How Does it Work?

1.During or after the production project spends money in the state, a CPA audits the expenditures and issues an audited expenditures report to the project

2. The project submits the audited expenditures report to the appropriate state agency for certification

3. The State issues a letter to the project, which states that the credits have been certified and waives any right of recapture of the credits from the end user unless fraud is involved.

4. When the credits are sold to an end purchaser, a sales agreement is issued with the credit certification letters attached. The letter lists total amount of credits available, how many are sold/transferred in the transaction, and the remaining balance available for further sale/transfer

5. The selling project issues a notification to the appropriate state agency confirming the credits have been transferred to the end purchaser. Celtic will obtain the agency’s stamp evidencing receipt.

6. The end user of the credits simply attaches the tax credit certification and the purchase documents to their tax return and takes the tax credit deduction on a particular line of the state income tax form.

7. Consult a tax professional to confirm applicability to your particular circumstances.

8. Tax Credit Legislation link:


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