NC S804

Allows small businesses to deduct deposits to a capital improvement account from North Carolina state taxable income at tiered rates: 5% of adjusted gross income up to $1,000,000, 2% above $1,000,000 up to $2,000,000, and 1% above $2,000,000 up to $3,000,000

Defines "small business" as a business with cumulative gross receipts not exceeding $10,000,000 for the taxable year

Restricts capital improvement account funds to real property improvements that add value, extend useful life at least 10 years, or adapt property to new uses, and requires accounts be held at federally insured banking institutions

Requires any previously deducted amounts that are withdrawn and not used for qualifying improvements to be added back to taxable income in the year of withdrawal

Effective for taxable years beginning January 1, 2022