6327: 2024 Alaska Oil and Gas Qualified Service Industry Expenditure Credit (2024)
Alaska · Alaska DOR · Used for tax years 2024
Alaska Form 6327 calculates the potential current-year Qualified Oil and Gas Service Industry Expenditure Credit. It reports qualified expenditures incurred in Alaska and calculates a tentative credit of 10% of those expenditures, up to $10 million per tax year.
Who files this form
Use Form 6327 to calculate the potential current Alaska Qualified Oil and Gas Service Industry Expenditure Credit for qualifying expenditures incurred in Alaska.
Complete one Form 6327 for each corporation that incurred qualifying expenditures. Attach additional Forms 6327 as necessary.
If an entity taxed as a partnership incurs the expenditures, it reports the credit on Form 6900. A corporate partner may claim the credit against that partner’s Alaska corporate income tax.
What you'll need
To complete Form 6327, have the following information available:
- The calendar year or taxable year beginning and ending dates.
- The EIN and name shown on the return.
- The total qualified oil and gas service industry expenditures incurred in Alaska during the tax year.
The form also directs you to report the credit and expense add-back on the applicable corporate or partnership forms and schedules.
How to file
- Enter the tax year, EIN and name shown on the return.
- On line 1, enter total qualified expenditures incurred in Alaska during the tax year.
- On line 2, enter the smaller of line 1 or $100,000,000.
- On line 3, multiply line 2 by 10% to calculate the tentative current-year credit.
Report line 3 on:
- Corporations: Form 6300, line 11.
- Partnerships: Form 6900, Schedule A, line 14.
Add line 2 back to Alaska taxable income on the applicable schedule:
- Form 6000, Schedule H, line 4e.
- Form 6100, Schedule G, line 3h.
- Form 6150, Schedule G, line 3h or Schedule H, line 4e.
- For expenditures incurred by a partnership, Form 6900, Schedule A, line 3.
Complete a separate Form 6327 for each corporation with qualifying expenditures and attach additional Forms 6327 as necessary. The supplied text does not give a mailing address or e-filing directions.
Common mistakes
- Deducting expenditures used for the credit. You may not claim an Alaska corporate net income tax deduction for an expenditure that is the basis of this credit. Add the amount on line 2 back to Alaska taxable income.
- Including excluded costs. Qualifying expenditures do not include facilities or components or equipment used in the manufacturing or modification process.
- Exceeding the expenditure limit. Line 2 must be the smaller of line 1 or $100,000,000.
- Overlooking the limit when carrying a credit forward. If you carry credit into a later year and incur additional qualified expenditures in that year, the maximum credit you may claim in that year is $10,000,000.
Questions people ask
What expenditures qualify for the credit?
Expenditures must be incurred in Alaska and directly attributable to the in-state manufacture or modification of tangible personal property with a useful life of at least three years that is used to explore, develop or produce oil or gas. Qualifying costs include services and supplies used to manufacture or modify that property.
How much is the credit?
The credit is 10% of qualified expenditures, up to $10,000,000 per tax year. Form 6327 calculates the tentative current-year credit.
Can unused credit be carried forward?
Yes. Credit that is not fully used may be carried forward for five years.
Can a corporate partner claim credit for partnership expenditures?
Yes. When an entity taxed as a partnership incurs the expenditures, it reports the credit on Form 6900. A corporate partner may claim the credit to offset that partner’s Alaska corporate income tax.