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1999 SESSION

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HB 1667 Research and development investment tax credit

Introduced by: Harry R. Purkey | all patrons    ...    notes | add to my profiles | history

SUMMARY AS PASSED:

Technology and biotechnology investment incentives. Creates a research and development tax credit, not to exceed 15 percent of the amount spent by the taxpayer on an eligible research and development activity. The maximum credit is $100,000 per year. The tax credit will become effective only if reenacted by the 2000 General Assembly Session. The bill also directs the Secretaries of Technology and Commerce and Trade to conduct a study of tax incentives for research and development initiatives.

SUMMARY AS PASSED HOUSE:

Virginia Technology and Biotechnology Investment Act created. Creates a research and development tax credit, not to exceed 25 percent of the amount spent by the taxpayer on an eligible research and development activity. Taxpayer may take up to a maximum $500,000 credit, which can be carried over, in most circumstances, for up to 10 years. Taxpayers having no tax liability for two years shall be allowed to redeem the credit with the Tax Commissioner for 90 percent of the face value. The bill will only become effective if reenacted by the 2000 General Assembly Session.

SUMMARY AS INTRODUCED:

Virginia Technology and Biotechnology Investment Act created. Creates a research and development tax credit, not to exceed 50 percent of the tax liability due, for “technology” and “biotechnology” companies in Virginia and permits the credit to be carried over for up to 15 years. The bill also creates a tax credit for individual taxpayers, estates, trusts, partnerships, and corporations that invest in technology or biotechnology companies. So long as the credit does not exceed 50 percent of the tax liability due, investors can take up to a maximum $500,000 credit, which can be carried over, in most circumstances, for up to 15 years. The bill permits technology or biotechnology companies to carry over net operating losses for up to 15 years. The bill creates a “corporation tax benefit certificate program” to be administered by the Virginia Economic Development Partnership in cooperation with the Tax Department. Under the program, technology or biotechnology companies may transfer their unused but otherwise allowable research and development tax credits or net operating loss carry-over for a minimum of 75 cents on the dollar to another corporation taxpayer. The proceeds from the transfer can be used for a broad range of “costs” associated with operating a technology or biotechnology company. The bill is a recommendation of the Joint Commission on Technology and Science.