House
File
2546
-
Introduced
HOUSE
FILE
2546
BY
PRICHARD
,
KONFRST
,
WESSEL-KROESCHELL
,
B.
MEYER
,
OLDSON
,
STECKMAN
,
M.
SMITH
,
BEARINGER
,
KRESSIG
,
BROWN-POWERS
,
WILLIAMS
,
MATSON
,
DONAHUE
,
STAED
,
KURTH
,
McKEAN
,
JAMES
,
KACENA
,
BRECKENRIDGE
,
JACOBY
,
OLSON
,
SUNDE
,
ISENHART
,
THEDE
,
GAINES
,
HUNTER
,
COHOON
,
DERRY
,
WILBURN
,
HALL
,
NIELSEN
,
BENNETT
,
JUDGE
,
EHLERT
,
WOLFE
,
FORBES
,
ANDERSON
,
MASCHER
,
WINCKLER
,
ABDUL-SAMAD
,
GASKILL
,
R.
SMITH
,
LENSING
,
and
McCONKEY
A
BILL
FOR
An
Act
relating
to
the
child
and
dependent
care
credit
1
available
against
the
individual
income
tax,
and
including
2
retroactive
applicability
provisions.
3
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
4
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2546
Section
1.
Section
422.12C,
subsection
1,
Code
2020,
is
1
amended
by
striking
the
subsection
and
inserting
in
lieu
2
thereof
the
following:
3
1.
The
taxes
imposed
under
this
division,
less
the
amounts
4
of
nonrefundable
credits
allowed
under
this
division,
shall
5
be
reduced
by
a
child
and
dependent
care
credit
equal
to
the
6
following
percentages
of
the
federal
child
and
dependent
care
7
credit
provided
in
section
21
of
the
Internal
Revenue
Code,
8
without
regard
to
whether
or
not
the
federal
credit
was
limited
9
by
the
taxpayer’s
federal
tax
liability:
10
a.
For
a
taxpayer
with
net
income
of
less
than
forty-five
11
thousand
dollars,
one
hundred
percent.
12
b.
For
a
taxpayer
with
net
income
of
forty-five
thousand
13
dollars
or
more
but
less
than
ninety
thousand
dollars,
thirty
14
percent.
15
c.
For
a
taxpayer
with
net
income
of
ninety
thousand
dollars
16
or
more
but
less
than
one
hundred
thousand
dollars,
twenty-five
17
percent.
18
d.
For
a
taxpayer
with
net
income
of
one
hundred
thousand
19
dollars
or
more
but
less
than
one
hundred
twenty-five
thousand
20
dollars,
twenty
percent.
21
e.
For
a
taxpayer
with
net
income
of
one
hundred
twenty-five
22
thousand
dollars
or
more
but
less
than
one
hundred
fifty
23
thousand
dollars,
fifteen
percent.
24
f.
For
a
taxpayer
with
net
income
of
one
hundred
fifty
25
thousand
dollars
or
more
but
less
than
one
hundred
seventy-five
26
thousand
dollars,
ten
percent.
27
g.
For
a
taxpayer
with
net
income
of
one
hundred
28
seventy-five
thousand
dollars
or
more
but
less
than
two
hundred
29
fifty
thousand
dollars,
five
percent.
30
h.
For
a
taxpayer
with
net
income
of
two
hundred
fifty
31
thousand
dollars
or
more,
zero
percent.
32
Sec.
2.
RETROACTIVE
APPLICABILITY.
This
Act
applies
33
retroactively
to
January
1,
2020
for
tax
years
beginning
on
or
34
after
that
date.
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EXPLANATION
1
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
2
the
explanation’s
substance
by
the
members
of
the
general
assembly.
3
This
bill
increases
the
Iowa
net
income
threshold
levels
for
4
purposes
of
calculating
the
Iowa
child
and
dependent
child
care
5
tax
credit
available
against
the
individual
income
tax.
The
6
Iowa
child
and
dependent
care
tax
credit
is
a
refundable
credit
7
calculated
as
a
percentage
of
the
nonrefundable
federal
child
8
and
dependent
care
tax
credit,
depending
on
the
Iowa
net
income
9
of
the
taxpayer.
10
Currently,
there
are
seven
graduated
Iowa
net
income
11
thresholds
used
to
calculate
the
credit.
The
bill
increases
12
these
graduated
thresholds
from
seven
threshold
levels
to
13
eight
threshold
levels,
and
changes
the
percentage
of
the
14
nonrefundable
federal
child
and
dependent
care
tax
credit
15
used
to
calculate
the
Iowa
child
and
dependent
child
care
tax
16
credit.
17
Currently,
the
credit
percentages
in
these
seven
Iowa
18
net
income
thresholds
range
from
a
high
of
75
percent
of
19
the
federal
credit
for
taxpayers
with
net
income
of
less
20
than
$10,000,
to
a
low
of
30
percent
of
the
federal
credit
21
for
taxpayers
with
net
income
of
$40,000
or
more
but
less
22
than
$45,000.
Under
the
bill,
the
credit
percentages
in
the
23
thresholds
range
from
a
high
of
100
percent
of
the
federal
24
credit
for
taxpayers
with
a
net
income
of
less
than
$45,000
to
25
a
low
of
5
percent
of
the
federal
credit
for
taxpayers
with
net
26
income
of
$175,000
or
more
but
less
than
$250,000.
27
The
bill
applies
retroactively
to
January
1,
2020,
for
tax
28
years
beginning
on
or
after
that
date.
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