Louisiana Administrative Code › Title 10 - FINANCIAL INSTITUTIONS, CONSUMER CREDIT, INVESTMENT SECURITIES AND UCC › Part XV - Other Regulated Entities › Chapter 3 - Capital Companies Tax Credit Program › Section XV-305 - Income and Premium Tax Credits

Current through Register Vol. 50, No. 6, June 20, 2024
A.
				In order to be eligible for any income or premium tax credits, debentures,
				notes or any other quasi-equity/debt instruments shall have an original
				maturity date of not less than five years from the date of issuance. If an
				investment is in the form of stock, partnership interest, or any other
				equivalent ownership interest, such investment shall not be subject to
				redemption or repurchase within five years from the date of issuance. Except in
				the case where a CAPCO voluntarily decertifies and preserves all income and
				premium tax credits, if debentures, notes or any other quasi-equity/debt
				instruments or stock, partnership interests, or other equivalent ownership
				interests are redeemed or repurchased within five years from issuance, any
				income or premium tax credits previously taken, to the extent applicable to the
				investment redeemed or repurchased, shall be repaid to the Department of
				Insurance or the Department of Revenue and Taxation at the time of redemption,
				and any remaining tax credits shall be forfeited, pursuant to
				R.S.
				51:1927 and
				R.S.
				51:1928. Amortization of a note over its
				stated maturity does not constitute a redemption or repurchase under this
				Subpart.
B. Income or premium tax
				credits may be sold or transferred, subject to the following conditions.
1. The transfer or sale of income or premium
				tax credits, pursuant to
				R.S.
				51:1924(F) or
				R.S.
				22:1068(E)(4), will be
				restricted to transfers or sales between affiliates and sophisticated
				investors, collectively referred to as acquirors. Furthermore, even though a
				transfer or sale of credits, known as an election under this Section, may
				involve several entities, only one election may be made during any calendar
				year. Therefore, an investor in a CAPCO may only transfer or sell credits once
				during a calendar year and the entity that purchases the credit may not
				transfer credits obtained during the year of purchase. In any subsequent
				calendar year, the purchaser of the credits may make one election per year, if
				needed.
2. Companies and/or
				individuals shall submit to the Department of Insurance or the Department of
				Revenue and Taxation in writing, a notification of any transfer or sale of
				income or premium tax credits within 30 days of the transfer or sale of such
				credits. The notification shall include the original investor's income or
				premium tax credit balance prior to transfer, the remaining balance after
				transfer, all tax identification numbers for both transferor and acquiror, the
				date of transfer, and the amount transferred.
3. If an insurance company transfers premium
				tax credits between affiliates or sophisticated investors, the notification
				submitted to the Department of Insurance shall be provided on forms prescribed
				by the Department of Insurance.
4.
				If income tax credits are transferred between affiliates or sophisticated
				investors (acquirors), the notification submitted to the Department of Revenue
				and Taxation must include a worksheet, which the transfer or and each acquir or
				shall also attach to their Louisiana corporate and/or individual income tax
				returns, which shall contain the following information for each corporation or
				individual involved:
a. name of transfer or
				and each acquiror;
b. the gross
				Louisiana corporation or individual income tax liability of the transfer or and
				each acquiror; and
c. credits taken
				by the transferor and each acquiror under
				R.S.
				51:1924(A) and
				(B).
5. Failure to comply with this rule will
				jeopardize the income or premium tax credit transferred.
6. The transfer or sale of income or premium
				tax credits, pursuant to
				R.S.
				51:1924(F) or
				R.S.
				22:1068(E)(4), shall not
				affect the time schedule for taking such tax credits, as provided in
				R.S.
				51:1924(A) and (E) or
				R.S.
				22:1068(E)(3), respectively.
				Any income or premium tax credits transferred or sold pursuant to
				R.S.
				51:1924(F) or
				R.S.
				22:1068(E)(4), which credits
				are subject to recapture pursuant to
				R.S.
				51:1927(C),
				51:1928(A)
				or
				R.S.
				22:1068(E)(4), shall be the
				liability of the taxpayer that actually claimed the credit.