WEST virginia legislature

2020 regular session

Introduced

House Bill 4751

By Delegates  Barrett, Steele, N. Brown, Criss, Maynard, Hardy, Byrd, Bates and Staggers

[Introduced February 07, 2020; Referred to the Committee on Industry and Labor then Finance]

A BILL to amend the Code of West Virginia, 1931, as amended, by adding thereto a new article, designated §11-13FF-1, relating to providing a tax credit for dues paid to trade associations.

Be it enacted by the Legislature of West Virginia:

ARTICLE 13FF. trade association dues TAX CREDITS.

§11-13FF-1. Tax credits for dues paid to trade associations.

(a) Credit allowed. – For those tax years beginning on or after January 1, 2021, there is allowed a credit for any taxpayer against certain taxes imposed by this state as described in subsection (d) of this section for dues paid to trade associations by the taxpayer in the tax year.

(b) Amount of credit. – The tax credit equals dues paid to trade associations by the taxpayer in the tax year, not to exceed $10,000 in the aggregate for all dues pay in the tax year.

(c) Trade association. – For purposes of this section, a trade association is an association of persons having some common business interest, the purpose of which is to promote such common interest and not to engage in a regular business of a kind ordinarily carried on for profit.

(d) Application of annual credit allowance. – The amount of credit as determined under subsection (b) of this section is allowed as a credit against the taxpayer’s state tax liability applied as provided in subdivisions (1) through (2), inclusive, of this subsection, and in that order.

(1) Corporation net income taxes. – The credit must first be applied to reduce the taxes imposed by article §11-24-1 et seq. of this code for the taxable year.

(2) Personal income taxes. – After application of subdivision (1) of this subsection, any unused credit is next applied as follows:

(A) If the person making the qualified investment is an electing small business corporation (as defined in Section 1361 of the United States Internal Revenue Code of 1986, as amended), a partnership, a limited liability company that is treated as a partnership for federal income tax purposes, or a sole proprietorship, then any unused credit (after application of subdivision (1) of this subsection) is allowed as a credit against the taxes imposed by §11-21-1 et seq. of this code on the income from business or other activity on income of a sole proprietor attributable to the business.

(B) Electing small business corporations, limited liability companies, partnerships and other unincorporated organizations shall allocate the credit allowed by this article among its members in the same manner as profits and losses are allocated for the taxable year.

(3) A credit is not allowed under this section against any employer withholding taxes imposed by §11-21-1 et seq. of this code.

(e) Unused credit. – If any credit remains after application of subsection (d) of this section, that amount is forfeited. A carryback to a prior taxable year is not allowed for the amount of any unused portion of any annual credit allowance.

NOTE: The purpose of this bill is to provide a tax credit for dues paid to trade associations.

Strike-throughs indicate language that would be stricken from a heading or the present law, and underscoring indicates new language that would be added.