Senate File 631 S-3256 Amend Senate File 631 as follows: 1 1. By striking everything after the enacting clause and 2 inserting: 3 < DIVISION I 4 INCOME TAX 5 Section 1. Section 422.4, subsection 16, paragraph e, 6 unnumbered paragraph 1, Code 2019, is amended to read as 7 follows: 8 Add back the following percentage of the qualified business 9 income deduction deductions under section 199A sections 199A(a) 10 and 199A(g) of the Internal Revenue Code taken and allowable in 11 calculating federal taxable income for the applicable tax year: 12 Sec. 2. Section 422.9, subsection 2A, paragraph a, 13 unnumbered paragraph 1, Code 2019, is amended to read as 14 follows: 15 The following percentage of the qualified business income 16 deduction deductions under section 199A sections 199A(a) and 17 199A(g) of the Internal Revenue Code taken and allowable in 18 calculating federal taxable income for the applicable tax year: 19 Sec. 3. Section 422.9, subsection 2A, paragraph b, Code 20 2019, is amended to read as follows: 21 b. Notwithstanding paragraph “a” , and section 422.4, 22 subsection 16 , paragraph “e” , for an entity electing or 23 required to file a composite return under section 422.13, 24 subsection 5 , the deduction allowed under this subsection for 25 purposes of the composite return shall be an amount equal to 26 the applicable percentage described in paragraph “a” of the 27 deduction deductions that would be allowable for federal income 28 tax purposes under section 199A sections 199A(a) and 199A(g) of 29 the Internal Revenue Code by an individual taxpayer reporting 30 the same items of income and loss that are included in the 31 composite return. 32 Sec. 4. Section 422.11S, subsection 7, paragraph b, Code 33 2019, is amended to read as follows: 34 b. The department shall authorize a school tuition 35 -1- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 1/ 26 #1.

organization to issue tax credit certificates for contributions 1 made to the school tuition organization. The aggregate amount 2 of tax credit certificates that the department shall authorize 3 for a school tuition organization for a tax calendar year shall 4 be determined for that organization pursuant to subsection 8 . 5 However, a school tuition organization shall not be authorized 6 to issue tax credit certificates unless the organization is 7 controlled by a board of directors consisting of at least 8 seven members. The names and addresses of the members shall 9 be provided to the department and shall be made available 10 by the department to the public, notwithstanding any state 11 confidentiality restrictions. 12 Sec. 5. Section 422.11S, subsection 8, paragraph a, 13 subparagraph (2), Code 2019, is amended to read as follows: 14 (2) “Total approved tax credits” means for the tax year 15 beginning in the 2006 calendar year, two million five hundred 16 thousand dollars, for the tax year beginning in the 2007 17 calendar year, five million dollars, for tax calendar years 18 beginning on or after January 1, 2008, but before January 1, 19 2012, seven million five hundred thousand dollars, for tax 20 calendar years beginning on or after January 1, 2012, but 21 before January 1, 2014, eight million seven hundred fifty 22 thousand dollars, and for tax calendar years beginning on or 23 after January 1, 2014, but before January 1, 2019, twelve 24 million dollars, and for tax calendar years beginning on or 25 after January 1, 2019, thirteen million dollars. 26 Sec. 6. Section 422.11S, subsection 8, paragraph b, 27 unnumbered paragraph 1, Code 2019, is amended to read as 28 follows: 29 Each year by December 1, the department shall authorize 30 school tuition organizations to issue tax credit certificates 31 for the following tax calendar year. However, for the tax year 32 beginning in the 2006 calendar year only, the department, by 33 September 1, 2006, shall authorize school tuition organizations 34 to issue tax credit certificates for the 2006 calendar tax 35 -2- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 2/ 26

year. For the tax year beginning in the 2006 calendar year 1 only, each school served by a school tuition organization shall 2 submit a participation form to the department by August 1, 3 2006, providing the certified enrollment as of the third Friday 4 of September 2005, along with the school tuition organization 5 that represents the school. Tax credit certificates available 6 for issue by each school tuition organization shall be 7 determined in the following manner: 8 Sec. 7. Section 422.11S, subsection 9, unnumbered paragraph 9 1, Code 2019, is amended to read as follows: 10 A school tuition organization that receives a voluntary cash 11 or noncash contribution pursuant to this section shall report 12 to the department, on a form prescribed by the department, 13 by January 12 of each tax calendar year all of the following 14 information: 15 Sec. 8. Section 422.11S, subsection 9, paragraphs b and c, 16 Code 2019, are amended to read as follows: 17 b. The total number and dollar value of contributions 18 received and the total number and dollar value of the tax 19 credits approved during the previous tax calendar year. 20 c. A list of the individual donors for the previous tax 21 calendar year that includes the dollar value of each donation 22 and the dollar value of each approved tax credit. 23 Sec. 9. Section 422.12C, subsection 4, Code 2019, is amended 24 to read as follows: 25 4. Married taxpayers who have filed joint federal returns 26 electing to file separate returns or to file separately on a 27 combined return form must determine the child and dependent 28 care credit under subsection 1 or the early childhood 29 development tax credit under subsection 2 based upon their 30 combined net income and allocate the total credit amount to 31 each spouse in the proportion that each spouse’s respective net 32 income bears to the total combined net income. Nonresidents or 33 part-year residents of Iowa must determine their Iowa child and 34 dependent care credit under subsection 1 or the early childhood 35 -3- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 3/ 26

development tax credit under subsection 2 in the ratio of 1 their Iowa source net income to their all source net income. 2 Nonresidents or part-year residents who are married and elect 3 to file separate returns or to file separately on a combined 4 return form must allocate the Iowa child and dependent care 5 credit under subsection 1 or the early childhood development 6 tax credit under subsection 2 between the spouses in the ratio 7 of each spouse’s Iowa source net income to the combined Iowa 8 source net income of the taxpayers. 9 Sec. 10. Section 422.60, subsection 2, paragraph b, Code 10 2019, is amended by adding the following new subparagraph: 11 NEW SUBPARAGRAPH . (6) For purposes of this paragraph, 12 “Internal Revenue Code” means the Internal Revenue Code of 13 1954, prior to the date of its redesignation as the Internal 14 Revenue Code of 1986 by the Tax Reform Act of 1986, or means 15 the Internal Revenue Code of 1986 as amended and in effect on 16 December 21, 2017. This definition shall not be construed to 17 include any amendment to the Internal Revenue Code enacted 18 after the date specified in the preceding sentence, including 19 any amendment with retroactive applicability or effectiveness. 20 Sec. 11. LIKE-KIND EXCHANGES OF PERSONAL PROPERTY 21 UNDER CORPORATE INCOME TAX AND FRANCHISE TAX FOR TAX YEAR 22 2019. Notwithstanding any other provision of law to the 23 contrary, all of the following shall apply when computing net 24 income for purposes of the corporation income tax or franchise 25 tax under section 422.35 for tax years beginning during the 26 2019 calendar year: 27 1. The rules for nonrecognition of gain or loss from 28 exchanges of real property held for productive use or 29 investment and not held primarily for sale, as provided in 30 section 1031 of the Internal Revenue Code, as amended up to and 31 including March 24, 2018, apply for state income tax purposes 32 with regard to exchanges of real property. 33 2. The rules for nonrecognition of gain or loss from 34 exchanges of property other than real property held for 35 -4- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 4/ 26

productive use or investment as provided in section 1031 of the 1 Internal Revenue Code, as amended up to and including December 2 21, 2017, apply for state income tax purposes, notwithstanding 3 any other provision of law to the contrary. If the taxpayer’s 4 federal taxable income includes gain or loss from property, 5 other than real property described in subsection 1, and the 6 taxpayer elects to have this subsection apply, the following 7 adjustments shall be made: 8 a. (1) Subtract the total amount of gain related to the 9 sale or exchange of the property as properly reported for 10 federal tax purposes under the Internal Revenue Code. 11 (2) Add back any gain related to the sale or exchange of the 12 property to the extent such gain does not qualify for deferral 13 under section 1031 of the Internal Revenue Code, as amended 14 up to and including December 21, 2017, which gain shall be 15 calculated using the taxpayer’s adjusted basis in the property 16 for state tax purposes. 17 b. (1) Add the total amount of loss related to the sale or 18 exchange of the property as properly reported for federal tax 19 purposes under the Internal Revenue Code. 20 (2) Subtract any loss related to the sale or exchange of the 21 property to the extent such loss does not qualify for deferral 22 under section 1031 of the Internal Revenue Code, as amended 23 up to and including December 21, 2017, which loss shall be 24 calculated using the taxpayer’s adjusted basis in the property 25 for state tax purposes. 26 c. Any other adjustments to gains, losses, deductions, or 27 tax basis for the property given up or received in the sale or 28 exchange pursuant to rules adopted by the director. 29 Sec. 12. REFUNDS —— EARLY CHILDHOOD DEVELOPMENT TAX 30 CREDIT. Notwithstanding any provision of law to the contrary, 31 for tax years beginning prior to January 1, 2019, refunds of 32 the early childhood development tax credit provided in section 33 422.12C, subsection 2, requested on or after the effective 34 date of the provision of this division of this Act amending 35 -5- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 5/ 26

section 422.12C, subsection 4, shall not exceed the amount 1 allowed under section 422.12C, subsection 4, as amended by this 2 division of this Act. 3 Sec. 13. LEGISLATIVE INTENT. It is the intent of the 4 general assembly that the provisions of this division of 5 this Act amending section 422.11S are conforming amendments 6 consistent with current state law, and that the amendments do 7 not change the application of current law but instead reflect 8 current law both before and after the enactment of this Act. 9 Sec. 14. EFFECTIVE DATE. The following, being deemed of 10 immediate importance, take effect upon enactment: 11 1. The section of this division of this Act amending section 12 422.12C, subsection 4. 13 2. The section of this division of this Act relating to 14 refunds for the early childhood development tax credit. 15 3. The section of this division of this Act relating to 16 like-kind exchanges of personal property under corporate income 17 tax and franchise tax. 18 Sec. 15. RETROACTIVE APPLICABILITY. The following apply 19 retroactively to January 1, 2019, for tax years beginning on 20 or after that date: 21 1. The section of this division of this Act amending section 22 422.4, subsection 16, paragraph “e”, unnumbered paragraph 1. 23 2. The sections of this division of this Act amending 24 section 422.9, subsection 2A. 25 3. The section of this division of this Act amending section 26 422.12C, subsection 4. 27 4. The section of this division of this Act amending section 28 422.60, subsection 2, paragraph “b”. 29 Sec. 16. RETROACTIVE APPLICABILITY —— LIKE-KIND EXCHANGES 30 OF PERSONAL PROPERTY. The section of this division of this 31 Act relating to like-kind exchanges of personal property under 32 corporate income tax and franchise tax applies retroactively to 33 January 1, 2019, for tax years beginning on or after that date, 34 but before January 1, 2020. 35 -6- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 6/ 26

DIVISION II 1 ADMINISTRATIVE PROVISIONS 2 Sec. 17. Section 422.20, Code 2019, is amended by adding the 3 following new subsection: 4 NEW SUBSECTION . 5. The department may permit, by rule, the 5 disclosure of state tax information to a person a taxpayer has 6 authorized to receive such state tax information, in the manner 7 prescribed by the department. 8 Sec. 18. Section 422.72, Code 2019, is amended by adding the 9 following new subsection: 10 NEW SUBSECTION . 8. The department may permit, by rule, the 11 disclosure of state tax information to a person a taxpayer has 12 authorized to receive such state tax information, in the manner 13 prescribed by the department. 14 DIVISION III 15 SALES AND USE TAX 16 Sec. 19. Section 423.1, subsection 2, paragraphs b and c, 17 Code 2019, are amended to read as follows: 18 b. Is directly, indirectly, or constructively controlled by 19 another entity person . 20 c. Is subject to the control of a common entity person . A 21 common entity person is one which a person who owns directly 22 or individually indirectly more than ten percent of the voting 23 securities of the entity. 24 Sec. 20. Section 423.2, subsection 1, paragraph a, 25 subparagraph (5), subparagraph division (a), Code 2019, is 26 amended to read as follows: 27 (a) If a service or warranty contract does not specify a fee 28 amount for nontaxable services or taxable personal property, 29 the tax imposed pursuant to this section shall be imposed upon 30 an amount equal to one-half of the sales price of the contract. 31 Sec. 21. Section 423.2, subsection 6, paragraph k, Code 32 2019, is amended to read as follows: 33 k. Carpentry repair and installation . 34 Sec. 22. Section 423.3, Code 2019, is amended by adding the 35 -7- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 7/ 26

following new subsection: 1 NEW SUBSECTION . 16A. a. The sales price from the sale of 2 a grain bin, including material or replacement parts used to 3 construct or repair a grain bin. 4 b. For purposes of this subsection, “grain bin” means 5 property that is vented and covered with corrugated metal or 6 similar material, and that is primarily used to hold loose 7 grain for drying or storage. 8 Sec. 23. Section 423.3, subsection 47, paragraph c, 9 subparagraph (3), Code 2019, is amended by striking the 10 subparagraph and inserting in lieu thereof the following: 11 (3) The following within the scope of section 427A.1, 12 subsection 1, paragraphs “h” and “i” : 13 (a) Computers. 14 (b) Machinery. 15 (c) Equipment, including pollution control equipment. 16 (d) Replacement parts. 17 (e) Supplies. 18 (f) Materials used to construct or self-construct the 19 following: 20 (i) Computers. 21 (ii) Machinery. 22 (iii) Equipment, including pollution control equipment. 23 (iv) Replacement parts. 24 (v) Supplies. 25 Sec. 24. Section 423.3, subsection 104, paragraph a, Code 26 2019, is amended to read as follows: 27 a. The sales price of specified digital products and of 28 prewritten computer software sold, and of enumerated services 29 described in section 423.2, subsection 1, paragraph “a” , 30 subparagraph (5), or section 423.2, subsection 6 , paragraphs 31 “bq” , “br” , “bs” , and “bu” furnished, to a commercial enterprise 32 for use exclusively by the commercial enterprise. The use of 33 prewritten computer software, a specified digital product, or 34 service fails to qualify as a use exclusively by the commercial 35 -8- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 8/ 26

enterprise if its use for noncommercial purposes is more than 1 de minimis. 2 Sec. 25. Section 423.14A, subsection 3, paragraph b, Code 3 2019, is amended by striking the paragraph. 4 Sec. 26. Section 423.14A, subsection 3, paragraph d, 5 subparagraph (1), Code 2019, is amended to read as follows: 6 (1) A marketplace facilitator that makes or facilitates 7 Iowa sales on its own behalf or for one or more marketplace 8 sellers equal to or exceeding one hundred thousand dollars , 9 or in two hundred or more separate transactions, for an 10 immediately preceding calendar year or a current calendar year. 11 Sec. 27. Section 423.14A, subsection 3, paragraph e, 12 subparagraph (1), unnumbered paragraph 1, Code 2019, is amended 13 to read as follows: 14 A referrer if, for any immediately preceding calendar year 15 or a current calendar year, one hundred thousand dollars or 16 more in Iowa sales or two hundred or more separate Iowa sales 17 transactions result from referrals from a platform of the 18 referrer. A referrer is not required to collect and remit 19 sales and use tax pursuant to this paragraph if the referrer 20 does all of the following: 21 Sec. 28. Section 423.14A, subsection 3, paragraph e, 22 subparagraph (1), subparagraph division (c), unnumbered 23 paragraph 1, Code 2019, is amended to read as follows: 24 The referrer provides the department with monthly annual 25 reports in an electronic format and in the manner prescribed 26 by the department, which monthly annual reports contain all of 27 the following: 28 Sec. 29. Section 423.14A, subsection 3, paragraph e, Code 29 2019, is amended by adding the following new subparagraph: 30 NEW SUBPARAGRAPH . (5) This paragraph is subject to 31 implementation by the department by rule and shall not require 32 a referrer to collect tax or comply with the notice and 33 reporting requirements and other provisions of this paragraph 34 unless and until such administrative rules take effect. 35 -9- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 9/ 26

Sec. 30. Section 423.48, subsection 2, paragraph c, Code 1 2019, is amended by striking the paragraph. 2 Sec. 31. TAXATION AND EXEMPTION OF COMPUTERS TASK FORCE. A 3 taxation and exemption of computers task force is created. The 4 department of revenue shall initiate and coordinate the task 5 force and provide staff assistance. It is the intent of the 6 general assembly that the task force include representatives of 7 the department of revenue; a commercial enterprise that claims 8 an exemption for computers under section 423.3, subsection 9 47; an association that represents manufacturers and other 10 industrial producers; and an association that represents 11 business tax issues. The director of revenue or the director’s 12 designee shall serve as chairperson of the task force. 13 The task force shall be charged with reviewing the 14 definition of “computer” as used throughout the portions of the 15 Iowa Code and the Iowa Administrative Code administered by the 16 department of revenue including the exemption for computers 17 provided in section 423.3, subsection 47, paragraph “a”, 18 subparagraph (4). If the task force recommends modifications 19 to the current definition of “computer” including the exemption 20 for computers provided in section 423.3, subsection 47, 21 paragraph “a”, subparagraph (4), the department of revenue 22 shall provide any recommendations to the general assembly by 23 January 1, 2020. 24 Sec. 32. EFFECTIVE DATE. The following, being deemed of 25 immediate importance, take effect upon enactment: 26 1. The section of this division of this Act amending section 27 423.1, subsection 2, paragraphs “b” and “c”. 28 2. The section of this division of this Act amending section 29 423.3, subsection 47, paragraph “c”, subparagraph (3). 30 Sec. 33. RETROACTIVE APPLICABILITY. The following applies 31 retroactively to January 1, 2019, for tax years beginning on 32 or after that date: 33 The section of this division of this Act amending section 34 423.1, subsection 2, paragraphs “b” and “c”. 35 -10- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 10/ 26

Sec. 34. RETROACTIVE APPLICABILITY. The following applies 1 retroactively to January 1, 2016, for tax years beginning on 2 or after that date: 3 The section of this division of this Act amending section 4 423.3, subsection 47, paragraph “c”, subparagraph (3). 5 DIVISION IV 6 AUTOMOBILE RENTAL EXCISE TAX 7 Sec. 35. Section 423.14A, subsection 1, paragraph b, 8 subparagraph (3), Code 2019, is amended to read as follows: 9 (3) A “rental platform” , as defined in section 423C.2 , that 10 meets the requirements described in person who is not required 11 to collect and remit automobile rental excise tax pursuant to 12 section 423C.3, subsection 3 , paragraph “c” , subparagraph (2), 13 shall not be considered a “marketplace facilitator” with respect 14 to any sale of a transportation service under section 423.2, 15 subsection 6 , paragraph “bf” , or section 423.5, subsection 1 , 16 paragraph “e” , consisting of the rental of vehicles subject 17 to registration which are registered for a gross weight of 18 thirteen tons or less for a period of sixty days or less. 19 Sec. 36. Section 423C.2, subsection 3, paragraphs a and b, 20 Code 2019, are amended to read as follows: 21 a. A person or any affiliate of a person that owns or 22 controls an automobile and makes the automobile available for 23 rent through the person or any affiliate, or through a rental 24 platform or rental facilitator any other person . 25 b. A person or any affiliate of a person who possesses or 26 acquires a right or interest in any automobile with an intent 27 to rent the automobile to another person , or through the person 28 or any affiliate, or through a rental platform or a rental 29 facilitator any other person . 30 Sec. 37. Section 423C.2, subsection 6, Code 2019, is amended 31 to read as follows: 32 6. “Facilitation fee” means any consideration, by whatever 33 name called, that a rental facilitator or a rental platform 34 person charges to a user for facilitating the user’s rental 35 -11- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 11/ 26

of an automobile. “Facilitation fee” does not include any 1 commission an automobile provider pays to a rental facilitator 2 or a rental platform person for facilitating the rental of an 3 automobile. 4 Sec. 38. Section 423C.2, Code 2019, is amended by adding the 5 following new subsection: 6 NEW SUBSECTION . 6A. “Host” means the registered owner of an 7 automobile made available for sharing through a peer-to-peer 8 automobile sharing marketplace. 9 Sec. 39. Section 423C.2, subsections 9 and 10, Code 2019, 10 are amended by striking the subsections. 11 Sec. 40. Section 423C.2, subsection 11, Code 2019, is 12 amended to read as follows: 13 11. “Rental price” means all consideration charged for 14 the renting and facilitation of renting of an automobile 15 before taxes, including but not limited to facilitation fees, 16 reservation fees, services fees, nonrefundable deposits, and 17 any other direct or indirect charge made or consideration 18 provided in connection with the renting or facilitation of 19 renting of an automobile the same as “sales price” as defined 20 in section 423.1, which term includes but is not limited 21 to facilitation fees, reservation fees, services fees, 22 nonrefundable deposits, and any other direct or indirect charge 23 made or consideration provided in connection with the renting 24 or facilitation of renting an automobile . 25 Sec. 41. Section 423C.3, Code 2019, is amended to read as 26 follows: 27 423C.3 Tax on rental of automobiles —— collection and 28 remittance of tax. 29 1. For purposes of this section : 30 a. “Discount rental charge” means the amount an automobile 31 provider charges to a rental facilitator for the rental of an 32 automobile, excluding any applicable tax. 33 b. “Travel package” means an automobile rental bundled 34 with one or more separate components such as lodging, air 35 -12- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 12/ 26

transportation, or similar items and charged for a single 1 retail price. 2 2. 1. A tax of five percent is imposed upon the rental 3 price of an automobile if the rental transaction is subject to 4 the sales and services tax under chapter 423, subchapter II , or 5 the use tax under chapter 423, subchapter III . The tax shall 6 not be imposed on any rental transaction not taxable under the 7 state sales and services tax, as provided in section 423.3 , or 8 the state use tax, as provided in section 423.6 , on automobile 9 rental receipts. 10 3. 2. This subsection shall govern the collection and 11 remittance of the tax imposed under subsection 2 The tax 12 imposed under subsection 1 shall be collected and remitted to 13 the department by all persons required to collect state sales 14 and use tax on the rental transaction under chapter 423 . 15 a. Unless otherwise provided in this subsection , the 16 automobile provider shall collect the tax by adding the tax to 17 the rental price of the automobile and the tax, when collected, 18 shall be stated as a distinct item separate and apart from 19 the rental price of the automobile and the sales and services 20 tax imposed under chapter 423, subchapter II , or the use tax 21 imposed under chapter 423, subchapter III . 22 b. If a transaction for the rental of an automobile involves 23 a rental facilitator, all of the following shall occur in the 24 order prescribed: 25 (1) The rental facilitator shall collect the tax on any 26 rental price that the user pays to the rental facilitator in 27 the same manner as an automobile provider under paragraph “a” . 28 (2) (a) Unless otherwise required by rule or order of 29 the department, the rental facilitator shall remit to the 30 automobile provider that portion of the tax collected on the 31 rental price that represents the discount rental charge. 32 (b) No assessment shall be made against a rental facilitator 33 for tax due on a discount rental charge if the rental 34 facilitator collected the tax and remitted it to an automobile 35 -13- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 13/ 26

provider that has a valid tax permit required under this 1 chapter or under chapter 423 . This subparagraph division shall 2 not apply if the rental facilitator and automobile provider 3 are affiliates, or if the department requires the rental 4 facilitator to remit taxes collected on that portion of the 5 sales price that represents the discount rental charge directly 6 to the department. 7 (3) The rental facilitator shall remit any remaining tax it 8 collected to the department. 9 (4) (a) The automobile provider shall collect and remit 10 to the department any taxes the rental facilitator remitted to 11 the automobile provider, and shall collect and remit to the 12 department any taxes due on any amount of rental price the user 13 paid to the automobile provider. 14 (b) No assessment shall be made against an automobile 15 provider for any tax due on a discount rental charge that 16 was not remitted to the automobile provider by a rental 17 facilitator. This subparagraph division shall not apply if the 18 automobile provider and the rental facilitator are affiliates. 19 (5) Notwithstanding any other provision of this paragraph 20 to the contrary, if a rental facilitator and its affiliates 21 facilitate total rentals under this chapter and chapter 22 423A that are equal to or less than an aggregate amount of 23 rental price and sales price of ten thousand dollars for an 24 immediately preceding calendar year or a current calendar year, 25 or in ten or fewer separate transactions for an immediately 26 preceding calendar year or a current calendar year, the 27 rental facilitator shall not be required to collect tax on the 28 amount of sales price that represents the rental facilitator’s 29 facilitation fee. 30 c. (1) If a transaction for the rental of an automobile 31 involves a rental platform, other than a rental platform 32 described in subparagraph (2), the rental platform shall 33 collect and remit the tax imposed under this chapter in the 34 same manner as an automobile provider under paragraph “a” . 35 -14- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 14/ 26

(2) 3. A rental platform person is not required to collect 1 and remit the tax imposed under this chapter in the same manner 2 as an automobile provider under paragraph “a” if the rental 3 platform person meets all of the following requirements: 4 a. The person or any affiliate of the person is not an 5 automobile provider. 6 b. The person or any affiliate of the person facilitates 7 the renting or sharing of an automobile by doing all of the 8 following: 9 (1) The person owns, operates, or controls a peer-to-peer 10 automobile sharing marketplace that allows a host or an 11 automobile provider who is not an affiliate of the person 12 to offer or list an automobile for sharing or rent on the 13 marketplace. For purposes of this paragraph, it is immaterial 14 whether or not the automobile provider has a tax permit under 15 this chapter or chapter 423 or whether the automobile is owned 16 by a natural person or by a business entity. 17 (2) The person or affiliate of the person collects or 18 processes the rental price charged to the user. 19 (a) c. The only sales the rental platform person and 20 its affiliates of the person facilitate that are subject to 21 tax under chapter 423 are sales of a transportation service 22 under section 423.2, subsection 6 , paragraph “bf” , or section 23 423.5, subsection 1 , paragraph “e” , consisting of the rental 24 of vehicles subject to registration which are registered for 25 a gross weight of thirteen tons or less for a period of sixty 26 days or less. 27 (b) The rental platform operates a peer-to-peer automobile 28 sharing marketplace. 29 (3) 4. For any rental transaction for which the rental 30 platform a person is required to or elects to collect and 31 remit the tax under this chapter , the rental platform person 32 shall also be liable for the collection and remittance of any 33 sales or use tax due on that transaction under section 423.2, 34 subsection 6 , paragraph “bf” , or section 423.5, subsection 35 -15- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 15/ 26

1 , paragraph “e” , notwithstanding any other provision to the 1 contrary in chapter 423 . 2 (4) 5. For any rental transaction for which the rental 3 platform person is not required to collect and remit the 4 tax under this chapter as provided under subparagraph (2) 5 subsection 3 , the automobile provider shall be solely liable 6 for any amount of uncollected or unremitted tax under this 7 chapter and chapter 423 . 8 DIVISION V 9 TELEPHONE COMPANY PROPERTY 10 Sec. 42. NEW SECTION . 433.4A Competitive long distance 11 telephone company property. 12 For assessment years beginning before January 1, 2022, 13 the director of revenue shall assess the property of a long 14 distance telephone company, as defined in section 476.1D, 15 subsection 10, Code 2018, previously classified by the 16 utilities board as a competitive long distance telephone 17 company under section 476.1D, subsection 10, Code 2018, which 18 property is first assessed for taxation in this state on or 19 after January 1, 1996, in the same manner as all other property 20 assessed as commercial property by the local assessor under 21 chapters 427, 427A, 427B, 428, and 441. 22 Sec. 43. EFFECTIVE DATE. This division of this Act, being 23 deemed of immediate importance, takes effect upon enactment. 24 Sec. 44. RETROACTIVE APPLICABILITY. This division of this 25 Act applies retroactively to July 1, 2018. 26 DIVISION VI 27 TARGETED JOBS WITHHOLDING CREDIT 28 Sec. 45. Section 403.19A, subsection 3, paragraph c, 29 subparagraph (2), Code 2019, is amended to read as follows: 30 (2) The pilot project city and the economic development 31 authority shall not enter into a withholding agreement after 32 June 30, 2019 2021 . 33 DIVISION VII 34 SCHOOL TUITION ORGANIZATION TAX CREDITS 35 -16- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 16/ 26

Sec. 46. Section 422.11S, subsection 8, paragraph a, 1 subparagraph (2), Code 2019, is amended to read as follows: 2 (2) “Total approved tax credits” means for the tax year 3 beginning in the 2006 calendar year, two million five hundred 4 thousand dollars, for the tax year beginning in the 2007 5 calendar year, five million dollars, for tax years beginning 6 on or after January 1, 2008, but before January 1, 2012, seven 7 million five hundred thousand dollars, for tax years beginning 8 on or after January 1, 2012, but before January 1, 2014, eight 9 million seven hundred fifty thousand dollars, and for tax years 10 beginning on or after January 1, 2014, but before January 1, 11 2019, twelve million dollars, and for tax years beginning on 12 or after January 1, 2019, but before January 1, 2020, thirteen 13 million dollars , and for tax years beginning on or after 14 January 1, 2020, fifteen million dollars . 15 Sec. 47. CONTINGENT CODE EDITOR DIRECTIVE. The Code editor 16 is directed to harmonize the section of this division of this 17 Act amending section 422.11S with the other division of this 18 Act amending section 422.11S, if enacted, by changing tax year 19 to calendar year where appropriate and to make other related 20 changes, if necessary, to effectuate such changes. 21 DIVISION VIII 22 INCOME TAX CHECKOFFS 23 Sec. 48. Section 173.22, subsection 2, Code 2019, is amended 24 to read as follows: 25 2. A foundation fund is created within the state treasury 26 composed of moneys appropriated or available to and obtained or 27 accepted by the foundation. The foundation fund shall include 28 moneys credited to the fund as provided in section 422.12D 29 422.12I . 30 Sec. 49. Section 422.12E, Code 2019, is amended to read as 31 follows: 32 422.12E Income tax return checkoffs limited. 33 1. For tax years beginning on or after January 1, 2019, 34 there There shall be allowed no more than four income tax 35 -17- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 17/ 26

return checkoffs on each income tax return. For tax years 1 beginning on or after January 1, 2017, when the same four 2 income tax return checkoffs have been provided on the income 3 tax return for two consecutive tax years, the two checkoffs for 4 which the least amount has been contributed, in the aggregate 5 for the first tax year and through March 15 after the end of the 6 second tax year, are repealed on December 31 after the end of 7 the second tax year and shall be removed from the return form . 8 2. If more checkoffs are enacted in the same session of 9 the general assembly than there is space for inclusion on the 10 individual tax return form, the checkoffs with the earliest 11 enacted checkoffs date of enactment as determined pursuant 12 to section 3.7 for which there is space for inclusion on the 13 return form shall be included on the return form, and all other 14 checkoffs enacted during that session of the general assembly 15 are repealed on December 31 of the year of enactment . If 16 more checkoffs are enacted in the same session of the general 17 assembly than there is space for inclusion on the individual 18 income tax form and the additional checkoffs are enacted on 19 the same day and it is indeterminable which checkoffs have 20 the earliest date of enactment pursuant to section 3.7 , the 21 director shall determine which checkoffs shall be included on 22 the return form , and all other checkoffs not included on the 23 return form shall be repealed on December 31 of the year of 24 enactment and shall not be included on the return form . 25 3. a. By July 1 of the year in which two checkoffs are 26 repealed pursuant to subsection 1, the department shall notify 27 the Iowa Code editor which two checkoffs received the least 28 amount of contributions and are repealed. 29 b. By September 1 of any applicable year, the department 30 shall notify the Iowa Code editor of any repeal pursuant to 31 subsection 2. 32 Sec. 50. NEW SECTION . 422.12G Joint income tax checkoff for 33 veterans trust fund and volunteer fire fighter preparedness fund. 34 1. A person who files an individual or a joint income tax 35 -18- SF631.2488 (2) 88 (amending this SF 631 to CONFORM to HF 779) jm/jh 18/ 26