House Study Bill 309 HOUSE FILE BY (PROPOSED COMMITTEE ON WAYS AND MEANS BILL BY CHAIRPERSON SHOMSHOR) Passed House, Date Passed Senate, Date Vote: Ayes Nays Vote: Ayes Nays Approved A BILL FOR 1 An Act providing a biodiesel blended fuel tax credit for 2 consumers, and providing effective and applicability dates. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 2898HC 82 5 da/es/88 PAG LIN 1 1 Section 1. NEW SECTION. 422.11T BIODIESEL BLENDED FUEL 1 2 TAX CREDIT FOR CONSUMERS. 1 3 1. As used in this section, unless the context otherwise 1 4 requires: 1 5 a. "Biodiesel blended fuel" and "retail dealer" mean the 1 6 same as defined in section 214A.1. 1 7 b. "Purchase" means to purchase on a retail basis. 1 8 c. "Tax credit" means a biodiesel blended fuel tax credit 1 9 for consumers as provided in this section. 1 10 2. The taxes imposed under this division, less the credits 1 11 allowed under sections 422.12 and 422.12B, shall be reduced by 1 12 the amount of the biodiesel blended fuel tax credit for 1 13 consumers for each tax year that the taxpayer is eligible to 1 14 claim a tax credit under this subsection. 1 15 a. In order to be eligible, all of the following must 1 16 apply: 1 17 (1) The taxpayer is a consumer who purchases biodiesel 1 18 blended fuel from a retail dealer in the tax year in which the 1 19 tax credit is claimed. 1 20 (2) The consumer does not resell the biodiesel blended 1 21 fuel. 1 22 (3) The consumer complies with requirements of the 1 23 department established to administer this section. 1 24 b. The tax credit shall apply to biodiesel blended fuel 1 25 formulated with a minimum percentage of two percent by volume 1 26 of biodiesel, if the formulation meets the standards provided 1 27 in section 214A.2. 1 28 3. The amount of the tax credit is seven cents multiplied 1 29 by the total number of gallons of biodiesel blended fuel 1 30 purchased by the consumer during the consumer's tax year. 1 31 4. Any credit in excess of the consumer's tax liability 1 32 shall be refunded. In lieu of claiming a refund, the consumer 1 33 may elect to have the overpayment shown on the consumer's 1 34 final, completed return credited to the tax liability for the 1 35 following tax year. 2 1 5. An individual may claim the tax credit allowed a 2 2 partnership, limited liability company, S corporation, estate, 2 3 or trust electing to have the income taxed directly to the 2 4 individual. The amount claimed by the individual shall be 2 5 based upon the pro rata share of the individual's earnings of 2 6 the partnership, limited liability company, S corporation, 2 7 estate, or trust. 2 8 Sec. 2. Section 422.33, Code 2007, is amended by adding 2 9 the following new subsection: 2 10 NEW SUBSECTION. 11D. The taxes imposed under this 2 11 division shall be reduced by a biodiesel blended fuel tax 2 12 credit for consumers for each tax year that the taxpayer is 2 13 eligible to claim the tax credit under this subsection. 2 14 a. The taxpayer may claim the biodiesel blended fuel tax 2 15 for consumers credit according to the same requirements, for 2 16 the same amount, and calculated in the same manner, as 2 17 provided for the biodiesel blended fuel tax credit for 2 18 consumers pursuant to section 422.11T. 2 19 b. Any biodiesel blended fuel tax credit for consumers 2 20 which is in excess of the taxpayer's tax liability shall be 2 21 refunded or may be shown on the taxpayer's final, completed 2 22 return credited to the tax liability for the following tax 2 23 year in the same manner as provided in section 422.11T. 2 24 Sec. 3. EFFECTIVE AND APPLICABILITY DATES. This Act takes 2 25 effect January 1, 2008, and applies to tax years beginning on 2 26 or after that date. 2 27 EXPLANATION 2 28 This bill provides a refundabale income tax credit which 2 29 may be claimed by consumers of biodiesel blended fuel, 2 30 including for individual and corporate tax filers. The amount 2 31 of the tax credit is seven cents multiplied by the total 2 32 number of gallons purchased during the consumer's tax year. 2 33 The bill takes effect January 1, 2008, and applies to tax 2 34 years beginning on or after that date. 2 35 LSB 2898HC 82 3 1 da:rj/es/88