A.R.S.
§§ 43-1083.01 or 43-1164.01 (claimed on Arizona
The second military reuse zone, Phoenix/Goodyear Airport,
Form 342).
was established on December 10, 2002. There is no available
credit or carryforward before that date. The current zone
The amount of the credit is a dollar amount allowed for each
designation expires in December 2017.
new full-time employee. The amount per employee differs
depending on whether the employee is a dislocated military
A taxpayer that owns or leases income producing property
base employee or another type of full-time military base
located in a military reuse zone is eligible for the military
employee. A "dislocated military base employee" means a
reuse zone tax credit according to the terms and conditions
civilian who previously had permanent full-time civilian
prescribed by A.R.S. §§ 43-1079 or 43-1167. To qualify for
employment on the military facility, at the date the closure of
the tax incentive the taxpayer shall:
the facility was finally determined under federal law, as
Agree
with
the
Arizona
Commerce
Authority
certified by Commerce. The credit amount per employee is as
(Commerce) in writing to furnish information relating to
follows:
the amount of tax benefits the taxpayer receives for each
Year of
Amount of credit allowed per employee
taxable year in which the taxpayer claims the credit. If
employment
Dislocated
Non-dislocated
the taxpayer fails to provide the required information,
Employee
Employee
Commerce shall immediately revoke the taxpayer's
qualification and notify the Arizona Department of
1st
$1,000
$ 500
Revenue (Revenue).
2nd
$1,500
$1,000
3rd
$2,000
$1,500
Enter into a memorandum of understanding with this
4th
$2,500
$2,000
state through Commerce containing employment goals.
5th
$3,000
$2,500
Each year in which the taxpayer claims the credit the
taxpayer shall report in writing to Commerce its
If the allowable tax credit exceeds the taxes otherwise due, or
performance in achieving the goals. The memorandum
if there are no taxes due, the amount of the claim not used to
shall contain provisions that allow:
offset the taxes may be carried forward as a credit against the
five subsequent years' income tax liabilities, if the business
a.
Commerce to stop, readjust, or recapture all or part
remains in the military reuse zone.
of the tax incentives provided to the taxpayer on
noncompliance with the terms of the memorandum;
Co-owners of a business, including partners in a partnership
and shareholders of an S corporation, may each claim only a
b. Commerce to notify Revenue of the conditions of
pro rata share of the allowable credit based on the ownership
noncompliance; and

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