59-7-610. Recycling market development zones tax credits.

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Effective 12/31/2024

(1)Subject to other provisions of this section, a taxpayer that is a business operating in a recycling market development zone as defined in Section 19-13-102 may claim the following nonrefundable tax credits:

(a)a tax credit equal to the product of the percentage listed in Subsection 59-7-104(2) and the purchase price paid for machinery and equipment used directly in:

(i)commercial composting; or

(ii)manufacturing facilities or plant units that:

(A)manufacture, process, compound, or produce recycled items of tangible personal property for sale; or

(B)reduce or reuse postconsumer waste material; and

(b)a tax credit equal to the lesser of:

(i)20% of net expenditures to third parties for rent, wages, supplies, tools, test inventory, and utilities made by the taxpayer for establishing and operating recycling or composting technology in the state; and

(ii)$2,000.

(a)To claim a tax credit described in Subsection

(1), the taxpayer shall receive from the Department of Environmental Quality a written certification, on a form approved by the commission, that includes:

(i)a statement that the taxpayer is operating a business within the boundaries of a recycling market development zone;

(ii)for a claim of the tax credit described in Subsection (1)(a) :

(A)the type of the machinery and equipment that the taxpayer purchased;

(B)the date that the taxpayer purchased the machinery and equipment;

(C)the purchase price for the machinery and equipment;

(D)the total purchase price for all machinery and equipment for which the taxpayer is claiming a tax credit;

(E)a statement that the machinery and equipment are integral to the composting or recycling process; and

(F)the amount of the taxpayer's tax credit; and

(iii)for a claim of the tax credit described in Subsection (1)(b) :

(A)the type of net expenditure that the taxpayer made to a third party;

(B)the date that the taxpayer made the payment to a third party;

(C)the amount that the taxpayer paid to each third party;

(D)the total amount that the taxpayer paid to all third parties;

(E)a statement that the net expenditures support the establishment and operation of recycling or composting technology in the state; and

(F)the amount of the taxpayer's tax credit.

(i)The Department of Environmental Quality shall provide a taxpayer seeking to claim a tax credit under Subsection

(1)with a copy of the written certification.

(ii)The taxpayer shall retain a copy of the written certification for the same period of time that a person is required to keep books and records under Section 59-1-1406 .

(c)The Department of Environmental Quality shall submit to the commission an electronic list that includes:

(i)the name and identifying information of each taxpayer to which the Department of Environmental Quality issues a written certification; and

(ii)for each taxpayer, the amount of each tax credit listed on the written certification.

(3)A taxpayer may not claim a tax credit under Subsection (1)(a) , Subsection (1)(b) , or both that exceeds 40% of the taxpayer's state income tax liability as the tax liability is calculated:

(a)for the taxable year in which the taxpayer made the purchases or payments;

(b)before any other tax credits the taxpayer may claim for the taxable year; and

(c)before the taxpayer claims a tax credit authorized by this section.

(4)The commission shall make rules governing what information a taxpayer shall file with the commission to verify the entitlement to and amount of a tax credit.

(5)Except as provided in Subsections

(6)through

(8), a taxpayer may carry forward, to the next three taxable years, the amount of a tax credit described in Subsection (1)(a) that the taxpayer does not use for the taxable year.

(6)A taxpayer may not claim or carry forward a tax credit described in Subsection (1)(a) in a taxable year during which the taxpayer claims or carries forward a tax credit under Section 63N-2-213 .

(7)A taxpayer may not claim a tax credit described in Subsection (1)(b) in a taxable year during which the taxpayer claims or carries forward a tax credit under Section 63N-2-213 .

Amended by Chapter 367 , 2021 General Session