Senate Bill No. 1
(By Senator Ross, Unger, Minard, Sharp, Smith, Weeks, White,
Fanning, Rowe, Jenkins, Caldwell, McCabe, Snyder, Bowman, Love,
Dempsey, Deem, Facemyer, Hunter, McKenzie, Harrison, Boley,
Guills, Minear, Sprouse and Tomblin)
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[Introduced January 14, 2004; referred to the Committee on
Economic Development and then to the Committee on Finance.]
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A BILL to amend the code of West Virginia, 1931, as amended, by
adding thereto a new article, designated §11-13U-1, §11-13U-2
and §11-13U-3, all relating to taxation; and providing a small
business tax credit equal to any guaranty fee paid to the
small business administration to obtain small business
administration financing.
Be it enacted by the Legislature of West Virginia:
That the code of West Virginia, 1931, as amended, be amended
by adding thereto a new article, designated §11-13U-1, §11-13U-2
and §11-13U-3
, all to read as follows:
ARTICLE 13U. SMALL BUSINESS TAX CREDIT.
§11-13U-1. Short title.
This article may be cited as the "West Virginia Small Business
Tax Credit Act."
§11-13U-2. Small business tax credit.
(a) For the purposes of this article, a small business is any
corporation, partnership, sole proprietorship or other business
entity which has an annual payroll of one million five thousand
dollars or less, or annual gross sales of not more than five
million dollars. The tax commissioner may adjust these amounts
based on the cost-of-living index for that calendar year beginning
on the first day of January, two thousand five, and each subsequent
January.
(b) Each small business formed under the laws of the state of
West Virginia and operating within the state is entitled to claim
as a credit against the tax imposed by articles twenty-one,
twenty-three and twenty-four of this chapter any amount paid to the
United States small business administration as a guaranty fee that
results from obtaining small business administration guaranteed
financing.
(c) The credit may be used by the small business one time
within three years from the date that the fee is incurred. The
credit may not reduce the tax below any minimum tax prescribed
under the specified articles. The credit may be claimed only by
the small business that is the primary obligor in the financing
transaction and that actually paid the guaranty fee.
§11-13U-3. Tax commissioner to propose legislative rules;
effective date.
(a) The tax commissioner shall propose rules for legislative
approval prescribing the method and documentation to be used to
claim the credit in accordance with the provisions of article
three, chapter twenty-nine of the code. The commissioner may
initially promulgate emergency rules in order to facilitate the
implementation of the provisions of this article.
(b) The credit allowed by this section applies to tax years
beginning after the thirty-first day of December, two thousand
four.
NOTE: The purpose of this bill is to give small businesses a
tax credit equal to any guaranty fee paid to the Small Business
Administration in order to obtain SBA financing.
This article is new; therefore, strike-throughs and
underscoring have been omitted.