Recapture of tax credit
(1) The Department of Revenue may recapture any portion of a tax credit allowed under ORS 315.533 (Qualified equity investments) if:
(a) Any amount of federal tax credit that might be available with respect to the qualified equity investment that generated the tax credit under ORS 315.533 (Qualified equity investments) is recaptured under section 45D of the Internal Revenue Code. The department’s recapture shall be proportionate to the federal recapture with respect to the qualified equity investment.
(b) The qualified community development entity redeems or makes a principal repayment with respect to the qualified equity investment that generated the tax credit prior to the final credit allowance date of the qualified equity investment. The department’s recapture shall be proportionate to the amount of the redemption or repayment with respect to the qualified equity investment.
(c) The qualified community development entity fails to invest at least 85 percent of the purchase price of the qualified equity investment in qualified low-income community investments within 12 months of the issuance of the qualified equity investment and maintain the same level of investment in qualified low-income community investments until the last credit allowance date for the qualified equity investment. For purposes of calculating the amount of qualified low-income community investments held by a qualified community development entity, an investment shall be considered held by the entity even if the investment has been sold or repaid provided that the entity reinvests an amount equal to the capital returned to or recovered from the original investment, exclusive of any profits realized, in another qualified active low-income community business in this state within 12 months of the receipt of the capital. A qualified community development entity may not be required to reinvest capital returned from qualified low-income community investments after the sixth anniversary of the issuance of the qualified equity investment, the proceeds of which were used to make the qualified low-income community investment, and the qualified low-income community investment shall be considered held by the issuer through the qualified equity investment’s final credit allowance date.
(2) The department shall provide notice to the qualified community development entity of any proposed recapture of tax credits pursuant to this section. The entity shall have 90 days to cure any deficiency indicated in the department’s original recapture notice and avoid the recapture. If the entity fails or is unable to cure the deficiency within the 90-day period, the department shall provide the entity and the taxpayer from whom the credit is to be recaptured with a final order of recapture. Any tax credit for which a final recapture order has been issued shall be recaptured by the department from the taxpayer who claimed the tax credit on a tax return. [2011 c.732 §8]
Note: See notes under 285C.650 (Certification as qualified equity investment).
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