Form It 611 - Corporation Income Tax Forms And General Instructions

TAX CREDITS

(continued)

Description

Credit

Type Code

110

Diesel Particulate Emission Reduction Technology Equipment. This is a credit given to any person who installs diesel

particulate emission reduction equipment at any truck stop, depot, or other facility. For more information, refer to O.C.G.A.

§48-7-40.19.

111

Business Enterprise Vehicle Credit. This credit is for a business enterprise for the purchase of a motor vehicle used

exclusively to provide transportation for employees. In order to qualify, a business enterprise must certify that each ve-

hicle carries an average daily ridership of not less than four employees for an entire taxable year. This credit cannot be

claimed if the low and zero emission vehicle credit was claimed at the time the vehicle was purchased. For more infor-

mation, refer to O.C.G.A. §48-7-40.22.

112

Research Tax Credit.

A tax credit is allowed for research expenses for research conducted within Georgia for any business

or headquarters of any such business engaged in manufacturing, warehousing and distribution, processing, telecommuni

cations, tourism, broadcasting or research and development industries. The credit shall be 10% of the additional research

expense over the “base amount,” provided that the business enterprise for the same taxable year claims and is allowed a

research credit under Section 41 of the Internal Revenue Code of 1986. For tax years beginning on or after January 1, 2009,

the base amount calculation is based on Georgia gross receipts instead of Georgia taxable net income. (Note that for tax

years beginning before January 1, 2009, the base amount must contain positive Georgia taxable net income for all years.) For

taxable years beginning on or after January 1, 2012, the credit may be claimed against withholding tax. The credit may not

exceed 50% of the business’s Georgia net income tax liability after all other credits have been applied in any one year. Any

unused credit may be carried forward 10 years. This credit should be claimed on Form IT-RD. For more information, refer to

O.C.G.A. §48-7-40.12.

113

Headquarters Tax Credit. Companies establishing their headquarters or relocating their headquarters to Georgia prior

to January 1, 2009 may be entitled to a tax credit if the following criteria are met: 1) At least fifty (50) headquarters jobs are

created; and 2) within one year of the first hire, $1 million is spent in construction, renovation, leasing, or other cost

related to such establishment or reallocation. Headquarters is defined as the principal central administrative offices of

a company or a subsidiary of the company. The credit is available for establishing new full-time jobs. To qualify, each job

must pay a salary which is a stated percentage of the average county wage where the job is located: Tier 1 counties at

least 100%; Tier 2 counties at least 105%; Tier 3 counties at least 110%; and Tier 4 counties at least 115%. The company

has the ability to claim the credit in years one through five for jobs created in year one and may continue to claim newly

created jobs through year seven and claim the credit on each of those jobs for five years. The credit is equal to $2,500

annually per new full-time job meeting the wage requirement or $5,000 if the average wage of all new qualifying fulltime

jobs is 200% or more of the average county wage where new jobs are located. The credit may be used to offset 100

percent of the taxpayers Georgia income tax liability in the taxable year. Where the amount of such credit exceeds the

taxpayer’s tax liability in a taxable year, the excess may be taken as a credit against such taxpayer’s quarterly or monthly

withholding tax. To claim the credit against withholding, a business must file Form IT-WH at least 30 days prior to filing

the return on which the applicable jobs are claimed. Once the income tax return is filed, the Department has 90 days to

review the withholding credit being claimed and notify the business of the approved credit and when and how it may be

claimed. This credit should be applied for and claimed on Form IT-HQ. For more information, refer to O.C.G.A. §48-7-

40.17.

Port Activity Tax Credit. For taxable years beginning before January 1, 2010, businesses or the headquarters of any

114

such businesses engaged in manufacturing, warehousing and distribution, processing, telecommunications, broad-

casting, tourism, or research and development that have increased shipments out of Georgia ports during the previous

12-month period by more than 10% over their 1997 base year port traffic, or by more than 10% over 75 net tons, five

containers or ten 20-foot equivalent units (TEU’s) during the previous 12-month period are qualified for increased job tax

credits or investment tax credits. NOTE: Base year port traffic must be at least 75 net tons, five containers, or 10 TEU’s.

If not, the percentage increase in port traffic will be calculated using 75 net tons, five containers, or 10 TEU’s as the base.

Companies must meet Business Expansion and Support Act (BEST) criteria for the county in which they are located. The

tax credit amounts are as follows for all Tiers:

An additional job tax credit of $1,250 per job; investment tax credit of 5%; or optional investment tax credit of 10%.Com-

panies that create 400 or more new jobs, invest $20 million or more in new and expanded facilities, and increase their

port traffic by more than 20% above their base year port traffic may take both job tax credits and investment tax credits.

The credit is claimed by filing the appropriate form for the applicable credit (job tax: Form IT-CA; investment tax: Form IT-

IC or optional: Form IT-OIT) with the tax return and providing a statement with port numbers to verify the increase in port

traffic. For more information, refer to O.C.G.A. §48-7-40.15.

For tax years beginning on or after January 1, 2010, the following changes apply:

1. “Base year port traffic” means the amount of imports and exports during the second preceding 12 month period. For

example, if the taxpayer is trying to claim the credit for 2010, they would compare 2009 to 2008 and if the increase is

more than 10% they would qualify. NOTE: Base year port traffic must be at least 75 net tons, five containers, or 10 TEU’s.

If not, the percentage increase in port traffic will be calculated using 75 net tons,five containers, or 10 TEU’s as the base.

2. “Port traffic” means the amount of imports and exports.

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Form It 611 - Corporation Income Tax Forms And General Instructions - 2012 Page 17

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