(A) For purposes of this chapter, "economic impact zone business" means, with respect to any taxable year, any corporation if for such year:

1. (1)

   1. (a) every trade or business of such corporation is the active conduct of a qualified business within an economic impact zone; and
   2. (b) at least eighty percent of the total gross income of the corporation is derived from the active conduct of the business;
2. (2) substantially all of the use of the tangible property of the corporation (whether owned or leased) is within an economic impact zone;
3. (3) substantially all of the intangible property of the corporation is used in, and exclusively related to, the active conduct of any such business;
4. (4) substantially all of the services performed for the corporation by its employees are performed within an economic impact zone;
5. (5) at least one-third of its employees are residents of an economic impact zone;
6. (6) less than five percent of the average of the aggregate unadjusted bases of the property of such corporation is attributable to collectibles (as defined in Section 408(m)(2) of the Internal Revenue Code) other than collectibles that are held primarily for sale to customers in the ordinary course of such business; and
7. (7) less than five percent of the average of the aggregate unadjusted bases of the property of such corporation is attributable to nonqualified financial property.

(B) For purposes of this chapter:

1. (1) Except as otherwise provided in this subsection, the term "qualified business" means any trade or business.

2. (2) The rental to others of real property located in an economic impact zone may be treated as a qualified business only if:

   1. (a) in the case of real property which is not residential rental property (as defined in Section 168(e)(2) of the Internal Revenue Code), the lessee is an economic impact zone business; or

   2. (b) in the case of residential rental property:

      1. (i) the property was originally placed in service after the date the economic impact zone was designated; or
      2. (ii) the property is rehabilitated after such date in a rehabilitation which meets requirements based on the principles of Section 42(e)(3) of the Internal Revenue Code.
3. (3) The rental to others of tangible personal property must be treated as a qualified business only if substantially all of the rental of the property is by economic impact zone businesses or by residents of an economic impact zone.
4. (4) "Qualified business" does not include any trade or business consisting predominantly of the development or holding of intangibles for sale or license.

5. (5) The term "qualified business" does not include:

   1. (a) any trade or business consisting of the operation of any facility described in Section 144(c)(6)(B) of the Internal Revenue Code; and

   2. (b) any trade or business the principal activity of which is farming (within the meaning of subsections (A) or (B) of Section 2032A(e)(5) of the Internal Revenue Code), but only if, as of the close of the preceding taxable year, the sum of:

      1. (i) the aggregate unadjusted bases (or, if greater, the fair market value) of the assets owned by the taxpayer which are used in such trade or business; and

      2. (ii) the aggregate value of assets leased by the taxpayer which are used in such a trade or business, exceeds five hundred thousand dollars.

         For purposes of subitem (b), rules similar to the rules of Section 1395(b) of the Internal Revenue Code apply.

6. (6) For purposes of this chapter, the term "nonqualified financial property" means debt, stock, partnership interests, options, futures contracts, forward contracts, warrants, notional principal contracts, annuities, and other similar property specified in regulations, except that the term does not include:

   1. (a) reasonable amounts of working capital held in cash, cash equivalents, or debt instruments with a term of eighteen months or less; or
   2. (b) debt instruments described in Section 1221(4) of the Internal Revenue Code.