318: Credit for Taxes Paid for Coal Consumed in Generating Electrical Power (2024)
Arizona · Arizona DOR · Used for tax years 2024
Arizona Form 318 calculates the credit for transaction privilege tax or use tax paid on coal purchased to generate electrical power in Arizona. It reports the current year's credit, credits passed through from partnerships, and available credit carryovers.
Who files this form
Form 318 calculates the credit for transaction privilege tax (TPT) or use tax paid by the seller or purchaser on coal sold to the taxpayer for generating electrical power in Arizona.
- C corporations and S corporations electing to claim the credit at the corporate level report their available credit on this form and Form 300.
- Partnerships claiming the credit must pass it through to their corporate partners using Form 318-P.
- The credit is not available to individual partners or individual shareholders of an S corporation.
What you'll need
Have the following forms and information available:
- Your name as shown on Form 99T, 120, 120A, 120S, 120X or 165, and your Employer Identification Number (EIN).
- Form 318-1 with vendor and taxpayer names, Arizona TPT or use tax numbers, and monthly coal purchase details: tax type, price before tax, tax paid and total amount. Complete additional Forms 318-1 if there are more than two vendors.
- Form 318-P, line 3c, for any credit passed through from a partnership.
- For carryovers, the taxable year, original credit amount and amount previously used.
- Form 300 to report the credit amounts for C corporations and S corporations electing to claim the credit at the corporate level.
How to file
A partnership claiming this credit must complete Form 318-P for each corporate partner, provide a completed copy to each partner, file a copy of each completed Form 318-P with its tax return, and keep a copy for its records.
Common mistakes
- Completing Form 318 before Form 318-1. The form directs you to complete Form 318-1 on page 2 first.
- Claiming the credit for an individual partner or individual S corporation shareholder. The form specifically says the credit is not available to them.
- Leaving out additional vendors. If there are more than two vendors, complete additional Forms 318-1.
Questions people ask
How is the credit from my own operations calculated?
Enter the total qualifying tax paid from the included Forms 318-1, line 13, column (d), on Form 318, line 1. Multiply that amount by 30% to calculate line 2.
How do I include a credit passed through from a partnership?
Enter the amount from Form 318-P, line 3c, on Form 318, line 3. Add it to line 2 to calculate the current taxable year’s credit on line 4.
How is an available carryover calculated?
In Part 3, subtract the amount previously used from the original credit amount for each listed taxable year.
Where do corporations report the credit on Form 300?
C corporations and S corporations electing to claim the credit at the corporate level enter the amounts from Form 318, lines 11, 12 and 13, on Form 300, Part 1, line 3, columns (a), (b) and (c), respectively.