House File 2424 H-8116 Amend the amendment, H-8087, to House File 2424 as follows: 1 1. By striking page 1, line 2, through page 2, line 25, and 2 inserting: 3 < ___. By striking everything after the enacting clause and 4 inserting: 5 < DIVISION I 6 Section 1. Section 422.12C, subsection 1, Code 2020, is 7 amended by striking the subsection and inserting in lieu 8 thereof the following: 9 1. The taxes imposed under this division, less the amounts 10 of nonrefundable credits allowed under this division, shall 11 be reduced by a child and dependent care credit equal to the 12 following percentages of the federal child and dependent care 13 credit provided in section 21 of the Internal Revenue Code, 14 without regard to whether or not the federal credit was limited 15 by the taxpayer’s federal tax liability: 16 a. For a taxpayer with net income of less than forty-five 17 thousand dollars, one hundred percent. 18 b. For a taxpayer with net income of forty-five thousand 19 dollars or more but less than ninety thousand dollars, thirty 20 percent. 21 c. For a taxpayer with net income of ninety thousand dollars 22 or more but less than one hundred thousand dollars, twenty-five 23 percent. 24 d. For a taxpayer with net income of one hundred thousand 25 dollars or more but less than one hundred twenty-five thousand 26 dollars, twenty percent. 27 e. For a taxpayer with net income of one hundred twenty-five 28 thousand dollars or more but less than one hundred fifty 29 thousand dollars, fifteen percent. 30 f. For a taxpayer with net income of one hundred fifty 31 thousand dollars or more but less than one hundred seventy-five 32 thousand dollars, ten percent. 33 g. For a taxpayer with net income of one hundred 34 seventy-five thousand dollars or more but less than two hundred 35 -1- H8087.3653 (2) 88 as/rh 1/ 7 #1.
fifty thousand dollars, five percent. 1 h. For a taxpayer with net income of two hundred fifty 2 thousand dollars or more, zero percent. 3 Sec. 2. RETROACTIVE APPLICABILITY. This division of this 4 Act applies retroactively to January 1, 2020 for tax years 5 beginning on or after that date. 6 DIVISION II 7 Sec. 3. NEW SECTION . 237D.1 Definitions. 8 As used in this chapter, unless the context otherwise 9 requires: 10 1. “Child” means the same as defined in section 237A.1. 11 2. “Child care” means the same as defined in section 237A.1. 12 3. “Child development home” means the same as defined in 13 section 237A.1. 14 4. “Department” means the department of human services. 15 5. “Facility” means the same as defined in section 237A.1. 16 6. “Fund” means the child care center and child development 17 home grant fund. 18 7. “Home” means a child development home. 19 8. “Licensed child care center” or “center” means a facility 20 providing child care or preschool services for seven or more 21 children that has been issued a license by the department 22 pursuant to section 237A.2. 23 9. “Program” means the child care center and child 24 development home grant program. 25 Sec. 4. NEW SECTION . 237D.2 Child care center and child 26 development home grant fund. 27 1. A child care center and child development home grant fund 28 is created and established as a separate and distinct fund in 29 the state treasury under the control of the department. 30 2. a. The fund may consist of any moneys appropriated by 31 the general assembly for purposes of this chapter and any other 32 moneys that are lawfully available to the department. Moneys 33 in the fund are appropriated to the department and shall be 34 used for the purposes of this chapter. 35 -2- H8087.3653 (2) 88 as/rh 2/ 7
b. Notwithstanding section 8.33, moneys in the fund 1 that remain unencumbered or unobligated at the close of the 2 fiscal year shall not revert but shall remain available for 3 expenditure for the purposes of this section in succeeding 4 fiscal years. Notwithstanding section 12C.7, subsection 2, 5 interest earned on moneys in the fund shall be credited to the 6 fund. 7 Sec. 5. NEW SECTION . 237D.3 Child care center and child 8 development home grant program. 9 1. The department shall adopt rules to establish and 10 administer a child care center and child development home 11 grant program to provide for the allocation of money in the 12 fund in the form of grants, not to exceed fifty thousand 13 dollars per grant, to eligible persons for costs related to 14 the establishment of a new licensed child care center or 15 a new child development home, or for the expansion of an 16 existing licensed child care center or the expansion of an 17 existing child development home. For any one fiscal year, the 18 department shall not approve more than four million dollars 19 in grants. The rules adopted by the department shall specify 20 the eligibility requirements for applicants of the program and 21 the items eligible for a program grant. Items eligible for a 22 program grant must include the costs related to licensing or 23 registration, supplies, and infrastructure. 24 2. A new center or a new home must be licensed or registered 25 and fully operational within two years of the date of an 26 applicant’s receipt of a grant. 27 3. Of the children for whom a new or expanded center or a 28 new or expanded home provide child care, a minimum of twenty 29 percent of the children must be from a family that qualifies 30 for state child care assistance pursuant to section 237A.13. 31 4. A person that is awarded a grant shall enter into an 32 agreement with the department that specifies the requirements 33 that must be maintained throughout the period of the agreement 34 in order for the person to retain the grant. The agreement 35 -3- H8087.3653 (2) 88 as/rh 3/ 7
must contain, at a minimum, provisions addressing all of the 1 following: 2 a. The legal name of the person receiving the grant. 3 b. The amount of the grant. 4 c. Annual certification by the person to the department of 5 compliance with the requirements of the agreement, the program, 6 and this chapter. 7 d. The repayment of the grant, or a portion of the grant, 8 if the person does not meet all of the requirements of the 9 agreement, the program, and this chapter. 10 e. If a new center or a new home for which the grant was 11 received goes out of business within two years of the date the 12 new center or new home becomes fully operational pursuant to 13 subsection 2, the grant shall be subject to repayment. If an 14 expanded center or an expanded home for which the grant was 15 received goes out of business within two years of the date on 16 which the grant was received, the grant shall be subject to 17 repayment. 18 DIVISION III 19 Sec. 6. NEW SECTION . 237A.31 Small business child care tax 20 credit. 21 1. As used in this section “small business” means any 22 enterprise which is located in this state, which is operated 23 for profit and under a single management, and which has either 24 fewer than twenty employees or an annual gross income of less 25 than four million dollars computed as the average of the three 26 preceding fiscal years. This definition does not apply to any 27 program or activity for which a definition for small business 28 is provided for the program or activity by federal law or 29 regulation or other state law. 30 2. A small business may receive a child care tax credit 31 for providing child care employee benefits to employees of 32 the business. The credit may be applied against income tax 33 imposed under chapter 422, division II or III, the franchise 34 tax imposed under chapter 422, division V, the gross premiums 35 -4- H8087.3653 (2) 88 as/rh 4/ 7
tax imposed under chapter 432, or the moneys and credits tax 1 imposed in section 533.329. The amount of the credit equals 2 the costs to provide the benefit up to three thousand dollars 3 per employee per year. 4 3. The aggregate amount of tax credits authorized pursuant 5 to this section shall not exceed a total of two million 6 dollars per fiscal year, and shall be awarded on a first-come, 7 first-served basis. 8 4. To be eligible for a small business child care tax 9 credit, the small business must provide child care employee 10 benefits to employees of the business through any of the 11 following: 12 a. Build a new structure or rehabilitate an existing 13 structure to be used as a child care center at or near the small 14 business where the children of the employees of the business 15 are provided child care. A small business may construct or 16 rehabilitate the structure in conjunction with another business 17 but only the actual cost of the business shall be considered in 18 determining the credit. 19 b. Operate or lease a child care center at or near the small 20 business where the children of the employees of the business 21 are provided child care. 22 5. Any credit in excess of the tax liability is not 23 refundable but the excess for the tax year may be credited 24 to the tax liability for the following five years or until 25 depleted, whichever is earlier. The director of revenue shall 26 adopt rules to implement this section. 27 Sec. 7. NEW SECTION . 422.12O Small business child care tax 28 credit. 29 1. The taxes imposed under this division, less the credits 30 allowed under section 422.12, shall be reduced by a small 31 business child care tax credit received pursuant to section 32 237A.31. 33 2. An individual may claim the tax credit allowed a 34 partnership, S corporation, limited liability company, estate, 35 -5- H8087.3653 (2) 88 as/rh 5/ 7
or trust electing to have the income taxed directly to the 1 individual. The amount claimed by the individual shall be 2 based upon the pro rata share of the individual’s earnings of a 3 partnership, S corporation, limited liability company, estate, 4 or trust. 5 Sec. 8. Section 422.33, Code 2020, is amended by adding the 6 following new subsection: 7 NEW SUBSECTION . 31. The taxes imposed under this division 8 shall be reduced by a small business child care tax credit 9 received pursuant to section 237A.31. 10 Sec. 9. Section 422.60, Code 2020, is amended by adding the 11 following new subsection: 12 NEW SUBSECTION . 14. The taxes imposed under this division 13 shall be reduced by a small business child care tax credit 14 received pursuant to section 237A.31. 15 Sec. 10. NEW SECTION . 432.12N Small business child care 16 tax credit. 17 The taxes imposed under this chapter shall be reduced by 18 a small business child care tax credit received pursuant to 19 section 237A.31. 20 Sec. 11. Section 533.329, subsection 2, Code 2020, is 21 amended by adding the following new paragraph: 22 NEW PARAGRAPH . l. The moneys and credits tax imposed under 23 this section shall be reduced by a small business child care 24 tax credit received pursuant to section 237A.31. 25 Sec. 12. APPLICABILITY. This division of this Act applies 26 to tax years beginning on or after January 1, 2021. 27 DIVISION IV 28 Sec. 13. Section 237A.13, subsection 7, paragraph c, Code 29 2020, is amended to read as follows: 30 c. Families with an income of more than one hundred 31 percent but not more than one two hundred forty-five percent 32 of the federal poverty level whose members, for at least 33 twenty-eight hours per week in the aggregate, are employed 34 or are participating at a satisfactory level in an approved 35 -6- H8087.3653 (2) 88 as/rh 6/ 7
training program or educational program. 1 Sec. 14. DIRECTIVE TO DEPARTMENT OF HUMAN SERVICES —— CHILD 2 CARE ASSISTANCE. 3 1. The department of human services shall amend its 4 administrative rules pursuant to chapter 17A to do all of the 5 following: 6 a. Provide income eligibility for state child care 7 assistance, according to family size for children needing basic 8 care, to families whose nonexempt gross monthly income does not 9 exceed two hundred percent of the federal poverty level. 10 b. Adjust the state child care assistance copayment 11 schedule in incrementally increased amounts for families whose 12 nonexempt gross monthly income does not exceed two hundred 13 percent of the federal poverty level. 14 2. The rules adopted pursuant to this section shall take 15 effect January 1, 2021. > 16 ___. Title page, by striking lines 1 through 4 and inserting 17 < An Act relating to child care, grants and tax credits relating 18 to child care, state child care assistance, and including 19 applicability and retroactive applicability provisions. >> 20 ______________________________ JAMES of Dubuque -7- H8087.3653 (2) 88 as/rh 7/ 7