West Virginia Code of State Rules › Agency 110 - Tax › Title 110 - LEGISLATIVE RULE STATE TAX DEPARTMENT › Series 110-13Q - Commercial Patent Incentives Tax Credit › Section 110-13Q-2 - Definitions

Current through Register Vol. XLI, No. 28, July 12, 2024
For purposes of this rule, the following terms shall have the
				  meaning ascribed in this section, unless the context in which used requires a
				  different meaning.
2.1. "Agreement"
				means a written agreement entered into after December 31, 2010, between a
				person developing patents in this State and either a corporation formed with
				respect to Marshall University or West Virginia University as provided in W.
				Va. Code §
									18B-12-3,
				or a center for economic development and technical advancement formed with
				respect to Marshall University or West Virginia University as provided in W.
				Va. Code §
									18B-12A-3,
				for purposes of developing a patent eligible for the credits under this
				series.
2.2. "Business activity"
				means all activities engaged in or caused to be engaged in by a person with the
				object of gain or economic benefit, direct or indirect. For purposes of this
				definition, the term "gain or economic benefit, direct or indirect" does not
				include income realized by any person in the form of wages, salary or income
				that is reported on federal form W-2.
2.3. "Commercial use" means selling,
				licensing, leasing or otherwise making patents available to a third party for a
				price, fee, royalty, commission or other consideration called by whatever name.
				"Commercial use" also means, in the case of patents developed by the developer
				for the developer's own commercial use, the first use of the patents in a
				manufacturing or other business activity of the developer. "Commercial use"
				does not include any selling, licensing, leasing or otherwise making patents
				available to a third party when done by a broker or by any person who does not
				own the patent sold, licensed, leased or otherwise made available.
2.4. "Commissioner" and "Tax Commissioner"
				are used interchangeably in this section and means the Tax Commissioner of the
				State of West Virginia, or his or her designee.
2.5. "Copyright" means a copyright that is
				registered with the United States Copyright Office or with a similar office of
				a foreign country when the foreign copyright is recognized under federal
				law.
2.6. "Delegate" in the phrase
				"or his or her delegate", when used in reference to the Tax Commissioner, means
				any officer or employee of the Tax Department of the Department of Revenue duly
				authorized by the Tax Commissioner directly, or indirectly, by one or more
				redelegations of authority to perform the functions mentioned or described in
				this rule.
2.7. "Developer" means a
				person engaged in this State in developing patents for direct use in a
				manufacturing process or product and who has an agreement, as defined in this
				section, with Marshall University or West Virginia University.
2.8. "Development of a patent," "developing
				patents" or "development" means the act of inventing or discovering any new and
				useful process, machine, article of manufacture, or composition of matter, or
				any new and useful improvement thereto through significant investment of money,
				performance of research, or application of design or engineering expertise,
				which culminates in the issuance of a patent, as defined in this
				article.
2.9. "Directly used in
				manufacturing process or product" and "direct use in manufacturing process or
				product" with reference to patents means application or incorporation of a
				patented process, machine, article of manufacture or composition of matter, in
				manufacturing operations or processes, or in manufactured products, in
				circumstances where United States or foreign patent laws require that the
				specific patent for the process, machine, article of manufacture or composition
				of matter be owned by the manufacturer, or purchased, leased, licensed or
				authorized by contract to be applied or incorporated in the manufacturing
				operation, processes or product, and where such lawful ownership, purchase,
				lease, licensure or contractual authorization is in effect.
2.10. "Manufacturing" means any business
				activity classified as having a sector identifier, consisting of the first two
				digits of the six-digit North American Industry Classification System code
				number of thirty-one, thirty-two or thirty-three.
2.11. "Mask work" means a series of related
				images, however fixed or encoded:
2.11.a.
				Having or representing the predetermined, three-dimensional pattern of
				metallic, insulating or semiconductor material present or removed from the
				layers of a semiconductor chip product; and
2.11.b. In which series the relation of the
				images to one another is that each image has the pattern of the surface of one
				form of the semiconductor chip product.