15E.44 - QUALIFYING BUSINESSES.
15E.44 QUALIFYING BUSINESSES.
1. In order for an equity investment to qualify for a tax credit,
the business in which the equity investment is made shall, within one
hundred twenty days of the date of the first investment, notify the
board of the names, addresses, shares issued, consideration paid for
the shares, and the amount of any tax credits, of all shareholders
who may initially qualify for the tax credits, and the earliest year
in which the tax credits may be redeemed. The list of shareholders
who may qualify for the tax credits shall be amended as new equity
investments are sold or as any information on the list shall change.
2. In order to be a qualifying business, a business must meet all
of the following criteria:
a. The principal business operations of the business are
located in this state.
b. The business has been in operation for six years or less.
c. The business has an owner who has successfully completed
one of the following:
(1) An entrepreneurial venture development curriculum.
(2) Three years of relevant business experience.
(3) A four-year college degree in business management, business
administration, or a related field.
(4) Other training or experience as the board may specify by rule
or order as sufficient to increase the probability of success of the
qualifying business.
d. The business is not a business engaged primarily in retail
sales, real estate, or the provision of health care or other
professional services.
e. The business shall not have a net worth that exceeds ten
million dollars.
f. The business shall have secured, within twenty-four months
following the first date on which the equity investments qualifying
for tax credits have been made, total equity or near equity financing
equal to at least two hundred fifty thousand dollars.
3. A qualifying business shall have the burden of proof to
demonstrate to the board its qualifications under this section, and
shall have the obligation to notify the board in a timely manner of
any changes in the qualifications of the business or in the
eligibility of investors to redeem the investment tax credits in any
tax year.
4. After verifying the eligibility of a qualifying business, the
board shall issue a tax credit certificate to be attached to the
equity investor's tax return. The tax credit certificate shall
contain the taxpayer's name, address, tax identification number, the
amount of credit, the name of the qualifying business, and other
information required by the department of revenue. The tax credit
certificate, unless rescinded by the board, shall be accepted by the
department of revenue as payment for taxes imposed pursuant to
chapter 422, divisions II, III, and V, and in chapter 432, and for
the moneys and credits tax imposed in section 533.329, subject to any
conditions or restrictions placed by the board upon the face of the
tax credit certificate and subject to the limitations of section
15E.43. Section History: Recent Form
2002 Acts, ch 1006, §4, 13; 2003 Acts, ch 145, §286; 2004 Acts, ch
1148, §3, 7; 2005 Acts, ch 157, §2; 2007 Acts, ch 174, §84; 2007
Acts, ch 186, §1
Referred to in § 15E.42, 15E.45, 15E.51