Text: HF00750 Text: HF00752 Text: HF00700 - HF00799 Text: HF Index Bills and Amendments: General Index Bill History: General Index
PAG LIN 1 1 Section 1. NEW SECTION. 404A.1 NEIGHBORHOOD ASSISTANCE 1 2 HOUSING TAX CREDIT ELIGIBLE PROPERTY. 1 3 1. A neighborhood assistance housing tax credit is granted 1 4 against the income tax imposed under chapter 422, division II 1 5 or division III, for the new construction of eligible housing 1 6 property located in HUD-eligible areas of this state as 1 7 provided in this chapter. Tax credits in excess of tax 1 8 liabilities may be carried forward for up to seven years or 1 9 back for up to three years. 1 10 2. Eligible housing property for which a taxpayer may 1 11 receive the neighborhood assistance housing tax credit 1 12 computed under this chapter is housing property located in a 1 13 HUD-eligible area which meets either of the following: 1 14 a. Two or more newly constructed single-family units with 1 15 a market value per unit of not more than one hundred twenty 1 16 thousand dollars upon completion of the construction. 1 17 b. At least one newly constructed multifamily housing 1 18 project containing three or more units with a market value per 1 19 unit of not more than one hundred twenty thousand dollars upon 1 20 completion of the construction. 1 21 3. For purposes of this section, "HUD-eligible area" means 1 22 an impoverished area in an entitlement city as designated by 1 23 the United States department of housing and urban development. 1 24 Sec. 2. NEW SECTION. 404A.2 AMOUNT OF CREDIT. 1 25 The amount of the credit equals ten percent of the 1 26 qualified construction costs of the eligible housing property. 1 27 In computing the tax credit, the only costs which may be 1 28 included are the construction costs directly related to the 1 29 construction of the housing incurred by the housing developer 1 30 or contractor during the period ending on the project 1 31 completion date and beginning on the later of either the date 1 32 of issuance of the approval of the project as provided in 1 33 section 404A.3 or two years prior to the project completion 1 34 date. Costs that are not included are the costs of 1 35 acquisition of the land, subdividing the land, and road or 2 1 sidewalk construction. 2 2 Sec. 3. NEW SECTION. 404A.3 APPROVAL OF NEW HOUSING 2 3 CONSTRUCTION PROJECT. 2 4 1. a. In order for a taxpayer to qualify for a tax credit 2 5 for the costs of a new housing construction project, the 2 6 housing developer or contractor must receive approval for the 2 7 new housing project from all of the following bodies: 2 8 (1) The governing bodies of the city, county, and council 2 9 of governments in which the eligible housing property will be 2 10 located and which have established approved selection criteria 2 11 and standards for projects involving eligible housing 2 12 property. 2 13 (2) The department of economic development. 2 14 b. Applications for approvals from the department and the 2 15 appropriate governing bodies shall be filed by the housing 2 16 developer or housing contractor and shall be on forms approved 2 17 by the department and shall contain information as required by 2 18 the department. The information shall include the approximate 2 19 date of the start of the new construction, the approximate 2 20 date of completion, the approximate market value of each 2 21 family unit upon completion of construction, as well as the 2 22 projected cost. 2 23 2. The governing body of a city, county, or council of 2 24 governments may establish selection criteria and standards for 2 25 projects involving eligible housing property. However, at 2 26 least one of these governing bodies shall establish selection 2 27 criteria and project standards. The standards shall be 2 28 written to ensure that a project is compatible with the area 2 29 being redeveloped and is in furtherance of an overall 2 30 development plan adopted by that body. Upon receiving 2 31 approval from the governing body, the housing developer or 2 32 contractor shall seek approval from the department of economic 2 33 development. The department shall establish its own criteria 2 34 for selection and standards with priority given to projects 2 35 which involve local government participation and private 3 1 sector support. Until a governing body's selection criteria 3 2 and project standards have been established and approved by 3 3 the department, a construction project on eligible housing 3 4 property within the jurisdiction of the governing body does 3 5 not need the approval of that governing body for the project 3 6 to receive the tax credit. However, if construction on the 3 7 project has not begun within sixty days of receiving the 3 8 approval of the department, the project must meet the 3 9 standards of a governing body if the governing body's 3 10 standards have received department approval within that sixty- 3 11 day period. The department shall not grant its approval for a 3 12 construction project prior to at least one of the governing 3 13 bodies having established criteria and standards. 3 14 Sec. 4. NEW SECTION. 404A.4 PROJECT COMPLETION AND TAX 3 15 CREDIT CERTIFICATION CREDIT TRANSFER. 3 16 1. Upon completion of the new construction housing 3 17 project, a certification of completion must be obtained from 3 18 each of the governing bodies which approved the project. The 3 19 governing bodies each shall determine that the project is 3 20 actually complete and was done according to the approved 3 21 standards of the governing body. Each governing body may 3 22 issue a separate certificate of completion or all of the 3 23 governing bodies may issue a joint certificate of completion. 3 24 A completion certificate shall identify the person claiming 3 25 the tax credit under this chapter and the qualified 3 26 construction costs incurred up to the two years preceding the 3 27 completion date. 3 28 2. Upon receipt of all separate certificates of completion 3 29 or a joint certificate of completion, the person claiming the 3 30 tax credit under this chapter shall present the completion 3 31 certificates or certificate to the department of economic 3 32 development. After verifying the eligibility for the tax 3 33 credit, the department shall issue a neighborhood assistance 3 34 housing tax credit certificate to be attached to the person's 3 35 tax return. The tax credit certificate shall contain the 4 1 taxpayer's name, address, tax identification number, the date 4 2 of project completion, the amount of credit, other information 4 3 required by the department of revenue and finance, and a place 4 4 for the name and tax identification number of any transferee 4 5 and the amount of the tax credit being transferred. 4 6 3. A person receiving a neighborhood assistance housing 4 7 tax credit under this chapter may transfer all or a portion of 4 8 the unused tax credit to any other person. The transferee may 4 9 use the amount of the tax credit transferred against the taxes 4 10 imposed under chapter 422, divisions II and III, for any tax 4 11 year the original transferor could have claimed the credit. 4 12 Any consideration received for the transfer of the tax credit 4 13 shall not be included as income under chapter 422, divisions 4 14 II and III. Any consideration paid for the transfer of the 4 15 tax credit shall not be deducted from income under chapter 4 16 422, divisions II and III. 4 17 Sec. 5. NEW SECTION. 422.11D NEIGHBORHOOD ASSISTANCE 4 18 HOUSING TAX CREDIT. 4 19 1. The taxes imposed under this division, less the credits 4 20 allowed under sections 422.12 and 422.12B, shall be reduced by 4 21 a neighborhood assistance housing tax credit equal to the 4 22 amount as computed under chapter 404A for the new construction 4 23 of eligible housing property. Any credit in excess of the tax 4 24 liability is nonrefundable and may be carried forward for up 4 25 to seven tax years or backward up to three tax years. 4 26 2. An individual may claim a neighborhood assistance 4 27 housing tax credit allowed a partnership, limited liability 4 28 company, S corporation, estate, or trust electing to have the 4 29 income taxed directly to the individual. The amount claimed 4 30 by the individual shall be based upon the pro rata share of 4 31 the individual's earnings from a partnership, limited 4 32 liability company, S corporation, estate, or trust. 4 33 3. However, if the original taxpayer who receives the 4 34 neighborhood assistance housing tax credit transfers all or a 4 35 portion of the tax credit, any transferee shall only be 5 1 entitled to use the amount of the tax credit transferred for a 5 2 tax year for which the original taxpayer could have claimed 5 3 the credit. 5 4 4. For purposes of this section, "eligible housing 5 5 property" means the same as used in section 404A.1. 5 6 Sec. 6. Section 422.33, Code 1999, is amended by adding 5 7 the following new subsection: 5 8 NEW SUBSECTION. 8. a. The taxes imposed under this 5 9 division shall be reduced by a neighborhood assistance housing 5 10 tax credit equal to the amount as computed under chapter 404A 5 11 for the new construction of eligible housing property. Any 5 12 credit in excess of the tax liability is nonrefundable but may 5 13 be carried forward for up to seven tax years or backward up to 5 14 three tax years. 5 15 b. However, if the original taxpayer who receives the 5 16 neighborhood assistance housing tax credit transfers all or a 5 17 portion of the tax credit, any transferee shall only be 5 18 entitled to use the amount of the tax credit transferred for a 5 19 tax year for which the original taxpayer could have claimed 5 20 the credit. 5 21 c. For purposes of this subsection, "eligible housing 5 22 property" means the same as used in section 404A.1. 5 23 EXPLANATION 5 24 The bill provides for an individual and corporate income 5 25 tax credit equal to 10 percent of the costs of the new 5 26 construction of eligible housing properties. Eligible housing 5 27 properties are properties constructed in HUD-eligible areas 5 28 which consist of either two single-family units or one 5 29 multifamily project containing at least three family units. 5 30 The value of each family unit must not exceed $120,000. In 5 31 addition, the new housing construction project must be 5 32 approved by the governing body of the city, county, and 5 33 councils of government in which the property is to be located. 5 34 At least one of the governing bodies has to establish 5 35 construction standards and selection criteria. The project 6 1 must also be approved by the department of economic 6 2 development. 6 3 The tax credits may be carried forward seven years or 6 4 carried back three tax years. In addition, the taxpayer may 6 5 transfer to another any unused tax credit to be applied to the 6 6 individual or corporate income tax of the transferee. 6 7 LSB 1655HH 78 6 8 mg/jw/5.1
Text: HF00750 Text: HF00752 Text: HF00700 - HF00799 Text: HF Index Bills and Amendments: General Index Bill History: General Index
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