Instructions For Form 720 - Kentucky Corporation Income Tax And Llet Return - 2013 Page 14
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20New Markets Development Program Tax Credit—KRS 141.432
Each corporation or railway company eligible for the credit
to 141.434 was created to encourage taxpayer investment in
provided under this section shall file a railroad expansion
qualified low-income communities. A taxpayer that makes a
tax credit claim on forms prescribed by the department by
qualified equity investment as provided by KRS 141.432(7) in a
the fifteenth day of the first month following the close of the
qualified community development entity as provided by KRS
preceding calendar year. The department shall determine the
141.432(6) shall be entitled to a nonrefundable tax credit against
amount of the approved credit and issue a credit certificate to
the taxes imposed by KRS 141.020, 141.040, 141.0401, 136.320,
the corporation or railway company by the fifteenth day of the
136.330, 136.340, 136.350, 137.370, 136.390 or 304.3-270. The total
third month following the close of the calendar year. KRS 141.386
amount of tax credits that may be awarded by the department
shall be limited to $5 million. “Qualified low-income community
investment” means any capital or equity investment in, or loan
ENDOW Kentuck y Tax Credit – A taxpayer making an
to, any qualified active low-income community business made
endowment gift to a permanent endowment fund of a qualified
after June 4, 2010. With respect to any one qualified active low-
community foundation, or county-specific component fund,
income community business, the maximum amount of qualified
or affiliate community foundation, which has been certified
active low-income community investments that may be made in
under KRS 147A.325, is entitled to a tax credit equal to twenty
the business, on a collective basis with all of its affiliates, with
percent (20%) of the endowment gift, not to exceed $10,000. The
the proceeds of qualified equity investments that have been
nonrefundable tax credit is allowed against the taxes imposed
certified under KRS 141.433 shall be $10 million, whether made
by KRS 141.020 or 141.040 and KRS 141.0401 and if not use in
by one or several qualified community development entities.
the year the tax credit is awarded may be carried forward for
a period not to exceed five years. The department shall issue
The amount of the credit shall be equal to 39% of the purchase
a credit certification (Schedule ENDOW) to a taxpayer upon
price of the qualified equity investment made by the taxpayer.
receiving proof that the endowment gift was made to the
A taxpayer is allowed to claim zero percent (0%) for each of
approved community foundation as provided by KRS 141.438(7).
the first two credit allowance dates, seven percent (7%) for
Schedule ENDOW must be attached to the taxpayer’s tax return
the third allowance date, and eight percent (8%) for the next
each year to claim the credit. A partner, member or shareholder
four allowance dates. “Credit allowance date” means with
of a pass-through entity shall attach a copy of Schedule
respect to any qualified equity investment: (a) the date on
K-1, Form 720S, 765 or 765-GP to the partner’s, member’s
which the investment is initially made; and (b) each of the
or shareholder’s tax return each year to claim the tax credit.
six anniversary dates of that date thereafter. KRS 141.434
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