Schedule Eotc-1 - Economic Opportunity Tax Credit (Page 5 of 9) in pdf

was commenced and executed on or after January 1,

4. Its straight line depreciation.

2003.

5. The amount of credit taken.

5. Tangible personal property owned or leased, used at

6. The date it was disposed of or otherwise ceased to be

a business location outside this State which is moved

qualified property.

into this State on or after January 1, 2003. If owned,

property must be depreciable or amortizable and

Such records must be retained for a period of three (3) years

have a useful life of four (4) or more years remaining

after the last year for which the credit is claimed.

at the time the property is placed in service or use

Cost or Other Basis

in this State. If leased, the primary term of the lease

remaining at the time the property is placed in

1. The cost of purchased property may not include the

service or use in West Virginia must be four (4) or

value of property given in trade or exchange for the

more years.

property purchased.

Qualified Investment Property May Not Include:

2. The cost of replacement property may not include

any insurance proceeds received in compensation for

1. Property owned or leased, for which another tax

property damaged or destroyed by fire, flood, storm

credit (e.g. for Manufacturing Investment Tax Credit,

or other casualty or is stolen.

Industrial Expansion and Revitalization; or Research

3. The cost of real property with a written primary

and Development Projects) has been taken by the

lease term of ten (10) or more years is 100% of the

taxpayer, seller, lessor, or other transferor.

rent reserved for the primary term of the lease, not to

2. Repair costs, unless capitalized for federal income

exceed twenty (20) years.

tax purposes.

4. The cost of tangible personal property with a written

3. Airplanes.

primary lease term of at least four (4) years but less

4. Property primarily used outside this State.

than six (6) years is one-third (1/3) of the rent reserved

for the primary term of the lease.

5. Property acquired incidental to the purchase of the

stock or assets of the seller. This restriction can be

5. For tangible personal property with a written

waived by the Tax Commissioner.

primary lease term of at least six (6) years but less

than eight (8) years, the cost is two-thirds (2/3) of the

6. Natural resources in place.

rent reserved for the primary term of the lease.

7. Property purchased or leased, the cost of which

6. For tangible personal property with a written lease

cannot be quantified when such property is placed

term of eight (8) or more years, the cost is 100% of the

in service.

rent reserved for the primary term of the lease, not to

8. Property not directly attributable to the qualified

exceed twenty (20) years. The rent reserved may not

investment activity (e.g. recreational boat, vehicle for

include rent for any year subsequent to the expiration

personal use).

of the book life of the property, determined by use of

the straight line method of depreciation.

Date Placed In Service or Use

7. For qualifying property purchased for multiple use

Property is considered to be placed in service or use in the

the cost must be pro-rated.

earlier of:

8. For self-constructed property the cost is the

1. The taxable year in which, under the taxpayer’s

amount properly charged to the capital account for

depreciation practice, the period for depreciation for

depreciation in accordance with federal income tax

such property begins; or

law.

2. The taxable year in which the property is placed in a

9. The cost of property transferred into this State is

condition of state or readiness and availability for a

determined based on remaining useful life of the

specifically assigned function.

property at the time it is placed in service or use in this

State. The cost is the original cost of the property to

Required Records

the taxpayer less straight line depreciation allowable

for tax years, or portions of tax years, the property

For each item of qualified property, the taxpayer must

was used outside West Virginia.

maintain records to establish the following:

10. For leased tangible personal property transferred

1. Its identity.

into this State, the cost is based on the period

remaining in the primary term of the lease after the

2. Its actual or reasonably determined cost.

property is brought into this State for use in a new or

3. The month and taxable year in which it was placed

expanded business. The cost is the rent reserved for

in service or use.

the remaining period of the primary lease term, not

West Virginia Economic Opportunity Tax Credit  Schedule EOTC-1  Page 3

Schedule Eotc-1 - Economic Opportunity Tax Credit Page 5

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