{"data":{"id":"us-ok/okla.-stat.-tit.-68-68-2357.74b","jurisdiction":"us-ok","citation":"Okla. Stat. tit. 68, § 68-2357.74B","heading":"Recapture event - Tax increase due to recaptured","body":"credit amount.\n\nA. As used in this section, “recapture event” means that with\n\nrespect to a qualified investment in an Oklahoma rural small\n\nbusiness venture:\n\n1. The Oklahoma rural small business venture fails to expend at\n\nleast fifty percent (50%) of the proceeds of qualified investments\n\nfor acquisition of tangible or intangible assets to be used in the\n\nactive conduct of the trade or business or for working capital for\n\nthe active conduct of the trade or business of the rural small\n\nbusiness venture within eighteen (18) months after the qualified\n\ninvestment is made or within an extension of such period as provided\n\nin Section 2357.72 of this title. For purposes of this paragraph,\n\n“working capital” shall not include consulting, brokerage or\n\ntransaction fees;\n\n2. The investment in the rural small business venture is\n\ntransferred, withdrawn or otherwise returned within five (5) years;\n\nprovided, a “recapture event” shall not include the transfer,\n\nwithdrawal or return of an investment as a result of a “market-based\n\nliquidity event”. As used in the Rural Venture Capital Formation\n\nIncentive Act, a “market-based liquidity event” means that an\n\nOklahoma rural small business venture:\n\na. sells all or substantially all of its assets to, or is\n\nacquired by share acquisition, share exchange, merger,\n\nconsolidation or other similar transaction by another\n\nperson or entity other than:\n\n(1) a person or entity controlled by a person that\n\nmade a qualified investment in the qualified\n\nrural small business capital company that\n\nprovided funds for use by the Oklahoma rural\n\nsmall business venture, or\n\n(2) a person or entity controlled by a person that\n\nmade an investment in conjunction with a\n\nqualified investment made by the qualified rural\n\nsmall business capital company that provided\n\nfunds for use by the Oklahoma rural small\n\nbusiness venture,\n\nb. conducts an initial public offering of a class of its\n\nequity securities pursuant to the requirements of the\n\nUnited States Securities and Exchange Commission or\n\nother applicable federal law governing the sale of\n\nsecurities in interstate commerce,\n\nc. makes an amortization payment under the terms of a\n\nsubordinated debt instrument, or\n\nd. repays indebtedness from net income as determined in\n\naccordance with generally accepted accounting\n\nprinciples or proceeds of the sale of assets in the\n\nordinary course of business; or\n\n3. The Oklahoma Tax Commission finds that the qualified\n\ninvestment does not meet the requirements of the Rural Venture\n\nCapital Formation Incentive Act.\n\nB. If a recapture event occurs with respect to a qualified\n\ninvestment for which a credit authorized by either Section 2357.73\n\nor Section 2357.74 of this title has been claimed, the tax imposed\n\npursuant to the applicable provisions of Title 36 or this title of\n\nthe Oklahoma Statutes against which the credit has been claimed\n\nshall be increased to the extent of the recaptured credit amount.\n\nC. For purposes of this section, the recapture amount shall be\n\nequal to the sum of:\n\n1. The aggregate decrease in the credits previously allowed to\n\nthe taxpayer pursuant to Section 2357.73 or Section 2357.74 of this\n\ntitle for all prior taxable periods which would have resulted if no\n\ncredit had been authorized with respect to the qualified investment;\n\nplus\n\n2. Interest at the rate prescribed by Section 217 of this title\n\non the amount determined pursuant to paragraph 1 of this subsection\n\nfor each prior taxable period for the period beginning on the due\n\ndate for filing the applicable report or return for the prior\n\ntaxable period.\n\nD. The tax for the taxable period shall be increased pursuant\n\nto this section only with respect to credits which were used to\n\nreduce tax liability. In the case of credits not used to reduce tax\n\nliability, the carryforwards allowed shall be adjusted accordingly.\nfor filing the applicable report or return for the prior\n\ntaxable period.\n\nD. The tax for the taxable period shall be increased pursuant\n\nto this section only with respect to credits which were used to\n\nreduce tax liability. In the case of credits not used to reduce tax\n\nliability, the carryforwards allowed shall be adjusted accordingly.\n\nE. For any transaction that is audited by the Tax Commission\n\nafter such credits have been allowed, but which is subsequently\n\ndetermined to constitute a recapture event, the Tax Commission shall\n\nbe required to disallow any and all credits claimed in violation of\n\nthe requirements of this section or any other provision of the Rural\n\nVenture Capital Formation Incentive Act for a period of ten (10)\n\nyears after the date as of which any applicable tax report or return\n\nutilizing such credits is filed.\n\nF. The provisions of subsection E of this section shall\n\nsupersede any other provision of the Uniform Tax Procedure Code or\n\nany other state tax law that would prohibit the disallowance of such\n\ncredits based upon an otherwise applicable statute of limitations.\n\nG. Notwithstanding any other provision of this section, a\n\nrecapture event shall not occur with respect to qualified\n\ninvestments made by a qualified rural small business capital company\n\nthat is also licensed as a rural business investment company under 7\n\nU.S.C., Section 2009cc et seq., or any successor statute, at the\n\ntime of the qualified investment. The qualified rural small\n\nbusiness capital company shall include in its annual report proof of\n\na valid license under the federal statute.","path":["OK Code","Title 68"],"source_url":"https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os68.pdf","current_through":"2026-08-14","vintage":"open-us-law v2026.08, retrieved 2026-09-14","retrieved_at":"2026-09-14T18:32:36Z","sha256":"3b0e56a170f726b2fd92f3572dbe1676feb2db5388e41205ebf3e5c09e4bfb80","source_id":"us-ok","stale":false,"prev":"us-ok/okla.-stat.-tit.-68-68-2357.74a","next":"us-ok/okla.-stat.-tit.-68-68-2357.74c"},"notice":"GroundRules: Original legal text. Not legal advice."}