S 0226 Joint Resolution, By J.M. Waddell and Passailaigue
 A Joint Resolution to allow state income tax deductions for individuals for
 commercial timber losses and timber damage assessments attributable to the
 impact of Hurricane Hugo in counties declared a federal disaster area because
 of the impact of Hurricane Hugo, to prescribe the eligibility requirements for
 the deduction including reduction of other tax attributes of taxpayers
 claiming the deduction, and to eliminate penalties for failure to file tax
 returns due from September 18,1989, to November 30,1989, for taxpayers in
 counties declared disaster areas.

   10/08/90  Senate Prefiled
   10/08/90  Senate Referred to Committee on Finance
   01/08/91  Senate Introduced and read first time SJ-84
   01/08/91  Senate Referred to Committee on Finance SJ-85
   01/23/91  Senate Committee report: Favorable Finance SJ-15
   02/05/91  Senate Read second time SJ-39
   02/05/91  Senate Ordered to third reading with notice of
                     amendments SJ-39
   02/05/91  Senate Debate adjourned SJ-39
   02/12/91  Senate Debate interrupted SJ-18
   02/13/91  Senate  Carried over int. debate until Tues. Feb 19 SJ-3
   02/21/91  Senate Amended SJ-16
   02/21/91  Senate Read third time and sent to House SJ-16
   02/26/91  House  Point of order-Bills dealing with revenue must
                     originate in the House HJ-17
   02/26/91  House  Returned to the Senate HJ-17
   02/27/91  Senate Returned SJ-5

February 21, 1991

S. 226

Introduced by SENATORS Waddell and Passailaigue

S. Printed 2/21/91--S.

Read the first time January 8, 1991.

A JOINT RESOLUTION

TO ALLOW STATE INCOME TAX DEDUCTIONS FOR INDIVIDUALS FOR COMMERCIAL TIMBER LOSSES AND TIMBER DAMAGE ASSESSMENTS ATTRIBUTABLE TO THE IMPACT OF HURRICANE HUGO IN COUNTIES DECLARED A FEDERAL DISASTER AREA BECAUSE OF THE IMPACT OF HURRICANE HUGO, TO PRESCRIBE THE ELIGIBILITY REQUIREMENTS FOR THE DEDUCTION INCLUDING REDUCTION OF OTHER TAX ATTRIBUTES OF TAXPAYERS CLAIMING THE DEDUCTION, AND TO ELIMINATE PENALTIES FOR FAILURE TO FILE TAX RETURNS DUE FROM SEPTEMBER 18, 1989, TO NOVEMBER 30, 1989, FOR TAXPAYERS IN COUNTIES DECLARED DISASTER AREAS.

Amend Title To Conform

Be it enacted by the General Assembly of the State of South Carolina:

SECTION 1. (A) An individual who is the owner of commercial timber in a county of this State damaged by Hurricane Hugo in September, 1989, may deduct from state taxable income an amount not to exceed fifty percent of the loss resulting from the damage to the timber if it is in a county declared a federal disaster area as a result of the hurricane. The deduction must be in accordance with the special rules provided in this section. If the taxpayer's tracts of timber in the affected counties are one hundred acres or less, no more than one-third of the amount is allowed as a deduction in any one year and this deduction may be carried forward for five succeeding taxable years. If the taxpayer's tracts of timber in the affected counties are more than one hundred acres but not in excess of five hundred acres, no more than one-fifth of the amount is allowed as a deduction in any one year and this deduction may be carried forward for ten succeeding taxable years. If the taxpayer's tracts of timber in the affected counties are more than five hundred acres, no more than one-tenth of the amount is allowed as a deduction in any one year and this deduction may be carried forward for fifteen succeeding taxable years. The total of the loss on which the deduction allowed by this section is based must be reduced by any Hurricane Hugo-caused casualty loss of commercial timber deducted on the taxpayer's federal income tax return.

(B) A deduction under this section may exceed the basis of the damaged commercial timber if the basis is exceeded by the amount of the loss, as determined by the difference in fair market value of the commercial timber immediately before the impact of Hurricane Hugo and the fair market value of the commercial timber immediately after the impact of Hurricane Hugo.

(C) To the extent that a deduction under this section exceeds the basis of the damaged commercial timber, the amount of the excess must be applied to reduce the following tax attributes of the taxpayer in the following order:

(1) the basis of commercial timber not damaged by Hurricane Hugo which is located in this State;

(2) any net operating loss carryover to years after the year of the damage arising other than as a result of this section;

(3) any net capital losses arising before the year of the damage;

(4) the basis of any real estate in this State used for commercial timber production before the impact of Hurricane Hugo.

(D) The reductions described in subsection (C) of this section are one dollar for each dollar of deduction in excess of the basis of the damaged commercial timber. The basis of any real estate reduced by subsection (C) of this section for purposes of determining South Carolina income taxes reverts to its basis for purposes of the federal income tax after five years.

(E) The South Carolina Tax Commission may promulgate regulations and prescribe rules and procedures to implement the provisions of this section, including requirements for recordkeeping and adjusting South Carolina taxable income pursuant to subsection (C) of this section.

SECTION 2. (A) There is allowed as a deduction from South Carolina taxable income of individuals Hurricane Hugo commercial timber damage assessment expenses. For purposes of this subsection, the term "Hurricane Hugo commercial timber damage assessment expenses" means expenses of any person to assess the extent of damage to commercial timber owned by him where:

(1) the damage was caused by Hurricane Hugo in September, 1989;

(2) the commercial timber is located in this State and in a county declared a federal disaster area as a result of Hurricane Hugo; and

(3) the expenses were incurred in 1989 or 1990.

(B) The deductions allowed by this section may be carried forward for five succeeding taxable years.

SECTION 3. (A) An individual taxpayer affected by Hurricane Hugo who is required by any provision of Title 12 of the 1976 Code to file any return of income, estate, gift, sales, use, or property tax from September 18, 1989, to November 30, 1989, must not be penalized for failing to file the return during the period.

(B) As used in this section, the term "taxpayer affected by Hurricane Hugo" means a taxpayer whose residence or principal place of business, on September 18, 1989, was in an area declared a federal disaster area as a result of the impact of Hurricane Hugo in September, 1989.

SECTION 4. Upon approval by the Governor, Sections 1 and 2 of this joint resolution are effective for taxable years beginning after 1992. Section 3 takes effect upon approval by the Governor.