SENATE FILE 89

BY  FEENSTRA, JOHNSON, BARTZ, KAPUCIAN, BACON, SEYMOUR, BOETTGER, ANDERSON, SMITH, and GREINER

A BILL FOR

An Act providing an individual income tax credit for certain supplies purchased by a teacher and including retroactive applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

   Section 1.  NEW SECTION.  422.11Y  Teacher expense credit.
   1.  The taxes imposed under this division, less the credits allowed under section 422.12, shall be reduced by a teacher expense credit equal to the first two hundred fifty dollars of the cost incurred to purchase supplies by the taxpayer to assist the taxpayer in teaching at an elementary or secondary school situated in Iowa, which school is accredited under section 256.11. To qualify for the credit, the costs must be nonreimbursable from any source. If the cost incurred has been deducted in computing federal adjusted gross income, the amount of such deduction shall be added in determining net income under section 422.7. Any credit in excess of the tax liability is nonrefundable.
   2.  As used in this section,“supplies” includes but is not limited to paper supplies, bulletin boards, books, maps, charts, computer software but not hardware, and other items directly used by the taxpayer as a teacher. The cost incurred to purchase supplies for which a tax credit may be received under this section shall not be used by a school district to supplement its costs of instructional materials.
   Sec. 2.  RETROACTIVE APPLICABILITY.  This Act applies retroactively to January 1, 2011, for tax years beginning on or after that date.
EXPLANATION
   This bill provides an income tax credit of up to $250 for teachers that incur expenses for supplies directly used by them in teaching at accredited elementary or secondary schools in Iowa. To qualify, the expenses must be nonreimbursable from any source. If the expenses were deducted in computing federal adjusted gross income, the deduction shall be added in determining Iowa net income. These supplies include paper supplies, bulletin boards, books, maps, charts, computer software but not hardware, and other similar items directly used by the taxpayer as a teacher. The cost incurred to purchase supplies for which a tax credit may be received under this Code section shall not be used by a school district to supplement its costs of instructional materials.
   The bill applies retroactively to January 1, 2011, for tax years beginning on or after that date.