Senate File 2286
SENATE FILE
BY COMMITTEE ON WAYS AND MEANS
(SUCCESSOR TO SSB 3162)
Passed Senate, Date Passed House, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act updating the Iowa Code references to the Internal Revenue
2 Code, decoupling with the Internal Revenue Code for a certain
3 bonus depreciation provision, and providing retroactive
4 applicability dates and an effective date.
5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
6 TLSB 6683SV 80
7 sc/gg/14
PAG LIN
1 1 Section 1. Section 15.335, subsection 4, unnumbered
1 2 paragraph 2, Code Supplement 2003, is amended to read as
1 3 follows:
1 4 For purposes of this section, "Internal Revenue Code" means
1 5 the Internal Revenue Code in effect on January 1, 2003 2004.
1 6 Sec. 2. Section 15A.9, subsection 8, paragraph e,
1 7 unnumbered paragraph 2, Code Supplement 2003, is amended to
1 8 read as follows:
1 9 For purposes of this subsection, "Internal Revenue Code"
1 10 means the Internal Revenue Code in effect on January 1, 2003
1 11 2004.
1 12 Sec. 3. Section 422.3, subsection 5, Code Supplement 2003,
1 13 is amended to read as follows:
1 14 5. "Internal Revenue Code" means the Internal Revenue Code
1 15 of 1954, prior to the date of its redesignation as the
1 16 Internal Revenue Code of 1986 by the Tax Reform Act of 1986,
1 17 or means the Internal Revenue Code of 1986 as amended to and
1 18 including January 1, 2003 2004, whichever is applicable.
1 19 Sec. 4. Section 422.7, subsection 39, unnumbered paragraph
1 20 1, Code Supplement 2003, is amended to read as follows:
1 21 The additional first=year depreciation allowance authorized
1 22 in section 168(k) of the Internal Revenue Code, as enacted by
1 23 Pub. L. No. 107=147, section 101, and amended by Pub. L. No.
1 24 108=27, section 201, does not apply in computing net income
1 25 for state tax purposes. If the taxpayer has taken such
1 26 deduction in computing federal adjusted gross income, the
1 27 following adjustments shall be made:
1 28 Sec. 5. Section 422.7, subsection 39, paragraph b, Code
1 29 Supplement 2003, is amended to read as follows:
1 30 b. Subtract an amount equal to depreciation taken allowed
1 31 on such property for the tax year using the modified
1 32 accelerated cost recovery system depreciation method
1 33 applicable under section 168 of the Internal Revenue Code
1 34 without regard to section 168(k).
1 35 Sec. 6. Section 422.10, subsection 3, unnumbered paragraph
2 1 2, Code Supplement 2003, is amended to read as follows:
2 2 For purposes of this section, "Internal Revenue Code" means
2 3 the Internal Revenue Code in effect on January 1, 2003 2004.
2 4 Sec. 7. Section 422.32, subsection 7, Code Supplement
2 5 2003, is amended to read as follows:
2 6 7. "Internal Revenue Code" means the Internal Revenue Code
2 7 of 1954, prior to the date of its redesignation as the
2 8 Internal Revenue Code of 1986 by the Tax Reform Act of 1986,
2 9 or means the Internal Revenue Code of 1986 as amended to and
2 10 including January 1, 2003 2004, whichever is applicable.
2 11 Sec. 8. Section 422.33, subsection 5, paragraph d,
2 12 unnumbered paragraph 2, Code Supplement 2003, is amended to
2 13 read as follows:
2 14 For purposes of this subsection, "Internal Revenue Code"
2 15 means the Internal Revenue Code in effect on January 1, 2003
2 16 2004.
2 17 Sec. 9. Section 422.35, subsection 19, unnumbered
2 18 paragraph 1, Code Supplement 2003, is amended to read as
2 19 follows:
2 20 The additional first=year depreciation allowance authorized
2 21 in section 168(k) of the Internal Revenue Code, as enacted by
2 22 Pub. L. No. 107=147, section 101, and amended by Pub. L. No.
2 23 108=27, section 201, does not apply in computing net income
2 24 for state tax purposes. If the taxpayer has taken such
2 25 deduction in computing taxable income, the following
2 26 adjustments shall be made:
2 27 Sec. 10. Section 422.35, subsection 19, paragraph b, Code
2 28 Supplement 2003, is amended to read as follows:
2 29 b. Subtract an amount equal to depreciation taken allowed
2 30 on such property for the tax year using the modified
2 31 accelerated cost recovery system depreciation method
2 32 applicable under section 168 of the Internal Revenue Code
2 33 without regard to section 168(k).
2 34 Sec. 11. RETROACTIVE APPLICABILITY.
2 35 1. Sections 4 and 9 of this Act, amending section 422.7,
3 1 subsection 39, unnumbered paragraph 1, and section 422.35,
3 2 subsection 19, unnumbered paragraph 1, apply retroactively to
3 3 tax years ending on or after May 5, 2003.
3 4 2. The remainder of this Act applies retroactively to
3 5 January 1, 2003, for tax years beginning on or after that
3 6 date.
3 7 Sec. 12. EFFECTIVE DATE. This Act, being deemed of
3 8 immediate importance, takes effect upon enactment.
3 9 EXPLANATION
3 10 This bill updates the references to the Internal Revenue
3 11 Code to make the federal income tax revisions enacted by
3 12 Congress in 2003 applicable for Iowa income tax purposes.
3 13 Code sections 15.335, 15A.9, 422.10, and 422.33 are amended
3 14 to update the Iowa Code references to the state research
3 15 activities credit for individuals, corporations, corporations
3 16 in economic development areas, and corporations in quality
3 17 jobs enterprise zones to include the 2003 federal changes in
3 18 the research activities credit.
3 19 The bill amends Code sections 422.7 and 422.35 to make
3 20 adjustments to federal adjusted gross income for individuals
3 21 and federal taxable income for corporations to disallow, for
3 22 state income tax purposes, the changes to the bonus
3 23 depreciation deduction enacted in the federal Jobs and Growth
3 24 Tax Relief Reconciliation Act of 2003 (Pub. L. No. 108=27).
3 25 The provisions of the bill updating references to the
3 26 Internal Revenue Code are retroactively applicable to January
3 27 1, 2003, for tax years beginning on or after that date. The
3 28 provisions of the bill decoupling from the changes to the
3 29 federal bonus depreciation apply retroactively to tax years
3 30 ending on or after May 5, 2003.
3 31 The bill takes effect upon enactment.
3 32 LSB 6683SV 80
3 33 sc/gg/14