Text: SF00441 Text: SF00443 Text: SF00400 - SF00499 Text: SF Index Bills and Amendments: General Index Bill History: General Index
PAG LIN 1 1 Section 1. Section 15.335, subsection 4, Code 2003, is 1 2 amended to read as follows: 1 3 4. For purposes of this section, "base amount", "basic 1 4 research payment", and "qualified research expense" mean the 1 5 same as defined for the federal credit for increasing research 1 6 activities under section 41 of the Internal Revenue Code, 1 7 except that for the alternative incremental credit such 1 8 amounts are for research conducted within this state. 1 9 PARAGRAPH DIVIDED. For purposes of this section, "Internal 1 10 Revenue Code" means the Internal Revenue Code in effect on 1 11 January 1,20022003. 1 12 Sec. 2. Section 15A.9, subsection 8, paragraph e, Code 1 13 2003, is amended to read as follows: 1 14 e. For the purposes of this subsection, "base amount", 1 15 "basic research payment", and "qualified research expense" 1 16 mean the same as defined for the federal credit for increasing 1 17 research activities under section 41 of the Internal Revenue 1 18 Code, except that for the alternative incremental credit such 1 19 amounts are for research conducted within this state within 1 20 the zone. 1 21 PARAGRAPH DIVIDED. For purposes of this subsection, 1 22 "Internal Revenue Code" means the Internal Revenue Code in 1 23 effect on January 1,20022003. 1 24 Sec. 3. Section 422.3, subsection 5, Code 2003, is amended 1 25 to read as follows: 1 26 5. "Internal Revenue Code" means the Internal Revenue Code 1 27 of 1954, prior to the date of its redesignation as the 1 28 Internal Revenue Code of 1986 by the Tax Reform Act of 1986, 1 29 or means the Internal Revenue Code of 1986 as amended to and 1 30 including January31, 20021, 2003, whichever is applicable. 1 31 Sec. 4. Section 422.5, subsection 1, paragraph k, 1 32 subparagraph (1), Code 2003, is amended to read as follows: 1 33 (1) Add items of tax preference included in federal 1 34 alternative minimum taxable income under section 57, except 1 35 subsections (a)(1), (a)(2), and (a)(5), of the Internal 2 1 Revenue Code, make the adjustments included in federal 2 2 alternative minimum taxable income under section 56, except 2 3 subsections (a)(4), (b)(1)(C)(iii), and (d), of the Internal 2 4 Revenue Code, and add losses as required by section 58 of the 2 5 Internal Revenue Code. To the extent that any preference or 2 6 adjustment is determined by an individual's federal adjusted 2 7 gross income, the individual's federal adjusted gross income 2 8 is computed in accordance with section 422.7, subsection 39. 2 9 In the case of an estate or trust, the items of tax 2 10 preference, adjustments, and losses shall be apportioned 2 11 between the estate or trust and the beneficiaries in 2 12 accordance with rules prescribed by the director. 2 13 Sec. 5. Section 422.7, Code 2003, is amended by adding the 2 14 following new subsection: 2 15 NEW SUBSECTION. 39. The additional first-year 2 16 depreciation allowance authorized in section 168(k) of the 2 17 Internal Revenue Code, as enacted by Pub. L. No. 107-147, 2 18 section 101, does not apply in computing net income for state 2 19 tax purposes. If the taxpayer has taken such deduction in 2 20 computing federal adjusted gross income, the following 2 21 adjustments shall be made: 2 22 a. Add the total amount of depreciation taken on all 2 23 property for which the election under section 168(k) of the 2 24 Internal Revenue Code was made for the tax year. 2 25 b. Subtract an amount equal to depreciation taken on such 2 26 property for the tax year using the modified accelerated cost 2 27 recovery system depreciation method applicable under section 2 28 168 of the Internal Revenue Code without regard to section 2 29 168(k). 2 30 c. Any other adjustments to gains or losses to reflect the 2 31 adjustments made in paragraphs "a" and "b" pursuant to rules 2 32 adopted by the director. 2 33 Sec. 6. Section 422.9, subsection 2, Code 2003, is amended 2 34 by adding the following new paragraph: 2 35 NEW PARAGRAPH. j. For purposes of calculating the 3 1 deductions in this subsection that are authorized under the 3 2 Internal Revenue Code, and to the extent that any of such 3 3 deductions is determined by an individual's federal adjusted 3 4 gross income, the individual's federal adjusted gross income 3 5 is computed in accordance with section 422.7, subsection 39. 3 6 Sec. 7. Section 422.10, subsection 3, Code 2003, is 3 7 amended to read as follows: 3 8 3. For purposes of this section, "base amount", "basic 3 9 research payment", and "qualified research expense" mean the 3 10 same as defined for the federal credit for increasing research 3 11 activities under section 41 of the Internal Revenue Code, 3 12 except that for the alternative incremental credit such 3 13 amounts are for research conducted within this state. 3 14 PARAGRAPH DIVIDED. For purposes of this section, "Internal 3 15 Revenue Code" means the Internal Revenue Code in effect on 3 16 January 1,20022003. 3 17 Sec. 8. Section 422.32, Code 2003, is amended by adding 3 18 the following new subsection: 3 19 NEW SUBSECTION. 6A. "Internal Revenue Code" means the 3 20 Internal Revenue Code of 1954, prior to the date of its 3 21 redesignation as the Internal Revenue Code of 1986 by the Tax 3 22 Reform Act of 1986, or means the Internal Revenue Code of 1986 3 23 as amended to and including January 1, 2003, whichever is 3 24 applicable. 3 25 Sec. 9. Section 422.33, subsection 5, paragraph d, Code 3 26 2003, is amended to read as follows: 3 27 d. For purposes of this subsection, "base amount", "basic 3 28 research payment", and "qualified research expense" mean the 3 29 same as defined for the federal credit for increasing research 3 30 activities under section 41 of the Internal Revenue Code, 3 31 except that for the alternative incremental credit such 3 32 amounts are for research conducted within this state. 3 33 PARAGRAPH DIVIDED. For purposes of this subsection, 3 34 "Internal Revenue Code" means the Internal Revenue Code in 3 35 effect on January 1,20022003. 4 1 Sec. 10. Section 422.35, Code 2003, is amended by adding 4 2 the following new subsection: 4 3 NEW SUBSECTION. 19. The additional first-year 4 4 depreciation allowance authorized in section 168(k) of the 4 5 Internal Revenue Code, as enacted by Pub. L. No. 107-147, 4 6 section 101, does not apply in computing net income for state 4 7 tax purposes. If the taxpayer has taken such deduction in 4 8 computing taxable income, the following adjustments shall be 4 9 made: 4 10 a. Add the total amount of depreciation taken on all 4 11 property for which the election under section 168(k) of the 4 12 Internal Revenue Code was made for the tax year. 4 13 b. Subtract an amount equal to depreciation taken on such 4 14 property for the tax year using the modified accelerated cost 4 15 recovery system depreciation method applicable under section 4 16 168 of the Internal Revenue Code without regard to section 4 17 168(k). 4 18 c. Any other adjustments to gains or losses to reflect the 4 19 adjustments made in paragraphs "a" and "b" pursuant to rules 4 20 adopted by the director. 4 21 Sec. 11. RETROACTIVE APPLICABILITY. 4 22 1. Sections 1 through 3 and sections 7 through 9 apply 4 23 retroactively to January 1, 2002, for tax years beginning on 4 24 or after that date. 4 25 2. Sections 4, 5, 6, and 10 apply retroactively to tax 4 26 years ending on or after September 10, 2001. 4 27 Sec. 12. EFFECTIVE DATE. This Act, being deemed of 4 28 immediate importance, takes effect upon enactment. 4 29 EXPLANATION 4 30 This bill updates the references to the Internal Revenue 4 31 Code to make the federal income tax revisions enacted by 4 32 Congress in 2002 applicable for Iowa income tax purposes. 4 33 Code sections 15.335, 15A.9, 422.10, and 422.33 are amended to 4 34 update the Iowa Code references to the state research 4 35 activities credit for individuals, corporations, corporations 5 1 in economic development areas, and corporations in quality 5 2 jobs enterprise zones to include the 2002 federal changes in 5 3 the research activities credit. 5 4 The bill amends Code sections 422.5, 422.7, and 422.9 to 5 5 make adjustments to federal adjusted gross income, and amends 5 6 Code section 422.35 to make adjustments to taxable income, to 5 7 disallow, for state income tax purposes, the bonus 5 8 depreciation deduction enacted in the federal Job Creation and 5 9 Worker Assistance Act of 2002. 5 10 The provisions of the bill updating references to the 5 11 Internal Revenue Code are retroactively applicable to January 5 12 1, 2002, for tax years beginning on or after that date. The 5 13 provisions of the bill decoupling from the federal bonus 5 14 depreciation apply retroactively to tax years ending on or 5 15 after September 10, 2001. 5 16 The bill takes effect upon enactment. 5 17 LSB 3412SV 80 5 18 sc/pj/5
Text: SF00441 Text: SF00443 Text: SF00400 - SF00499 Text: SF Index Bills and Amendments: General Index Bill History: General Index
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