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2 - IMPOSITION, RATE, AND COMPUTATION; EXEMPTIONS (§§ 48-7-20 — 48-7-42) › Section 48-7-40.27 - [Effective 1/1/2025] [Repealed and Reserved Effective 12/31/2029] Tax credits for qualified investments in a research fund

(a)
As used in this Code section, the term:
(1)
"Credit" means a state income tax credit against the tax imposed pursuant to this article in an amount equal to 25 percent of the taxpayer's qualified investment.
(2)
"Qualified investment" means a cash investment in the research fund that is not a cash investment made by the state or on behalf of the state.
(3)
"Research fund" means a fund that is an investment entity pursuant to paragraph (7) of Code Section
10-10-1
, the purpose of which is to provide early-stage financing for businesses formed as a result of the intellectual property resulting from the research conducted in the research universities in this state.
(b)
A taxpayer shall be entitled to a credit for any qualified investment, subject to the conditions and limitations set forth in this Code section. Once the research fund reaches $30 million in total qualified investments, investors shall no longer be eligible for a credit pursuant to this subsection with respect to all subsequent qualified investments.
(c)
The credit provided in subsection (b) of this Code section shall be subject to the following conditions and limitations:
(1)
In no event shall the credit for a taxable year exceed the taxpayer's income tax liability. Any unused portion of the credit shall be permitted to be carried forward and applied to the taxpayer's tax liability for the subsequent five years. The credit shall not be applied against the taxpayer's prior years' tax liabilities;
(2)
The utilization of the credit shall have no effect on the taxpayer's basis in its investment;
(3)
A taxpayer shall only be allowed a credit for a qualified investment if the research fund issues to such taxpayer a certification that such investment meets the requirements of this Code section. Such certification shall include the taxpayer's name, address, the last four digits of the taxpayer's social security number or the employer identification number, as appropriate, the date, the amount of the qualified investment, and the amount of tax credit to which the taxpayer is entitled;
(4)
If the taxpayer is a Georgia Subchapter "S" corporation, a partnership, or a limited liability company taxed as a partnership, the credit shall be claimed by the respective shareholders, partners, or members of such entities in the same manner as they would account for their proportionate shares of income or loss from such entities. For the purposes of this Code section, such shareholders, partners, or members shall be considered to have made the qualified investments attributable to their interest in such entities; and
(5)
No taxpayer shall be eligible to claim the credit provided in subsection (b) of this Code section for a cash investment if they claim the tax credit provided in Code Section
48-7-40.28
for such cash investment.
(d)
The research fund shall provide the department at least on an annual basis a report that includes the taxpayer's name, the last four digits of the taxpayer's social security number or the employer identification number, as appropriate, and the amount of the taxpayer's qualified investment for which the research fund has issued to such taxpayer the certification pursuant to paragraph (3) of subsection (c) of this Code section. The research fund shall file this report with the department no later than January 31 of the year following the end of the reporting year.
(e)
In the event that the research fund liquidates prior to the investment of all of the cash received from taxpayers, the credit claimed with respect to such uninvested cash shall be recaptured. Such recapture shall be equal to the amount of the credit attributable to the qualified investment not invested by the research fund and returned to the taxpayer by the research fund. The recaptured amount shall be treated as taxes payable to the state for the taxable year in which such return of such investment occurs.
(f)
The commissioner may require such reports, promulgate such regulations, and gather such relevant data deemed necessary and advisable for the implementation of this Code section.
(g)
This Code section shall stand repealed and reserved on December 31, 2029.
Amended by 2024 Ga. Laws 598,§ 2-4, eff. 1/1/2025.
Amended by 2024 Ga. Laws 598,§ 1-32, eff. 1/1/2025, app. only to unused tax credits generated during taxable years beginning on or after 1/1/2025.
Added by 2008 Ga. Laws 750,§ 1, eff. 5/14/2008.
This section is set out more than once due to postponed, multiple, or conflicting amendments.