GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1997

H	3 

HOUSE BILL 1491*
Committee Substitute Favorable 7/15/98
Committee Substitute #2 Favorable 8/24/98

Short Title:  Amend Conservation Tax Credits.   	(Public)

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Sponsors:

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Referred to:  

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May 25, 1998

A BILL TO BE ENTITLED
AN ACT TO ELIMINATE THE REQUIREMENT THAT AN INDIVIDUAL INCOME TAXPAYER ADD BACK TO TAXABLE INCOME THE FAIR MARKET VALUE OF REAL PROPERTY DONATED FOR CONSERVATION PURPOSES IN ORDER TO CLAIM THE INCOME TAX CREDIT FOR THE DONATION OF THAT PROPERTY AND TO INCREASE THE MAXIMUM TAX CREDIT THAT MAY BE CLAIMED BY A CORPORATION AND BY AN INDIVIDUAL FOR A DONATION OF REAL PROPERTY FOR CONSERVATION PURPOSES.
The General Assembly of North Carolina enacts:
Section 1.  G.S. 105-134.6(c) reads as rewritten:
"(c)	Additions. – The following additions to taxable income shall be made in calculating North Carolina taxable income, to the extent each item is not included in taxable income:
(1)	Interest upon the obligations of states other than this State, political subdivisions of those states, and agencies of those states and their political subdivisions.
(2)	Any amount allowed as a deduction from gross income under the Code that is taxed under the Code by a separate tax other than the tax imposed in section 1 of the Code.
(3)	Any amount deducted from gross income under section 164 of the Code as state, local, or foreign income tax to the extent that the taxpayer's total itemized deductions deducted under the Code for the taxable year exceed the standard deduction allowable to the taxpayer under the Code reduced by the amount by which the taxpayer's allowable standard deduction has been increased under section 63(c)(4) of the Code.
(4)	The amount by which the taxpayer's standard deduction has been increased for inflation under section 63(c)(4)(A) of the Code.
(4a)	(Effective for taxable years beginning on or after January 1, 1995) The amount by which each of the taxpayer's personal exemptions has been increased for inflation under section 151(d)(4)(A) of the Code.  This amount is reduced by two hundred fifty dollars ($250.00) for each personal exemption if the taxpayer's adjusted gross income (AGI), as calculated under the Code, is less than the following amounts: 
Filing Status	AGI
Married, filing jointly		$100,000
Head of Household		  80,000
Single		  60,000
Married, filing separately		  50,000.
		For the purposes of this subdivision, if the taxpayer's personal exemptions have been reduced by the applicable percentage under section 151(d)(3) of the Code, the amount by which the personal exemptions have been increased for inflation is also reduced by the applicable percentage.
(4a)	(Effective for taxable years beginning on or after January 1, 1996) The amount by which each of the taxpayer's personal exemptions has been increased for inflation under section 151(d)(4)(A) of the Code.  This amount is reduced by five hundred dollars ($500.00) for each personal exemption if the taxpayer's adjusted gross income (AGI), as calculated under the Code, is less than the following amounts:
Filing Status	AGI
Married, filing jointly		$100,000
Head of Household		  80,000
Single		  60,000
Married, filing separately		  50,000.
		For the purposes of this subdivision, if the taxpayer's personal exemptions have been reduced by the applicable percentage under section 151(d)(3) of the Code, the amount by which the personal exemptions have been increased for inflation is also reduced by the applicable percentage.
(5)	The market price of the gleaned crop for which the taxpayer claims a credit for the taxable year under G.S. 105-151.14.
(6)	The amount by which the basis of property under the Code exceeds the basis of the property under this Article, in the year the taxpayer disposes of the property.
(7)	The amount of federal estate tax that is attributable to an item of income in respect of a decedent and is deducted from gross income under section 691(c) of the Code."
Section 2.  G.S. 105-151.12(c) is repealed.
Section 3.  G.S. 105-130.34(a) reads as rewritten:
"(a)	Any corporation that makes a qualified donation of an interest in real property located in North Carolina during the taxable year that is useful for public beach access or use, public access to public waters or trails, fish and wildlife conservation, or other similar land conservation purposes is allowed a credit against the tax imposed by this Division equal to twenty-five percent (25%) of the fair market value of the donated property interest.  To be eligible for this credit, the interest in real property must be donated to and accepted by either the State, a local government, or a body that is both organized to receive and administer lands for conservation purposes and qualified to receive charitable contributions pursuant to G.S. 105-130.9.  Lands required to be dedicated pursuant to local governmental regulation or ordinance and dedications made to increase building density levels permitted under a regulation or ordinance are not eligible for this credit.  The credit allowed under this section may not exceed five hundred thousand dollars ($500,000).  To support the credit allowed by this section, the taxpayer must file with its income tax return, for the taxable year in which the credit is claimed, a certification by the Department of Environment and Natural Resources that the property donated is suitable for one or more of the valid public benefits set forth in this subsection."
Section 4.  G.S. 105-151.12(a) reads as rewritten:
"(a)	A person who makes a qualified donation of an interest in real property located in North Carolina during the taxable year that is useful for (i) public beach access or use, (ii) public access to public waters or trails, (iii) fish and wildlife conservation, or (iv) other similar land conservation purposes is allowed a credit against the tax imposed by this Division equal to twenty-five percent (25%) of the fair market value of the donated property interest.  To be eligible for this credit, the interest in property must be donated to and accepted by either the State, a local government, or a body that is both organized to receive and administer lands for conservation purposes and qualified to receive charitable contributions under the Code.  Lands required to be dedicated pursuant to local governmental regulation or ordinance and dedications made to increase building density levels permitted under a regulation or ordinance are not eligible for this credit.  The credit allowed under this section may not exceed two hundred fifty thousand dollars ($250,000).  To support the credit allowed by this section, the taxpayer must file with the income tax return for the taxable year in which the credit is claimed a certification by the Department of Environment and Natural Resources that the property donated is suitable for one or more of the valid public benefits set forth in this subsection."
Section 5.  This act becomes effective for taxable years beginning on or after 1 January 1999.