Instructions For Form 344 - Arizona Solar Liquid Fuel Credit - 2014

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Arizona Form
2014 Solar Liquid Fuel Credit
344
Obtain additional information or assistance by calling one of
Specific Instructions
the numbers listed below:
Complete the name and taxpayer identification number section
Phoenix
(602) 255-3381
at the top of the form. Indicate the period covered by the
From area codes 520 and 928, toll-free
(800) 352-4090
taxable year. Include the completed form with the tax return.
Obtain tax rulings, tax procedures, tax forms and instructions,
All returns, statements, and other documents filed with the
and other tax information by accessing the department's
department require a taxpayer identification number (TIN).
website at
The TIN for a corporation, an exempt organization with
General Instructions
UBTI, an S corporation or a partnership is the taxpayer's
employer identification number. The TIN for an individual is
Arizona Revised Statutes (A.R.S.) §§ 43-1085.01 and
the taxpayer's social security number or an Internal Revenue
43-1164.02 provide nonrefundable individual and corporate
Service individual taxpayer identification number. Taxpayers
income tax credits for increased research activities related to
that fail to include their TIN may be subject to a penalty.
solar liquid fuel. This credit is allowed for taxable years
Part 1 - Current Taxable Year's Credit Calculation
beginning from and after December 31, 2010 through
Line 1 -
December 31, 2021.
Enter total wages paid or incurred for qualified services performed
Additional credits related to solar liquid fuel will become
in Arizona. Do not include the amount of such wages paid to
available in 2016 for production and delivery system costs.
employees that were used in the calculation of the federal work
"Solar liquid fuel" means liquid fuel that is generated through
opportunity credit. Wages include any wages paid or incurred to
processes that use sunlight, carbon dioxide and water to
an employee for qualified services performed by such employee.
produce infrastructure compatible liquid hydrocarbon fuels.
Qualified services consist of engaging in qualified research or
Co-owners of a business, including partners in a partnership
engaging in the direct supervision or direct support of research
and shareholders of an S corporation, may each claim only
activities that constitute qualified research.
the pro rata share of the credit allowed based on the
Line 2 -
ownership interest. The total of the credits allowed all such
Enter the cost of supplies paid or incurred for use in the
owners may not exceed the amount that would have been
conduct of qualified research in Arizona. Supplies include
allowed for a sole owner of the business.
expenditures for any tangible property other than land or
The credit is available to an exempt organization that is
improvements to land, and property of a character subject to
subject to corporate income tax on unrelated business taxable
the allowance for depreciation.
income (UBTI). The credit must result from the activities that
Line 3 -
generate UBTI.
There is no carry forward for the solar liquid fuel credit. This
Enter the amount paid or incurred to rent or lease the right to
credit must be used on the tax return filed for the taxable year
use computers in the conduct of qualified research in Arizona.
in which the research was conducted.
Line 4 -
The solar liquid fuel credit is in lieu of the following credits,
Enter the total of:
with respect to the same expenses.
(a) Seventy-five percent (.75) of any amount paid or incurred
The credit for increased research activities under A.R.S.
for qualified research performed in Arizona by a qualified
§§ 43-1074.01
or
43-1168
(claimed
on
Arizona
research consortium on the taxpayer's behalf. "Qualified
Form 308-I or Form 308); and
research consortium" is any qualifying organization as
The credit for increased research activities for basic
defined in IRC § 41(b)(3)(C)(ii).
research payments, under A.R.S. § 43-1074(A)(1)(d) or
(b) Sixty-five percent (.65) of any amount paid or incurred for
A.R.S. § 43-1168 (A)(1)(c) (claimed on Arizona Form 346).
qualified research performed in Arizona on the taxpayer's
The Arizona solar liquid fuel credit related to increased research
behalf, other than such amounts paid to a qualified research
is allowed in an amount computed pursuant to Internal Revenue
consortium. Prepaid contract research expenses are
Code (IRC) § 41 with the following exceptions:
considered paid in the year the research is actually done.
 Qualified research includes only research related to solar
Line 6 -
liquid fuel conducted in Arizona. The term "qualified
Enter the amount of expenses included on lines 1 through 4 that
research," for purposes of the Arizona tax credit, means
are related to solar liquid fuel that will be claimed on Arizona
qualified research, as defined in IRC § 41, that is
Form 308, Arizona Form 308-I or Arizona Form 346. The solar
conducted in Arizona.
liquid fuel credit is in lieu of these credits with respect to the
 The amount of the credit is based on the federal regular
same expenses.
credit computation method for Arizona qualified research
Line 8 -
expenses. [Taxpayers
use the federal alternative
CANNOT
Enter the average annual Arizona gross receipts for the four
credit computation method.] The allowable current
taxable years preceding the taxable year for which the credit is
taxable year credit is 40 percent of the excess, if any, of
the Arizona qualified research expenses for the taxable
being determined (the credit year). The taxpayer may be
year, over the base amount.
required to annualize gross receipts for any short taxable year.

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