Senate File 121 - Introduced



                                       SENATE FILE       
                                       BY  BOLKCOM


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

                                      A BILL FOR

  1 An Act providing an income tax credit for purchasing new fuel
  2    economy vehicles and including effective and retroactive
  3    applicability date provisions.
  4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
  5 TLSB 2277SS 81
  6 mg/gg/14

PAG LIN



  1  1    Section 1.  NEW SECTION.  422.11I  FUEL ECONOMY TAX CREDIT.
  1  2    1.  The taxes imposed under this division, less the credits
  1  3 allowed under sections 422.12 and 422.12B, shall be reduced by
  1  4 a fuel economy tax credit equal to five hundred dollars for
  1  5 the purchase by the taxpayer of each new motor vehicle which
  1  6 has attached a fuel economy label, as required by the United
  1  7 States environmental protection agency, listing the fuel
  1  8 economy rating for city driving of at least thirty miles per
  1  9 gallon.  For purposes of this section, "new motor vehicle"
  1 10 means a motor vehicle as defined in section 321.1 which has
  1 11 never before been sold at retail.
  1 12    2.  Any credit in excess of the tax liability shall be
  1 13 refunded.  In lieu of claiming a refund, a taxpayer may elect
  1 14 to have the overpayment shown on the taxpayer's final,
  1 15 completed return credited to the tax liability for the
  1 16 following taxable year.
  1 17    3.  An individual may claim a fuel economy tax credit
  1 18 allowed a partnership, limited liability company, S
  1 19 corporation, estate, or trust electing to have the income
  1 20 taxed directly to the individual.  The amount claimed by the
  1 21 individual shall be based upon the pro rata share of the
  1 22 individual's earnings of the partnership, limited liability
  1 23 company, S corporation, estate, or trust.
  1 24    Sec. 2.  Section 422.33, Code 2005, is amended by adding
  1 25 the following new subsection:
  1 26    NEW SUBSECTION.  15.  a.  The taxes imposed under this
  1 27 division shall be reduced by a fuel economy tax credit equal
  1 28 to five hundred dollars for the purchase by the taxpayer of
  1 29 each new motor vehicle which has attached a fuel economy
  1 30 label, as required by the United States environmental
  1 31 protection agency, listing the fuel economy rating for city
  1 32 driving of at least thirty miles per gallon.  For purposes of
  1 33 this subsection, "new motor vehicle" means a motor vehicle as
  1 34 defined in section 321.1 which has never before been sold at
  1 35 retail.
  2  1    b.  Any credit in excess of the tax liability shall be
  2  2 refunded.  In lieu of claiming a refund, a taxpayer may elect
  2  3 to have the overpayment shown on the taxpayer's final,
  2  4 completed return credited to the tax liability for the
  2  5 following taxable year.
  2  6    Sec. 3.  EFFECTIVE AND APPLICABILITY DATE.  This Act, being
  2  7 deemed of immediate importance, takes effect upon enactment
  2  8 and applies retroactively to January 1, 2005, for tax years
  2  9 beginning on or after that date.
  2 10                           EXPLANATION
  2 11    This bill provides a refundable $500 individual and
  2 12 corporate income tax credit for each new motor vehicle
  2 13 purchased by the taxpayer which has listed on the required
  2 14 fuel economy label attached to the motor vehicle a fuel
  2 15 economy rating of 30 miles per gallons or more for city
  2 16 driving.
  2 17    The bill takes effect upon enactment and applies
  2 18 retroactively to January 1, 2005, for tax years beginning on
  2 19 or after that date.
  2 20 LSB 2277SS 81
  2 21 mg:rj/gg/14