ORS 315.518
Research conducted by semiconductor company
(1)
As used in this section, “qualified semiconductor company” means an entity whose primary business is the research, design, development, fabrication, assembly, testing, packaging or validation of semiconductors, or an entity whose primary business is the creation of semiconductor manufacturing equipment, semiconductor core intellectual property or electronic design automation software that is primarily intended for use in the semiconductor industry.(2)
A credit against taxes otherwise due under ORS chapter 316 or, if the taxpayer is a corporation, under ORS chapter 317 shall be allowed to eligible taxpayers for increases in qualified research expenses and basic research payments. The credit shall be determined in accordance with section 41 of the Internal Revenue Code, except as follows:(a)
The applicable percentage specified in section 41(a) of the Internal Revenue Code shall be 15 percent.(b)
“Qualified research” and “basic research” shall consist only of research conducted in Oregon by a qualified semiconductor company, in support of a trade or business directly related to semiconductors.(c)
Section 41(c)(4) of the Internal Revenue Code (relating to the alternative incremental credit) does not apply to the credit allowable under this section.(3)
The Income Tax Regulations as prescribed by the Secretary of the Treasury under authority of section 41 of the Internal Revenue Code apply for purposes of this section, except as modified by this section or as provided in rules adopted by the Department of Revenue.(4)
The maximum credit under this section may not exceed $4 million for any taxpayer.(5)
Prior to claiming a credit under this section, a taxpayer must obtain from the Oregon Business Development Department:(a)
If applicable, approval from the Oregon Business Development Department as provided in section 5, chapter 298, Oregon Laws 2023.(b)
Certification as provided in ORS 315.522 (Certification).(6)
The Oregon Business Development Department shall provide information to the Department of Revenue about all certifications issued under ORS 315.522 (Certification), if required by ORS 315.058 (Agency to provide tax credit approval information to Department of Revenue).(7)
The Director of the Oregon Business Development Department may order the suspension or revocation of a credit allowed under this section, as provided in ORS 315.061 (Suspension, revocation or forfeiture).(8)
A deduction may not be taken for the portion of expenses or payments, otherwise allowable as a deduction, that is equal to the amount of the credit claimed under this section.(9)
Notwithstanding ORS 317.090 (Minimum tax) (3), the refundable portion of a credit under this section is allowed against the tax imposed under ORS 317.090 (Minimum tax) and may reduce the tax imposed under ORS 317.090 (Minimum tax) to zero. Any remaining amount of credit above the minimum shall be refunded as provided in ORS 315.519 (Refundability of tax credit).(10)
Any tax credit that is otherwise allowable under this section and that is not used by the taxpayer in that year may be carried forward and offset against the taxpayer’s tax liability for the next succeeding tax year. Any credit remaining unused in such next succeeding tax year may be carried forward and used in the second succeeding tax year, and likewise any credit not used in that second succeeding tax year may be carried forward and used in the third succeeding tax year, and any credit not used in that third succeeding tax year may be carried forward and used in the fourth succeeding tax year, and any credit not used in that fourth succeeding tax year may be carried forward and used in the fifth succeeding tax year, but may not be carried forward for any tax year thereafter. [2023 c.298 §2]
Source:
Section 315.518 — Research conducted by semiconductor company, https://www.oregonlegislature.gov/bills_laws/ors/ors315.html.
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