Text: SF00552 Text: SF00554 Text: SF00500 - SF00599 Text: SF Index Bills and Amendments: General Index Bill History: General Index
PAG LIN
1 1 Section 1. NEW SECTION. 422.11 FRANCHISE TAX CREDIT.
1 2 The taxes imposed under this division, less the credits
1 3 allowed under section 422.12, shall be reduced by a franchise
1 4 tax credit. A taxpayer who is a shareholder in a financial
1 5 institution, as defined in section 581 of the Internal Revenue
1 6 Code, which has in effect for the tax year an election under
1 7 subchapter S of the Internal Revenue Code shall compute the
1 8 amount of the tax credit by recomputing the amount of tax
1 9 under this division by reducing the taxable income of the
1 10 taxpayer by the taxpayer's pro rata share of the items of
1 11 income and expense of the financial institution and
1 12 subtracting the credits allowed under section 422.12. This
1 13 recomputed tax shall be subtracted from the amount of tax
1 14 computed under this division after the deduction for credits
1 15 allowed under section 422.12. The resulting amount, which
1 16 shall not exceed the taxpayer's pro rata share of the
1 17 franchise tax paid by the financial institution, is the amount
1 18 of the franchise tax credit allowed.
1 19 Sec. 2. Section 422.61, subsection 3, Code 1997, is
1 20 amended by adding the following new paragraph:
1 21 NEW PARAGRAPH. g. Where a financial institution as
1 22 defined in section 581 of the Internal Revenue Code is not
1 23 subject to income tax and the shareholders of the financial
1 24 institution are taxed on the financial institution's income
1 25 under the provisions of the Internal Revenue Code, such tax
1 26 treatment shall be disregarded and the financial institution
1 27 shall compute its net income for franchise tax purposes in the
1 28 same manner under this subsection as a financial institution
1 29 that is subject to or liable for federal income tax under the
1 30 Internal Revenue Code in effect for the applicable year.
1 31 Sec. 3. This Act applies retroactively to January 1, 1997,
1 32 for tax years beginning on or after January 1, 1997.
1 33 SF 553
1 34 mg/cc/26
Text: SF00552 Text: SF00554 Text: SF00500 - SF00599 Text: SF Index Bills and Amendments: General Index Bill History: General Index
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