Senate Study Bill 3179 - Introduced SENATE FILE _____ BY (PROPOSED COMMITTEE ON WAYS AND MEANS BILL BY CHAIRPERSON BOLKCOM) A BILL FOR An Act limiting the amount of research activities tax credit 1 that is refundable and including retroactive applicability 2 provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 5747XC (3) 83 tw/sc

S.F. _____ Section 1. Section 15.335, subsection 5, Code Supplement 1 2009, is amended to read as follows: 2 5. Any credit in excess of the tax liability for the taxable 3 year shall be refunded with interest computed under section 4 422.25. The amount of tax credit that may be refunded pursuant 5 to this subsection and section 15A.9, subsection 8, section 6 422.10, and section 422.33, subsection 5, shall not exceed 7 two hundred fifty thousand dollars per taxpayer per year. In 8 lieu of claiming a refund, a taxpayer may elect to have the 9 overpayment shown on its final, completed return credited to 10 the tax liability for the following year. 11 Sec. 2. Section 15A.9, subsection 8, paragraph d, Code 12 Supplement 2009, is amended to read as follows: 13 d. Any credit in excess of the tax liability for the tax 14 year shall be refunded with interest computed under section 15 422.25. The amount of tax credit that may be refunded pursuant 16 to this paragraph and section 15.335 shall not exceed two 17 hundred fifty thousand dollars per taxpayer per year. In lieu 18 of claiming a refund, the primary business or a supporting 19 business may elect to have the overpayment shown on its final 20 return credited to its tax liability for the following tax 21 year. 22 Sec. 3. Section 422.10, subsection 4, Code Supplement 2009, 23 is amended to read as follows: 24 4. Any credit in excess of the tax liability imposed by 25 section 422.5 less the amounts of nonrefundable credits allowed 26 under this division for the taxable year shall be refunded 27 with interest computed under section 422.25. The amount of 28 tax credit that may be refunded pursuant to this subsection 29 and section 15.335 shall not exceed two hundred fifty thousand 30 dollars per taxpayer per year. In lieu of claiming a refund, 31 a taxpayer may elect to have the overpayment shown on the 32 taxpayer’s final, completed return credited to the tax 33 liability for the following taxable year. 34 Sec. 4. Section 422.33, subsection 5, paragraph e, Code 1 -1- LSB 5747XC (3) 83 tw/sc 1/ 2

S.F. _____ Supplement 2009, is amended to read as follows: 2 e. Any credit in excess of the tax liability for the 3 taxable year shall be refunded with interest computed under 4 section 422.25. The amount of tax credit that may be refunded 5 pursuant to this paragraph and section 15.335 shall not exceed 6 two hundred fifty thousand dollars per taxpayer per year. In 7 lieu of claiming a refund, a taxpayer may elect to have the 8 overpayment shown on its final, completed return credited to 9 the tax liability for the following taxable year. 10 Sec. 5. RETROACTIVE APPLICABILITY. This Act applies 11 retroactively to January 1, 2010, for tax years beginning on 12 or after that date. 13 EXPLANATION 14 This bill limits the amount of research activities tax 15 credit that is refundable to $250,000 per taxpayer per year. 16 This limitation includes the individual and corporate research 17 activities tax credits, the supplemental research activities 18 tax credit in Code section 15.335, and the quality jobs 19 enterprise zone research activities tax credit in Code section 20 15A.9. 21 The bill applies retroactively to January 1, 2010, for tax 22 years beginning on or after that date. 23 -2- LSB 5747XC (3) 83 tw/sc 2/ 2