STATE OF OKLAHOMA

2nd Session of the 53rd Legislature (2012)

SENATE BILL 1677	By:	Schulz

AS INTRODUCED

An Act relating to income tax; providing a credit against taxes for establishment of a corporate headquarters; setting amount of, and criteria for, credit; limiting ability to claim credit for certain costs; defining terms; providing for carry forward; providing for codification; and providing an effective date.

BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1.     NEW LAW     A new section of law to be codified in the Oklahoma Statutes as Section 2357.403 of Title 68, unless there is created a duplication in numbering, reads as follows:
A.  For taxable years beginning on or after January 1, 2013, there shall be allowed a credit against the tax imposed pursuant to Section 2355 of Title 68 of the Oklahoma Statutes for a taxpayer establishing a corporate headquarters in this state, subject to the limitations provided in subsection B of this section, as follows:
1.  The credit shall be equal to twenty percent (20%) of qualifying real property costs of if the establishment of the headquarters results in the creation of at least forty (40) new direct jobs, at least twenty (20) of which are classified by the employer as headquarters staff employees; and
2.  The credit shall be equal to twenty percent (20%) of qualifying tangible personal property costs if the establishment of the headquarters results in the creation of at least seventy-five (75) new direct jobs with an average compensation level of more than one and one-half (1.5) times the per capita income of this state based on the most recent per capita income data available at the end of the year during which the jobs are filled.
B.  1.  For facilities which are constructed, the credit shall only be allowed for the taxable year in which the headquarters is established or is placed in service for federal income tax purposes.
2.  For personal property, the credit shall not be allowed for property used to replace property for which the credit was initially claimed.
3.  For leased real or personal property, the credit shall only be allowed for the taxable year during which the first direct lease costs are incurred.
C.  As used in this section:
1.  "Corporate headquarters" means the facility or portion of a facility where corporate staff employees are physically employed and where the majority of the company's financial, personnel, legal, planning or other headquarters-related functions are handled, either on a regional, national or international basis;
2.  "Headquarters staff employee" means executive, administrative or professional workers performing headquarters-related functions and services;
3.  "New direct jobs" means full-time-equivalent jobs located in this state and performing headquarters-related functions and services, and does not include a job created when an employee is shifted from an existing location in this state;
4.  "Qualifying tangible personal property" means property capitalized as personal property for income tax purposes under the Internal Revenue Code and purchased for the establishment of a corporate headquarters and used for corporate headquarters-related functions; and
5.  "Qualifying real property costs" means costs incurred in the design, preparation, development and construction of a corporate headquarters or, with respect to leased facilities, direct lease costs during the first five (5) years of operations for the corporate headquarters.
D.  If the tax credit authorized by this section exceeds the amount of taxes due, or if there are no state taxes due of the taxpayer, the amount of the claim not used as an offset against the taxes of a taxable year may be carried forward for a period not to exceed ten (10) years.
SECTION 2.  This act shall become effective January 1, 2013.
53-2-2726	JCR	1/19/2012 2:43:08 PM