As Introduced

129th General Assembly
Regular Session
2011-2012
H. B. No. 220


Representatives Beck, Baker 

Cosponsors: Representatives Adams, J., Blair, Blessing, Butler, Combs, Thompson, Rosenberger 



A BILL
To amend sections 5747.01 and 5751.98 and to enact 1
section 5751.54 of the Revised Code to allow a 2
refundable commercial activity tax credit for 3
investment losses recognized by foreign 4
entrepreneur investors who invest in certain 5
projects in Ohio.6


BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

       Section 1. That sections 5747.01 and 5751.98 be amended and 7
section 5751.54 of the Revised Code be enacted to read as follows:8

       Sec. 5747.01.  Except as otherwise expressly provided or 9
clearly appearing from the context, any term used in this chapter 10
that is not otherwise defined in this section has the same meaning 11
as when used in a comparable context in the laws of the United 12
States relating to federal income taxes or if not used in a 13
comparable context in those laws, has the same meaning as in 14
section 5733.40 of the Revised Code. Any reference in this chapter 15
to the Internal Revenue Code includes other laws of the United 16
States relating to federal income taxes.17

       As used in this chapter:18

       (A) "Adjusted gross income" or "Ohio adjusted gross income" 19
means federal adjusted gross income, as defined and used in the 20
Internal Revenue Code, adjusted as provided in this section:21

       (1) Add interest or dividends on obligations or securities of 22
any state or of any political subdivision or authority of any 23
state, other than this state and its subdivisions and authorities.24

       (2) Add interest or dividends on obligations of any 25
authority, commission, instrumentality, territory, or possession 26
of the United States to the extent that the interest or dividends 27
are exempt from federal income taxes but not from state income 28
taxes.29

       (3) Deduct interest or dividends on obligations of the United 30
States and its territories and possessions or of any authority, 31
commission, or instrumentality of the United States to the extent 32
that the interest or dividends are included in federal adjusted 33
gross income but exempt from state income taxes under the laws of 34
the United States.35

       (4) Deduct disability and survivor's benefits to the extent 36
included in federal adjusted gross income.37

       (5) Deduct benefits under Title II of the Social Security Act 38
and tier 1 railroad retirement benefits to the extent included in 39
federal adjusted gross income under section 86 of the Internal 40
Revenue Code.41

       (6) In the case of a taxpayer who is a beneficiary of a trust 42
that makes an accumulation distribution as defined in section 665 43
of the Internal Revenue Code, add, for the beneficiary's taxable 44
years beginning before 2002, the portion, if any, of such 45
distribution that does not exceed the undistributed net income of 46
the trust for the three taxable years preceding the taxable year 47
in which the distribution is made to the extent that the portion 48
was not included in the trust's taxable income for any of the 49
trust's taxable years beginning in 2002 or thereafter. 50
"Undistributed net income of a trust" means the taxable income of 51
the trust increased by (a)(i) the additions to adjusted gross 52
income required under division (A) of this section and (ii) the 53
personal exemptions allowed to the trust pursuant to section 54
642(b) of the Internal Revenue Code, and decreased by (b)(i) the 55
deductions to adjusted gross income required under division (A) of 56
this section, (ii) the amount of federal income taxes attributable 57
to such income, and (iii) the amount of taxable income that has 58
been included in the adjusted gross income of a beneficiary by 59
reason of a prior accumulation distribution. Any undistributed net 60
income included in the adjusted gross income of a beneficiary 61
shall reduce the undistributed net income of the trust commencing 62
with the earliest years of the accumulation period.63

       (7) Deduct the amount of wages and salaries, if any, not 64
otherwise allowable as a deduction but that would have been 65
allowable as a deduction in computing federal adjusted gross 66
income for the taxable year, had the targeted jobs credit allowed 67
and determined under sections 38, 51, and 52 of the Internal 68
Revenue Code not been in effect.69

       (8) Deduct any interest or interest equivalent on public 70
obligations and purchase obligations to the extent that the 71
interest or interest equivalent is included in federal adjusted 72
gross income.73

       (9) Add any loss or deduct any gain resulting from the sale, 74
exchange, or other disposition of public obligations to the extent 75
that the loss has been deducted or the gain has been included in 76
computing federal adjusted gross income.77

       (10) Deduct or add amounts, as provided under section 5747.70 78
of the Revised Code, related to contributions to variable college 79
savings program accounts made or tuition units purchased pursuant 80
to Chapter 3334. of the Revised Code.81

       (11)(a) Deduct, to the extent not otherwise allowable as a 82
deduction or exclusion in computing federal or Ohio adjusted gross 83
income for the taxable year, the amount the taxpayer paid during 84
the taxable year for medical care insurance and qualified 85
long-term care insurance for the taxpayer, the taxpayer's spouse, 86
and dependents. No deduction for medical care insurance under 87
division (A)(11) of this section shall be allowed either to any 88
taxpayer who is eligible to participate in any subsidized health 89
plan maintained by any employer of the taxpayer or of the 90
taxpayer's spouse, or to any taxpayer who is entitled to, or on 91
application would be entitled to, benefits under part A of Title 92
XVIII of the "Social Security Act," 49 Stat. 620 (1935), 42 U.S.C. 93
301, as amended. For the purposes of division (A)(11)(a) of this 94
section, "subsidized health plan" means a health plan for which 95
the employer pays any portion of the plan's cost. The deduction 96
allowed under division (A)(11)(a) of this section shall be the net 97
of any related premium refunds, related premium reimbursements, or 98
related insurance premium dividends received during the taxable 99
year.100

       (b) Deduct, to the extent not otherwise deducted or excluded 101
in computing federal or Ohio adjusted gross income during the 102
taxable year, the amount the taxpayer paid during the taxable 103
year, not compensated for by any insurance or otherwise, for 104
medical care of the taxpayer, the taxpayer's spouse, and 105
dependents, to the extent the expenses exceed seven and one-half 106
per cent of the taxpayer's federal adjusted gross income.107

       (c) Deduct, to the extent not otherwise deducted or excluded 108
in computing federal or Ohio adjusted gross income, any amount 109
included in federal adjusted gross income under section 105 or not 110
excluded under section 106 of the Internal Revenue Code solely 111
because it relates to an accident and health plan for a person who 112
otherwise would be a "qualifying relative" and thus a "dependent" 113
under section 152 of the Internal Revenue Code but for the fact 114
that the person fails to meet the income and support limitations 115
under section 152(d)(1)(B) and (C) of the Internal Revenue Code. 116

       (d) For purposes of division (A)(11) of this section, 117
"medical care" has the meaning given in section 213 of the 118
Internal Revenue Code, subject to the special rules, limitations, 119
and exclusions set forth therein, and "qualified long-term care" 120
has the same meaning given in section 7702B(c) of the Internal 121
Revenue Code. Solely for purposes of divisions (A)(11)(a) and (c) 122
of this section, "dependent" includes a person who otherwise would 123
be a "qualifying relative" and thus a "dependent" under section 124
152 of the Internal Revenue Code but for the fact that the person 125
fails to meet the income and support limitations under section 126
152(d)(1)(B) and (C) of the Internal Revenue Code.127

       (12)(a) Deduct any amount included in federal adjusted gross 128
income solely because the amount represents a reimbursement or 129
refund of expenses that in any year the taxpayer had deducted as 130
an itemized deduction pursuant to section 63 of the Internal 131
Revenue Code and applicable United States department of the 132
treasury regulations. The deduction otherwise allowed under 133
division (A)(12)(a) of this section shall be reduced to the extent 134
the reimbursement is attributable to an amount the taxpayer 135
deducted under this section in any taxable year.136

       (b) Add any amount not otherwise included in Ohio adjusted 137
gross income for any taxable year to the extent that the amount is 138
attributable to the recovery during the taxable year of any amount 139
deducted or excluded in computing federal or Ohio adjusted gross 140
income in any taxable year.141

       (13) Deduct any portion of the deduction described in section 142
1341(a)(2) of the Internal Revenue Code, for repaying previously 143
reported income received under a claim of right, that meets both 144
of the following requirements:145

       (a) It is allowable for repayment of an item that was 146
included in the taxpayer's adjusted gross income for a prior 147
taxable year and did not qualify for a credit under division (A) 148
or (B) of section 5747.05 of the Revised Code for that year;149

       (b) It does not otherwise reduce the taxpayer's adjusted 150
gross income for the current or any other taxable year.151

       (14) Deduct an amount equal to the deposits made to, and net 152
investment earnings of, a medical savings account during the 153
taxable year, in accordance with section 3924.66 of the Revised 154
Code. The deduction allowed by division (A)(14) of this section 155
does not apply to medical savings account deposits and earnings 156
otherwise deducted or excluded for the current or any other 157
taxable year from the taxpayer's federal adjusted gross income.158

       (15)(a) Add an amount equal to the funds withdrawn from a 159
medical savings account during the taxable year, and the net 160
investment earnings on those funds, when the funds withdrawn were 161
used for any purpose other than to reimburse an account holder 162
for, or to pay, eligible medical expenses, in accordance with 163
section 3924.66 of the Revised Code;164

       (b) Add the amounts distributed from a medical savings 165
account under division (A)(2) of section 3924.68 of the Revised 166
Code during the taxable year.167

       (16) Add any amount claimed as a credit under section 168
5747.059 of the Revised Code to the extent that such amount 169
satisfies either of the following:170

       (a) The amount was deducted or excluded from the computation 171
of the taxpayer's federal adjusted gross income as required to be 172
reported for the taxpayer's taxable year under the Internal 173
Revenue Code;174

       (b) The amount resulted in a reduction of the taxpayer's 175
federal adjusted gross income as required to be reported for any 176
of the taxpayer's taxable years under the Internal Revenue Code.177

       (17) Deduct the amount contributed by the taxpayer to an 178
individual development account program established by a county 179
department of job and family services pursuant to sections 329.11 180
to 329.14 of the Revised Code for the purpose of matching funds 181
deposited by program participants. On request of the tax 182
commissioner, the taxpayer shall provide any information that, in 183
the tax commissioner's opinion, is necessary to establish the 184
amount deducted under division (A)(17) of this section.185

       (18) Beginning in taxable year 2001 but not for any taxable 186
year beginning after December 31, 2005, if the taxpayer is married 187
and files a joint return and the combined federal adjusted gross 188
income of the taxpayer and the taxpayer's spouse for the taxable 189
year does not exceed one hundred thousand dollars, or if the 190
taxpayer is single and has a federal adjusted gross income for the 191
taxable year not exceeding fifty thousand dollars, deduct amounts 192
paid during the taxable year for qualified tuition and fees paid 193
to an eligible institution for the taxpayer, the taxpayer's 194
spouse, or any dependent of the taxpayer, who is a resident of 195
this state and is enrolled in or attending a program that 196
culminates in a degree or diploma at an eligible institution. The 197
deduction may be claimed only to the extent that qualified tuition 198
and fees are not otherwise deducted or excluded for any taxable 199
year from federal or Ohio adjusted gross income. The deduction may 200
not be claimed for educational expenses for which the taxpayer 201
claims a credit under section 5747.27 of the Revised Code.202

       (19) Add any reimbursement received during the taxable year 203
of any amount the taxpayer deducted under division (A)(18) of this 204
section in any previous taxable year to the extent the amount is 205
not otherwise included in Ohio adjusted gross income.206

       (20)(a)(i) Add five-sixths of the amount of depreciation 207
expense allowed by subsection (k) of section 168 of the Internal 208
Revenue Code, including the taxpayer's proportionate or 209
distributive share of the amount of depreciation expense allowed 210
by that subsection to a pass-through entity in which the taxpayer 211
has a direct or indirect ownership interest.212

       (ii) Add five-sixths of the amount of qualifying section 179 213
depreciation expense, including a person's proportionate or 214
distributive share of the amount of qualifying section 179 215
depreciation expense allowed to any pass-through entity in which 216
the person has a direct or indirect ownership. For the purposes of 217
this division, "qualifying section 179 depreciation expense" means 218
the difference between (I) the amount of depreciation expense 219
directly or indirectly allowed to the taxpayer under section 179 220
of the Internal Revenue Code, and (II) the amount of depreciation 221
expense directly or indirectly allowed to the taxpayer under 222
section 179 of the Internal Revenue Code as that section existed 223
on December 31, 2002.224

       The tax commissioner, under procedures established by the 225
commissioner, may waive the add-backs related to a pass-through 226
entity if the taxpayer owns, directly or indirectly, less than 227
five per cent of the pass-through entity.228

       (b) Nothing in division (A)(20) of this section shall be 229
construed to adjust or modify the adjusted basis of any asset.230

       (c) To the extent the add-back required under division 231
(A)(20)(a) of this section is attributable to property generating 232
nonbusiness income or loss allocated under section 5747.20 of the 233
Revised Code, the add-back shall be sitused to the same location 234
as the nonbusiness income or loss generated by the property for 235
the purpose of determining the credit under division (A) of 236
section 5747.05 of the Revised Code. Otherwise, the add-back shall 237
be apportioned, subject to one or more of the four alternative 238
methods of apportionment enumerated in section 5747.21 of the 239
Revised Code.240

       (d) For the purposes of division (A) of this section, net 241
operating loss carryback and carryforward shall not include 242
five-sixths of the allowance of any net operating loss deduction 243
carryback or carryforward to the taxable year to the extent such 244
loss resulted from depreciation allowed by section 168(k) of the 245
Internal Revenue Code and by the qualifying section 179 246
depreciation expense amount.247

       (21)(a) If the taxpayer was required to add an amount under 248
division (A)(20)(a) of this section for a taxable year, deduct 249
one-fifth of the amount so added for each of the five succeeding 250
taxable years.251

       (b) If the amount deducted under division (A)(21)(a) of this 252
section is attributable to an add-back allocated under division 253
(A)(20)(c) of this section, the amount deducted shall be sitused 254
to the same location. Otherwise, the add-back shall be apportioned 255
using the apportionment factors for the taxable year in which the 256
deduction is taken, subject to one or more of the four alternative 257
methods of apportionment enumerated in section 5747.21 of the 258
Revised Code.259

       (c) No deduction is available under division (A)(21)(a) of 260
this section with regard to any depreciation allowed by section 261
168(k) of the Internal Revenue Code and by the qualifying section 262
179 depreciation expense amount to the extent that such 263
depreciation resulted in or increased a federal net operating loss 264
carryback or carryforward to a taxable year to which division 265
(A)(20)(d) of this section does not apply.266

       (22) Deduct, to the extent not otherwise deducted or excluded 267
in computing federal or Ohio adjusted gross income for the taxable 268
year, the amount the taxpayer received during the taxable year as 269
reimbursement for life insurance premiums under section 5919.31 of 270
the Revised Code.271

        (23) Deduct, to the extent not otherwise deducted or excluded 272
in computing federal or Ohio adjusted gross income for the taxable 273
year, the amount the taxpayer received during the taxable year as 274
a death benefit paid by the adjutant general under section 5919.33 275
of the Revised Code.276

       (24) Deduct, to the extent included in federal adjusted gross 277
income and not otherwise allowable as a deduction or exclusion in 278
computing federal or Ohio adjusted gross income for the taxable 279
year, military pay and allowances received by the taxpayer during 280
the taxable year for active duty service in the United States 281
army, air force, navy, marine corps, or coast guard or reserve 282
components thereof or the national guard. The deduction may not be 283
claimed for military pay and allowances received by the taxpayer 284
while the taxpayer is stationed in this state.285

       (25) Deduct, to the extent not otherwise allowable as a 286
deduction or exclusion in computing federal or Ohio adjusted gross 287
income for the taxable year and not otherwise compensated for by 288
any other source, the amount of qualified organ donation expenses 289
incurred by the taxpayer during the taxable year, not to exceed 290
ten thousand dollars. A taxpayer may deduct qualified organ 291
donation expenses only once for all taxable years beginning with 292
taxable years beginning in 2007.293

       For the purposes of division (A)(25) of this section:294

        (a) "Human organ" means all or any portion of a human liver, 295
pancreas, kidney, intestine, or lung, and any portion of human 296
bone marrow.297

        (b) "Qualified organ donation expenses" means travel 298
expenses, lodging expenses, and wages and salary forgone by a 299
taxpayer in connection with the taxpayer's donation, while living, 300
of one or more of the taxpayer's human organs to another human 301
being.302

       (26) Deduct, to the extent not otherwise deducted or excluded 303
in computing federal or Ohio adjusted gross income for the taxable 304
year, amounts received by the taxpayer as retired military 305
personnel pay for service in the United States army, navy, air 306
force, coast guard, or marine corps or reserve components thereof, 307
or the national guard, or received by the surviving spouse or 308
former spouse of such a taxpayer under the survivor benefit plan 309
on account of such a taxpayer's death. If the taxpayer receives 310
income on account of retirement paid under the federal civil 311
service retirement system or federal employees retirement system, 312
or under any successor retirement program enacted by the congress 313
of the United States that is established and maintained for 314
retired employees of the United States government, and such 315
retirement income is based, in whole or in part, on credit for the 316
taxpayer's military service, the deduction allowed under this 317
division shall include only that portion of such retirement income 318
that is attributable to the taxpayer's military service, to the 319
extent that portion of such retirement income is otherwise 320
included in federal adjusted gross income and is not otherwise 321
deducted under this section. Any amount deducted under division 322
(A)(26) of this section is not included in a taxpayer's adjusted 323
gross income for the purposes of section 5747.055 of the Revised 324
Code. No amount may be deducted under division (A)(26) of this 325
section on the basis of which a credit was claimed under section 326
5747.055 of the Revised Code.327

       (27) Deduct, to the extent not otherwise deducted or excluded 328
in computing federal or Ohio adjusted gross income for the taxable 329
year, the amount the taxpayer received during the taxable year 330
from the military injury relief fund created in section 5101.98 of 331
the Revised Code.332

       (28) Deduct, to the extent not otherwise deducted or excluded 333
in computing federal or Ohio adjusted gross income for the taxable 334
year, the amount the taxpayer received as a veterans bonus during 335
the taxable year from the Ohio department of veterans services as 336
authorized by Section 2r of Article VIII, Ohio Constitution.337

       (29) Deduct, to the extent not otherwise deducted or excluded 338
in computing federal or Ohio adjusted gross income for the taxable 339
year, any loss from wagering transactions that is allowed as an 340
itemized deduction under section 165 of the Internal Revenue Code 341
and that the taxpayer deducted in computing federal taxable 342
income.343

       (30) If the taxpayer will receive any proceeds of a 344
refundable tax credit for losses on eligible EB-5 projects under 345
section 5751.54 of the Revised Code, add any amounts deducted in 346
the computation of federal adjusted gross income for any taxable 347
year for the project's capital loss as reported under section 1211 348
of the Internal Revenue Code.349

       (B) "Business income" means income, including gain or loss, 350
arising from transactions, activities, and sources in the regular 351
course of a trade or business and includes income, gain, or loss 352
from real property, tangible property, and intangible property if 353
the acquisition, rental, management, and disposition of the 354
property constitute integral parts of the regular course of a 355
trade or business operation. "Business income" includes income, 356
including gain or loss, from a partial or complete liquidation of 357
a business, including, but not limited to, gain or loss from the 358
sale or other disposition of goodwill.359

       (C) "Nonbusiness income" means all income other than business 360
income and may include, but is not limited to, compensation, rents 361
and royalties from real or tangible personal property, capital 362
gains, interest, dividends and distributions, patent or copyright 363
royalties, or lottery winnings, prizes, and awards.364

       (D) "Compensation" means any form of remuneration paid to an 365
employee for personal services.366

       (E) "Fiduciary" means a guardian, trustee, executor, 367
administrator, receiver, conservator, or any other person acting 368
in any fiduciary capacity for any individual, trust, or estate.369

       (F) "Fiscal year" means an accounting period of twelve months 370
ending on the last day of any month other than December.371

       (G) "Individual" means any natural person.372

       (H) "Internal Revenue Code" means the "Internal Revenue Code 373
of 1986," 100 Stat. 2085, 26 U.S.C.A. 1, as amended.374

       (I) "Resident" means any of the following, provided that 375
division (I)(3) of this section applies only to taxable years of a 376
trust beginning in 2002 or thereafter:377

       (1) An individual who is domiciled in this state, subject to 378
section 5747.24 of the Revised Code;379

       (2) The estate of a decedent who at the time of death was 380
domiciled in this state. The domicile tests of section 5747.24 of 381
the Revised Code are not controlling for purposes of division 382
(I)(2) of this section.383

       (3) A trust that, in whole or part, resides in this state. If 384
only part of a trust resides in this state, the trust is a 385
resident only with respect to that part.386

       For the purposes of division (I)(3) of this section:387

       (a) A trust resides in this state for the trust's current 388
taxable year to the extent, as described in division (I)(3)(d) of 389
this section, that the trust consists directly or indirectly, in 390
whole or in part, of assets, net of any related liabilities, that 391
were transferred, or caused to be transferred, directly or 392
indirectly, to the trust by any of the following:393

        (i) A person, a court, or a governmental entity or 394
instrumentality on account of the death of a decedent, but only if 395
the trust is described in division (I)(3)(e)(i) or (ii) of this 396
section;397

       (ii) A person who was domiciled in this state for the 398
purposes of this chapter when the person directly or indirectly 399
transferred assets to an irrevocable trust, but only if at least 400
one of the trust's qualifying beneficiaries is domiciled in this 401
state for the purposes of this chapter during all or some portion 402
of the trust's current taxable year;403

       (iii) A person who was domiciled in this state for the 404
purposes of this chapter when the trust document or instrument or 405
part of the trust document or instrument became irrevocable, but 406
only if at least one of the trust's qualifying beneficiaries is a 407
resident domiciled in this state for the purposes of this chapter 408
during all or some portion of the trust's current taxable year. If 409
a trust document or instrument became irrevocable upon the death 410
of a person who at the time of death was domiciled in this state 411
for purposes of this chapter, that person is a person described in 412
division (I)(3)(a)(iii) of this section.413

        (b) A trust is irrevocable to the extent that the transferor 414
is not considered to be the owner of the net assets of the trust 415
under sections 671 to 678 of the Internal Revenue Code.416

       (c) With respect to a trust other than a charitable lead 417
trust, "qualifying beneficiary" has the same meaning as "potential 418
current beneficiary" as defined in section 1361(e)(2) of the 419
Internal Revenue Code, and with respect to a charitable lead trust 420
"qualifying beneficiary" is any current, future, or contingent 421
beneficiary, but with respect to any trust "qualifying 422
beneficiary" excludes a person or a governmental entity or 423
instrumentality to any of which a contribution would qualify for 424
the charitable deduction under section 170 of the Internal Revenue 425
Code.426

        (d) For the purposes of division (I)(3)(a) of this section, 427
the extent to which a trust consists directly or indirectly, in 428
whole or in part, of assets, net of any related liabilities, that 429
were transferred directly or indirectly, in whole or part, to the 430
trust by any of the sources enumerated in that division shall be 431
ascertained by multiplying the fair market value of the trust's 432
assets, net of related liabilities, by the qualifying ratio, which 433
shall be computed as follows:434

        (i) The first time the trust receives assets, the numerator 435
of the qualifying ratio is the fair market value of those assets 436
at that time, net of any related liabilities, from sources 437
enumerated in division (I)(3)(a) of this section. The denominator 438
of the qualifying ratio is the fair market value of all the 439
trust's assets at that time, net of any related liabilities.440

        (ii) Each subsequent time the trust receives assets, a 441
revised qualifying ratio shall be computed. The numerator of the 442
revised qualifying ratio is the sum of (1) the fair market value 443
of the trust's assets immediately prior to the subsequent 444
transfer, net of any related liabilities, multiplied by the 445
qualifying ratio last computed without regard to the subsequent 446
transfer, and (2) the fair market value of the subsequently 447
transferred assets at the time transferred, net of any related 448
liabilities, from sources enumerated in division (I)(3)(a) of this 449
section. The denominator of the revised qualifying ratio is the 450
fair market value of all the trust's assets immediately after the 451
subsequent transfer, net of any related liabilities.452

       (iii) Whether a transfer to the trust is by or from any of 453
the sources enumerated in division (I)(3)(a) of this section shall 454
be ascertained without regard to the domicile of the trust's 455
beneficiaries.456

        (e) For the purposes of division (I)(3)(a)(i) of this 457
section:458

        (i) A trust is described in division (I)(3)(e)(i) of this 459
section if the trust is a testamentary trust and the testator of 460
that testamentary trust was domiciled in this state at the time of 461
the testator's death for purposes of the taxes levied under 462
Chapter 5731. of the Revised Code.463

        (ii) A trust is described in division (I)(3)(e)(ii) of this 464
section if the transfer is a qualifying transfer described in any 465
of divisions (I)(3)(f)(i) to (vi) of this section, the trust is an 466
irrevocable inter vivos trust, and at least one of the trust's 467
qualifying beneficiaries is domiciled in this state for purposes 468
of this chapter during all or some portion of the trust's current 469
taxable year.470

        (f) For the purposes of division (I)(3)(e)(ii) of this 471
section, a "qualifying transfer" is a transfer of assets, net of 472
any related liabilities, directly or indirectly to a trust, if the 473
transfer is described in any of the following:474

        (i) The transfer is made to a trust, created by the decedent 475
before the decedent's death and while the decedent was domiciled 476
in this state for the purposes of this chapter, and, prior to the 477
death of the decedent, the trust became irrevocable while the 478
decedent was domiciled in this state for the purposes of this 479
chapter.480

        (ii) The transfer is made to a trust to which the decedent, 481
prior to the decedent's death, had directly or indirectly 482
transferred assets, net of any related liabilities, while the 483
decedent was domiciled in this state for the purposes of this 484
chapter, and prior to the death of the decedent the trust became 485
irrevocable while the decedent was domiciled in this state for the 486
purposes of this chapter.487

        (iii) The transfer is made on account of a contractual 488
relationship existing directly or indirectly between the 489
transferor and either the decedent or the estate of the decedent 490
at any time prior to the date of the decedent's death, and the 491
decedent was domiciled in this state at the time of death for 492
purposes of the taxes levied under Chapter 5731. of the Revised 493
Code.494

        (iv) The transfer is made to a trust on account of a 495
contractual relationship existing directly or indirectly between 496
the transferor and another person who at the time of the 497
decedent's death was domiciled in this state for purposes of this 498
chapter.499

        (v) The transfer is made to a trust on account of the will of 500
a testator who was domiciled in this state at the time of the 501
testator's death for purposes of the taxes levied under Chapter 502
5731. of the Revised Code.503

        (vi) The transfer is made to a trust created by or caused to 504
be created by a court, and the trust was directly or indirectly 505
created in connection with or as a result of the death of an 506
individual who, for purposes of the taxes levied under Chapter 507
5731. of the Revised Code, was domiciled in this state at the time 508
of the individual's death.509

       (g) The tax commissioner may adopt rules to ascertain the 510
part of a trust residing in this state.511

       (J) "Nonresident" means an individual or estate that is not a 512
resident. An individual who is a resident for only part of a 513
taxable year is a nonresident for the remainder of that taxable 514
year.515

       (K) "Pass-through entity" has the same meaning as in section 516
5733.04 of the Revised Code.517

       (L) "Return" means the notifications and reports required to 518
be filed pursuant to this chapter for the purpose of reporting the 519
tax due and includes declarations of estimated tax when so 520
required.521

       (M) "Taxable year" means the calendar year or the taxpayer's 522
fiscal year ending during the calendar year, or fractional part 523
thereof, upon which the adjusted gross income is calculated 524
pursuant to this chapter.525

       (N) "Taxpayer" means any person subject to the tax imposed by 526
section 5747.02 of the Revised Code or any pass-through entity 527
that makes the election under division (D) of section 5747.08 of 528
the Revised Code.529

       (O) "Dependents" means dependents as defined in the Internal 530
Revenue Code and as claimed in the taxpayer's federal income tax 531
return for the taxable year or which the taxpayer would have been 532
permitted to claim had the taxpayer filed a federal income tax 533
return.534

       (P) "Principal county of employment" means, in the case of a 535
nonresident, the county within the state in which a taxpayer 536
performs services for an employer or, if those services are 537
performed in more than one county, the county in which the major 538
portion of the services are performed.539

       (Q) As used in sections 5747.50 to 5747.55 of the Revised 540
Code:541

       (1) "Subdivision" means any county, municipal corporation, 542
park district, or township.543

       (2) "Essential local government purposes" includes all 544
functions that any subdivision is required by general law to 545
exercise, including like functions that are exercised under a 546
charter adopted pursuant to the Ohio Constitution.547

       (R) "Overpayment" means any amount already paid that exceeds 548
the figure determined to be the correct amount of the tax.549

       (S) "Taxable income" or "Ohio taxable income" applies only to 550
estates and trusts, and means federal taxable income, as defined 551
and used in the Internal Revenue Code, adjusted as follows:552

       (1) Add interest or dividends, net of ordinary, necessary, 553
and reasonable expenses not deducted in computing federal taxable 554
income, on obligations or securities of any state or of any 555
political subdivision or authority of any state, other than this 556
state and its subdivisions and authorities, but only to the extent 557
that such net amount is not otherwise includible in Ohio taxable 558
income and is described in either division (S)(1)(a) or (b) of 559
this section:560

        (a) The net amount is not attributable to the S portion of an 561
electing small business trust and has not been distributed to 562
beneficiaries for the taxable year;563

        (b) The net amount is attributable to the S portion of an 564
electing small business trust for the taxable year.565

       (2) Add interest or dividends, net of ordinary, necessary, 566
and reasonable expenses not deducted in computing federal taxable 567
income, on obligations of any authority, commission, 568
instrumentality, territory, or possession of the United States to 569
the extent that the interest or dividends are exempt from federal 570
income taxes but not from state income taxes, but only to the 571
extent that such net amount is not otherwise includible in Ohio 572
taxable income and is described in either division (S)(1)(a) or 573
(b) of this section;574

       (3) Add the amount of personal exemption allowed to the 575
estate pursuant to section 642(b) of the Internal Revenue Code;576

       (4) Deduct interest or dividends, net of related expenses 577
deducted in computing federal taxable income, on obligations of 578
the United States and its territories and possessions or of any 579
authority, commission, or instrumentality of the United States to 580
the extent that the interest or dividends are exempt from state 581
taxes under the laws of the United States, but only to the extent 582
that such amount is included in federal taxable income and is 583
described in either division (S)(1)(a) or (b) of this section;584

       (5) Deduct the amount of wages and salaries, if any, not 585
otherwise allowable as a deduction but that would have been 586
allowable as a deduction in computing federal taxable income for 587
the taxable year, had the targeted jobs credit allowed under 588
sections 38, 51, and 52 of the Internal Revenue Code not been in 589
effect, but only to the extent such amount relates either to 590
income included in federal taxable income for the taxable year or 591
to income of the S portion of an electing small business trust for 592
the taxable year;593

       (6) Deduct any interest or interest equivalent, net of 594
related expenses deducted in computing federal taxable income, on 595
public obligations and purchase obligations, but only to the 596
extent that such net amount relates either to income included in 597
federal taxable income for the taxable year or to income of the S 598
portion of an electing small business trust for the taxable year;599

       (7) Add any loss or deduct any gain resulting from sale, 600
exchange, or other disposition of public obligations to the extent 601
that such loss has been deducted or such gain has been included in 602
computing either federal taxable income or income of the S portion 603
of an electing small business trust for the taxable year;604

       (8) Except in the case of the final return of an estate, add 605
any amount deducted by the taxpayer on both its Ohio estate tax 606
return pursuant to section 5731.14 of the Revised Code, and on its 607
federal income tax return in determining federal taxable income;608

       (9)(a) Deduct any amount included in federal taxable income 609
solely because the amount represents a reimbursement or refund of 610
expenses that in a previous year the decedent had deducted as an 611
itemized deduction pursuant to section 63 of the Internal Revenue 612
Code and applicable treasury regulations. The deduction otherwise 613
allowed under division (S)(9)(a) of this section shall be reduced 614
to the extent the reimbursement is attributable to an amount the 615
taxpayer or decedent deducted under this section in any taxable 616
year.617

       (b) Add any amount not otherwise included in Ohio taxable 618
income for any taxable year to the extent that the amount is 619
attributable to the recovery during the taxable year of any amount 620
deducted or excluded in computing federal or Ohio taxable income 621
in any taxable year, but only to the extent such amount has not 622
been distributed to beneficiaries for the taxable year.623

       (10) Deduct any portion of the deduction described in section 624
1341(a)(2) of the Internal Revenue Code, for repaying previously 625
reported income received under a claim of right, that meets both 626
of the following requirements:627

       (a) It is allowable for repayment of an item that was 628
included in the taxpayer's taxable income or the decedent's 629
adjusted gross income for a prior taxable year and did not qualify 630
for a credit under division (A) or (B) of section 5747.05 of the 631
Revised Code for that year.632

       (b) It does not otherwise reduce the taxpayer's taxable 633
income or the decedent's adjusted gross income for the current or 634
any other taxable year.635

       (11) Add any amount claimed as a credit under section 636
5747.059 of the Revised Code to the extent that the amount 637
satisfies either of the following:638

       (a) The amount was deducted or excluded from the computation 639
of the taxpayer's federal taxable income as required to be 640
reported for the taxpayer's taxable year under the Internal 641
Revenue Code;642

       (b) The amount resulted in a reduction in the taxpayer's 643
federal taxable income as required to be reported for any of the 644
taxpayer's taxable years under the Internal Revenue Code.645

       (12) Deduct any amount, net of related expenses deducted in 646
computing federal taxable income, that a trust is required to 647
report as farm income on its federal income tax return, but only 648
if the assets of the trust include at least ten acres of land 649
satisfying the definition of "land devoted exclusively to 650
agricultural use" under section 5713.30 of the Revised Code, 651
regardless of whether the land is valued for tax purposes as such 652
land under sections 5713.30 to 5713.38 of the Revised Code. If the 653
trust is a pass-through entity investor, section 5747.231 of the 654
Revised Code applies in ascertaining if the trust is eligible to 655
claim the deduction provided by division (S)(12) of this section 656
in connection with the pass-through entity's farm income.657

        Except for farm income attributable to the S portion of an 658
electing small business trust, the deduction provided by division 659
(S)(12) of this section is allowed only to the extent that the 660
trust has not distributed such farm income. Division (S)(12) of 661
this section applies only to taxable years of a trust beginning in 662
2002 or thereafter.663

       (13) Add the net amount of income described in section 641(c) 664
of the Internal Revenue Code to the extent that amount is not 665
included in federal taxable income.666

       (14) Add or deduct the amount the taxpayer would be required 667
to add or deduct under division (A)(20) or (21) of this section if 668
the taxpayer's Ohio taxable income were computed in the same 669
manner as an individual's Ohio adjusted gross income is computed 670
under this section. In the case of a trust, division (S)(14) of 671
this section applies only to any of the trust's taxable years 672
beginning in 2002 or thereafter.673

       (T) "School district income" and "school district income tax" 674
have the same meanings as in section 5748.01 of the Revised Code.675

       (U) As used in divisions (A)(8), (A)(9), (S)(6), and (S)(7) 676
of this section, "public obligations," "purchase obligations," and 677
"interest or interest equivalent" have the same meanings as in 678
section 5709.76 of the Revised Code.679

       (V) "Limited liability company" means any limited liability 680
company formed under Chapter 1705. of the Revised Code or under 681
the laws of any other state.682

       (W) "Pass-through entity investor" means any person who, 683
during any portion of a taxable year of a pass-through entity, is 684
a partner, member, shareholder, or equity investor in that 685
pass-through entity.686

       (X) "Banking day" has the same meaning as in section 1304.01 687
of the Revised Code.688

       (Y) "Month" means a calendar month.689

       (Z) "Quarter" means the first three months, the second three 690
months, the third three months, or the last three months of the 691
taxpayer's taxable year.692

       (AA)(1) "Eligible institution" means a state university or 693
state institution of higher education as defined in section 694
3345.011 of the Revised Code, or a private, nonprofit college, 695
university, or other post-secondary institution located in this 696
state that possesses a certificate of authorization issued by the 697
Ohio board of regents pursuant to Chapter 1713. of the Revised 698
Code or a certificate of registration issued by the state board of 699
career colleges and schools under Chapter 3332. of the Revised 700
Code.701

       (2) "Qualified tuition and fees" means tuition and fees 702
imposed by an eligible institution as a condition of enrollment or 703
attendance, not exceeding two thousand five hundred dollars in 704
each of the individual's first two years of post-secondary 705
education. If the individual is a part-time student, "qualified 706
tuition and fees" includes tuition and fees paid for the academic 707
equivalent of the first two years of post-secondary education 708
during a maximum of five taxable years, not exceeding a total of 709
five thousand dollars. "Qualified tuition and fees" does not 710
include:711

       (a) Expenses for any course or activity involving sports, 712
games, or hobbies unless the course or activity is part of the 713
individual's degree or diploma program;714

       (b) The cost of books, room and board, student activity fees, 715
athletic fees, insurance expenses, or other expenses unrelated to 716
the individual's academic course of instruction;717

       (c) Tuition, fees, or other expenses paid or reimbursed 718
through an employer, scholarship, grant in aid, or other 719
educational benefit program.720

       (BB)(1) "Modified business income" means the business income 721
included in a trust's Ohio taxable income after such taxable 722
income is first reduced by the qualifying trust amount, if any.723

       (2) "Qualifying trust amount" of a trust means capital gains 724
and losses from the sale, exchange, or other disposition of equity 725
or ownership interests in, or debt obligations of, a qualifying 726
investee to the extent included in the trust's Ohio taxable 727
income, but only if the following requirements are satisfied:728

        (a) The book value of the qualifying investee's physical 729
assets in this state and everywhere, as of the last day of the 730
qualifying investee's fiscal or calendar year ending immediately 731
prior to the date on which the trust recognizes the gain or loss, 732
is available to the trust.733

       (b) The requirements of section 5747.011 of the Revised Code 734
are satisfied for the trust's taxable year in which the trust 735
recognizes the gain or loss.736

        Any gain or loss that is not a qualifying trust amount is 737
modified business income, qualifying investment income, or 738
modified nonbusiness income, as the case may be.739

       (3) "Modified nonbusiness income" means a trust's Ohio 740
taxable income other than modified business income, other than the 741
qualifying trust amount, and other than qualifying investment 742
income, as defined in section 5747.012 of the Revised Code, to the 743
extent such qualifying investment income is not otherwise part of 744
modified business income.745

       (4) "Modified Ohio taxable income" applies only to trusts, 746
and means the sum of the amounts described in divisions (BB)(4)(a) 747
to (c) of this section:748

       (a) The fraction, calculated under section 5747.013, and 749
applying section 5747.231 of the Revised Code, multiplied by the 750
sum of the following amounts:751

        (i) The trust's modified business income;752

        (ii) The trust's qualifying investment income, as defined in 753
section 5747.012 of the Revised Code, but only to the extent the 754
qualifying investment income does not otherwise constitute 755
modified business income and does not otherwise constitute a 756
qualifying trust amount.757

       (b) The qualifying trust amount multiplied by a fraction, the 758
numerator of which is the sum of the book value of the qualifying 759
investee's physical assets in this state on the last day of the 760
qualifying investee's fiscal or calendar year ending immediately 761
prior to the day on which the trust recognizes the qualifying 762
trust amount, and the denominator of which is the sum of the book 763
value of the qualifying investee's total physical assets 764
everywhere on the last day of the qualifying investee's fiscal or 765
calendar year ending immediately prior to the day on which the 766
trust recognizes the qualifying trust amount. If, for a taxable 767
year, the trust recognizes a qualifying trust amount with respect 768
to more than one qualifying investee, the amount described in 769
division (BB)(4)(b) of this section shall equal the sum of the 770
products so computed for each such qualifying investee.771

       (c)(i) With respect to a trust or portion of a trust that is 772
a resident as ascertained in accordance with division (I)(3)(d) of 773
this section, its modified nonbusiness income.774

        (ii) With respect to a trust or portion of a trust that is 775
not a resident as ascertained in accordance with division 776
(I)(3)(d) of this section, the amount of its modified nonbusiness 777
income satisfying the descriptions in divisions (B)(2) to (5) of 778
section 5747.20 of the Revised Code, except as otherwise provided 779
in division (BB)(4)(c)(ii) of this section. With respect to a 780
trust or portion of a trust that is not a resident as ascertained 781
in accordance with division (I)(3)(d) of this section, the trust's 782
portion of modified nonbusiness income recognized from the sale, 783
exchange, or other disposition of a debt interest in or equity 784
interest in a section 5747.212 entity, as defined in section 785
5747.212 of the Revised Code, without regard to division (A) of 786
that section, shall not be allocated to this state in accordance 787
with section 5747.20 of the Revised Code but shall be apportioned 788
to this state in accordance with division (B) of section 5747.212 789
of the Revised Code without regard to division (A) of that 790
section.791

       If the allocation and apportionment of a trust's income under 792
divisions (BB)(4)(a) and (c) of this section do not fairly 793
represent the modified Ohio taxable income of the trust in this 794
state, the alternative methods described in division (C) of 795
section 5747.21 of the Revised Code may be applied in the manner 796
and to the same extent provided in that section.797

       (5)(a) Except as set forth in division (BB)(5)(b) of this 798
section, "qualifying investee" means a person in which a trust has 799
an equity or ownership interest, or a person or unit of government 800
the debt obligations of either of which are owned by a trust. For 801
the purposes of division (BB)(2)(a) of this section and for the 802
purpose of computing the fraction described in division (BB)(4)(b) 803
of this section, all of the following apply:804

        (i) If the qualifying investee is a member of a qualifying 805
controlled group on the last day of the qualifying investee's 806
fiscal or calendar year ending immediately prior to the date on 807
which the trust recognizes the gain or loss, then "qualifying 808
investee" includes all persons in the qualifying controlled group 809
on such last day.810

        (ii) If the qualifying investee, or if the qualifying 811
investee and any members of the qualifying controlled group of 812
which the qualifying investee is a member on the last day of the 813
qualifying investee's fiscal or calendar year ending immediately 814
prior to the date on which the trust recognizes the gain or loss, 815
separately or cumulatively own, directly or indirectly, on the 816
last day of the qualifying investee's fiscal or calendar year 817
ending immediately prior to the date on which the trust recognizes 818
the qualifying trust amount, more than fifty per cent of the 819
equity of a pass-through entity, then the qualifying investee and 820
the other members are deemed to own the proportionate share of the 821
pass-through entity's physical assets which the pass-through 822
entity directly or indirectly owns on the last day of the 823
pass-through entity's calendar or fiscal year ending within or 824
with the last day of the qualifying investee's fiscal or calendar 825
year ending immediately prior to the date on which the trust 826
recognizes the qualifying trust amount.827

        (iii) For the purposes of division (BB)(5)(a)(iii) of this 828
section, "upper level pass-through entity" means a pass-through 829
entity directly or indirectly owning any equity of another 830
pass-through entity, and "lower level pass-through entity" means 831
that other pass-through entity.832

        An upper level pass-through entity, whether or not it is also 833
a qualifying investee, is deemed to own, on the last day of the 834
upper level pass-through entity's calendar or fiscal year, the 835
proportionate share of the lower level pass-through entity's 836
physical assets that the lower level pass-through entity directly 837
or indirectly owns on the last day of the lower level pass-through 838
entity's calendar or fiscal year ending within or with the last 839
day of the upper level pass-through entity's fiscal or calendar 840
year. If the upper level pass-through entity directly and 841
indirectly owns less than fifty per cent of the equity of the 842
lower level pass-through entity on each day of the upper level 843
pass-through entity's calendar or fiscal year in which or with 844
which ends the calendar or fiscal year of the lower level 845
pass-through entity and if, based upon clear and convincing 846
evidence, complete information about the location and cost of the 847
physical assets of the lower pass-through entity is not available 848
to the upper level pass-through entity, then solely for purposes 849
of ascertaining if a gain or loss constitutes a qualifying trust 850
amount, the upper level pass-through entity shall be deemed as 851
owning no equity of the lower level pass-through entity for each 852
day during the upper level pass-through entity's calendar or 853
fiscal year in which or with which ends the lower level 854
pass-through entity's calendar or fiscal year. Nothing in division 855
(BB)(5)(a)(iii) of this section shall be construed to provide for 856
any deduction or exclusion in computing any trust's Ohio taxable 857
income.858

       (b) With respect to a trust that is not a resident for the 859
taxable year and with respect to a part of a trust that is not a 860
resident for the taxable year, "qualifying investee" for that 861
taxable year does not include a C corporation if both of the 862
following apply:863

       (i) During the taxable year the trust or part of the trust 864
recognizes a gain or loss from the sale, exchange, or other 865
disposition of equity or ownership interests in, or debt 866
obligations of, the C corporation.867

       (ii) Such gain or loss constitutes nonbusiness income.868

        (6) "Available" means information is such that a person is 869
able to learn of the information by the due date plus extensions, 870
if any, for filing the return for the taxable year in which the 871
trust recognizes the gain or loss.872

        (CC) "Qualifying controlled group" has the same meaning as in 873
section 5733.04 of the Revised Code.874

        (DD) "Related member" has the same meaning as in section 875
5733.042 of the Revised Code.876

       (EE)(1) For the purposes of division (EE) of this section: 877

       (a) "Qualifying person" means any person other than a 878
qualifying corporation.879

       (b) "Qualifying corporation" means any person classified for 880
federal income tax purposes as an association taxable as a 881
corporation, except either of the following:882

       (i) A corporation that has made an election under subchapter 883
S, chapter one, subtitle A, of the Internal Revenue Code for its 884
taxable year ending within, or on the last day of, the investor's 885
taxable year;886

       (ii) A subsidiary that is wholly owned by any corporation 887
that has made an election under subchapter S, chapter one, 888
subtitle A of the Internal Revenue Code for its taxable year 889
ending within, or on the last day of, the investor's taxable year.890

       (2) For the purposes of this chapter, unless expressly stated 891
otherwise, no qualifying person indirectly owns any asset directly 892
or indirectly owned by any qualifying corporation.893

       (FF) For purposes of this chapter and Chapter 5751. of the 894
Revised Code:895

       (1) "Trust" does not include a qualified pre-income tax 896
trust.897

       (2) A "qualified pre-income tax trust" is any pre-income tax 898
trust that makes a qualifying pre-income tax trust election as 899
described in division (FF)(3) of this section.900

       (3) A "qualifying pre-income tax trust election" is an 901
election by a pre-income tax trust to subject to the tax imposed 902
by section 5751.02 of the Revised Code the pre-income tax trust 903
and all pass-through entities of which the trust owns or controls, 904
directly, indirectly, or constructively through related interests, 905
five per cent or more of the ownership or equity interests. The 906
trustee shall notify the tax commissioner in writing of the 907
election on or before April 15, 2006. The election, if timely 908
made, shall be effective on and after January 1, 2006, and shall 909
apply for all tax periods and tax years until revoked by the 910
trustee of the trust.911

       (4) A "pre-income tax trust" is a trust that satisfies all of 912
the following requirements:913

       (a) The document or instrument creating the trust was 914
executed by the grantor before January 1, 1972;915

       (b) The trust became irrevocable upon the creation of the 916
trust; and917

       (c) The grantor was domiciled in this state at the time the 918
trust was created.919

       Sec. 5751.54.  (A) As used in this section:920

       (1) "EB-5 investor" means an individual who invests money as 921
a condition of eligibility for an EB-5 visa in accordance with the 922
"Immigration Act of 1990," 104 Stat. 4978, 8 U.S.C. 1153, as 923
amended, and "Petitions for employment creation aliens," 8 C.F.R. 924
204.6.925

        (2) "Project" means any entity formed for the ongoing conduct 926
of a lawful business including, but not limited to, a sole 927
proprietorship, partnership, holding company, joint venture, 928
corporation, business trust, or other entity, that is affiliated 929
with an EB-5 regional center under the "Immigration Act of 1990," 930
104 Stat. 4978, 8 U.S.C. 1153, as amended, and "Petitions for 931
employment creation aliens," 8 C.F.R. 204.6, in which at least one 932
EB-5 investor has invested money.933

       (B) A limited liability company incorporated under the laws 934
of this state that maintains its corporate headquarters and doing 935
business as "Ohio Foreign Investment Authority, LLC," may certify 936
a project, upon written application, as eligible to claim a 937
refundable tax credit allowed under this section against the tax 938
levied under section 5751.02 of the Revised Code. The company 939
shall, not more than ninety days following the enactment of this 940
section, establish, and subsequently may modify as it considers 941
necessary, a written policy governing eligibility to receive tax 942
credits under this section, which shall include the minimum 943
requirements under this division. Before a project may be 944
certified as eligible for a credit under this section, the United 945
States citizenship and immigration services must approve the 946
project's EB-5 investor's I-526 petition in accordance with the 947
"Immigration Act of 1990," 104 Stat. 4978, 8 U.S.C. 1153, as 948
amended, and "Petitions for employment creation aliens," 8 C.F.R. 949
204.6. 950

       For a project to be certified as eligible, the project must 951
demonstrate that the project will create the number of jobs that 952
are required to be created by each EB-5 investor under the methods 953
and models allowed by the "Immigration Act of 1990," 104 Stat. 954
4978, 8 U.S.C. 1153, as amended, and "Petitions for employment 955
creation aliens," 8 C.F.R. 204.6. Jobs created by an EB-5 investor 956
that apply toward such federal requirements must be created in 957
this state in order for a project to be certified under this 958
division.959

       The limited liability company, after approving the 960
certification application of a project, shall issue to the project 961
a certificate stating that the project is eligible to receive a 962
tax credit under this section, subject to the limitations of 963
division (C)(2) of this section. The limited liability company 964
shall not approve a project's application for certification on or 965
after January 1, 2017. The limited liability company shall not 966
approve a project's application for certification if the potential 967
value of tax credits to all outstanding certificates would exceed 968
two hundred million dollars.969

       (C)(1) A project holding an eligibility certificate issued 970
under division (B) of this section may claim a refundable credit 971
against the tax imposed by section 5751.02 of the Revised Code. If 972
the project is an excluded person for failure to have not more 973
than one hundred fifty thousand dollars of taxable gross receipts 974
during the calendar year as provided by division (E)(1) of section 975
5751.01 of the Revised Code, then the project shall be treated as 976
though it were a taxpayer, as defined in section 5751.01 of the 977
Revised Code, for the purpose of claiming the credit allowed under 978
this section.979

       The credit shall be claimed for the annual tax period that 980
includes the last day of the project's taxable year in which the 981
project recognizes a capital loss for federal income tax purposes. 982
The amount of the credit shall be equal to the total amount of 983
capital loss recognized by the EB-5 investor or investors from the 984
project for federal income tax purposes before any combination 985
with gains or losses not arising from the project, and 986
notwithstanding any amount deducted in the computation of federal 987
or Ohio adjusted gross income under the Internal Revenue Code or 988
section 5747.01 of the Revised Code. The credit shall be allocated 989
by the project among the EB-5 investors in the project in the 990
proportion that each EB-5 investor's recognized loss from the 991
project bears to the total of such recognized losses of all EB-5 992
investors in the project. No share of any credit granted under 993
this section shall be allocated to a project investor who is not 994
an EB-5 investor.995

       (2) No credit may be granted to a project under this section 996
unless and until the United States citizenship and immigration 997
services approves the project's EB-5 investor's I-829 petition in 998
accordance with the "Immigration Act of 1990," 104 Stat. 4978, 8 999
U.S.C. 1153, as amended, and "Petition by entrepreneur to remove 1000
conditional basis of lawful permanent resident status," 8 C.F.R. 1001
216.6.1002

       (D) On January 1, 2016, the limited liability company 1003
described in division (B) of this section shall file with the 1004
speaker of the house of representatives, the president of the 1005
senate, and the chairpersons of the house and senate standing 1006
committees predominantly concerned with economic development a 1007
written report on the tax credit under this section. The report 1008
shall include all of the following:1009

       (1) The written eligibility policy used by the company to 1010
evaluate applicants for the eligibility certificates under 1011
division (B) of this section; 1012

       (2) The number of project eligibility certificates issued 1013
under this section in each fiscal year ending on or before the 1014
preceding thirtieth day of June;1015

       (3) Any recommendations for continuing or modifying the tax 1016
credit.1017

       Sec. 5751.98.  (A) To provide a uniform procedure for 1018
calculating the amount of tax due under this chapter, a taxpayer 1019
shall claim any credits to which it is entitled in the following 1020
order:1021

        (1) The nonrefundable jobs retention credit under division 1022
(B) of section 5751.50 of the Revised Code;1023

        (2) The nonrefundable credit for qualified research expenses 1024
under division (B) of section 5751.51 of the Revised Code;1025

        (3) The nonrefundable credit for a borrower's qualified 1026
research and development loan payments under division (B) of 1027
section 5751.52 of the Revised Code;1028

        (4) The nonrefundable credit for calendar years 2010 to 2029 1029
for unused net operating losses under division (B) of section 1030
5751.53 of the Revised Code;1031

        (5) The refundable credit for calendar year 2030 for unused 1032
net operating losses under division (C) of section 5751.53 of the 1033
Revised Code;1034

        (6) The refundable jobs creation credit or job retention 1035
credit under division (A) of section 5751.50 of the Revised Code;1036

       (7) The refundable credit for investment losses recognized by 1037
an EB-5 investor involved in certain investment projects under 1038
section 5751.54 of the Revised Code.1039

        (B) For any credit except the refundable credits enumerated 1040
in this section, the amount of the credit for a tax period shall 1041
not exceed the tax due after allowing for any other credit that 1042
precedes it in the order required under this section. Any excess 1043
amount of a particular credit may be carried forward if authorized 1044
under the section creating the credit.1045

       Section 2.  That existing sections 5747.01 and 5751.98 of the 1046
Revised Code are hereby repealed.1047

       Section 3. The amendment or enactment by this act of sections 1048
5747.01, 5751.54, and 5751.98 of the Revised Code applies to 1049
taxable years and annual tax periods ending after the effective 1050
date of this act.1051