HF 2511 (LSB 6029YH (3) 83)

HOUSE FILE 2511

BY  BAILEY

A BILL FOR

An Act relating to the repayment under certain circumstances of tax credits received for increasing research activities in the state and including effective date and retroactive applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  NEW SECTION.  422.10A  Repayment of tax credits.
   1.  A taxpayer meeting the conditions described in subsection 2 shall repay the amount of any tax credits received in the prior tax year under any of the following:
   a.  Section 15.335.
   b.  Section 15A.9, subsection 8.
   c.  Section 422.10.
   d.  Section 422.33, subsection 5.
   2.  A taxpayer is subject to subsection 1 if all of the following conditions exist:
   a.  The taxpayer is a business operating in the state currently and during the prior tax year.
   b.  The taxpayer has relocated more than half of the full-time equivalent positions based in this state during the prior tax year to a foreign country. For purposes of this subsection, “full-time equivalent position” means the same as defined in section 15G.101.
   3.  A taxpayer meeting the conditions of subsection 2 is ineligible to receive the tax credits described in subsection 1 for a period of three tax years beginning with the tax year in which the taxpayer was first subject to repayment.
    Sec. 2.  EFFECTIVE UPON ENACTMENT AND RETROACTIVE APPLICABILITY.  This Act, being deemed of immediate importance, takes effect upon enactment and applies retroactively to January 1, 2010, for tax years beginning on or after that date.
EXPLANATION
   This bill requires a business that has received a research activities tax credit to repay the amount of that credit if the business relocates more than half of its full-time equivalent positions to a foreign country. The bill also prohibits such a business from receiving a research activities tax credit for three tax years.
   The bill takes effect upon enactment and applies retroactively to January 1, 2010, for tax years beginning on or after that date.