Senate File 2401 - Introduced
SENATE FILE
BY COMMITTEE ON WAYS AND
MEANS
(SUCCESSOR TO SSB 3276)
Passed Senate, Date Passed House, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act relating to the carryforward of unused investment tax
2 credits under the high quality job creation and enterprise
3 zone programs and including effective and applicability date
4 provisions.
5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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PAG LIN
1 1 Section 1. Section 15.333, subsection 1, unnumbered
1 2 paragraph 1, Code Supplement 2007, is amended to read as
1 3 follows:
1 4 An eligible business may claim a tax credit equal to a
1 5 percentage of the new investment directly related to new jobs
1 6 created by the location or expansion of an eligible business
1 7 under the program. The tax credit shall be amortized equally
1 8 over five calendar years. The tax credit shall be allowed
1 9 against taxes imposed under chapter 422, division II, III, or
1 10 V, and against the moneys and credits tax imposed in section
1 11 533.329. If the business is a partnership, S corporation,
1 12 limited liability company, cooperative organized under chapter
1 13 501 and filing as a partnership for federal tax purposes, or
1 14 estate or trust electing to have the income taxed directly to
1 15 the individual, an individual may claim the tax credit
1 16 allowed. The amount claimed by the individual shall be based
1 17 upon the pro rata share of the individual's earnings of the
1 18 partnership, S corporation, limited liability company,
1 19 cooperative organized under chapter 501 and filing as a
1 20 partnership for federal tax purposes, or estate or trust. The
1 21 percentage shall be determined as provided in section 15.335A.
1 22 Any tax credit in excess of the tax liability for the tax year
1 23 may be credited to the tax liability for the following seven
1 24 five years or until depleted, whichever occurs first.
1 25 Sec. 2. Section 15.333A, subsection 1, Code 2007, is
1 26 amended to read as follows:
1 27 1. An eligible business may claim an insurance premium tax
1 28 credit equal to a percentage of the new investment directly
1 29 related to new jobs created by the location or expansion of an
1 30 eligible business under the program. The tax credit shall be
1 31 amortized equally over a five=year period. The tax credit
1 32 shall be allowed against taxes imposed in chapter 432. A tax
1 33 credit in excess of the tax liability for the tax year may be
1 34 credited to the tax liability for the following seven five
1 35 years or until depleted, whichever occurs first. The
2 1 percentage shall be determined as provided in section 15.335A.
2 2 Sec. 3. Section 15E.193B, subsection 6, paragraph a, Code
2 3 2007, is amended to read as follows:
2 4 a. An eligible housing business may claim a tax credit up
2 5 to a maximum of ten percent of the new investment which is
2 6 directly related to the building or rehabilitating of a
2 7 minimum of four single=family homes located in that part of a
2 8 city or county in which there is a designated enterprise zone
2 9 or one multiple dwelling unit building containing three or
2 10 more individual dwelling units located in that part of a city
2 11 or county in which there is a designated enterprise zone. The
2 12 new investment that may be used to compute the tax credit
2 13 shall not exceed the new investment used for the first one
2 14 hundred forty thousand dollars of value for each single=family
2 15 home or for each unit of a multiple dwelling unit building
2 16 containing three or more units. The tax credit may be used to
2 17 reduce the tax liability imposed under chapter 422, division
2 18 II, III, or V, or chapter 432. Any credit in excess of the
2 19 tax liability for the tax year may be credited to the tax
2 20 liability for the following seven five years or until
2 21 depleted, whichever occurs earlier. If the business is a
2 22 partnership, S corporation, limited liability company, or
2 23 estate or trust electing to have the income taxed directly to
2 24 the individual, an individual may claim the tax credit
2 25 allowed. The amount claimed by the individual shall be based
2 26 upon the pro rata share of the individual's earnings of the
2 27 partnership, S corporation, limited liability company, or
2 28 estate or trust except as allowed for under subsection 8 when
2 29 low=income housing tax credits authorized under section 42 of
2 30 the Internal Revenue Code are used to assist in the financing
2 31 of the housing development.
2 32 Sec. 4. EFFECTIVE AND APPLICABILITY DATE. This Act takes
2 33 effect January 1, 2009, for contracts entered into on or after
2 34 that date.
2 35 EXPLANATION
3 1 Under the high quality job creation program and the
3 2 enterprise zone program, eligible businesses may receive an
3 3 investment tax credit to offset their individual or corporate
3 4 income tax, franchise tax, or insurance premiums tax. If the
3 5 tax credit is in excess of the tax liability, the business may
3 6 carry the excess forward for up to seven tax years. This bill
3 7 limits the carryforward to up to five tax years.
3 8 The bill takes effect January 1, 2009, for contracts
3 9 entered into on or after that date.
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