135.100. Definitions.
Definitions.
135.100. As used in sections 135.100 to 135.150 the following termsshall mean:
(1) "Commencement of commercial operations" shall be deemed to occurduring the first taxable year for which the new business facility is firstavailable for use by the taxpayer, or first capable of being used by thetaxpayer, in the revenue-producing enterprise in which the taxpayer intends touse the new business facility;
(2) "Existing business facility", any facility in this state which wasemployed by the taxpayer claiming the credit in the operation of arevenue-producing enterprise immediately prior to an expansion, acquisition,addition, or replacement;
(3) "Facility", any building used as a revenue-producing enterpriselocated within the state, including the land on which the facility is locatedand all machinery, equipment and other real and depreciable tangible personalproperty acquired for use at and located at or within such facility and usedin connection with the operation of such facility;
(4) "New business facility", a facility which satisfies the followingrequirements:
(a) Such facility is employed by the taxpayer in the operation of arevenue-producing enterprise. Such facility shall not be considered a newbusiness facility in the hands of the taxpayer if the taxpayer's only activitywith respect to such facility is to lease it to another person or persons. Ifthe taxpayer employs only a portion of such facility in the operation of arevenue-producing enterprise, and leases another portion of such facility toanother person or persons or does not otherwise use such other portions in theoperation of a revenue-producing enterprise, the portion employed by thetaxpayer in the operation of a revenue-producing enterprise shall beconsidered a new business facility, if the requirements of paragraphs (b),(c), (d) and (e) of this subdivision are satisfied;
(b) Such facility is acquired by, or leased to, the taxpayer afterDecember 31, 1983. A facility shall be deemed to have been acquired by, orleased to, the taxpayer after December 31, 1983, if the transfer of title tothe taxpayer, the transfer of possession pursuant to a binding contract totransfer title to the taxpayer, or the commencement of the term of the leaseto the taxpayer occurs after December 31, 1983, or, if the facility isconstructed, erected or installed by or on behalf of the taxpayer, suchconstruction, erection or installation is commenced after December 31, 1983;
(c) If such facility was acquired by the taxpayer from another person orpersons and such facility was employed immediately prior to the transfer oftitle to such facility to the taxpayer, or to the commencement of the term ofthe lease of such facility to the taxpayer, by any other person or persons inthe operation of a revenue-producing enterprise, the operation of the same ora substantially similar revenue-producing enterprise is not continued by thetaxpayer at such facility;
(d) Such facility is not a replacement business facility, as defined insubdivision (10) of this section; and
(e) The new business facility investment exceeds one hundred thousanddollars during the tax period in which the credits are claimed;
(5) "New business facility employee", a person employed by the taxpayerin the operation of a new business facility during the taxable year for whichthe credit allowed by section 135.110 is claimed, except that truck driversand rail and barge vehicle operators shall not constitute new businessfacility employees. A person shall be deemed to be so employed if such personperforms duties in connection with the operation of the new business facilityon:
(a) A regular, full-time basis; or
(b) A part-time basis, provided such person is customarily performingsuch duties an average of at least twenty hours per week; or
(c) A seasonal basis, provided such person performs such duties for atleast eighty percent of the season customary for the position in which suchperson is employed;
(6) "New business facility income", the Missouri taxable income, asdefined in chapter 143, RSMo, derived by the taxpayer from the operation ofthe new business facility. For the purpose of apportionment as prescribed inthis subdivision, the term "Missouri taxable income" means, in the case ofinsurance companies, direct premiums as defined in chapter 148, RSMo. If ataxpayer has income derived from the operation of a new business facility aswell as from other activities conducted within this state, the Missouritaxable income derived by the taxpayer from the operation of the new businessfacility shall be determined by multiplying the taxpayer's Missouri taxableincome, computed in accordance with chapter 143, RSMo, or in the case of aninsurance company, computed in accordance with chapter 148, RSMo, by afraction, the numerator of which is the property factor, as defined inparagraph (a) of this subdivision, plus the payroll factor, as defined inparagraph (b) of this subdivision, and the denominator of which is two:
(a) The property factor is a fraction, the numerator of which is the newbusiness facility investment certified for the tax period, and the denominatorof which is the average value of all the taxpayer's real and depreciabletangible personal property owned or rented and used in this state during thetax period. The average value of all such property shall be determined asprovided in chapter 32, RSMo;
(b) The payroll factor is a fraction, the numerator of which is thetotal amount paid during the tax period by the taxpayer for compensation topersons qualifying as new business facility employees, as determined bysubsection 4 of section 135.110, at the new business facility, and thedenominator of which is the total amount paid in this state during the taxperiod by the taxpayer for compensation. The compensation paid in this stateshall be determined as provided in chapter 32, RSMo. For the purpose of thissubdivision, "other activities conducted within this state" shall includeactivities previously conducted at the expanded, acquired or replaced facilityat any time during the tax period immediately prior to the tax period in whichcommencement of commercial operations occurred;
(7) "New business facility investment", the value of real anddepreciable tangible personal property, acquired by the taxpayer as part ofthe new business facility, which is used by the taxpayer in the operation ofthe new business facility, during the taxable year for which the creditallowed by section 135.110 is claimed, except that trucks, truck-trailers,truck semitrailers, rail vehicles, barge vehicles, aircraft and other rollingstock for hire, track, switches, barges, bridges, tunnels and rail yards andspurs shall not constitute new business facility investments. The total valueof such property during such taxable year shall be:
(a) Its original cost if owned by the taxpayer; or
(b) Eight times the net annual rental rate, if leased by the taxpayer.The net annual rental rate shall be the annual rental rate paid by thetaxpayer less any annual rental rate received by the taxpayer from subrentals. The new business facility investment shall be determined by dividing bytwelve the sum of the total value of such property on the last business day ofeach calendar month of the taxable year. If the new business facility is inoperation for less than an entire taxable year, the new business facilityinvestment shall be determined by dividing the sum of the total value of suchproperty on the last business day of each full calendar month during theportion of such taxable year during which the new business facility was inoperation by the number of full calendar months during such period;
(8) "Office", a regional, national or international headquarters, atelemarketing operation, a computer operation, an insurance company, apassenger transportation ticket/reservation system or a credit card billingand processing center. For the purposes of this subdivision, "headquarters"means the administrative management of at least four integrated facilitiesoperated by the taxpayer or related taxpayer. An office, as defined in thissubdivision, when established must create and maintain positions for a minimumnumber of twenty-five new business facility employees as defined insubdivision (5) of this section;
(9) "Related taxpayer" shall mean:
(a) A corporation, partnership, trust or association controlled by thetaxpayer;
(b) An individual, corporation, partnership, trust or association incontrol of the taxpayer; or
(c) A corporation, partnership, trust or association controlled by anindividual, corporation, partnership, trust or association in control of thetaxpayer. For the purposes of sections 135.100 to 135.150, "control of acorporation" shall mean ownership, directly or indirectly, of stock possessingat least fifty percent of the total combined voting power of all classes ofstock entitled to vote; "control of a partnership or association" shall meanownership of at least fifty percent of the capital or profits interest in suchpartnership or association; and "control of a trust" shall mean ownership,directly or indirectly, of at least fifty percent of the beneficial interestin the principal or income of such trust; ownership shall be determined asprovided in Section 318 of the U.S. Internal Revenue Code;
(10) "Replacement business facility", a facility otherwise described insubdivision (4) of this section, hereafter referred to in this subdivision as"new facility", which replaces another facility, hereafter referred to in thissubdivision as "old facility", located within the state, which the taxpayer ora related taxpayer previously operated but discontinued operating on or beforethe close of the first taxable year in which the credit allowed by thissection is claimed. A new facility shall be deemed to replace an old facilityif the following conditions are met:
(a) The old facility was operated by the taxpayer or a related taxpayerduring the taxpayer's or related taxpayer's taxable period immediatelypreceding the taxable year in which commencement of commercial operationsoccurs at the new facility; and
(b) The old facility was employed by the taxpayer or a related taxpayerin the operation of a revenue-producing enterprise and the taxpayer continuesthe operation of the same or substantially similar revenue-producingenterprise at the new facility.
Notwithstanding the preceding provisions of this subdivision, a facility shallnot be considered a replacement business facility if the taxpayer's newbusiness facility investment, as computed in subsection 5 of section 135.110,in the new facility during the tax period in which the credits allowed insections 135.110, 135.225 and 135.235 and the exemption allowed in section135.220 are claimed exceed one million dollars or, if less, two hundredpercent of the investment in the old facility by the taxpayer or relatedtaxpayer, and if the total number of employees at the new facility exceeds thetotal number of employees at the old facility by at least two except that thetotal number of employees at the new facility exceeds the total number ofemployees at the old facility by at least twenty-five if an office as definedin subdivision (8) of this section is established by a revenue-producingenterprise other than a revenue-producing enterprise defined in paragraphs (a)to (g) and (i) to (l) of subdivision (11) of this section;
(11) "Revenue-producing enterprise" means:
(a) Manufacturing activities classified as SICs 20 through 39;
(b) Agricultural activities classified as SIC 025;
(c) Rail transportation terminal activities classified as SIC 4013;
(d) Motor freight transportation terminal activities classified as SIC4231;
(e) Public warehousing and storage activities classified as SICs 422 and423 except SIC 4221, miniwarehouse warehousing and warehousing self-storage;
(f) Water transportation terminal activities classified as SIC 4491;
(g) Airports, flying fields, and airport terminal services classified asSIC 4581;
(h) Wholesale trade activities classified as SICs 50 and 51;
(i) Insurance carriers activities classified as SICs 631, 632 and 633;
(j) Research and development activities classified as SIC 873, except8733;
(k) Farm implement dealer activities classified as SIC 5999;
(l) Interexchange telecommunications services as defined in subdivision(20) of section 386.020, RSMo, or training activities conducted by aninterexchange telecommunications company as defined in subdivision (19) ofsection 386.020, RSMo;
(m) Recycling activities classified as SIC 5093;
(n) Office activities as defined in subdivision (8) of this section,notwithstanding SIC classification;
(o) Mining activities classified as SICs 10 through 14;
(p) Computer programming, data processing and other computer-relatedactivities classified as SIC 737;
(q) The administrative management of any of the foregoing activities; or
(r) Any combination of any of the foregoing activities;
(12) "Same or substantially similar revenue-producing enterprise", arevenue-producing enterprise in which the nature of the products produced orsold, or activities conducted, are similar in character and use or areproduced, sold, performed or conducted in the same or similar manner as inanother revenue-producing enterprise;
(13) "SIC", the standard industrial classification as suchclassifications are defined in the 1987 edition of the Standard IndustrialClassification Manual as prepared by the Executive Office of the President,Office of Management and Budget;
(14) "Taxpayer", an individual proprietorship, corporation described insection 143.441 or 143.471, RSMo, and partnership or an insurance companysubject to the tax imposed by chapter 148, RSMo, or in the case of aninsurance company exempt from the thirty-percent employee requirement ofsection 135.230, to any obligation imposed pursuant to section 375.916, RSMo.
(L. 1980 S.B. 644 § 1, A.L. 1983 H.B. 54, A.L. 1985 H.B. 416, A.L. 1986 S.B. 727, A.L. 1991 H.B. 294 & 405, A.L. 1992 S.B. 661 & 620, A.L. 1993 H.B. 566, A.L. 1994 H.B. 1248 & 1048, A.L. 1995 H.B. 414, A.L. 1996 H.B. 1237, A.L. 1997 2d Ex. Sess. S.B. 1, A.L. 1998 S.B. 827, A.L. 1999 H.B. 701)Definitions.*Two versions of this section are printed here due to a technical drafting error.
135.100. As used in sections 135.100 to 135.150 the following termsshall mean:
(1) "Commencement of commercial operations" shall be deemed to occurduring the first taxable year for which the new business facility is firstavailable for use by the taxpayer, or first capable of being used by thetaxpayer, in the revenue-producing enterprise in which the taxpayer intendsto use the new business facility;
(2) "Existing business facility", any facility in this state whichwas employed by the taxpayer claiming the credit in the operation of arevenue-producing enterprise immediately prior to an expansion,acquisition, addition, or replacement;
(3) "Facility", any building used as a revenue-producing enterpriselocated within the state, including the land on which the facility islocated and all machinery, equipment and other real and depreciabletangible personal property acquired for use at and located at or withinsuch facility and used in connection with the operation of such facility;
(4) "New business facility", a facility which satisfies the followingrequirements:
(a) Such facility is employed by the taxpayer in the operation of arevenue-producing enterprise. Such facility shall not be considered a newbusiness facility in the hands of the taxpayer if the taxpayer's onlyactivity with respect to such facility is to lease it to another person orpersons. If the taxpayer employs only a portion of such facility in theoperation of a revenue-producing enterprise, and leases another portion ofsuch facility to another person or persons or does not otherwise use suchother portions in the operation of a revenue-producing enterprise, theportion employed by the taxpayer in the operation of a revenue-producingenterprise shall be considered a new business facility, if the requirementsof paragraphs (b), (c), (d) and (e) of this subdivision are satisfied;
(b) Such facility is acquired by, or leased to, the taxpayer afterDecember 31, 1983. A facility shall be deemed to have been acquired by, orleased to, the taxpayer after December 31, 1983, if the transfer of titleto the taxpayer, the transfer of possession pursuant to a binding contractto transfer title to the taxpayer, or the commencement of the term of thelease to the taxpayer occurs after December 31, 1983, or, if the facilityis constructed, erected or installed by or on behalf of the taxpayer, suchconstruction, erection or installation is commenced after December 31,1983;
(c) If such facility was acquired by the taxpayer from another personor persons and such facility was employed immediately prior to the transferof title to such facility to the taxpayer, or to the commencement of theterm of the lease of such facility to the taxpayer, by any other person orpersons in the operation of a revenue-producing enterprise, the operationof the same or a substantially similar revenue-producing enterprise is notcontinued by the taxpayer at such facility;
(d) Such facility is not a replacement business facility, as definedin subdivision (10) of this section; and
(e) The new business facility investment exceeds one hundred thousanddollars during the tax period in which the credits are claimed;
(5) "New business facility employee", a person employed by thetaxpayer in the operation of a new business facility during the taxableyear for which the credit allowed by section 135.110 is claimed, exceptthat truck drivers and rail and barge vehicle operators shall notconstitute new business facility employees. A person shall be deemed to beso employed if such person performs duties in connection with the operationof the new business facility on:
(a) A regular, full-time basis; or
(b) A part-time basis, provided such person is customarily performingsuch duties an average of at least twenty hours per week; or
(c) A seasonal basis, provided such person performs such duties forat least eighty percent of the season customary for the position in whichsuch person is employed;
(6) "New business facility income", the Missouri taxable income, asdefined in chapter 143, RSMo, derived by the taxpayer from the operation ofthe new business facility. For the purpose of apportionment as prescribedin this subdivision, the term "Missouri taxable income" means, in the caseof insurance companies, direct premiums as defined in chapter 148, RSMo.If a taxpayer has income derived from the operation of a new businessfacility as well as from other activities conducted within this state, theMissouri taxable income derived by the taxpayer from the operation of thenew business facility shall be determined by multiplying the taxpayer'sMissouri taxable income, computed in accordance with chapter 143, RSMo, orin the case of an insurance company, computed in accordance with chapter148, RSMo, by a fraction, the numerator of which is the property factor, asdefined in paragraph (a) of this subdivision, plus the payroll factor, asdefined in paragraph (b) of this subdivision, and the denominator of whichis two:
(a) The "property factor" is a fraction, the numerator of which isthe new business facility investment certified for the tax period, and thedenominator of which is the average value of all the taxpayer's real anddepreciable tangible personal property owned or rented and used in thisstate during the tax period. The average value of all such property shallbe determined as provided in chapter 32, RSMo;
(b) The "payroll factor" is a fraction, the numerator of which is thetotal amount paid during the tax period by the taxpayer for compensation topersons qualifying as new business facility employees, as determined bysubsection 4 of section 135.110, at the new business facility, and thedenominator of which is the total amount paid in this state during the taxperiod by the taxpayer for compensation. The compensation paid in thisstate shall be determined as provided in chapter 32, RSMo. For the purposeof this subdivision, "other activities conducted within this state" shallinclude activities previously conducted at the expanded, acquired orreplaced facility at any time during the tax period immediately prior tothe tax period in which commencement of commercial operations occurred;
(7) "New business facility investment", the value of real anddepreciable tangible personal property, acquired by the taxpayer as part ofthe new business facility, which is used by the taxpayer in the operationof the new business facility, during the taxable year for which the creditallowed by section 135.110 is claimed, except that trucks, truck-trailers,truck semitrailers, rail and barge vehicles and other rolling stock forhire, track, switches, barges, bridges, tunnels and rail yards and spursshall not constitute new business facility investments. The total value ofsuch property during such taxable year shall be:
(a) Its original cost if owned by the taxpayer; or
(b) Eight times the net annual rental rate, if leased by thetaxpayer. The net annual rental rate shall be the annual rental rate paidby the taxpayer less any annual rental rate received by the taxpayer fromsubrentals. The new business facility investment shall be determined bydividing by twelve the sum of the total value of such property on the lastbusiness day of each calendar month of the taxable year. If the newbusiness facility is in operation for less than an entire taxable year, thenew business facility investment shall be determined by dividing the sum ofthe total value of such property on the last business day of each fullcalendar month during the portion of such taxable year during which the newbusiness facility was in operation by the number of full calendar monthsduring such period;
(8) "Office", a regional, national or international headquarters, atelemarketing operation, an insurance company, a passenger transportationticket/reservation system or a credit card billing and processing center.For the purposes of this subdivision, "headquarters" means theadministrative management of at least four integrated facilities operatedby the taxpayer or related taxpayer. An office, as defined in thissubdivision, when established must create and maintain positions for aminimum number of twenty-five new business facility employees as defined insubdivision (5) of this section;
(9) "Related taxpayer" shall mean:
(a) A corporation, partnership, trust or association controlled bythe taxpayer;
(b) An individual, corporation, partnership, trust or association incontrol of the taxpayer; or
(c) A corporation, partnership, trust or association controlled by anindividual, corporation, partnership, trust or association in control ofthe taxpayer. For the purposes of sections 135.100 to 135.150, "control ofa corporation" shall mean ownership, directly or indirectly, of stockpossessing at least fifty percent of the total combined voting power of allclasses of stock entitled to vote; "control of a partnership orassociation" shall mean ownership of at least fifty percent of the capitalor profits interest in such partnership or association; and "control of atrust" shall mean ownership, directly or indirectly, of at least fiftypercent of the beneficial interest in the principal or income of suchtrust; ownership shall be determined as provided in Section 318 of the U.S.Internal Revenue Code;
(10) "Replacement business facility", a facility otherwise describedin subdivision (4) of this section, hereafter referred to in thissubdivision as "new facility", which replaces another facility, hereafterreferred to in this subdivision as "old facility", located within thestate, which the taxpayer or a related taxpayer previously operated butdiscontinued operating on or before the close of the first taxable year inwhich the credit allowed by this section is claimed. A new facility shallbe deemed to replace an old facility if the following conditions are met:
(a) The old facility was operated by the taxpayer or a relatedtaxpayer during the taxpayer's or related taxpayer's taxable periodimmediately preceding the taxable year in which commencement of commercialoperations occurs at the new facility; and
(b) The old facility was employed by the taxpayer or a relatedtaxpayer in the operation of a revenue-producing enterprise and thetaxpayer continues the operation of the same or substantially similarrevenue-producing enterprise at the new facility.
Notwithstanding the preceding provisions of this subdivision, a facilityshall not be considered a replacement business facility if the taxpayer'snew business facility investment, as computed in subsection 5 of section135.110, in the new facility during the tax period in which the creditsallowed in sections 135.110, 135.225 and 135.235 and the exemption allowedin section 135.220 are claimed exceed one million dollars or, if less, twohundred percent of the investment in the old facility by the taxpayer orrelated taxpayer, and if the total number of employees at the new facilityexceeds the total number of employees at the old facility by at least twoexcept that the total number of employees at the new facility exceeds thetotal number of employees at the old facility by at least twenty-five if anoffice as defined in subdivision (8) of this section is established by arevenue-producing enterprise other than a revenue-producing enterprisedefined in paragraphs (a) to (g) and (i) to (l) of subdivision (11) of thissection;
(11) "Revenue-producing enterprise" means:
(a) Manufacturing activities classified as SICs 20 through 39;
(b) Agricultural activities classified as SIC 025;
(c) Rail transportation terminal activities classified as SIC 4013;
(d) Motor freight transportation terminal activities classified asSIC 4231;
(e) Public warehousing and storage activities classified as SICs 422and 423 except SIC 4221, miniwarehouse warehousing and warehousingself-storage;
(f) Water transportation terminal activities classified as SIC 4491;
(g) Wholesale trade activities classified as SICs 50 and 51;
(h) Insurance carriers activities classified as SICs 631, 632 and633;
(i) Research and development activities classified as SIC 873, except8733;
(j) Farm implement dealer activities classified as SIC 5999;
(k) Interexchange telecommunications services as defined insubdivision (24) or local exchange telecommunications services as definedin subdivision (31) of section 386.020, RSMo, or training activitiesconducted by an interexchange telecommunications company or by a localexchange telecommunications company as defined in subdivisions (23) and(30) of section 386.020, RSMo;
(l) Recycling activities classified as SIC 5093;
(m) Office activities as defined in subdivision (8) of this section,notwithstanding SIC classification;
(n) Mining activities classified as SICs 10 through 14;
(o) Computer programming, data processing and other computer-relatedactivities classified as SIC 737;
(p) The administrative management of any of the foregoing activities;or
(q) Any combination of any of the foregoing activities;
(12) "Same or substantially similar revenue-producing enterprise", arevenue-producing enterprise in which the nature of the products producedor sold, or activities conducted, are similar in character and use or areproduced, sold, performed or conducted in the same or similar manner as inanother revenue-producing enterprise;
(13) "SIC", the primary standard industrial classification as suchclassifications are defined in the 1987 edition of the Standard IndustrialClassification Manual as prepared by the Executive Office of the President,Office of Management and Budget. For the purpose of this subdivision,"primary" means at least fifty percent of the activities so classified areperformed at the new business facility during the taxpayer's tax period inwhich such tax credits are being claimed;
(14) "Taxpayer", an individual proprietorship, corporation describedin section 143.441 or 143.471, RSMo, and partnership or an insurancecompany subject to the tax imposed by chapter 148, RSMo, or in the case ofan insurance company exempt from the thirty percent employee requirement ofsection 135.230, to any obligation imposed pursuant to section 375.916,RSMo.
(L. 1980 S.B. 644 § 1, A.L. 1983 H.B. 54, A.L. 1985 H.B. 416, A.L. 1986 S.B. 727, A.L. 1991 H.B. 294 & 405, A.L. 1992 S.B. 661 & 620, A.L. 1993 H.B. 566, A.L. 1994 H.B. 1248 & 1048, A.L. 1995 H.B. 414, A.L. 1996 H.B. 1237, A.L. 1997 2d Ex. Sess. S.B. 1, A.L. 1998 S.B. 827)*Two versions of this section are printed here due to a technical drafting error.