Subchapter I. Neighborhood Assistance Tax Credit
TITLE 30
State Taxes
Income, Inheritance and Estate Taxes
CHAPTER 20. BUSINESS TAX CREDITS AND DEDUCTIONS
Subchapter I. Neighborhood Assistance Tax Credit
§ 2001. Short title.
This subchapter shall be known and may be cited as the "Neighborhood Assistance Act."
30 Del. C. 1953, § 2001; 56 Del. Laws, c. 405, § 1; 72 Del. Laws, 1st Sp. Sess., c. 250, § 2.;
§ 2002. Definitions.
As used in this subchapter:
(1) "Community development corporation" and "community-based development organization" means any locally-based, resident-controlled, nonprofit organization that plans and implements Community Economic Development projects in impoverished areas or for low- and moderate-income people and that holds a ruling from the Internal Revenue Service of the United States Department of the Treasury that the organization is exempt from income taxation under the provisions of the Internal Revenue Code.
(2) "Community services" means any type of counseling and advice, emergency assistance or medical care furnished to individuals or groups in an impoverished area or for low and moderate income families.
(3) "Crime prevention" means any activity that aids in the reduction of crime in an impoverished area or to assist low and moderate income families.
(4) "Economic development" means any activity that aids in business development and ownership in impoverished areas.
(5) "Education" means any type of scholastic instruction to an individual who resides in an impoverished area or for low and moderate income families that enables that individual to meet educational requirements for known job vacancies.
(6) "Housing" means any activity that aids in substantial renovation or new construction of rental or owner-occupied residences for low and moderate income families in impoverished areas or for low and moderate income families.
(7) "Impoverished area" means any clearly-defined, economically-distressed urban or rural area in this State that is certified as such by the Delaware State Housing Authority. Such certification shall be made on the basis of federal census studies and current indices of social and economic conditions.
(8) "Job training" means any type of instruction to an individual who resides in an impoverished area or for low and moderate income families that enables an individual to acquire vocational skills so that the individual can become employable or be able to seek a higher grade of employment.
(9) "Low and moderate income family" means an individual or family whose total household income is at or below 80% of the Area Median Income as established by the federal Department of Housing and Urban Development.
(10) "Neighborhood assistance" means the furnishing of financial assistance, labor, material and technical advice to aid in the physical, economic and community improvement of any part or all of an impoverished area or to assist low and moderate income families through the provision of community services, crime prevention, economic development, education, housing, and job training.
(11) "Neighborhood organization" means any organization performing neighborhood assistance in an impoverished area or for low and moderate income families and holding a ruling from the Internal Revenue Service of the United States Department of the Treasury that the organization is exempt from income taxation under the provisions of the Internal Revenue Code, or any community development corporation or community-based development organization as defined in this section.
(12) "Person" or "persons" shall include any individual; any form of company or corporation which is lawful within the State (including limited liability companies and S corporations), any form of partnership which is lawful within the State (including limited liability partnerships); and any trust or estate.
30 Del. C. 1953, § 2002; 56 Del. Laws, c. 405, § 1; 57 Del. Laws, c. 741, § 9A; 70 Del. Laws, c. 186, § 1; 72 Del. Laws, 1st Sp. Sess., c. 250, § 2; 76 Del. Laws, c. 172, §§ 1-8.;
§ 2003. Declaration of policy.
It is declared to be public policy of this State to encourage the investment by persons in offering neighborhood assistance both directly and by contributing to neighborhood organizations, to benefit individuals living in impoverished areas or low and moderate income families. This public policy further encourages the creation of significant partnerships among community-based development organizations, the private sector and the government.
30 Del. C. 1953, § 2003; 56 Del. Laws, c. 405, § 1; 72 Del. Laws, 1st Sp. Sess., c. 250, § 2; 76 Del. Laws, c. 172, § 9.;
§ 2004. Qualification for tax credit.
For each taxable period beginning on or after July 1, 2007, a person that contributes to a neighborhood organization or that provides neighborhood assistance in an impoverished area or for low and moderate income families shall receive a tax credit as provided in § 2005 of this title if the Director of the Delaware State Housing Authority annually approves the proposal of the taxpaying investor. The Director of the Delaware State Housing Authority shall promulgate rules and regulations for the approval or disapproval of such proposals by taxpaying investors.
A Neighborhood Assistance Act Advisory Council, whose members shall be appointed every 2 years by the Director of the Delaware State Housing Authority and comprising community development practitioners and representatives of the private and public sectors shall be established. The Neighborhood Assistance Act Advisory Council may provide guidance and recommendations to the Director of the Delaware State Housing Authority in establishing program priorities and mechanisms for the program to be conducted and determining the impoverished area or areas selected and the estimated amount to be invested in the program or neighborhood organization. The Neighborhood Assistance Act Advisory Council shall assist the Delaware State Housing Authority in establishing and promulgating rules and regulations for the approval or disapproval of proposals by taxpaying investors and neighborhood organizations.
30 Del. C. 1953, § 2004; 56 Del. Laws, c. 405, § 1; 57 Del. Laws, c. 741, § 9A; 58 Del. Laws, c. 492, § 2; 72 Del. Laws, 1st Sp. Sess., c. 250, § 2; 76 Del. Laws, c. 80, § 111(c); 76 Del. Laws, c. 172, § 10.;
§ 2005. State income tax credit; amount.
(a) For purposes of computing taxable income under Chapter 11 or Chapter 19 of this title, relating to the personal income tax and the corporation income tax, the Secretary of Finance shall allow a credit equal to 50% of the amount invested by a person in a program or in a neighborhood organization the proposal for which was approved under § 2004 of this title. Such tax credit, however, shall not exceed $100,000 per person.
(b) Any investment made in a tax year for which the tax credit herein described is claimed by a taxpayer shall not also be eligible for treatment in the same tax year as a charitable contribution deduction for state income tax purposes in calculating Delaware income tax liability.
30 Del. C. 1953, § 2005; 56 Del. Laws, c. 405, § 1; 57 Del. Laws, c. 741, § 9B; 58 Del. Laws, c. 492, § 3; 72 Del. Laws, 1st Sp. Sess., c. 250, § 2; 76 Del. Laws, c. 172, §§ 11, 12.;
§ 2006. Limitations on credits.
(a) The aggregate amount of such tax credits approved for all firms shall not exceed $500,000 in any 1 fiscal year.
(b) The Director of the Delaware State Housing Authority shall ensure that each application has the date and time of submission recorded. Credits will be awarded in chronological order based upon the date and time upon which each complete application is received by the Delaware State Housing Authority. If a credit award results in exceeding the $500,000 limitation for the fiscal year in which it is awarded, the amount by which such credit award exceeds $500,000 shall carry over to the succeeding fiscal year and shall receive priority for that year.
72 Del. Laws, 1st Sp. Sess., c. 250, § 2; 76 Del. Laws, c. 80, § 111(c); 76 Del. Laws, c. 172, § 13.;
§ 2007. Unused tax credit.
(a) Any person making contributions after July 1, 2007, that produce credits under § 2005 of this title, in amounts in excess of the maximum allowable credit permitted under § 2005 of this title shall be permitted to carry forward the excess contribution as a credit in any of the next 5 years subsequent to the date of the initial grant, subject to the limitation imposed by subsection (b) of this section.
(b) Excess contributions are those contributions that are not available as a credit in the year of the grant because of the limitation imposed by § 2005 of this title. The excess contributions carried over from prior years shall be allowable only after contributions for the current year have been credited, and in no event shall the total credit under this subchapter for any 1 year exceed the limitation imposed by § 2005 of this title.
30 Del. C. 1953, § 2006; 56 Del. Laws, c. 405, § 1; 58 Del. Laws, c. 492, § 4; 72 Del. Laws, 1st Sp. Sess., c. 250, § 2; 76 Del. Laws, c. 172, § 14.;