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To amend sections 5747.98 and 5751.98 and to enact | 1 |
sections 3746.241, 5747.78, and 5751.54 of the | 2 |
Revised Code to authorize refundable tax credits | 3 |
through 2017 for the completion of a voluntary | 4 |
action to remediate a contaminated site and for | 5 |
the return of such sites to productive use, and to | 6 |
exempt persons through 2017 who have been issued | 7 |
covenants not to sue under the Voluntary Action | 8 |
Program from certain fees and penalties for one | 9 |
year after the issuance of such a covenant. | 10 |
Section 1. That sections 5747.98 and 5751.98 be amended and | 11 |
sections 3746.241, 5747.78, and 5751.54 of the Revised Code be | 12 |
enacted to read as follows: | 13 |
Sec. 3746.241. A person to which a covenant not to sue is | 14 |
issued under section 3746.12 of the Revised Code concerning a | 15 |
voluntary action that is initiated not later than December 31, | 16 |
2017, is exempt from any fees or civil or administrative penalties | 17 |
that are authorized to be levied or imposed under any | 18 |
environmental law with respect to the property that is the subject | 19 |
of the covenant not to sue for a period of one year after the | 20 |
issuance of the covenant. The director of environmental protection | 21 |
shall adopt rules in accordance with Chapter 119. of the Revised | 22 |
Code that are necessary to implement this section. | 23 |
For purposes of this section, a voluntary action is initiated | 24 |
upon the commencement of a phase I property assessment under this | 25 |
chapter. | 26 |
As used in this section, "environmental law" means this | 27 |
chapter or Chapter 3704., 3734., 3745., 3750., 3751., 3752., | 28 |
6109., or 6111. of the Revised Code or a rule adopted under any of | 29 |
those chapters. | 30 |
Sec. 5747.78. (A) As used in this section: | 31 |
(1) "Voluntary action," "remedial activities," "property," | 32 |
and "covenant not to sue" have the same meanings as in section | 33 |
3746.01 of the Revised Code. | 34 |
(2) "Remediation expenditures" means expenditures that are | 35 |
made directly to conduct remedial activities on property that is | 36 |
the subject of a voluntary action for which a covenant not to sue | 37 |
has been issued under Chapter 3746. of the Revised Code. | 38 |
"Remediation expenditures" does not include expenditures for | 39 |
remedial activities derived from grants or other transfers of | 40 |
money from governmental entities to a taxpayer for which there is | 41 |
no repayment obligation. | 42 |
(3) "Pass-through entity" includes a sole proprietorship. | 43 |
(4) Property is used for a "productive use" if it is used by | 44 |
any person to conduct a trade or business or if a certificate of | 45 |
occupancy has been issued for the property by the local authority | 46 |
having jurisdiction to issue such a certificate and the property | 47 |
is suitable for the conduct of a trade or business. For the | 48 |
purposes of this division, the use of property to conduct a trade | 49 |
or business includes a pass-through entity leasing the property to | 50 |
lessees for commercial, industrial, or residential purposes. | 51 |
(5) A voluntary action is "initiated" upon commencement of a | 52 |
phase I property assessment under Chapter 3746. of the Revised | 53 |
Code. | 54 |
(B) There is allowed a refundable credit against the tax | 55 |
imposed by section 5747.02 of the Revised Code for a taxpayer that | 56 |
is an equity owner of a pass-through entity to which a covenant | 57 |
not to sue has been issued under Chapter 3746. of the Revised Code | 58 |
on or after the effective date of this section. The credit equals | 59 |
the taxpayer's distributive or proportionate share of twenty-five | 60 |
per cent of the remediation expenditures paid or incurred by the | 61 |
entity. | 62 |
The credit shall be claimed for the taxpayer's taxable year | 63 |
that ends in the pass-through entity's taxable year in which the | 64 |
covenant not to sue was issued to the entity by the director of | 65 |
environmental protection. The credit may not be claimed for any | 66 |
remediation expenditures paid or incurred for a voluntary action | 67 |
initiated after December 31, 2017. | 68 |
A taxpayer may claim a credit under this division for each | 69 |
voluntary action for which a separate covenant not to sue was | 70 |
issued to a pass-through entity of which the taxpayer is an equity | 71 |
owner. | 72 |
(C) There is allowed an additional refundable credit against | 73 |
the tax imposed by section 5747.02 of the Revised Code for a | 74 |
taxpayer that qualifies for the credit under division (B) of this | 75 |
section if the property that was the subject of the covenant not | 76 |
to sue is used for a productive use. The credit equals the sum of | 77 |
twenty-five per cent of the remediation expenditures paid or | 78 |
incurred by the pass-through entity to which the covenant was | 79 |
issued. A credit may be claimed under this division regardless of | 80 |
whether a credit was claimed under division (B) of this section. | 81 |
The credit shall be claimed for the taxpayer's taxable year | 82 |
that ends in the pass-through entity's taxable year in which the | 83 |
property is first used for a productive use after the covenant not | 84 |
to sue was issued. The credit may not be claimed for any | 85 |
remediation expenditures paid or incurred for a voluntary action | 86 |
initiated after December 31, 2017. | 87 |
A taxpayer may claim a credit under this division for each | 88 |
property that is the subject of a voluntary action for which a | 89 |
separate covenant not to sue was issued to a pass-through entity | 90 |
of which the taxpayer is an equity owner. A taxpayer may not claim | 91 |
the credit allowed under this division more than once for each | 92 |
property for which a covenant not to sue was issued. | 93 |
(D) The credits allowed by this section shall be claimed in | 94 |
the order prescribed by section 5747.98 of the Revised Code. If | 95 |
the amount of the credits exceeds the amount of tax otherwise due | 96 |
after deducting all other credits claimed in that order, the | 97 |
excess shall be refunded to the taxpayer. | 98 |
(E) A credit may not be claimed under this section on the | 99 |
basis of a voluntary action on the basis of which a credit was | 100 |
claimed under section 5751.54 of the Revised Code. | 101 |
Sec. 5747.98. (A) To provide a uniform procedure for | 102 |
calculating the amount of tax due under section 5747.02 of the | 103 |
Revised Code, a taxpayer shall claim any credits to which the | 104 |
taxpayer is entitled in the following order: | 105 |
(1) The retirement income credit under division (B) of | 106 |
section 5747.055 of the Revised Code; | 107 |
(2) The senior citizen credit under division (C) of section | 108 |
5747.05 of the Revised Code; | 109 |
(3) The lump sum distribution credit under division (D) of | 110 |
section 5747.05 of the Revised Code; | 111 |
(4) The dependent care credit under section 5747.054 of the | 112 |
Revised Code; | 113 |
(5) The lump sum retirement income credit under division (C) | 114 |
of section 5747.055 of the Revised Code; | 115 |
(6) The lump sum retirement income credit under division (D) | 116 |
of section 5747.055 of the Revised Code; | 117 |
(7) The lump sum retirement income credit under division (E) | 118 |
of section 5747.055 of the Revised Code; | 119 |
(8) The low-income credit under section 5747.056 of the | 120 |
Revised Code; | 121 |
(9) The credit for displaced workers who pay for job training | 122 |
under section 5747.27 of the Revised Code; | 123 |
(10) The campaign contribution credit under section 5747.29 | 124 |
of the Revised Code; | 125 |
(11) The twenty-dollar personal exemption credit under | 126 |
section 5747.022 of the Revised Code; | 127 |
(12) The joint filing credit under division (G) of section | 128 |
5747.05 of the Revised Code; | 129 |
(13) The nonresident credit under division (A) of section | 130 |
5747.05 of the Revised Code; | 131 |
(14) The credit for a resident's out-of-state income under | 132 |
division (B) of section 5747.05 of the Revised Code; | 133 |
(15) The credit for employers that enter into agreements with | 134 |
child day-care centers under section 5747.34 of the Revised Code; | 135 |
(16) The credit for employers that reimburse employee child | 136 |
care expenses under section 5747.36 of the Revised Code; | 137 |
(17) The credit for adoption of a minor child under section | 138 |
5747.37 of the Revised Code; | 139 |
(18) The credit for purchases of lights and reflectors under | 140 |
section 5747.38 of the Revised Code; | 141 |
(19) The job retention credit under division (B) of section | 142 |
5747.058 of the Revised Code; | 143 |
(20) The credit for selling alternative fuel under section | 144 |
5747.77 of the Revised Code; | 145 |
(21) The second credit for purchases of new manufacturing | 146 |
machinery and equipment and the credit for using Ohio coal under | 147 |
section 5747.31 of the Revised Code; | 148 |
(22) The job training credit under section 5747.39 of the | 149 |
Revised Code; | 150 |
(23) The enterprise zone credit under section 5709.66 of the | 151 |
Revised Code; | 152 |
(24) The credit for the eligible costs associated with a | 153 |
voluntary action under section 5747.32 of the Revised Code; | 154 |
(25) The credit for employers that establish on-site child | 155 |
day-care centers under section 5747.35 of the Revised Code; | 156 |
(26) The ethanol plant investment credit under section | 157 |
5747.75 of the Revised Code; | 158 |
(27) The credit for purchases of qualifying grape production | 159 |
property under section 5747.28 of the Revised Code; | 160 |
(28) The export sales credit under section 5747.057 of the | 161 |
Revised Code; | 162 |
(29) The credit for research and development and technology | 163 |
transfer investors under section 5747.33 of the Revised Code; | 164 |
(30) The enterprise zone credits under section 5709.65 of the | 165 |
Revised Code; | 166 |
(31) The research and development credit under section | 167 |
5747.331 of the Revised Code; | 168 |
(32) The credit for rehabilitating a historic building under | 169 |
section 5747.76 of the Revised Code; | 170 |
(33) The refundable credit for rehabilitating a historic | 171 |
building under section 5747.76 of the Revised Code; | 172 |
(34) The refundable jobs creation credit under division (A) | 173 |
of section 5747.058 of the Revised Code; | 174 |
(35) The refundable credit for taxes paid by a qualifying | 175 |
entity granted under section 5747.059 of the Revised Code; | 176 |
(36) The refundable credits for taxes paid by a qualifying | 177 |
pass-through entity granted under division (J) of section 5747.08 | 178 |
of the Revised Code; | 179 |
(37) The refundable credit for tax withheld under division | 180 |
(B)(1) of section 5747.062 of the Revised Code; | 181 |
(38) The refundable credit for tax withheld under section | 182 |
5747.063 of the Revised Code; | 183 |
(39) The refundable credit under section 5747.80 of the | 184 |
Revised Code for losses on loans made to the Ohio venture capital | 185 |
program under sections 150.01 to 150.10 of the Revised Code; | 186 |
(40) The refundable motion picture production credit under | 187 |
section 5747.66 of the Revised Code; | 188 |
(41) The refundable credits for voluntary actions authorized | 189 |
under section 5747.78 of the Revised Code. | 190 |
(B) For any credit, except the refundable credits enumerated | 191 |
in this section and the credit granted under division (I) of | 192 |
section 5747.08 of the Revised Code, the amount of the credit for | 193 |
a taxable year shall not exceed the tax due after allowing for any | 194 |
other credit that precedes it in the order required under this | 195 |
section. Any excess amount of a particular credit may be carried | 196 |
forward if authorized under the section creating that credit. | 197 |
Nothing in this chapter shall be construed to allow a taxpayer to | 198 |
claim, directly or indirectly, a credit more than once for a | 199 |
taxable year. | 200 |
Sec. 5751.54. (A) As used in this section: | 201 |
(1) "Voluntary action," "remedial activities," "property," | 202 |
and "covenant not to sue" have the same meanings as in section | 203 |
3746.01 of the Revised Code. | 204 |
(2) "Remediation expenditures" means expenditures that are | 205 |
made directly to conduct remedial activities on property that is | 206 |
the subject of a voluntary action for which a covenant not to sue | 207 |
has been issued under Chapter 3746. of the Revised Code. | 208 |
"Remediation expenditures" does not include expenditures for | 209 |
remedial activities derived from grants or other transfers of | 210 |
money from governmental entities for which there is no repayment | 211 |
obligation. | 212 |
(3) Property is used for a "productive use" if it is used by | 213 |
any person to conduct a trade or business or if a certificate of | 214 |
occupancy has been issued for the property by the local authority | 215 |
having jurisdiction to issue such a certificate and the property | 216 |
is suitable for the conduct of a trade or business. For the | 217 |
purposes of this division, the use of property to conduct a trade | 218 |
or business includes a taxpayer leasing the property to lessees | 219 |
for commercial, industrial, or residential purposes. | 220 |
(4) A voluntary action is "initiated" upon commencement of a | 221 |
phase I property assessment under Chapter 3746. of the Revised | 222 |
Code. | 223 |
(B) There is allowed a refundable credit against the tax | 224 |
imposed by this chapter for a taxpayer to which a covenant not to | 225 |
sue has been issued under Chapter 3746. of the Revised Code on or | 226 |
after the effective date of this section. The credit equals | 227 |
twenty-five per cent of the remediation expenditures paid or | 228 |
incurred by the taxpayer. | 229 |
If the taxpayer is a calendar year taxpayer, the credit shall | 230 |
be claimed for the tax period that includes the day on which the | 231 |
covenant not to sue was issued to the taxpayer by the director of | 232 |
environmental protection. If the taxpayer is a calendar quarter | 233 |
taxpayer, one-fourth of the credit amount shall be claimed for the | 234 |
tax period that includes the day on which the covenant not to sue | 235 |
was issued and one-fourth of the credit amount shall be claimed in | 236 |
each of the three ensuing tax periods. | 237 |
A taxpayer may claim a credit under this division for each | 238 |
voluntary action for which a covenant not to sue was issued to the | 239 |
taxpayer. The credit may not be claimed for any remediation | 240 |
expenditures paid or incurred for a voluntary action initiated | 241 |
after December 31, 2017. | 242 |
(C) There is allowed an additional refundable credit against | 243 |
the tax imposed by this chapter for a taxpayer that qualifies for | 244 |
the credit under division (B) of this section if the property that | 245 |
was the subject of the covenant not to sue is owned by the | 246 |
taxpayer and the property is used for a productive use. The credit | 247 |
equals twenty-five per cent of the remediation expenditures paid | 248 |
or incurred by the taxpayer. A credit may be claimed under this | 249 |
division regardless of whether a credit was claimed under division | 250 |
(B) of this section. | 251 |
If the taxpayer is a calendar year taxpayer, the credit shall | 252 |
be claimed for the tax period in which the property is first used | 253 |
for a productive use after the covenant not to sue was issued. If | 254 |
the taxpayer is a calendar quarter taxpayer, one-fourth of the | 255 |
credit amount shall be claimed for the tax period in which the | 256 |
property is first used for a productive use after the covenant not | 257 |
to sue was issued, and one-fourth of the credit amount shall be | 258 |
claimed in each of the three ensuing tax periods. The credit may | 259 |
not be claimed for any remediation expenditures paid or incurred | 260 |
for a voluntary action initiated after December 31, 2017. | 261 |
A taxpayer may claim a credit under this division for each | 262 |
property that is the subject of a voluntary action for which a | 263 |
separate covenant not to sue was issued. The credit may not be | 264 |
claimed more than once for each property for which a covenant not | 265 |
to sue was issued. | 266 |
(D) The credits allowed by this section shall be claimed in | 267 |
the order prescribed by section 5751.98 of the Revised Code. If | 268 |
the amount of the credits exceeds the amount of tax otherwise due | 269 |
after deducting all other credits claimed in that order, the | 270 |
excess shall be refunded to the taxpayer. | 271 |
(E) A credit may not be claimed under this section on the | 272 |
basis of a voluntary action on the basis of which a credit was | 273 |
claimed under section 5747.78 of the Revised Code. | 274 |
Sec. 5751.98. (A) To provide a uniform procedure for | 275 |
calculating the amount of tax due under this chapter, a taxpayer | 276 |
shall claim any credits to which it is entitled in the following | 277 |
order: | 278 |
(1) The nonrefundable jobs retention credit under division | 279 |
(B) of section 5751.50 of the Revised Code; | 280 |
(2) The nonrefundable credit for qualified research expenses | 281 |
under division (B) of section 5751.51 of the Revised Code; | 282 |
(3) The nonrefundable credit for a borrower's qualified | 283 |
research and development loan payments under division (B) of | 284 |
section 5751.52 of the Revised Code; | 285 |
(4) The nonrefundable credit for calendar years 2010 to 2029 | 286 |
for unused net operating losses under division (B) of section | 287 |
5751.53 of the Revised Code; | 288 |
(5) The refundable credit for calendar year 2030 for unused | 289 |
net operating losses under division (C) of section 5751.53 of the | 290 |
Revised Code; | 291 |
(6) The refundable jobs creation credit under division (A) of | 292 |
section 5751.50 of the Revised Code; | 293 |
(7) The refundable credits for voluntary actions authorized | 294 |
under section 5751.54 of the Revised Code. | 295 |
(B) For any credit except the | 296 |
enumerated in division (A) | 297 |
credit for a tax period shall not exceed the tax due after | 298 |
allowing for any other credit that precedes it in the order | 299 |
required under this section. Any excess amount of a particular | 300 |
credit may be carried forward if authorized under the section | 301 |
creating the credit. | 302 |
Section 2. That existing sections 5747.98 and 5751.98 of the | 303 |
Revised Code are hereby repealed. | 304 |