Gains on Capital Transactions (code 81)

Utah Code §59-10-114(2)(1)

A qualified taxpayer may claim a credit for the short-term and long-term capital gain on a transaction if:

1. The gain occurs on or after January 1, 2008;
2. At least 70 percent of the capital gain transaction proceeds are used to purchase qualifying stock in a Utah small business corporation within 12 months from when the gain occurs; and
3. The individual did not have an ownership interest in the qualified Utah small business corporation at the time of investment.

To calculate the credit:

1.	Enter the amount of eligible short-term or long-term capital gain
		X   .05
2.	Multiply line 1 by .05 (5%)

Line 2 is your credit amount. Enter this on your TC-40A, Part 3, using code 04.

Note: Any credit over the tax liability may not be carried back or forward.

Definitions

Capital gain transaction is a transaction that results in a short-term or long-term capital gain (See IRC 1222).

Qualifying stock is either common or preferred stock originally issued for money or other property (except stock or securities) after January 1, 2008 to an individual, estate, trust, or partnership. (See UC §59-10-1022(1)(d)).

Utah small business corporation is a corporation that directs or manages its principal place of trade or business in Utah and meets the requirements of IRC section 1244 (except the aggregate amount of money and other property received by the corporation for stock, as a contribution to capital and paid-in surplus, may not exceed $2,500,000).