2023 CODE OF GEORGIA › Title 48 - REVENUE AND TAXATION (§§ 48-1-1 — 48-18-1) › Chapter 7 - INCOME TAXES (§§ 48-7-1 — 48-7-170) › Article 2 - IMPOSITION, RATE, AND COMPUTATION; EXEMPTIONS (§§ 48-7-20 — 48-7-42) › Section 48-7-40.4 - [Effective 1/1/2025] Tax credits for existing manufacturing and telecommunications facilities or manufacturing and telecommunications support facilities in tier 3 or 4 counties

(a)
As used in this Code section, the term:
(1)
"Product" means a marketable product or component of a product which has an economic value to the wholesale or retail consumer and is ready to be used without further alteration of its form or a product or material which is marketed as a prepared material or is a component in the manufacturing and assembly of other finished products.
(2)
"Qualified investment property" means all real and personal property purchased or acquired by a taxpayer for use in the construction of an additional manufacturing or telecommunications facility to be located in this state or the expansion of an existing manufacturing or telecommunications facility located in this state, including, but not limited to, amounts expended on land acquisition, improvements, buildings, building improvements, and machinery and equipment to be used in the manufacturing or telecommunications facility. The department shall promulgate rules defining eligible manufacturing facilities, telecommunications facilities, and qualified investment property pursuant to this paragraph.
(3)
"Recovered materials" means those materials, including but not limited to such materials as aluminum, oil, plastic, paper, paper products, scrap metal, iron, glass, and rubber, which have known use, reuse, or recycling potential; can be feasibly used, reused, or recycled; and have been diverted or removed from the solid waste stream for sale, use, reuse, or recycling, whether or not requiring subsequent separation and processing.
(4)
"Recycling" means any process by which materials which would otherwise become solid waste are collected, separated, or processed and reused or returned to use in the form of raw materials or products.
(5)
"Recycling machinery and equipment" means all tangible personal property used, directly or indirectly, to sort, store, prepare, convert, process, fabricate, or manufacture recovered materials into products which are composed of at least 25 percent recovered materials, such term including, but not being limited to, power generation and pollution control machinery and equipment.
(6)
"Recycling manufacturing facility" means any facility, including land, improvements to land, buildings, building improvements, and any recycling machinery and equipment used in the recycling process resulting in the manufacture of products from recovered materials, provided that up to 10 percent of any building that is a component of a recycling facility may be used for office space to house support staff for the recycling operation.
(b)
In the case of a taxpayer which has operated for the immediately preceding three years an existing manufacturing or telecommunications facility or manufacturing or telecommunications support facility in this state in a tier 3 or a tier 4 county designated pursuant to Code Section
48-7-40
, there shall be allowed a credit against the tax imposed under this article in an amount equal to 1 percent of the cost of all qualified investment property purchased or acquired by the taxpayer in such year, subject to the conditions and limitations set forth in this Code section. In the event such qualified investment property purchased or acquired by the taxpayer in such year consists of recycling machinery or equipment, a recycling manufacturing facility, pollution control or prevention machinery or equipment, a pollution control or prevention facility, or the conversion from defense to domestic production, the amount of such credit shall be equal to 3 percent.
(c)
The credit granted under subsection (b) of this Code section shall be subject to the following conditions and limitations:
(1)
In order to qualify as a basis for the credit, the investment in qualified investment property must occur no sooner than January 1, 1995. The credit may be taken beginning with the tax year immediately following the tax year in which the qualified investment property having an aggregate cost in excess of $50,000.00 is purchased or acquired by the taxpayer; provided, however, that, for tax years beginning on or after January 1, 2020, the credit may only be taken beginning with the tax year immediately following the tax year in which the qualified investment property having an aggregate cost in excess of $100,000.00 is purchased or acquired by the taxpayer. For every year in which a taxpayer claims the credit, the taxpayer shall attach a schedule to the taxpayer's Georgia income tax return which will set forth the following information, as a minimum:
(A)
A description of the project;
(B)
The amount of qualified investment property acquired during the taxable year;
(C)
The amount of tax credit claimed for the taxable year;
(D)
The amount of qualified investment property acquired in prior taxable years;
(E)
Any tax credit utilized by the taxpayer in prior taxable years;
(F)
The amount of tax credit carried over from prior years;
(G)
The amount of tax credit utilized by the taxpayer in the current taxable year; and
(H)
The amount of tax credit to be carried over to subsequent tax years;
(2)
Any credit claimed under this Code section but not used in any taxable year may be carried forward for five e years from the close of the taxable year in which the qualified investment property was acquired, provided that such qualified investment property remains in service. The credit established by this Code section taken in any one taxable year shall be limited to an amount not greater than 50 percent of the taxpayer's state income tax liability which is attributable to income derived from operations in this state for that taxable year. The sale, merger, acquisition, or bankruptcy of any taxpayer shall not create new eligibility in any succeeding taxpayer, but any unused credit may be transferred and continued by any transferee of the taxpayer;
(3)
In the initial year in which the taxpayer claims the credit granted in subsection (b) of this Code section, the taxpayer shall include in the description of the project required by subparagraph (A) of paragraph (1) of this subsection information which demonstrates that the project includes the acquisition of qualified investment property having an aggregate cost in excess of the amount required by paragraph (1) of this subsection;
(4)
Any lease for a period of five years or longer of any real or personal property used in a new or expanded manufacturing or telecommunications facility which would otherwise constitute qualified investment property shall be treated as the purchase or acquisition of qualified investment property by the lessee. The taxpayer may treat the full value of the leased property as qualified investment property in the taxable year in which the lease becomes binding on the lessor and the taxpayer if all other conditions of this subsection have been met; and
(5)
The utilization of the credit granted in subsection (b) of this Code section shall have no effect on the taxpayer's ability to claim depreciation for tax purposes on the assets acquired by the taxpayer, nor shall the credit have any effect on the taxpayer's basis in such assets for the purpose of depreciation.
(d)
No taxpayer shall be authorized to claim on a tax return for a given project the credit provided for in this Code section if such taxpayer claims on such tax return any of the credits authorized under Code Section
48-7-40
or
48-7-40.1
.
Amended by 2024 Ga. Laws 701,§ 5, eff. 7/1/2024.
Amended by 2024 Ga. Laws 598,§ 1-18, eff. 1/1/2025, app. only to unused tax credits generated during taxable years beginning on or after 1/1/2025.
Amended by 2019 Ga. Laws 228,§ 3-3, eff. 6/1/2019.
See 2019 Ga. Laws 228, § 4-1.
This section is set out more than once due to postponed, multiple, or conflicting amendments.