House File 2405 - Introduced



                                       HOUSE FILE       
                                       BY  SANDS


    Passed House,  Date               Passed Senate, Date             
    Vote:  Ayes        Nays           Vote:  Ayes        Nays         
                 Approved                            

                                      A BILL FOR

  1 An Act relating to the taxation of gain from the sale of farmland
  2    to the state department of transportation and including a
  3    retroactive applicability date provision.
  4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
  5 TLSB 5942YH 81
  6 mg/je/5

PAG LIN



  1  1    Section 1.  Section 422.7, Code Supplement 2005, is amended
  1  2 by adding the following new subsection:
  1  3    NEW SUBSECTION.  45.  Subtract, to the extent included, the
  1  4 amount of gain realized from the sale of farmland to the state
  1  5 department of transportation, if such gain is deposited into a
  1  6 qualified pension plan pursuant to section 401 of the Internal
  1  7 Revenue Code for the benefit of the taxpayer.  If only a
  1  8 portion of the gain realized is deposited into the qualified
  1  9 pension plan, then only that portion shall be subtracted under
  1 10 this subsection.  For purposes of this subsection, "farmland"
  1 11 means land of two acres or more that in good faith is used for
  1 12 agricultural or horticultural purposes.
  1 13    Sec. 2.  RETROACTIVE APPLICABILITY DATE.  This Act applies
  1 14 retroactively to January 1, 2006, for tax years beginning on
  1 15 or after that date.
  1 16                           EXPLANATION
  1 17    This bill provides that if an owner of farmland sells the
  1 18 land to the department of transportation, any gain realized
  1 19 will be exempt from state individual income tax if such gain
  1 20 is deposited into a qualified pension plan for the benefit of
  1 21 the taxpayer.  "Farmland" is land of two acres or more used
  1 22 for agricultural or horticultural purposes.
  1 23    The bill applies retroactively to January 1, 2006, for tax
  1 24 years beginning on or after that date.
  1 25 LSB 5942YH 81
  1 26 mg:rj/je/5