701—42.4 (422) Tuition and textbook credit for expenses incurred for dependents attending grades kindergarten through 12 in Iowa. Effective for tax years beginning on or after January 1, 1998, taxpayers who pay tuition and textbook expenses of dependents who attend grades kindergarten through 12 in an Iowa school may receive a tax credit of 25 percent of up to $1,000 of qualifying expenses for each dependent attending an elementary or secondary school located in Iowa. In order for the taxpayer to qualify for the tax credit for tuition and textbooks, the elementary school or secondary school that the dependent is attending must meet the standards for accreditation of public and nonpublic schools in Iowa provided in Iowa Code section 256.11. In addition, the school the dependent is attending must not be operated for profit and must adhere to the provisions of the United States Civil Rights Act of 1964, and the provisions of Iowa Code chapter 216, which is known as the Iowa civil rights Act of 1965. The following definitions and criteria apply to the determination of the tax credit for amounts paid by the taxpayer for tuition and textbooks for a dependent attending an elementary or secondary school in Iowa:
	 42.4(1) Tuition. For purposes of the tuition and textbook tax credit, “tuition” means any charge made by an elementary or secondary school for the expense of personnel, buildings, equipment and materials other than textbooks, and other expenses of elementary or secondary schools which relate to the teaching of only those subjects that are legally and commonly taught in public elementary or secondary schools in Iowa. “Tuition” includes charges by a qualified school for summer school classes or for private instruction of a child who is physically unable to attend classes at the site of the elementary or secondary school.
“Tuition” does not include charges or fees which relate to the teaching of religious tenets, doctrines, or worship in cases where the purpose of the teaching is to inculcate the religious tenets, doctrines, or worship. In addition, “tuition” does not include amounts paid to an individual or other entity for private instruction of a dependent who attends an elementary or secondary school in Iowa. Amounts paid to a school for meals, lodging, or clothing for a dependent do not qualify for the tax credit for tuition.
Amounts paid to an individual or organization for home schooling of a dependent or the teaching of a dependent outside of an elementary or secondary school may not be claimed for purposes of the tuition and textbook tax credit.
	 42.4(2) Textbooks. For purposes of the tuition and textbook tax credit, “textbooks” means books and other instructional materials used in elementary and secondary schools in Iowa to teach only those subjects legally and commonly taught in public elementary and secondary schools in Iowa. “Textbooks” includes fees or charges by the elementary or secondary school for required supplies or materials for classes in art, home economics, shop or similar courses. “Textbooks” also includes books and materials used for extracurricular activities, such as sporting events, musical events, dramatic events, speech activities, driver’s education, or programs of a similar nature.
“Textbooks” does not include amounts paid for books or other instructional materials used in the teaching of religious tenets, doctrines, or worship, in cases where the purpose of the teaching is to inculcate the religious tenets, doctrine, or worship. “Textbooks” also does not include amounts paid for books or other instructional materials used in teaching a dependent subjects in the home or outside of an elementary or secondary school.
	 42.4(3) Extracurricular activities. For purposes of the tuition and textbook tax credit, amounts paid for dependents to participate in or to attend extracurricular activities may be claimed as part of the tuition and textbook tax credit. “Extracurricular activities” includes sporting events, musical events, dramatic events, speech activities, driver’s education if provided at a school, and programs of a similar nature.
	  a.   	 The following are specific examples of expenditures related to a dependent’s participation in or attendance at extracurricular activities that may qualify for the tuition and textbook tax credit:
	 (1) 	 Fees for participation in school sports activities.
	 (2) 	 Fees for field trips.
	 (3) 	 Rental fees for instruments for school bands or orchestras but not rental fees in rent-to-own contracts.
	 (4) 	 Driver’s education fees, if paid to a school.
	 (5) 	 Cost of activity tickets or admission tickets to school sporting, music and dramatic events.
	 (6) 	 Fees for events such as homecoming, winter formal, prom, or similar events.
	 (7) 	 Rental of costumes for school plays.
	 (8) 	 Purchase of costumes for school plays if the costumes are not suitable for street wear.
	 (9) 	 Purchase of track shoes, football shoes, or other athletic shoes with cleats, spikes, or other features that are not suitable for street wear.
	 (10) 	 Costs of tickets or other admission fees to attend banquets or buffets for school academic or athletic awards.
	 (11) 	 Trumpet grease, woodwind reeds, guitar picks, violin strings and similar types of items for maintenance of instruments used in school bands or orchestras.
	 (12) 	 Band booster club or athletic booster club dues, but only if dues are for the dependent attending the school and not the parent or adult.
	 (13) 	 Rental of formal gown or tuxedo for school dance or other school event.
	 (14) 	 Dues paid to school clubs or school-sponsored organizations such as chess club, photography club, debate club, or similar organizations.
	 (15) 	 Amounts paid for music that will be used in school music programs, including vocal music programs.
	 (16) 	 Fees paid for general materials for shop class, agriculture class, home economics class, or auto repair class and general fees for equivalent classes.
	 (17) 	 Fees for a dependent’s bus trips to attend school if paid to the school.
	  b.   	 The following are specific examples of expenditures related to a dependent’s participation in or attendance at extracurricular activities that will not qualify for the tuition and textbook credit.
	 (1) 	 Purchase of a musical instrument used in a school band or orchestra.
	 (2) 	 Purchase of basketball shoes or other athletic shoes that are readily adaptable to street wear.
	 (3) 	 Amounts paid for special testing such as SAT or PSAT, and for Iowa talent search tests.
	 (4) 	 Payments for senior trips, band trips, and other overnight school activity trips which involve payment for meals and lodging.
	 (5) 	 Fees paid to K-12 schools for courses for college credit.
	 (6) 	 Amounts paid for T-shirts, sweatshirts and similar clothing that is appropriate for street wear.
	 (7) 	 Amounts paid for special programs at universities and colleges for high school students.
	 (8) 	 Payment for private instrumental lessons, voice lessons or similar lessons.
	 (9) 	 Amounts paid for a school yearbook, annual or class ring.
	 (10) 	 Fees for special materials paid for shop class, agriculture class, auto repair class, home economics class and similar classes. For purposes of this paragraph, “special materials” means materials used for personal projects of the dependents, such as materials to make furniture for personal use, automobile parts for family automobiles and other materials for projects for personal or family benefit.
This rule is intended to implement Iowa Code section 422.12.
[ARC 8702B, IAB 4/21/10, effective 5/26/10]