House File 2491
HOUSE FILE
BY COMMITTEE ON ECONOMIC GROWTH
(SUCCESSOR TO HSB 654)
Passed House, Date Passed Senate, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act creating a job corps center new jobs tax credit and
2 providing effective and retroactive applicability dates.
3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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PAG LIN
1 1 Section 1. NEW SECTION. 422.11J JOB CORPS CENTER NEW
1 2 JOBS TAX CREDIT.
1 3 The taxes imposed under this division, less the credits
1 4 allowed under sections 422.12 and 422.12B, shall be reduced by
1 5 a job corps center new jobs tax credit. An employer who hires
1 6 a graduate of a job corps center on a full=time basis within
1 7 six months of the employee's graduation from the job corps
1 8 center is entitled to the job corps center new jobs tax
1 9 credit. The amount of the tax credit for each employed job
1 10 corps graduate is equal to the product of six percent of the
1 11 taxable wages paid to the graduate upon which the employer is
1 12 required to contribute to the state unemployment compensation
1 13 fund, as defined in section 96.19, subsection 37, multiplied
1 14 by the number of whole months the graduate is employed by the
1 15 employer during the tax year divided by twelve. The tax
1 16 credit applies only to the first twelve months of employment
1 17 for each graduate hired. An individual may claim the tax
1 18 credit allowed a partnership, subchapter S corporation, or
1 19 estate or trust electing to have the income taxed directly to
1 20 the individual. The amount claimed by the individual shall be
1 21 based upon the pro rata share of the individual's earnings of
1 22 the partnership, subchapter S corporation, or estate or trust.
1 23 For purposes of this section, "job corps center" is defined as
1 24 a campus that is part of the nationwide network of campuses
1 25 organized under the federal job corps program authorized by
1 26 the federal Workforce Investment Act of 1998, Pub. L. No. 10=
1 27 222.
1 28 Sec. 2. Section 422.33, Code Supplement 2003, is amended
1 29 by adding the following new subsection:
1 30 NEW SUBSECTION. 16. The taxes imposed under this division
1 31 shall be reduced by a job corps center new jobs tax credit.
1 32 An employer who hires a graduate of a job corps center on a
1 33 full=time basis within six months of the employee's graduation
1 34 from the job corps center is entitled to the job corps center
1 35 new jobs tax credit. The amount of the tax credit for each
2 1 employed job corps graduate is equal to the product of six
2 2 percent of the taxable wages paid to the graduate upon which
2 3 the employer is required to contribute to the state
2 4 unemployment compensation fund, as defined in section 96.19,
2 5 subsection 37, multiplied by the number of whole months the
2 6 graduate is employed by the employer during the tax year
2 7 divided by twelve. The tax credit applies only to the first
2 8 twelve months of employment for each graduate hired. An
2 9 individual may claim the tax credit allowed a partnership,
2 10 subchapter S corporation, or estate or trust electing to have
2 11 the income taxed directly to the individual. The amount
2 12 claimed by the individual shall be based upon the pro rata
2 13 share of the individual's earnings of the partnership,
2 14 subchapter S corporation, or estate or trust. For purposes of
2 15 this section, "job corps center" is defined as a campus that
2 16 is part of the nationwide network of campuses organized under
2 17 the federal job corps program authorized by the federal
2 18 Workforce Investment Act of 1998, Pub. L. No. 10=222.
2 19 Sec. 3. EFFECTIVE AND APPLICABILITY DATES. This Act,
2 20 being deemed of immediate importance, takes effect upon
2 21 enactment. This Act applies retroactively to January 1, 2004,
2 22 and is applicable to tax years beginning on and after that
2 23 date.
2 24 EXPLANATION
2 25 This bill creates a job corps center new jobs tax credit to
2 26 be used against personal and corporate income tax liability.
2 27 The bill provides that an employer who hires a graduate of a
2 28 job corps center on a full=time basis within six months of the
2 29 employee's graduation from the job corps center is entitled to
2 30 a tax credit. The bill provides that the amount of the tax
2 31 credit for each employed job corps graduate is equal to the
2 32 product of 6 percent of the taxable wages paid to the graduate
2 33 upon which the employer is required to contribute to the state
2 34 unemployment compensation fund multiplied by the number of
2 35 whole months the graduate is employed by the employer during
3 1 the tax year divided by 12. The bill provides that the tax
3 2 credit applies only to the first 12 months of employment for
3 3 each graduate hired.
3 4 LSB 6413HV 80
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