Form QBA "Application for Designation as a Qualified Business for the Qualified Equity and Subordinated Debt Investments Tax Credit" - Virginia

What Is Form QBA?

This is a legal form that was released by the Virginia Department of Taxation - a government authority operating within Virginia. As of today, no separate filing guidelines for the form are provided by the issuing department.

Form Details:

  • Released on May 1, 2015;
  • The latest edition provided by the Virginia Department of Taxation;
  • Easy to use and ready to print;
  • Quick to customize;
  • Compatible with most PDF-viewing applications;

Download a fillable version of Form QBA by clicking the link below or browse more documents and templates provided by the Virginia Department of Taxation.

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Download Form QBA "Application for Designation as a Qualified Business for the Qualified Equity and Subordinated Debt Investments Tax Credit" - Virginia

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Form QBA
Application for Designation as a Qualified
Business for the Qualified Equity and
Subordinated Debt Investments Tax Credit
See the instructions for when and where to apply.
Name (Please Print)
FEIN
Trading As
Date Incorporated
Street Address
For Calendar Year
City, State and ZIP Code
NAICS Code
Office Use Only
Use this form to apply for designation as a qualified business for purposes of issuing equity or subordinated debt instruments which qualify for the Virginia
Qualified Equity and Subordinated Debt Investments Tax Credit. IMPORTANT: The Form QBA does not have to be filed prior to making issuances. Title
23 of the Virginia Administrative Code (VAC) 10-110-225 et seq. provide regulations on this credit. Additionally, see instructions for investor information.
Check this box to allow the Department to notify the Governor’s office that your company is approved for this credit.
Business Entity Identification: See the definition of “Qualified Business” in the instructions, Va. Code § 58.1-339.4, or
23 VAC 10-110-225 et seq.
Type (check one):
C Corporation
S Corporation
Partnership
Limited Liability Company (LLC)
Business Criteria (check one):
Advanced Computing
Advanced Materials
Advanced Manufacturing
Agricultural Technologies
Biotechnology
Electronic Device Technology
Energy
Environmental Technology
Information Technology
Medical Device Technology
Nanotechnology
Any Similar Technology-Related Field
Describe:
1. Was your business created to commercialize research
developed at or in partnership with an institution of higher
education?
Yes
No
If yes, what is the name of the institution?
2. Is its principal office or facility in Virginia?
Yes
No If No, STOP; the business does not qualify
3. Is Virginia where the business entity is primarily engaged
in business or does substantially all of its production?
Yes
No If No, STOP; the business does not qualify
4. Were the business entity’s annual gross revenues for
the most recent fiscal year $3 million or less?
Yes
No If No, STOP; the business does not qualify
If yes, what were the annual gross revenues?
$
5. Has the business obtained, during its existence, more
than $3 million in aggregate gross cash proceeds for the
issuance of its equity or debt investments (not including
commercial loans from charted banking or savings and
Yes If Yes, STOP; the business does not qualify
loan institutions)?
6. Provide a detailed description of the type of business or activities in which the entity is primarily engaged or primarily
organized to engage (attach additional pages if necessary).
Va. Dept. of Taxation
QBA W 2601695 Rev 05/15
Form QBA
Application for Designation as a Qualified
Business for the Qualified Equity and
Subordinated Debt Investments Tax Credit
See the instructions for when and where to apply.
Name (Please Print)
FEIN
Trading As
Date Incorporated
Street Address
For Calendar Year
City, State and ZIP Code
NAICS Code
Office Use Only
Use this form to apply for designation as a qualified business for purposes of issuing equity or subordinated debt instruments which qualify for the Virginia
Qualified Equity and Subordinated Debt Investments Tax Credit. IMPORTANT: The Form QBA does not have to be filed prior to making issuances. Title
23 of the Virginia Administrative Code (VAC) 10-110-225 et seq. provide regulations on this credit. Additionally, see instructions for investor information.
Check this box to allow the Department to notify the Governor’s office that your company is approved for this credit.
Business Entity Identification: See the definition of “Qualified Business” in the instructions, Va. Code § 58.1-339.4, or
23 VAC 10-110-225 et seq.
Type (check one):
C Corporation
S Corporation
Partnership
Limited Liability Company (LLC)
Business Criteria (check one):
Advanced Computing
Advanced Materials
Advanced Manufacturing
Agricultural Technologies
Biotechnology
Electronic Device Technology
Energy
Environmental Technology
Information Technology
Medical Device Technology
Nanotechnology
Any Similar Technology-Related Field
Describe:
1. Was your business created to commercialize research
developed at or in partnership with an institution of higher
education?
Yes
No
If yes, what is the name of the institution?
2. Is its principal office or facility in Virginia?
Yes
No If No, STOP; the business does not qualify
3. Is Virginia where the business entity is primarily engaged
in business or does substantially all of its production?
Yes
No If No, STOP; the business does not qualify
4. Were the business entity’s annual gross revenues for
the most recent fiscal year $3 million or less?
Yes
No If No, STOP; the business does not qualify
If yes, what were the annual gross revenues?
$
5. Has the business obtained, during its existence, more
than $3 million in aggregate gross cash proceeds for the
issuance of its equity or debt investments (not including
commercial loans from charted banking or savings and
Yes If Yes, STOP; the business does not qualify
loan institutions)?
6. Provide a detailed description of the type of business or activities in which the entity is primarily engaged or primarily
organized to engage (attach additional pages if necessary).
Va. Dept. of Taxation
QBA W 2601695 Rev 05/15
Form QBA
Application for Designation as a Qualified
Business for the Qualified Equity and
Page 2
Subordinated Debt Investments Tax Credit
Issuance Information
Describe the type of instrument the business entity is planning to issue for the purposes of this tax credit.
Type of Instrument
Estimated Amount
Anticipated Date of First Issuance
Equity
$:
Date:
Subordinated Debt
$:
Date:
Declaration
I, the undersigned officer or other person authorized to act on behalf of the business entity, have read and understand
the limitations and restrictions set forth for this application and the associated tax credit.
Authorized Signature
Title
Date
Printed Name
Phone Number
Email Address
FAX Number
Instructions for the Qualified Business Designation Application - Form QBA
Qualified Equity and Subordinated Debt Investments Tax Credit
Pursuant to Va. Code § 58.1-339.4, this credit is effective for taxable years beginning on and after January 1, 1999. 23
VAC 10-110-225 et seq. provide regulations on this credit, including definitions of terms used in this application. Virginia
Tax Bulletin 00-5, dated July 31, 2000, also provides additional information on this credit. For a copy of the applicable
regulations, Tax Bulletin, or additional forms, see the Where to Get Help section.
Under Va. Code § 58.1-339.4 (E), the Qualified Equity and
Who Must File This Application, Form QBA
Subordinated Debt Investments Tax Credit is capped at $5
Businesses that want to sell equity and subordinated debt
million annually. Of the amount of available credit, one-half of
investments for which taxpayers may claim credit for the
this amount must be allocated to commercialization investments
Qualified Equity and Subordinated Debt Investments Tax
and the other half is available for all other qualifying investments.
Credit must file. The qualification is valid for the calendar
If credit applications for either half exceed the allowed amount,
year of the application. A separate application is required for
the credits for that half will be prorated. If credit applications for
each year that the business wants to be eligible to offer this
either half are less than the allowed amount, the balance will
credit to its investors.
be available for allocation to the other type of credits.
All businesses should be registered with the Department
Where to Get Help
before completing Form QBA. If you are not registered,
complete Form R-1.
Write to Department of Taxation, Tax Credit Unit, P. O. Box
715, Richmond, VA 23218-0715 or call 804-786-2992. To
When to File This Application, Form QBA
order forms, bulletins or regulations call 804-367-8031. Visit
File Form QBA any time during the calendar year.
www.tax.virginia.gov for most Virginia tax forms, regulations
and additional tax information. Forms are available from your
You need to reapply each year that you plan to be designated
local Commissioner of the Revenue, Director of Finance or
as a qualified business.
Director of Tax Administration.
Where to File This Application, Form QBA
Tenemos servicios disponible en Español.
File Form QBA with the Department of Taxation, Tax Credit
General Information Concerning This Credit
Unit, P.O. Box 715, Richmond, VA 23218-0715.
The Qualified Equity and Subordinated Debt Investments Tax
You may also fax it to 804-774-3902, but please do not do
Credit is allowed to taxpayers making a qualified investment
both.
in the form of equity or subordinated debt from a qualifying
Information to Be Provided to Taxpayers (Investors)
business which is engaged in business or does substantially
all of its production in Virginia. The credit equals 50% of the
Upon issuance of equity or subordinated debt, the qualified
amount of qualifying investments made during the taxable
business must provide each taxpayer with a copy of the
year. The total amount of credit that may be used per taxable
qualified business certification from the Department and a
year is the lesser of the tax imposed or $50,000. The credit
statement on the business entity’s letterhead that contains
is nonrefundable. Excess credits may be carried forward for
the following information:
up to 15 years. If total annual requests for this credit exceed
• The investor’s name;
$5 million, the Department will prorate the allowable credit
• The investment by amount (list each amount separately);
for each taxpayer.
• The investment by type (equity or debt);
Taxpayers cannot receive a grant from the Small Business
• The investment by date (specific to each investment
Investment Grant Fund and take the Qualified Equity and
amount); and
Subordinated Debt Investments Tax Credit for the same
• Verification that the investment meets the definition of
investment.
a “qualified investment” for the purposes of claiming
the credit pursuant to Va. Code § 58.1-339.4. 23 VAC
• Equity received in connection with a qualified business
10-110-225 et seq. provide regulations on how this credit
investment must be held by the taxpayer for at least 3 full
applies.
calendar years following the calendar year for which a tax
credit is allocated.
Please specifically state that the investor (name), nor any
of his/her family members, nor any entity affiliated with
• Subordinated Debt received in connection with a qualified
him/her receives or has received compensation from the
business investment must be held by the taxpayer for at
qualified business in exchange for services provided to
least 3 years from the date of issuance.
such business as an employee, officer, director, manager,
• Holding Period Exception – Liquidation of the qualified
independent contractor or otherwise in connection
business issuing such equity; the merger, consolidation or
with or within 1 year before or after the date of such
other acquisition of such business; with or by a party not
investment. For the purposes hereof, reimbursement of
affiliated with such business or the death of the taxpayer.
reasonable expenses incurred shall not be deemed to be
If the 3 calendar year holding period is not met, the taxpayer
compensation.
forfeits the unused credit amount and will be assessed for
• The statement should be signed by a company officer.
the credit used, to which shall be added interest, computed
For investors affiliated with the qualified business, such
at the rate of 1% per month, compounded monthly from the
as a Corporate Officer, CFO, etc., the statement should be
date the tax credits were claimed.
signed by another member of the company.
Please note: For married investors, the credit cannot be
its equity or debt investments (not including commercial
issued jointly. The investment must be made individually
loans from chartered banking or savings and loan
and a separate Form EDC and business statement must be
institutions); and
provided for each spouse.
(v) Is primarily engaged or is primarily organized to engage
If the investment is an equity investment, the statement must
in the following fields:
indicate that the issuance is original, providing new capital to
1. advanced computing,
the qualified business and that it is not required, or subject to
2. advanced materials,
an option, that the issuer redeem the issuance within 3 years
3. advanced manufacturing,
of the issuance date.
4. agricultural technologies,
If the investment is a subordinated debt investment, the
statement must indicate that the issuance is original, providing
5. biotechnology,
new capital to the qualified business and that, by its terms,
6. electronic device technology,
requires no repayment of principal for 3 years after issuance,
7. energy,
is neither guaranteed nor secured by assets of the issuer
8. environmental technology,
nor by any other person or entity, and is subordinate to all
indebtedness and obligations to national or state chartered
9. information technology,
banking or savings and loan institutions.
    1 0. medical device technology,
The taxpayer is required to attach this statement to the Form
    1 1. nanotechnology, or
EDC.
  12. any similar technology-related field determined by
regulation by the Department of Taxation.
Definitions
“Commercialization investment” means a qualified
“Equity” means common stock or preferred stock, regardless
investment in a qualified business that was created to
of class or series, of a corporation; a partnership interest in
commercialize research developed at or in partnership with
a limited partnership; or a membership interest in a limited
an institution of higher education.
liability company, any of which is not required or subject to
an option on the part of the taxpayer to be redeemed by the
A business in its first taxable year of operation will be deemed
issuer within 3 years from the date of issuance.
to have annual gross revenues of no more than $3 million
and be primarily engaged in business and do substantially
“Subordinated debt” means indebtedness of a corporation,
all of its production in the Commonwealth if the commercial
general or limited partnership, or limited liability company that
domicile pursuant to 23 VAC10-120-140 of such business is
(i) by its terms requires no repayment of principal for the first 3
within the Commonwealth. (23 VAC10-110-225).
years after issuance; (ii) is not guaranteed by any other person
or entity, or secured by any assets of the issuer or any other
“Commercial domicile” means the state where the principal
person or entity; and (iii) is subordinated to all indebtedness
office from which the business affairs of the corporation are
and obligations of the issuer to national or state-chartered
normally directed or managed. See 23 VAC10-120-140 D.
banking or savings and loan institutions.
“Primarily engaged in business in the Commonwealth”
“Qualified investment” means a cash investment in a
means 50% or more of the entity’s gross receipts are derived
qualified business in the form of equity or subordinated
from sources within Virginia.
debt.
“Substantially all of its production in the Commonwealth”
An investment shall not be qualified if the taxpayer who holds
means 80% or more of the entity’s expenses are incurred
such investment, or a member of taxpayer’s family, or any
within Virginia.
entity affiliated with such taxpayer, receives (or has received)
compensation from the qualified business in exchange for
Virginia Tax Bulletin 00-5, dated July 31, 2000, and Title
services provided to such business as an employee, officer,
23 of Virginia Administrative Code (VAC) 10-110-225
director, manager, independent contractor or otherwise in
provide additional information on this credit. To obtain
connection with such business or within 1 year before or after
this bulletin, see “Where to Get Help” above.
the date of such investment.
For purposes hereof, reimbursement of reasonable expenses
incurred shall not be deemed to be compensation. A
qualified investment shall not include existing investments
or instruments that have been purchased, transferred, or
otherwise obtained without providing new capital to a qualified
business.
“Qualified business” means a business which:
(i) Has annual gross revenues of no more than $3 million in
its most recent fiscal year;
(ii) Has its principal office or facility in the Commonwealth;
(iii) Is engaged in business primarily in or does substantially
all of its production in the Commonwealth;
(iv) Has not obtained during its existence more than $3 million
in aggregate gross cash proceeds from the issuance of
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