2001 Montana Legislature

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SENATE BILL NO. 350

INTRODUCED BY J. ELLINGSON, BOHLINGER, ERICKSON, FRANKLIN, HALLIGAN, PEASE, TOOLE

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AN ACT CREATING A TAX CREDIT FOR DONATIONS TO THE AFFORDABLE HOUSING REVOLVING LOAN ACCOUNT BY INDIVIDUAL AND CORPORATE TAXPAYERS; PROVIDING THAT THE CREDIT IS A PERCENTAGE OF THE AMOUNT OF THE DONATION AND MAY NOT EXCEED $10,000; PROVIDING FOR THE ALLOCATION OF THE CREDIT FOR SMALL BUSINESS CORPORATIONS AND PARTNERSHIPS; PROVIDING THAT FOR THE PURPOSES OF THE QUALIFIED ENDOWMENT CREDIT UNDER STATE TAX LAW, THE AFFORDABLE HOUSING REVOLVING LOAN ACCOUNT IS A QUALIFIED ENDOWMENT; AMENDING SECTION 15-30-165, MCA; AND PROVIDING AN IMMEDIATE EFFECTIVE DATE, A RETROACTIVE APPLICABILITY DATE, AND A TERMINATION DATE.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:



     Section 1.  Credit for contributions to affordable housing revolving loan account. (1) A taxpayer is allowed a tax credit against the taxes imposed by 15-30-103 or 15-31-101 in an amount equal to 20% of the amount donated by an individual taxpayer or 10% of the amount donated by a taxpayer under Title 15, chapter 31, during the year to the affordable housing revolving loan account established in 90-6-133. The maximum credit that may be claimed by a taxpayer is $10,000. The credit allowed under this section may not exceed the taxpayer's income tax liability.

     (2)  The credit allowed under this section may not be claimed by a taxpayer if the taxpayer has included the full amount of the contribution upon which the amount of the credit was computed as a deduction under 15-30-121(1), 15-30-136(2), or 15-31-114.

     (3) The credit allowed under this section may not be claimed by a taxpayer if the taxpayer has claimed a credit for a contribution to a qualified endowment under the provisions of 15-30-165 through 15-30-167, 15-31-161, or 15-31-162 for a contribution to the affordable housing revolving loan account.

     (4)  There is no carryback or carryforward of the credit permitted under this section, and the credit must be applied to the tax year in which the contribution is made.



     Section 2.  Credit for contributions to affordable housing revolving loan account. (1) A contribution to the affordable housing revolving loan account as provided in [section 1] by a small business corporation, as defined in 15-31-201, a partnership, or a limited liability company, as defined in 35-8-102, carrying on any trade or business for which deduction would be allowed under section 162 of the Internal Revenue Code, 26 U.S.C. 162, or carrying on any rental activity qualifies for the credit provided in [section 1].

     (2) If contributions to the affordable housing revolving loan account are claimed as a credit under [section 1] by a small business corporation, as defined in 15-31-201, or a partnership, the credit must be attributed to shareholders or partners, using the same proportion used to report the corporation's or partnership's income or loss for Montana income tax purposes.



     Section 3.  Section 15-30-165, MCA, is amended to read:

     "15-30-165.  (Temporary) Qualified endowments credit -- definitions. For the purposes of 15-30-166, the following definitions apply:

     (1)  "Planned gift" means an irrevocable contribution to a permanent endowment held by a tax-exempt organization, or for a tax-exempt organization, when the contribution uses any of the following techniques that are authorized under the Internal Revenue Code:

     (a)  charitable remainder unitrusts, as defined by 26 U.S.C. 664;

     (b)  charitable remainder annuity trusts, as defined by 26 U.S.C. 664;

     (c)  pooled income fund trusts, as defined by 26 U.S.C. 642(c)(5);

     (d)  charitable lead unitrusts qualifying under 26 U.S.C. 170(f)(2)(B);

     (e)  charitable lead annuity trusts qualifying under 26 U.S.C. 170(f)(2)(B);

     (f)  charitable gift annuities undertaken pursuant to 26 U.S.C. 1011(b);

     (g)  deferred charitable gift annuities undertaken pursuant to 26 U.S.C. 1011(b);

     (h)  charitable life estate agreements qualifying under 26 U.S.C. 170(f)(3)(B);

     (i)  paid-up life insurance policies meeting the requirements of 26 U.S.C. 170.

     (2) (a) "Qualified endowment" means a permanent, irrevocable fund that is held by a Montana incorporated or established organization that:

     (a)(i)  is a tax-exempt organization under 26 U.S.C. 501(c)(3); or

     (b)(ii) is a bank or trust company, as defined in Title 32, chapter 1, part 1, that is holding the fund on behalf of a tax-exempt organization.

     (b) For the purposes of sections 15-30-165 through 15-30-167, the affordable housing revolving loan account established in 90-6-133 is considered qualified endowment. (Terminates December 31, 2001--sec. 9, Ch. 537, L. 1997.)"



     Section 4.  Codification instruction. (1) [Section 1] is intended to be codified as an integral part of Title 15, chapter 30, and the provisions of Title 15, chapter 30, apply to [section 1].

     (2)  [Section 2] is intended to be codified as an integral part of Title 15, chapter 31, and the provisions of Title 15, chapter 31, apply to [section 2].



     Section 5.  Effective date. [This act] is effective on passage and approval.



     Section 6.  Retroactive applicability. [This act] applies retroactively, within the meaning of 1-2-109, to tax years beginning after December 31, 2000.



     Section 7.  Termination. [This act] terminates December 31, 2004.

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