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REFERENCE TITLE: water augmentation systems; tax credit |
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State of Arizona House of Representatives Fifty-third Legislature First Regular Session 2017
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HB 2330 |
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Introduced by Representatives Campbell: Stringer, Senator Fann
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AN ACT
Amending section 43-222, Arizona Revised Statutes; amending title 43, chapter 10, article 5, Arizona Revised Statutes, by adding section 43‑1090.01; relating to individual income tax credits.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 43-222, Arizona Revised Statutes, is amended to read:
43-222. Income tax credit review schedule
The joint legislative income tax credit review committee shall review the following income tax credits:
1. For years ending in 0 and 5, sections 43‑1079.01, 43‑1087, 43‑1088, 43-1089.04, 43‑1167.01 and 43‑1175.
2. For years ending in 1 and 6, sections 43‑1074.02, 43‑1083, 43‑1083.02, 43‑1085.01, 43‑1164.02, 43-1164.03 and 43‑1183.
3. For years ending in 2 and 7, sections 43‑1073, 43‑1079, 43‑1080, 43‑1085, 43‑1086, 43‑1089, 43‑1089.01, 43‑1089.02, 43-1089.03, 43‑1090, 43-1090.01, 43‑1164, 43‑1167, 43‑1169, 43‑1176 and 43‑1181.
4. For years ending in 3 and 8, sections 43‑1074.01, 43‑1081, 43‑1168, 43‑1170 and 43‑1178.
5. For years ending in 4 and 9, sections 43‑1076, 43‑1076.01, 43‑1081.01, 43‑1083.01, 43‑1083.04, 43‑1084, 43‑1162, 43‑1162.01, 43‑1164.01, 43‑1164.05, 43‑1170.01 and 43-1184 and, beginning in 2019, sections 43‑1083.03 and 43‑1164.04.
Sec. 2. Title 43, chapter 10, article 5, Arizona Revised Statutes, is amended by adding section 43-1090.01, to read:
43-1090.01. Credit for residential water augmentation systems
A. Subject to the requirements of this section, for taxable years beginning from and after December 31, 2017 through January 1, 2026, a credit is allowed against the taxes imposed by this title for each resident who is not a dependent of another taxpayer for installing a residential water augmentation system during the taxable year in the taxpayer's residence located in this state. A person who installs a water augmentation system described in this section shall furnish to the taxpayer an accounting of the cost of the system.
B. The amount of the credit is equal to twenty‑five percent of the cost of the system but not exceeding one thousand dollars. A taxpayer may claim the credit under this section only once in a taxable year and may not cumulate over different taxable years tax credits under this section exceeding, in the aggregate, one thousand dollars for the same residence. A husband and wife who file separate returns for a taxable year in which they could have filed a joint return may each claim only one-half of the tax credit that would have been allowed for a joint return.
C. To qualify for the credit under this section, a residential water augmentation system must be either or both of the following:
1. A system or a series of components or mechanisms that is designed to provide for the collection of rainwater on residential property, including storage devices capable of storing rainwater for future use and reusing the collected water on the same property. A rainwater harvesting system that was installed by the builder of a house or dwelling unit before title was conveyed to the taxpayer does not qualify for a credit under this section.
2. A residential graywater system that is installed on residential property and that is not connected to a centralized public or private sewage collection facility, but instead uses an on-site wastewater collection system. The graywater system must comply with rules adopted by the department of environmental quality that relate to the recovery and disposal of graywater. Graywater systems and stub outs that were installed by the builder of a house or dwelling unit before title was conveyed to the taxpayer do not qualify for a credit under this section.
D. If the allowable tax credit exceeds the taxes otherwise due under this title on the claimant's income, or if there are no taxes due under this title, the amount of the claim not used to offset taxes under this title may be carried forward for not more than five consecutive taxable years as a credit against subsequent years' income tax liability.
E. Beginning from and after December 31, 2017, the department shall receive and evaluate applications that are submitted by taxpayers to receive a credit under this section. A taxpayer must apply for the credit on a form that is prescribed by and filed with the department, and the department shall issue a receipt to the applicant. The application shall include:
1. The applicant's name, address and social security number or federal employer identification number.
2. The amount of the cost of the residential water augmentation system and the amount for which the credit is claimed.
3. Any additional information the department requires.
F. The department shall review each application it receives under subsection E of this section and certify to the taxpayer the amount of the credit that is authorized. The department may not certify tax credits under this subsection exceeding two hundred fifty thousand dollars for any calendar year. If qualifying applications exceed two hundred fifty thousand dollars, the department shall authorize credits in the order of the date that the applications are received by the department. If an application is received that, if authorized, would require the department to exceed the two hundred fifty thousand dollar limit, the department shall grant the applicant only the remaining credit amount that would not exceed the limit. After the department authorizes two hundred fifty thousand dollars in tax credits, the department shall deny any subsequent applications that are received in that calendar year. The department may not authorize any additional tax credits that exceed the two hundred fifty thousand dollar limit even if the amounts that have been certified to any taxpayer were not claimed or a taxpayer otherwise fails to meet the requirements to claim the additional credit.
G. The department may verify that a residential water augmentation system has been installed in the taxpayer's residence.
Sec. 3. Purpose
Pursuant to section 43-223, Arizona Revised Statutes, the legislature enacts section 43-1090.01, Arizona Revised Statutes, as added by this act, to encourage taxpayers to install residential water augmentation systems to provide for the collection of rainwater or residential graywater for future reuse of the reclaimed water by the taxpayer on the taxpayer's property.
Sec. 4. Effective date; applicability
This act is effective and applies to taxable years beginning from and after December 31, 2017.