§ 44-62-4 - Calculation of tax credit and issuance of tax credit certificate.
SECTION 44-62-4
§ 44-62-4 Calculation of tax credit andissuance of tax credit certificate. – (a) When the contribution has been made as set forth in section 3 above, thebusiness entity shall apply to the division of taxation for a tax creditcertificate. The application will include such information, documentation, andcertification as the tax administrator deems proper for the administration ofthis chapter including, but not limited to a certification by an independentRhode Island certified public accountant that the cash contribution hasactually been made to the qualified scholarship organization. For purposes ofthe proper administration of this section, an independent Rhode Islandcertified public accountant shall be licensed in accordance with RIGL 5-3.1 andmeans a person, partnership, corporation, limited liability corporation that isnot affiliated with or an employee of said business entity or its affiliatesand is not affiliated in any manner whatsoever with a qualified scholarshiporganization or scholarship program as defined in § 42-62-2 (a) – (j).
(b) The division of taxation will review the documentationsubmitted; calculate the tax credit pertaining to the contribution, and prepareand mail a certificate for amount of credit to be granted.
(c) Unless a two year contribution plan is in place, thecredit, is computed at seventy-five percent (75%) of the total voluntary cashcontribution made by the business entity.
(d) This credit is available against taxes otherwise dueunder provisions of chapters 11, 13, 14, 15, 17 or 30 of title 44.
(e) A two year contribution plan is based on the writtencommitment of the business entity to provide the scholarship organization withthe same amount of contribution for two (2) consecutive tax years. The businessentity must provide in writing a commitment to this extended contribution tothe scholarship organization and the division of taxation at the time ofapplication.
(2) In the event that a two year contribution plan is inplace, the calculation of credit for each year shall be ninety percent (90%) ofthe total voluntary contribution made by a business entity.
(3) In the event that, in the second year of the plan, abusiness entity's contribution falls below the contribution amount made in thefirst year but the second year's contribution is eighty percent (80%) orgreater than the first year's contribution, the business entity shall receive acredit for both the first and second year contributions equal to ninety percent(90%) of each year's contribution.
(4) If the amount of the second year contribution is lessthan eighty percent (80%) of the first year contribution, then the credit forboth the first and second year contributions shall be equal to seventy-fivepercent (75%) of each year's contribution. In such case, the tax administratorshall prepare the tax credit certificate for the second year at seventy-fivepercent (75%). The difference in credit allowable for the first year [90%– 75% = 15% x first year contribution] shall be recaptured by addingit to the taxpayer's tax in that year.