Chapter 20

§ 2001 Short title. This subchapter shall be known and may be cited as the “Neighborhood Assistance Act.” 30 Del. C. 1953, §  2001; 56 Del. Laws, c. 405, §  1 ; 72 Del. Laws, 1st Sp. Sess., c. 250,, §  2 ; § 2002 Definitions. As used in this subchapter: (1) “Community development corporation” and “community-based development organization” means any locally-based, resident-controlled, nonprofit organization that plans and implements Community Economic Development projects in impoverished areas or for low- and moderate-income people and that holds a ruling from the Internal Revenue Service of the United States Department of the Treasury that the organization is exempt from income taxation under the provisions of the Internal Revenue Code. (2) “Community services” means any type of counseling and advice, emergency assistance or medical care furnished to individuals or groups in an impoverished area or for low and moderate income families. (3) “Crime prevention” means any activity that aids in the reduction of crime in an impoverished area or to assist low and moderate income families. (4) “Economic development” means any activity that aids in business development and ownership in impoverished areas or for low and moderate income families. (5) “Education” means any type of scholastic instruction to an individual who resides in an impoverished area or for low and moderate income families that enables that individual to meet educational requirements for known job vacancies. (6) “Housing” means any activity that aids in substantial renovation or new construction of rental or owner-occupied residences for low and moderate income families in impoverished areas or for low and moderate income families. (7) “Impoverished area” means any clearly-defined, economically-distressed urban or rural area in this State that is certified as such by the Delaware State Housing Authority. Such certification shall be made on the basis of federal census studies and current indices of social and economic conditions. (8) “Job training” means any type of instruction to an individual who resides in an impoverished area or for low and moderate income families that enables an individual to acquire vocational skills so that the individual can become employable or be able to seek a higher grade of employment. (9) “Low and moderate income family” means an individual or family whose total household income is at or below 80% of the Area Median Income as established by the federal Department of Housing and Urban Development. (10) “Neighborhood assistance” means the furnishing of financial assistance, labor, material and technical advice to aid in the physical, economic and community improvement of any part or all of an impoverished area or to assist low and moderate income families through the provision of community services, crime prevention, economic development, education, housing, and job training. (11) “Neighborhood organization” means any organization performing neighborhood assistance in an impoverished area or for low and moderate income families and holding a ruling from the Internal Revenue Service of the United States Department of the Treasury that the organization is exempt from income taxation under the provisions of the Internal Revenue Code, or any community development corporation or community-based development organization as defined in this section. (12) “Person” or “persons” shall include any individual; any form of company or corporation which is lawful within the State (including limited liability companies and S corporations), any form of partnership which is lawful within the State (including limited liability partnerships); and any trust or estate. 30 Del. C. 1953, §  2002; 56 Del. Laws, c. 405, §  1 ; 57 Del. Laws, c. 741, §  9A ; 70 Del. Laws, c. 186, §  1 ; 72 Del. Laws, 1st Sp. Sess., c. 250,, §  2 ; 76 Del. Laws, c. 172, §§  1-8 ; 84 Del. Laws, c. 233, § 64 ; § 2003 Declaration of policy. It is declared to be public policy of this State to encourage the investment by persons in offering neighborhood assistance both directly and by contributing to neighborhood organizations, to benefit individuals living in impoverished areas or low and moderate income families. This public policy further encourages the creation of significant partnerships among community-based development organizations, the private sector and the government. 30 Del. C. 1953, §  2003; 56 Del. Laws, c. 405, §  1 ; 72 Del. Laws, 1st Sp. Sess., c. 250,, §  2 ; 76 Del. Laws, c. 172, §  9 ; § 2004 Qualification for tax credit; Neighborhood Assistance Act Advisory Council. (a) For each taxable period beginning on or after July 1, 2007, a person that contributes to a neighborhood organization or that provides neighborhood assistance in an impoverished area or for low and moderate income families shall receive a tax credit as provided in § 2005 of this title if the Director of the Delaware State Housing Authority annually approves the proposal of the taxpaying investor. The Director of the Delaware State Housing Authority shall promulgate rules and regulations for the approval or disapproval of such proposals by taxpaying investors. (b) A Neighborhood Assistance Act Advisory Council, whose members shall be appointed every 2 years by the Director of the Delaware State Housing Authority and be comprised of community development practitioners and representatives of the private and public sectors, shall be established. The Neighborhood Assistance Act Advisory Council shall provide guidance and recommendations to the Director of the Delaware State Housing Authority in establishing program priorities and mechanisms for the program to be conducted and determining the impoverished area or areas selected and the estimated amount to be invested in the program or neighborhood organization. The Neighborhood Assistance Act Advisory Council shall assist the Delaware State Housing Authority in establishing and promulgating rules and regulations for the approval or disapproval of proposals by taxpaying investors and neighborhood organizations. 30 Del. C. 1953, §  2004; 56 Del. Laws, c. 405, §  1 ; 57 Del. Laws, c. 741, §  9A ; 58 Del. Laws, c. 492, §  2 ; 72 Del. Laws, 1st Sp. Sess., c. 250,, §  2 ; 76 Del. Laws, c. 80, §  111(c) ; 76 Del. Laws, c. 172, §  10 ; 79 Del. Laws, c. 95, §  1 ; 84 Del. Laws, c. 233, § 65 ; § 2005 State income tax credit; amount. (a) For purposes of computing taxable income under Chapter 11 or Chapter 19 of this title, relating to the personal income tax and the corporation income tax, the Secretary of Finance shall allow a credit equal to 50% of the amount invested by a person in a program or in a neighborhood organization the proposal for which was approved under § 2004 of this title. Such tax credit, however, shall not exceed $50,000 per person per year. No person may receive more than $100,000 in tax credits during any 3-year period. (b) Any investment made for which the tax credit herein described is claimed by a taxpayer shall not also be eligible for treatment as a charitable contribution deduction for state income tax purposes in calculating Delaware income tax liability. 30 Del. C. 1953, §  2005; 56 Del. Laws, c. 405, §  1 ; 57 Del. Laws, c. 741, §  9B ; 58 Del. Laws, c. 492, §  3 ; 72 Del. Laws, 1st Sp. Sess., c. 250,, §  2 ; 76 Del. Laws, c. 172, §§  11, 12 ; 79 Del. Laws, c. 95, §  1 ; § 2006 Limitations on credits. (a) The aggregate amount of such tax credits approved for all persons may not exceed $1,000,000 in any 1 fiscal year. (b) The Director of the Delaware State Housing Authority shall ensure that each application has the date and time of submission recorded. Credits must be awarded in chronological order based upon the date and time upon which each complete application is received by the Delaware State Housing Authority. If a credit award results in exceeding the $1,000,000 limitation for the fiscal year in which it is awarded, the amount by which such credit award exceeds $1,000,000 must carry over to the succeeding fiscal year and must receive priority for that year. 72 Del. Laws, 1st Sp. Sess., c. 250,, §  2 ; 76 Del. Laws, c. 80, §  111(c) ; 76 Del. Laws, c. 172, §  13 ; 81 Del. Laws, c. 351, § 1 ; § 2007 Unused tax credit. (a) Any person making contributions after July 1, 2007, that produce credits under § 2005 of this title, in amounts in excess of the maximum allowable credit permitted under § 2005 of this title shall be permitted to carry forward the excess contribution as a credit in any of the next 5 years subsequent to the date of the initial grant, subject to the limitation imposed by subsection (b) of this section. (b) Excess contributions are those contributions that are not available as a credit in the year of the grant because of the limitation imposed by § 2005 of this title. The excess contributions carried over from prior years shall be allowable only after contributions for the current year have been credited, and in no event shall the total credit under this subchapter for any 1 year exceed the limitation imposed by § 2005 of this title. 30 Del. C. 1953, §  2006; 56 Del. Laws, c. 405, §  1 ; 58 Del. Laws, c. 492, §  4 ; 72 Del. Laws, 1st Sp. Sess., c. 250,, §  2 ; 76 Del. Laws, c. 172, §  14 ; § 2008 Administrative costs. The Delaware State Housing Authority is authorized to use up to $50,000 of the interest income from the Housing Development Fund created under § 4030 of Title 31 for the support of administrative functions associated with this subchapter. 81 Del. Laws, c. 351, § 2 ; Delaware General Assembly Judicial Executive Contact Twitter Help function submitSearch() { if (!window.location.origin) { window.location.origin = window.location.protocol + "//" + window.location.hostname + (window.location.port ? ':' + window.location.port : ''); } keyword = document.getElementById('srch-term').value; window.location.href = "/Search?query=" + keyword; } document.getElementById('srch-term').onkeyup = function (e) { if (e.keyCode == 13) { submitSearch(); } } § 2010 Definitions. As used in this subchapter and in subchapters III, V and VIII of this chapter: (1) “Qualified facility” is any qualified property that is not a large energy use facility located within this State that constitutes a new facility or an expanded facility and that is used by the taxpayer in or in connection with a qualified activity. (2) “Qualified property” is: a. Any building and its structural components and any other improvement to real property; b. The land on which such building or other improvement is located; and c. Any machinery, equipment and other tangible personal property (other than inventory and property held by the taxpayer primarily for sale to customers in the ordinary course of the taxpayer’s trade or business) located in such building or other improvement or located on such land. If any property is owned, leased or subleased by the taxpayer in common with any other person or persons, such property may constitute “qualified property” only to the extent of the taxpayer’s proportionate interest. (3) “Qualified activity” is: a. Any activity constituting manufacturing within the meaning of § 2701(2) of this title (other than any repair, refurbishing, retooling (such as retooling by an automobile manufacturer), recycling or other similar process or procedure that merely preserves or restores the value of a product or that does not change the inherent nature of a product or material); b. Engaging in business as a wholesaler, as defined in § 2901(21) of this title, or as a drayperson, as defined in § 2301(a)(7) of this title; c. The operation of any laboratory or other similar facility for the purpose of scientific, agricultural or industrial research, development or testing; d. The administration, management or support operations, including marketing, of any activity described in paragraphs (3)a. through k. of this section; e. Any activity more than 50% of whose annual gross receipts are derived from computer processing or data preparation or processing services, including data entry (but not word processing) and making data processing equipment available on an hourly or time-sharing basis; f. Any activity more than 50% of whose annual gross receipts are derived from engineering services, including providing and supervising the taxpayer’s engineering staff on temporary contract to other firms. The term “engineering services” does not include businesses providing engineering personnel but not general supervision; nor does it include businesses primarily engaged in architectural or photogrammetric engineering; g. Any activity more than 50% of whose annual gross receipts are derived from consumer credit reporting services, including adjustment and collection services and credit reporting services. “Adjustment and collection services” are establishments primarily engaged in the collection or adjustment of claims, other than insurance. “Credit reporting services” are establishments primarily engaged in providing mercantile and consumer credit reporting services; h. Any activity more than 50% of whose annual gross receipts are derived from the sale at wholesale of computer software other than custom software by the developer of such software; i. Telecommunications services which, for purposes of this chapter, shall mean the administration, supervision, maintenance, repair and deployment of the physical infrastructure associated with the provision of telecommunications services, including, but not limited to, the receipt of requests for service and the dispatch of repair and maintenance personnel; the coordination, installation and record activity for the initiation of telecommunication services, including the installation of equipment; the maintenance of records and operations information regarding a telecommunications system or network; and engineering and construction services related to the deployment of infrastructure for a telecommunications system or network; j. Any activity more than 50% of whose annual gross receipts are derived from aviation services. The term “aviation services” means a business conducted by an employer in Delaware: 1. At an airport owned or operated by: A. The State, B. Any political subdivision of the State, C. Any agency or instrumentality of the State or of its political subdivisions, or D. A bi-state authority created by a compact between states and approved by the Congress of the United States, 2. Employing at least 100 qualified employees, 3. Constituting the inspection, maintenance, repair, overhaul or remanufacture of aircraft, aircraft engines and other aircraft components or parts; the performance of retrofits of aircraft engines and other components to aircraft and the performance of other modifications to aircraft (including interior and exterior modifications, whether to new or used aircraft, and the design, engineering, installation and certification of such modifications); the sale of aircraft components or parts and lubricants or other consumable goods in connection with the foregoing activities; or any combination of the foregoing activities; or k. The year-round operation of a building or other permanent structures on the same parcel of land consisting, in the aggregate, of no less than 400,000 square feet of enclosed, climate-controlled space used for growing fruits or vegetables. l . Any combination of the activities described in paragraphs (3)a. through (3)k. of this section. (4) “New facility” is any qualified property (other than an expanded facility or a replacement facility) placed in service by the taxpayer as owner, lessee or sublessee after December 31, 1984; provided, however, that such phrase shall not include any property the original use of which commenced prior to the time the taxpayer placed such property in service if: a. At any time within 1 year after the date the taxpayer placed such property in service, the taxpayer or a related person uses such property in or in connection with any qualified activity; and b. Such property was used by any person, at any time within the 1-year period ending on the date the taxpayer placed such property in service, in the same or substantially the same qualified activity. (5) “Expanded facility” is any qualified property (other than a replacement facility) resulting from the acquisition, construction, reconstruction, installation or erection of improvements or additions to existing property (not including any improvement or addition resulting from a repair, refurbishing, retooling (such as retooling by an automobile manufacturer), recycling or other similar process or procedure that merely preserves or restores the value of an existing facility, and not including any improvement or addition that, in the determination of the Secretary, does not constitute an integral part of a qualified activity), if such improvements or additions are placed in service by the taxpayer as owner, lessee or sublessee after December 31, 1984, but only to the extent of the taxpayer’s qualified investment in such improvements or additions. For property placed in service after July 1, 1992, a facility which constitutes a replacement facility, as defined in paragraph (6) of this section, shall be deemed an expanded facility, and the investment shall be deemed a qualified investment, to the extent the taxpayer’s investment in the replacement facility exceeds the greater of: a. One hundred and fifty percent of the unadjusted cost basis of the facility which is being replaced; or b. One hundred percent of the market value of the facility which is being replaced. (6) “Replacement facility” is any property (other than an expanded facility) that replaces or supersedes any other property located within this State that: a. The taxpayer or a related person used in or in connection with any activity for more than 2 years during the period of the 5 consecutive years ending on the date the replacement or superseding property is placed in service by the taxpayer; and b. Is not used by the taxpayer or a related person in or in connection with any qualified activity for a continuous period of 1 year or more commencing with the date the replacement or superseding property is placed in service by the taxpayer. (7) “Placed in service” and “original use” shall have the meanings ascribed to such phrases under § 167 of the Internal Revenue Code (26 U.S.C. § 167), and regulations promulgated thereunder. (8) “Qualified employee” is a person employed within this State on a regular and full-time basis. (9) “Qualified investment” for any taxable year is the value of a qualified facility as of the last business day of such taxable year. Such value during any taxable year of the taxpayer shall be: a. If the qualified facility is owned by the taxpayer, the original cost of such facility to the taxpayer; or b. If the qualified facility is leased or subleased by the taxpayer, 8 times the net annual rent paid or incurred by the taxpayer for such facility. The net annual rent shall be the gross rent paid or incurred by the taxpayer for such facility during the taxable year, less any gross rental income received by the taxpayer from sublessees of any portion of such facility during such taxable year. (10) “Related person” means: a. A corporation, partnership, association or trust controlled by the taxpayer; b. An individual, corporation, partnership, association or trust that is in control of the taxpayer; or c. A corporation, partnership, association or trust controlled by an individual, corporation, partnership, association or trust that is in control of the taxpayer. For purposes of this paragraph (10), “control,” with respect to a corporation, means ownership, directly or indirectly, of stock possessing 50 percent or more of the total combined voting power of all classes of the stock of such corporation entitled to vote and 50 percent or more of the total number of shares of all other classes of such corporation’s stock; “control,” with respect to a trust, means ownership, directly or indirectly, of 50 percent or more of the beneficial interest in the principal or income of such trust. The ownership of stock in a corporation, of a capital or profits interest in a partnership or association or of a beneficial interest in a trust shall be determined in accordance with the rules for constructive ownership of stock provided in § 267(c) of the Internal Revenue Code (26 U.S.C. § 267(c)) other than paragraph (c)(3) of such section. (11) “Qualified facility gross receipts” means the total Delaware gross receipts (as defined and computed under those provisions of Chapter 23, 27 or 29 of this title that apply to the qualified activity in question) attributable to and derived by the taxpayer from the operation of the qualified facility in question. (12) “Secretary” means the Secretary of Finance or the Secretary’s delegate. (13) “Taxpayer” means an individual pass-through entity, as defined in § 1601 of this title, or corporation. (14) “Full-time employment” means employment of 1 individual for at least 35 hours per week, not including absences excused by reason of vacations, illness, holidays or similar causes. (15) “Health care benefits” means financial protection against the medical care cost arising from disease and accidental bodily injury for which cost the employer pays at least 50% for employees employed by the employer for a continuous period of 6 months or more. (16) “Brownfield” shall have the meaning set forth in § 9103 of Title 7. (17) “Gross receipts” shall have the same definition as that contained in the denominator described in § 1903(b)(6)b.3. of this title plus the amount of federal taxable income of the taxpayer attributable to patent and copyright royalties. (18) “Delaware base amount” shall mean the “base amount” as defined in § 41(c) of the Internal Revenue Code of 1986 [26 U.S.C. § 41(c)], except that references to “qualified research expenses” shall mean “Delaware qualified research and development expenses” and references to “qualified research” shall mean “Delaware qualified research and development.” References to “fixed base percentage” shall mean the percentage which the aggregate Delaware qualified research and development expenses for the 4 taxable years immediately preceding the taxable year in which the expenses are taken into account for purposes of Delaware income taxation bear to the aggregate gross receipts for such years. The fixed base percentage for a taxpayer who has fewer than 4 but at least 1 taxable year with gross receipts and Delaware qualified research and development expenses shall be determined in the same manner using only the number of immediately preceding taxable years in which both existed to arrive at the percentage. In the event the taxpayer has in such 4 immediately preceding taxable years no year in which it had both gross receipts and Delaware qualified research and development expenses, the fixed base percentage shall be deemed to be zero. (19) “Delaware qualified research and development” shall mean qualified research as defined in § 41(d) of the Internal Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. § 41(d)) that is conducted in this State. The funding of research and development by any person or entity under common control with the ultimate parent corporation of the taxpayer shall not constitute “funded research” as described in § 41(d)(4)(H) of the Internal Revenue Code of 1986 for the purpose of determining Delaware qualified research and development hereunder. (20) “Delaware qualified research and development expenses” shall mean qualified research expenses as defined in § 41(b) of the Internal Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. § 41(b)) taken into account for purposes of Delaware income taxation for Delaware qualified research and development. (21) “Qualified tax liability” shall mean the liability for taxes imposed under Chapters 19 and 11 of this title on corporations, shareholders of an S corporation, sole proprietors, partners or members of any other pass-through entity eligible to apply for credits under this subchapter remaining after application of all other credits allowed under this chapter. (22) “Research and development tax credit” shall mean the credit provided under § 2070 of this title. (23) “Clean energy technology device” shall mean: a. Solar power devices, which shall mean devices or systems that use photovoltaic solar cells to produce electricity or that use solar energy to heat water; b. Fuel cells, which shall mean devices or systems that use an electrochemical generator that converts the chemical energy of a fuel and an oxidant directly to electricity; c. Wind power devices, which shall mean devices or systems that convert the motion of wind into electric power; or, d. Geothermal power devices, which shall mean devices or systems that use the temperature differentials between the atmosphere and subterranean areas to heat or cool buildings or to heat water. (24) “Clean energy technology device manufacturing” shall mean any activity constituting manufacturing within the meaning of § 2701(2) of this title (other than any repair, refurbishing, retooling, recycling or other similar process or procedure that merely preserves or restores the value of a product or that does not change the inherent nature of a product or material) of clean energy technology devices. (25) a. “Large energy use facility” means a facility that does any of the following: 1. Uses or is projected to use a monthly maximum demand of 75 megawatts or greater at a load factor of 85% or greater. 2. Uses a monthly maximum instantaneous demand of 100 megawatts or greater. 3. Uses or is able to use a monthly maximum demand of 30 megawatts or greater and is primarily engaged in providing a service described under code 518210 of the 2022 North American Industry Classification System. b. Multiple facilities may be aggregated and treated as a large energy use facility for the purposes of this definition if the electric utility or the electric utility’s regulatory body determines they would pose reliability risks to the electric system because of their electricity use, proximity, and operational characteristics. Factors that may be considered include close physical proximity, common ownership or control, or ownership or control through an affiliated company, and sharing of local electrical infrastructure. c. “Large energy use facility” does not include a facility that stores, processes, refines, or transfers crude petroleum or petroleum products in bulk quantities, including refineries, and such uses shall not count toward aggregation. This exemption does not apply to a new facility that, after August 26, 2026, adds uses unrelated to the storage, processing, refining, or transfer of crude petroleum, petroleum products in bulk quantities, or other energy storage materials, if the energy use of the new facility meets the thresholds in paragraph (25)a. of this section. d. 1. A large energy use facility will be a qualified facility if the facility produces sufficient power or procures sufficient generation to meet 100% of the large energy use facility’s annual energy needs from a facility or facilities interconnected in this State or within PJM Interconnection, L.L.C's (PJM) Delmarva Power and Light (DPL) transmission zone or within a transmission zone contiguous by land to the DPL transmission zone and with sufficient existing transmission infrastructure to deliver this additional electricity to Delaware. 2. Procured generation must be from a facility or facilities interconnected in this State or within PJM’s DPL transmission zone or within a transmission zone contiguous by land to the DPL transmission zone, with sufficient existing transmission infrastructure to deliver this additional electricity to Delaware, and which has not been already committed in a prior PJM capacity auction. This may include newly constructed generation at an existing facility, uprates, or repowering of deactivated or retired generating units as of June 12, 2026; provided that capacity that previously participated in the PJM base residual auction shall qualify only to the extent attributable to such uprate or repowering. 3. All power generated must meet the renewable energy portfolio standards established under § 354 of Title 26 at the established minimum cumulative percentage at the facility’s anticipated end of operation, determined at the facility’s proposed date of interconnection, and produced by clean energy technology. A facility may use a combination of 1 or more of the following forms of acceptable clean energy technology to meet the percentage thresholds established therein: A. Generation eligible for compliance with the renewable energy portfolio standards or any successor clean energy standards and interconnecting in Delaware. B. Nuclear power. C. Energy storage interconnecting in Delaware and used for the primary purpose of storing energy generated from resources outlined in this paragraph (25). 4. Compliance with this subsection may be achieved through any combination of procurement of renewable or clean energy resources, onsite or directly interconnected generation, power purchase agreements, or other mechanism approved by the electric utility’s regulatory body. 5. A single-cycle or open-cycle power generation facility is not an acceptable energy generation technology for purposes of this paragraph (25). 62 Del. Laws, c. 155, §  3 ; 62 Del. Laws, c. 328, §  1 ; 64 Del. Laws, c. 460, §§  1, 2 ; 67 Del. Laws, c. 120, §  1 ; 68 Del. Laws, c. 6, §  1 ; 68 Del. Laws, c. 202, §§  1, 4-6, 8, 13, 18 ; 70 Del. Laws, c. 186, §  1 ; 70 Del. Laws, c. 219, §  1 ; 70 Del. Laws, c. 487, §§  1, 12-14, 22 ; 72 Del. Laws, c. 23, §§  1-3 ; 72 Del. Laws, c. 442, §  1 ; 72 Del. Laws, c. 467, §  4 ; 73 Del. Laws, c. 183, §  7 ; 75 Del. Laws, c. 352, §  33 ; 76 Del. Laws, c. 78, §  2 ; 77 Del. Laws, c. 86, §  30 ; 77 Del. Laws, c. 412, §  2 ; 78 Del. Laws, c. 1, §  1 ; 78 Del. Laws, c. 47, §§  2-6 ; 78 Del. Laws, c. 100, §  1 ; 80 Del. Laws, c. 195, § 8 ; 84 Del. Laws, c. 134, § 1 ; 85 Del. Laws, c. 441, § 1 ; § 2011 Investment and employment credit against corporation income tax. (a) Any taxpayer (other than a public utility as defined in Chapter 1 of Title 26, unless such public utility is a provider of telecommunications services as described in § 2010(3)i. of this title) that: (1) During any consecutive 12-month period has placed in service a qualified facility in which such taxpayer has during such period made a qualified investment in an amount equal to or exceeding $200,000 except that, in the case of a new or expanded facility placed in service to conduct the qualified activity described in § 2010(3)k. of this title, the qualified investment during such period must be in an amount equal to or exceeding $40 million; (2) During the consecutive 12-month period referred to in paragraph (a)(1) of this section employs 5 or more qualified employees; (3) Within 36 months after the date on which a qualified facility is placed in service (which 36-month period shall include the month in which the qualified facility is placed in service) applies for written approval from the Secretary or the Secretary’s designee confirming the taxpayer’s qualification for the tax credits and license reductions set forth in this subchapter; shall (except as otherwise provided in subsection (e) of this section) be allowed a credit against the tax imposed by Chapter 19 of this title for the taxable year in which all conditions set forth in this subsection shall be met and for any of the 9 following taxable years in which such facility is a qualified facility with respect to the taxpayer on the last business day thereof. The amount of such credit for any such year shall be the amount determined under subsection (b) of this section. (b) Subject to the limitations contained in subsections (c) and (d) of this section, the amount of the credit allowable under subsection (a) of this section with respect to any qualified facility for each of the taxable years falling within the 10-year life of such credit shall be the sum of: (1) Five hundred dollars multiplied by that number that is the greater of: a. The difference between: 1. The number of qualified employees employed by the taxpayer on a date 1 year after the date on which the qualified facility is placed in service; and 2. The sum of the number of qualified employees, if any, that were employed by the taxpayer and by any related person on the day immediately preceding the date on which such qualified facility is placed in service by the taxpayer; and b. The difference between: 1. The number of qualified employees employed by the taxpayer on a date 1 year after the date on which occurs the event described in paragraph (a)(2) of this section; and 2. The sum of the number of qualified employees, if any, that were employed by the taxpayer and by any related person on the day immediately preceding the date on which occurs the event described in paragraph (a)(2) of this section; provided, in either case, that no credit shall be allowable under this paragraph (b)(1) with respect to any qualified employee, except to the extent that the qualified investment in such qualified facility equals or exceeds $40,000 per qualified employee; and provided further, that no credit shall be allowable under this paragraph (b)(1) with respect to any qualified employee to the extent a credit was claimed by the taxpayer or any related person under this paragraph (b)(1) for such qualified employee with respect to any other qualified facility placed in service in the same or a prior taxable year; plus (2) Five hundred dollars multiplied by each $100,000 (or major fraction thereof) of qualified investment in such qualified facility. (3) In the case of a qualified facility used in connection with the qualified activity described in § 2010(3)i. of this title, the amount of the credit allowable under subsection (a) of this section with respect to such a facility for each of the taxable years falling within the 10-year life of such credit shall be determined by the application of paragraphs (b)(1) and (2) of this section, except that: a. The amount of investment required per qualified employee for purposes of credits determined under paragraph (b)(1) of this section shall be $15,000 rather than $40,000, and the amount of minimum required investment determined under subsection (a) of this section shall be $750,000 rather than $200,000; b. No amount of investment may be included in any of the calculations required under paragraph (b)(2) or (3) of this section unless the taxpayer has elected that any such amount of investment shall not be also considered in determining the extent to which the taxpayer has satisfied any obligation it might have under § 711 of Title 26 [repealed]; and c. The minimum number of qualified employees required for purposes of credits determined under paragraph (b)(1) of this section shall be 50 rather than 5, provided further, that such 50 qualified employees shall be in addition to the number of qualified employees employed by the taxpayer within this State as of December 31, 1996, and no credit shall be allowed under paragraph (b)(2) of this section until the taxpayer shall have employed at least 50 qualified employees in addition to the number of qualified employees employed within this State as of December 31, 1996. (c) If the number of qualified employees employed by the taxpayer during any taxable year of the taxpayer later than the taxable year in which such qualified facility was placed in service by the taxpayer shall be less than 90 percent of the number of qualified employees that were taken into account under subsection (b) of this section, the amount of the credit otherwise allowable under subsection (b) of this section for such later taxable year shall be reduced by 1 percent for each full percentage point that the number of such qualified employees in such later taxable year is less than the number of qualified employees that were taken into account under subsection (b) of this section. (d) The amount of the credit allowable under this section for any taxable year shall not exceed 50 percent of the amount of tax imposed upon the taxpayer by Chapter 19 of this title for such taxable year (computed without regard to this section). (e) No credit shall be allowable under subsection (a) of this section unless at least 25 percent of all qualified employees employed by the taxpayer on the date a qualified facility is placed in service by the taxpayer are residents of this State on such date. (f) The amount of the credit determined under subsections (b) and (c) of this section for any taxable year that is not allowable for such taxable year solely as a result of the limitation contained in subsection (d) of this section shall be a credit carryover to each of the following taxable years that fall within the 10-year life of the credit specified in subsection (a) of this section. The entire amount of the credit that is not so allowable shall be carried to the earliest of the taxable years to which such credit may be carried, and the portion of such credit that shall be carried to each of the other taxable years to which such credit may be carried shall be the excess, if any, of such credit over the sum of the credits allowable under this section (including subsection (d) of this section) for each of the prior taxable years to which such credit may be carried. In applying the limitation contained in subsection (d) of this section to any taxable year to which a credit may be carried under this subsection, any credit carryovers to such taxable year shall be considered to be applied in reduction of the tax imposed by Chapter 19 of this title for such taxable year in the order of the taxable years from which such credits are carried over, beginning with the credit carryover from the earliest taxable year, and only after all such credit carryovers to such taxable year have been allowed in full shall any credit that would be allowable in such taxable year without regard to this subsection be allowed. (g) If any facility for which a credit was allowable to the taxpayer under subsection (a) of this section is not a qualified facility with respect to the taxpayer on the last business day of any taxable year during the 10-year life of the credit specified in subsection (a) of this section and if on the last business day of any later taxable year ending after the expiration of such 10-year life such facility again constitutes a qualified facility with respect to the taxpayer (whether as a result of the same qualified activity or a different qualified activity), the Secretary may, upon application of the taxpayer filed on or before the first day of the fourth month following the close of such later taxable year (and filed in such form and manner as may be prescribed in regulations by the Secretary), allow a credit for such later taxable year and for each of that number of the following taxable years as shall be equal to the difference between 9 and the number of prior taxable years for which a credit was allowable to the taxpayer for such qualified facility. The amount of the credit, for such later taxable year and for each such following taxable year, shall be the amount of the credit determined under subsection (b) of this section for the taxable year such qualified facility was first placed in service by the taxpayer, but subject in such later taxable year and in each such following taxable year to the limitations contained in subsections (c) and (d) of this section. The Secretary shall allow such credit if the Secretary determines that the resumption of a qualified activity with respect to such qualified facility will provide increased opportunities for employment in this State and will result in a meaningful contribution to the economy of this State. (h)-(j) [Repealed.] (k) Any taxpayer (other than a public utility as defined in Chapter 1 of Title 26) that for any taxable year has a qualified investment in a qualified facility that is placed in service by the taxpayer during such taxable year shall be allowed a credit under this section irrespective of the limitations contained in subsection (a)(2), (b) or (c) of this section; provided, however, as follows: (1) Such investment must equal or exceed the greater of: a. $1 million; or b. 15% of the unadjusted basis in such facility at the close of the taxable year preceding the date on which installation or construction of the investment described in this paragraph commenced; (2) Substantially all the use of the qualified facility by the taxpayer occurs in the activity of aviation services, manufacturing or wholesaling as defined respectively in § 2010(3)j., § 2701(2) or § 2901(21)a. of this title; (3) The amount of the credit allowed under this subsection shall be 75% of the credit allowable if the taxpayer were eligible for credit under subsection (a) of this section, subject, however, to limitation and carryover provisions under subsections (d) and (f) of this section. Credits claimed in any tax year (including amounts carried over from previous tax years) shall not exceed the difference between $500,000 and the amount of credits claimed under § 2012 of this title for the 12 months comprising said tax year. Amounts of credit not used by virtue of the preceding sentence may be carried forward as if such unused credits arose by virtue of § 2011(d) of this title; (4) No facility may be eligible for credits under both this subsection and subsection (a) of this section; (5) Should the qualified facility be an expanded facility, total wages paid during the taxable year by the taxpayer to qualified employees employed at the qualified facility must equal or exceed 85% of the wages paid by the taxpayer to qualified employees at the same facility during the 12 months preceding the date on which the qualified facility was placed in service; and (6) Construction of the qualified facility was commenced after February 6, 1992. For purposes of this paragraph (k)(6), construction of a facility shall commence on the date on which site alteration first occurs. ( l ) Except as otherwise provided in § 2021(d) of this title, in the case of a qualified facility located on a brownfield, this section shall be applied with respect to such qualified facility by: (1) Treating as a qualified activity any business, trade, commerce, profession or vocation carried on in or in connection with such qualified facility, (2) Treating as additional qualified investment all amounts expended by the taxpayer for environmental investigation and remediation of the brownfield, and (3) Substituting “$650” for “$500” in each of subsections (b)(1) and (b)(2) of this section. The total incremental credits allowable to the taxpayer under this subsection ( l ) shall not exceed the aggregate amount expended by the taxpayer for environmental investigation and remediation of the brownfield. 62 Del. Laws, c. 155, §  3 ; 64 Del. Laws, c. 460, §  2 ; 68 Del. Laws, c. 202, §§  3, 14 ; 70 Del. Laws, c. 142, §  3 ; 70 Del. Laws, c. 186, §  1 ; 70 Del. Laws, c. 219, §  2 ; 70 Del. Laws, c. 487, §§  3, 5, 15-17 ; 71 Del. Laws, c. 217, §§  14, 15 ; 77 Del. Laws, c. 412, §  2 ; 78 Del. Laws, c. 1, §  2 ; 78 Del. Laws, c. 47, §§  7-10 ; 78 Del. Laws, c. 76, §  67 ; 78 Del. Laws, c. 100, §  2 ; 84 Del. Laws, c. 134, § 2 ; § 2012 Reduction in license fees for investment and employment. (a) Any taxpayer that satisfies the requirements contained in § 2011(a) or § 2011( l ) of this title for the allowance of a credit against the tax imposed by Chapter 19 of this title (relating to corporation income tax), for the taxable year of the taxpayer in which a qualified facility is placed in service by the taxpayer, shall also be allowed a reduction in any license fee, other than those set forth in §§ 2902(c)(4) and 2905(h) of this title, imposed upon the taxpayer’s gross receipts by Chapter 27 of this title or by §§ 2301(d), 2902, 2903, 2904 of this title or, in the case of an activity described in §§ 2010(3)j., 2905 of this title for each taxable period used in computing the amount of such license fee that ends within or with such taxable year of the taxpayer, and for each such taxable period that ends within or with any of the 9 following taxable years in which such facility is a qualified facility with respect to the taxpayer on the last business day thereof. The amount of each such reduction in such license fee shall be determined under subsection (b) of this section. (b) The reduction in the license fee allowable by subsection (a) of this section shall be that percentage of such license fee (computed without regard to this section) imposed upon the taxpayer’s qualified facility gross receipts attributable to the operation of such qualified facility (as determined under § 2010(11) of this title) as shall be determined in accordance with the following table: If the number of full The license fee calendar months elapsed (computed without since such qualified regard to this facility was placed section) shall be in service by the reduced by the taxpayer is: following percentage: 1 through 12 90% 13 through 24 80% 25 through 36 70% 37 through 48 60% 49 through 60 50% 61 through 72 40% 73 through 84 30% 85 through 96 20% 97 through 108 10% 109 through 120 5% Over 120 0% (c) Any taxpayer placing in service a facility meeting the conditions set forth in § 2011(k) of this title shall be allowed a reduction in license fees other than those set forth in §§ 2902(c)(4) and 2905(h) of this title equal to 75% of the reduction allowable to taxpayers qualifying under subsection (a) of this section; provided, however, that such credits may not exceed $500,000 over their 10-year life. No taxpayer may be eligible for reductions under both this subsection and subsection (a) of this section for the same facility. 62 Del. Laws, c. 155, §  3 ; 64 Del. Laws, c. 460, §  2 ; 68 Del. Laws, c. 202, §  15 ; 70 Del. Laws, c. 219, §  3 ; 70 Del. Laws, c. 487, §§  18, 19 ; 71 Del. Laws, c. 217, §  8 ; § 2013 Rules and regulations. The Secretary shall prescribe such rules and regulations as the Secretary may deem necessary to carry out the purposes of this subchapter and subchapter III of Chapter 20 of this title. 62 Del. Laws, c. 155, §  3 ; 64 Del. Laws, c. 460, §  2 ; 70 Del. Laws, c. 186, §  1 ; § 2014 Report on effect of subchapters II and III of this chapter [Repealed]. 64 Del. Laws, c. 460, §  2 ; 69 Del. Laws, c. 458, §  1 ; repealed by 78 Del. Laws, c. 47, § 11, eff. July 1, 2011. ; § 2015 Successors in title. Notwithstanding any other provision of this subchapter, §§ 2011 and 2012 of this title shall also apply to a successor in title who acquires a facility through purchase or a transaction described in § 368(a)(1) of the Internal Revenue Code [26 U.S.C. § 368(a)(1)] (or successor provision) for so long as such qualified facility continues to be a qualified facility with respect to such successor, but such qualification shall cease at the same time it would have ceased had the property remained under the same ownership as was the case on the date the qualified facility was placed in service. 71 Del. Laws, c. 314, §  9 ; Delaware General Assembly Judicial Executive Contact Twitter Help function submitSearch() { if (!window.location.origin) { window.location.origin = window.location.protocol + "//" + window.location.hostname + (window.location.port ? ':' + window.location.port : ''); } keyword = document.getElementById('srch-term').value; window.location.href = "/Search?query=" + keyword; } document.getElementById('srch-term').onkeyup = function (e) { if (e.keyCode == 13) { submitSearch(); } } § 2020 Definitions. As used in this subchapter: (1) “Commercial activity” is an activity constituting a business licensable under § 2301 of this title, other than any of the following business: Amusement conductor, amusement park operator, auctioneer, automobile race operator, bowling alley operator, circus exhibitor, entertainment agent, finance or small loan agency, floor show operator, health spa or health club, junk dealer, motion picture theater, outdoor music festival promoter, pawnbroker, pool table operator, public bath keeper, salvage yard operator and self-service laundry or dry cleaner. (2) “Retail activity” is engaging in business as a retailer, as defined in § 2901(18) of this title, other than by providing retail food and beverage services (including eating and drinking places, but excluding grocery and convenience stores), engaging in automobile sales or providing recreation or entertainment. (3) “Targeted area” means any of the following: a. Any real property located within this State that is owned by the State, any political subdivision of the State, or any agency or instrumentality of the State or its political subdivisions. b. Any real property located within this State that is owned by an organization described in § 501(c) of the Internal Revenue Code (26 U.S.C. § 501(c)) which is organized and operated, and which holds such real property, solely for the purpose of fostering economic development within this State. c. Any area located within this State that has been approved by the United States Department of Commerce as a general purpose foreign trade zone. d. [Repealed.] e. 1. Following each decennial census, any census tract designated by the Director of the Division of Small Business, in conjunction with the Secretary of Finance, based on all of the following criteria: A. Percent of persons below poverty level. B. Percent of households receiving public assistance. C. Unemployment rate. D. Median household income. E. A significant presence of vacant property within the census tract. F. The character of the community. G. Population. 2. Based on the criteria under paragraph (3)e.1. of this section, the Director of the Division of Small Business, in conjunction with the Secretary of Finance, shall allocate targeted area status on the following basis: A. Ten in the City of Wilmington. B. Ten in New Castle County outside of the City of Wilmington. C. Five in Kent County. D. Five in Sussex County. 3. On request, the Director of the Division of Small Business, in conjunction with the Secretary of Finance, may consider extending the geographic boundary lines of a targeted area if an adjacent community otherwise satisfies the criteria under paragraph (3)e.1. of this section. (4) Any term or phrase defined in § 2010 of this title shall have the meaning ascribed to it therein. 64 Del. Laws, c. 460, §  3 ; 65 Del. Laws, c. 233, §  1 ; 67 Del. Laws, c. 40, §  25 ; 67 Del. Laws, c. 261, §  5 ; 68 Del. Laws, c. 202, §  9 ; 69 Del. Laws, c. 458, §  1 ; 74 Del. Laws, c. 162, §§  1-3 ; 77 Del. Laws, c. 412, §  2 ; 78 Del. Laws, c. 1, §  3 ; 78 Del. Laws, c. 100, §  3 ; 81 Del. Laws, c. 49, § 19 ; 81 Del. Laws, c. 374, § 50 ; 83 Del. Laws, c. 323, § 4 ; § 2021 Credit against corporation income tax for investment and employment in targeted areas. (a) In the case of any taxpayer that: (1) Places in service, within any targeted area, as defined by § 2020(3)a. through c. of this title and § 2020(3)d. of this title [repealed], a qualified facility in which the taxpayer is engaged in a qualified activity described in § 2010(3) of this title, and (2) Thereby satisfies the requirements contained in § 2011(a) of this title for the allowance of a credit against the tax imposed by Chapter 19 of this title (relating to corporation income tax) for the taxable year of the taxpayer in which such qualified facility is placed in service by the taxpayer, § 2011 of this title shall be applied with respect to such qualified facility by substituting “$750” for “$500” in § 2011(b)(1) and (2) of this title. (b) In the case of any taxpayer that: (1) Places in service, only within any of the targeted areas as defined by § 2020(3)d. [repealed] of this title, a facility in which the taxpayer is engaged in a commercial activity or retail activity, and (2) Would thereby satisfy the requirements contained in § 2011(a) of this title for the allowance of a credit against the tax imposed by Chapter 19 of this title (relating to corporation income tax) for the taxable year of the taxpayer in which such facility is placed in service by the taxpayer if such facility were a qualified facility by virtue of its use by the taxpayer in or in connection with such commercial activity or retail activity, § 2011 of this title shall be applied with respect to such facility by treating it as a qualified facility. (c) In the case of any taxpayer that: (1) Places in service, within any targeted area, as defined by § 2020(3) of this title, a qualified facility in which the taxpayer is engaged in a qualified activity described in § 2010(3) of this title, and (2) Satisfies the requirements contained in § 2011(k) of this title, such taxpayer shall be allowed a credit equal to 75% of the credit allowable under subsection (a) of this section, subject, however, to limitation and carryover provisions under § 2011(d) and (f) of this title. The credit claimed in any tax year (including amounts carried over from previous tax years) shall not exceed the difference between $500,000 and the amount of credits claimed under § 2022 of this title for the 12 months comprising said tax year. Amounts of credit not used by virtue of the preceding sentence may be carried forward as if such unused credits arose by virtue of § 2011(f) of this title. No taxpayer may be eligible for credit under both this subsection and subsection (a) of this section for the same facility. (d) In the case of a qualified facility located on a brownfield within any targeted area: (1) “$900” shall be substituted for “$750” in subsection (a) of this section with respect to such qualified facility; and (2) In applying this section, there shall be treated as a qualified activity any business, trade, commerce, profession or vocation carried on or in connection with such qualified facility, and there shall be treated as additional qualified investment all amounts expended by the taxpayer for environmental investigation and remediation of the brownfield. The total incremental credits allowable to the taxpayer under this subsection shall not exceed the appropriate amount expended by the taxpayer for environmental investigation and remediation of the brownfield. If the provisions of this subsection apply with respect to any qualified facility, the provisions of § 2011( l ) of this title shall not apply with respect to such qualified facility. 64 Del. Laws, c. 460, §  3 ; 68 Del. Laws, c. 202, §  16 ; 70 Del. Laws, c. 219, §  4 ; 70 Del. Laws, c. 487, §§  4, 6 ; 78 Del. Laws, c. 47, §§  12, 13 ; 83 Del. Laws, c. 323, § 4 ; § 2022 Reduction in license fees for investment and employment in targeted areas. (a) Any taxpayer that: (1) Places in service, within any targeted area as defined by § 2020(3)a. through c. of this title and § 2020(3)d. of this title [repealed], a qualified facility in which the taxpayer is engaged in a qualified activity described in § 2010(3) of this title, and (2) Thereby satisfies the requirements contained in § 2012(a) of this title for the allowance of a reduction in any license fee imposed upon the taxpayer’s gross receipts by any provision of Chapter 27 of this title or by §§ 2301(d), 2902, 2903, 2904 of this title or, in the case of an activity described in §§ 2010(3)j., 2905 of this title for the taxable year of the taxpayer in which such qualified facility is placed in service by the taxpayer, shall be allowed, in lieu of the reduction in such license fee provided by § 2012 of this title, a reduction in such license fee for each taxable period used in computing the amount of such license fee that ends within or with such taxable year of the taxpayer and for each such taxable period that ends within or with any of the 14 following taxable years in which such facility is a qualified facility with respect to the taxpayer on the last business day thereof. The amount of each such reduction in such license fee shall be determined in the manner provided in § 2012(b) of this title, but by employing the following table in lieu of the table contained in § 2012(b) of this title: If the number of full The license fee calendar months elapsed (computed without since such qualified regard to this facility was placed section) shall be in service by the reduced by the taxpayer is: following percentage: 1 through 60 100% 61 through 72 90% 73 through 84 80% 85 through 96 70% 97 through 108 60% 109 through 120 50% 121 through 132 40% 133 through 144 30% 145 through 156 20% 157 through 168 10% 169 through 180 5% Over 180 0% (b) In the case of any taxpayer that: (1) Places in service, only within any of the targeted areas as defined by § 2020(3)d. [repealed] of this title, a facility in which the taxpayer is engaged in a commercial activity or retail activity, and (2) Would thereby satisfy the requirements contained in § 2012(a) of this title for the allowance of a reduction in any license fee imposed upon the taxpayer’s gross receipts by any provision of Chapter 27 of this title or by § 2301(d), 2902, 2903 or 2904 of this title for any taxable period used in computing the amount of such license fee that ends within or with the taxable year of the taxpayer in which such facility is placed in service by the taxpayer if such facility were a qualified facility by virtue of its use by the taxpayer in or in connection with such commercial activity or retail activity, § 2012 of this title shall be applied with respect to such facility by treating it as a qualified facility. (c) In the case of any taxpayer that: (1) Places in service, within any targeted area, as defined by § 2020(3) of this title, a qualified facility in which the taxpayer is engaged in a qualified activity described in § 2010(3) of this title, and (2) Satisfies the requirements contained in § 2011(k) of this title, such taxpayer shall be allowed a reduction in license fees equal to 75% of the reduction allowable under subsection (a) of this section; provided, however, that said reduction shall be allowed against only those license fees imposed by §§ 2902(c)(1), (3) and (5) [repealed]; 2702(b)(1) and