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Fish Habitat Improvement Tax Credit

 

What is the Fish Habitat Improvement Tax Credit?

This tax credit allows a resident individual (or corporation) to reduce their taxes by completing projects that improve fish habitat.

 

How much credit can I receive for fish habitat projects?

The amount of the tax credit (per project) is 25 percent of the total certified cost of the project.

 

How do I get my project "certified"?

The project must have "final certification" by ODFW to qualify for the credit. This certification includes a verification of the total project cost, and must be included with your tax return to receive
the tax credit.

 

What are the steps for participating in this program?

  1. Apply for "preliminary certification" of the project at your local ODFW office. ODFW has application forms.
  2. On the application, (1) describe the proposed project, including expected benefits (your local biologist can help on this), (2) include a drawing of the project, and (3) include a detailed estimate of the project costs.
  3. ODFW will review the application and issue a "preliminary certification" if the project will improve fish habitat. The biologist may suggest modifications to the plan prior to approval.
  4. After receiving the 'preliminary certification" complete the habitat improvement project.
  5. Notify your local ODFW office when the project is completed and request a "final project certification". Forms are available at ODFW to apply for the "final certification" Report the detailed costs for the project on this form.
  6. ODFW will inspect the project to verify completion, and that fish habitat was improved. Once the inspection determines that the preliminary project plans were followed, ODFW will provide a written "final certification" for the project which documents the project costs for the tax credit. The final certified costs cannot exceed the preliminary certified cost estimate by more than 10 percent.
  7. Include a copy of this 'final report certification" with your return.

The tax credit must be claimed for the year in which ODFW provides the final certification for the project. If the entire tax credit cannot be used in that year, there are provisions to carry this credit forward to succeeding tax years (see next answer).

What if my tax situation prevents me from benefiting from the credit this year?

Since the amount of credit cannot exceed your tax liability in any one year, you may benefit greater by carrying the tax credit forward to offset your taxes in the next succeeding year. You can carry these tax credits forward for up to five succeeding tax years. Consult your tax accountant to determine how. you can best use these credits.

 

What are some of the limitations of this credit?

The person (or entity) receiving the credit must be the one who actually expended the funds for the fish habitat project.
The tax credit program is limited to $100,000 total tax credits statewide per calendar year.
To qualify for the credit, the fish habitat project must not be required by state or federal statute.

 

Can the credit be used for projects where I also received "basal area credit" during a forest harvest operation?

Projects completed to receive "basal area credit" under the FPA Water Protection Rules may not qualify for this program since these actions are required by state law. However, fish habitat improvement projects that exceed the minimum actions required to receive "basal area credit" may partially qualify for the tax credit. For example, if you were required to place 10 sq. ft. of conifer to receive the full basal area credit, but your project actually placed 25 sq. ft., the placement of the additional 15 sq. ft. may qualify for the tax credit since this extra action was not required by the rules.

 

What if I am a non-resident?

A non-resident can receive a proportion of the tax credit as provided by Oregon tax law (ORS 316.117). Please consult your tax accountant for further details.

 

How do I get more information on this program?

If the potential for a tax credit for fish habitat improvement sounds good to you, please contact your local office of ODFW to initiate, planning for your project. By talking to your local biologist early we should be able to cooperatively plan and implement projects that improve stream conditions for fish while reducing the cost of these important projects.