House File 2160 - Introduced HOUSE FILE BY UPMEYER, PAULSEN, DOLECHECK, ELGIN, ROBERTS, JENKINS, TYMESON, CHAMBERS, WILDERDYKE, HOFFMAN, and HEATON Passed House, Date Passed Senate, Date Vote: Ayes Nays Vote: Ayes Nays Approved A BILL FOR 1 An Act relating to the net income limit for eligibility for the 2 early childhood development tax credit. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 5419YH 81 5 mg/sh/8 PAG LIN 1 1 Section 1. Section 422.12C, subsection 2, paragraph a, 1 2 unnumbered paragraph 1, Code Supplement 2005, is amended to 1 3 read as follows: 1 4 In lieu of the child and dependent care credit authorized 1 5 in subsection 1, a taxpayer may claim an early childhood 1 6 development tax credit equal to twenty=five percent of the 1 7 first one thousand dollars which the taxpayer has paid to 1 8 others for each dependent, as defined in the Internal Revenue 1 9 Code, ages three through five for early childhood development 1 10 expenses. In determining the amount of early childhood 1 11 development expenses, such expenses paid during November and 1 12 December of the previous tax year shall be considered paid in 1 13 the tax year for which the tax credit is claimed. This credit 1 14 is available to a taxpayer whose net income is less than 1 15forty=fivefifty thousand dollars for the 2006 tax year, 1 16 fifty=five thousand dollars for the 2007 tax year, and sixty 1 17 thousand dollars for the 2008 and subsequent tax years. If 1 18 the early childhood development tax credit is claimed for a 1 19 tax year, the taxpayer and the taxpayer's spouse shall not 1 20 claim the child and dependent care credit under subsection 1. 1 21 As used in this subsection, "early childhood development 1 22 expenses" means services provided to the dependent by a 1 23 preschool, as defined in section 237A.1, materials, and other 1 24 activities as follows: 1 25 EXPLANATION 1 26 Current law limits the early childhood development tax 1 27 credit to taxpayers whose net incomes are less than $45,000 in 1 28 the 2006 tax year. This bill increases this limit to net 1 29 incomes of less than $50,000 in the 2006 tax year, $55,000 in 1 30 the 2007 tax year, and $60,000 in the 2008 and subsequent tax 1 31 years. 1 32 LSB 5419YH 81 1 33 mg:nh/sh/8