"NEW SECTION. Sec. 3.
A new section is added to chapter 48.43
RCW to read as follows:
(1) Subject to the restrictions in this section, in computing the tax due under section 2 of this act, there may be deducted from taxable premiums and prepayments the amount equal to the nonprofit health carrier's capital investments and community investment in Washington during the previous tax year.
(2)(a) The amount of capital investments deducted pursuant to this section must be equal to the depreciation deductions, allocated to Washington pursuant to (b) of this subsection, and taken pursuant to Title 26 U.S.C. Sec. 167 or 179 of the internal revenue code, as it existed on the effective date of this section or such subsequent date as may be provided by the department by rule, consistent with the purposes of this act.
(b) Depreciation deductions authorized under this subsection are allocated as follows:
(i) Depreciation deductions attributable to real property are allocated to this state if the real property is located in this state or a majority of the fair market value of the real property is located in this state.
(ii) Depreciation deductions from tangible personal property are allocated to this state if the property was located in this state at the time of the deduction. Depreciation deductions from tangible personal property are also allocated to this state even though the property was not located in this state at the time of the deduction if:
(A) The property was located in the state at any time during the taxable year or the immediately preceding taxable year;
(B) The taxpayer was a resident at the time of the deduction; and
(C) The taxpayer is not subject to the payment of an income or excise tax legally imposed on the depreciation deduction by another taxing jurisdiction.
(iii) Depreciation deductions derived from intangible personal property are allocated to this state if the taxpayer was domiciled in this state at the time the deduction occurred.
(3) The amount of community investment deducted pursuant to this section must be equal to any amounts provided to:
(a) A nonprofit organization, corporation, or association under Title 26 U.S.C. Sec. 501(c)(3) of the federal internal revenue code of 1986, as amended, as of the effective date of this section, for community or public health purposes in Washington; and
(b) A government entity for community or public health purposes in Washington.
(4) For the purposes of this section, "tax year" means a twelve-month period from January 1st to December 31st."