House Bill 1663

AN ACT TO PROVIDE AN INCOME TAX CREDIT FOR RESIDENTIAL BUILDERS THAT CONSTRUCT NEW HOMES FOR SINGLE-FAMILY, OWNER-OCCUPIED RESIDENTIAL USE IN HANCOCK, HARRISON, JACKSON, PEARL RIVER, STONE AND GEORGE COUNTIES; TO PROVIDE FOR THE AMOUNT OF THE CREDIT; TO PROVIDE THAT THE CREDIT SHALL BE FOR THE SALES TAX PAID BY THE TAXPAYER ON THE PURCHASE OF COMPONENT MATERIALS USED BY THE TAXPAYER IN THE CONSTRUCTION OF SUCH HOMES; TO LIMIT THE AMOUNT OF THE CREDIT THAT MAY BE CLAIMED IN A TAXABLE YEAR; TO PROVIDE THAT ANY UNUSED PORTION OF THE CREDIT MAY BE CARRIED FORWARD FOR THE SUCCEEDING FIVE TAX YEARS; TO PROVIDE THAT ANY PAYMENT THAT IS APPLIED TOWARD THE CREDIT AUTHORIZED IN THIS ACT MAY NOT BE USED AS A DEDUCTION BY THE TAXPAYER FOR STATE INCOME TAX PURPOSES;

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. (1) (a) Subject to the limitations of this subsection, a taxpayer that is a residential builder licensed under Section 73-59-1 et seq. shall be allowed a credit against the taxes imposed under this chapter for the sales tax paid by the taxpayer on the purchase of component materials that are used by the taxpayer in the construction of new homes that are for single-family, owner-occupied residential use and located in Hancock, Harrison, Jackson, Pearl River, Stone and/or George Counties.

(b) The amount of credit that may be claimed by a taxpayer on a home shall be determined by:

(i) Multiplying the total construction costs incurred by the taxpayer in constructing the home structure and related facilities, excluding costs for land, insurance and similar purposes, by sixty percent (60%), and

(ii) Multiplying the product derived under subparagraph (i) of this paragraph by seven percent (7%), the product of which shall be the amount of credit that may be claimed on the home.

(c) The aggregate tax credit claimed during a taxable year cannot exceed the tax imposed upon the taxpayer for the taxable year reduced by the sum of all other credits allowable to such taxpayer under this chapter, except credit for tax payments made by or on behalf of the taxpayer. Any unused portion of the credit may be carried forward for the succeeding five (5) tax years. Any payment that is applied toward the credit authorized in this section may not be used as a deduction by the employer for state income tax purposes.

(d) For the purposes of this section, the term "residential builder" means and has the same definition as that term has in Section 73-59-1.

(2) The Department of Revenue may promulgate rules and regulations necessary to implement and administer this section. SECTION 2. Section 1 of this act shall be codified as a new section in Chapter 7, Title 27, Mississippi Code of 1972.

SECTION 3. Nothing in this act shall affect or defeat any claim, assessment, appeal, suit, right or cause of action for taxes due or accrued under the income tax laws before the date on which this act becomes effective, whether such claims, assessments, appeals, suits or actions have been begun before the date on which this act becomes effective or are begun thereafter; and the provisions of the income tax laws are expressly continued in full force, effect and operation for the purpose of the assessment, collection and enrollment of liens for any taxes due or accrued and the execution of any warrant under such laws before the date on which this act becomes effective, and for the imposition of any penalties, forfeitures or claims for failure to comply with such laws.

SECTION 4. This act shall take effect and be in force from and after July 1, 2012.