H.F. 2224 Section 1. Section 422.21, subsection 1, Code 2011, is 1 amended to read as follows: 2 1. Returns shall be in the form the director prescribes, 3 and shall be filed with the department on or before the last 4 day of the fourth month after the expiration of the tax year. 5 However, cooperative associations as defined in section 6072(d) 6 of the Internal Revenue Code shall file their returns on or 7 before the fifteenth day of the ninth month following the 8 close of the taxable year and nonprofit corporations subject 9 to the unrelated business income tax imposed by section 10 422.33, subsection 1A 1B , shall file their returns on or before 11 the fifteenth day of the fifth month following the close of 12 the taxable year. If, under the Internal Revenue Code, a 13 corporation is required to file a return covering a tax period 14 of less than twelve months, the state return shall be for the 15 same period and is due forty-five days after the due date of 16 the federal tax return, excluding any extension of time to 17 file. In case of sickness, absence, or other disability, or 18 if good cause exists, the director may allow further time for 19 filing returns. The director shall cause to be prepared blank 20 forms for the returns and shall cause them to be distributed 21 throughout the state and to be furnished upon application, 22 but failure to receive or secure the form does not relieve 23 the taxpayer from the obligation of making a return that is 24 required. The department may as far as consistent with the 25 Code draft income tax forms to conform to the income tax 26 forms of the internal revenue department of the United States 27 government. Each return by a taxpayer upon whom a tax is 28 imposed by section 422.5 shall show the county of the residence 29 of the taxpayer. 30 Sec. 2. Section 422.33, subsection 1, unnumbered paragraph 31 1, Code Supplement 2011, is amended to read as follows: 32 A tax is imposed annually upon each corporation doing 33 business in this state, or deriving income from sources within 34 this state, in an the amount of one hundred fifty dollars on 35 -1- LSB 5328YH (2) 84 mm/sc 1/ 4

H.F. 2224 net income equal to or less than one million dollars. 1 1A. A tax is imposed annually upon each corporation doing 2 business in this state, or deriving income from sources within 3 this state, in an amount computed by applying the following 4 rates of taxation to the net income exceeding one million 5 dollars received by the corporation during the income year: 6 Sec. 3. Section 422.33, subsection 1A, Code Supplement 7 2011, is amended to read as follows: 8 1A. 1B. There is imposed upon each corporation exempt 9 from the general business tax on corporations by section 10 422.34, subsection 2 , a tax on the amounts and at the rates in 11 subsection subsections 1 and 1A upon the state’s apportioned 12 share computed in accordance with subsections 2 and 3 of the 13 unrelated business income computed in accordance with the 14 Internal Revenue Code and with the adjustments set forth in 15 section 422.35 . 16 Sec. 4. Section 422.33, subsection 4, unnumbered paragraph 17 1, Code Supplement 2011, is amended to read as follows: 18 In addition to all taxes imposed under this division , there 19 is imposed upon each corporation doing business within the 20 state the greater of the tax determined in subsection 1 1A , 21 paragraphs “a” through “d” or the state alternative minimum tax 22 equal to sixty percent of the maximum state corporate income 23 tax rate, rounded to the nearest one-tenth of one percent, of 24 the state alternative minimum taxable income of the taxpayer 25 computed under this subsection . 26 Sec. 5. Section 422.33, subsection 4, Code Supplement 2011, 27 is amended by adding the following new paragraph: 28 NEW PARAGRAPH . 0a. Subtract an exemption amount of one 29 million dollars. However, in the event this exemption amount 30 would reduce the state alternative minimum taxable income to 31 below zero dollars, then the exemption shall be reduced to that 32 amount which would result in allowing the taxpayer to retain a 33 state alternative minimum taxable income of zero dollars. 34 Sec. 6. Section 422.33, subsection 7, Code Supplement 2011, 35 -2- LSB 5328YH (2) 84 mm/sc 2/ 4

H.F. 2224 is amended to read as follows: 1 7. a. There is allowed as a credit against the tax 2 determined in subsection 1 1A for a tax year an amount equal to 3 the minimum tax credit for that tax year. 4 The minimum tax credit for a tax year is the excess, 5 if any, of the net minimum tax imposed for all prior tax 6 years beginning on or after January 1, 1987, over the amount 7 allowable as a credit under this subsection for those prior tax 8 years. 9 b. The allowable credit under paragraph “a” for a tax year 10 shall not exceed the excess, if any, of the tax determined 11 in subsection 1 1A over the state alternative minimum tax as 12 determined in subsection 4 . 13 The net minimum tax for a tax year is the excess, if any, of 14 the tax determined in subsection 4 for the tax year over the 15 tax determined in subsection 1 1A for the tax year. 16 Sec. 7. Section 441.21, subsection 11, Code Supplement 17 2011, is amended to read as follows: 18 11. Beginning with valuations established on or after 19 January 1, 1995, as used in this section , “residential 20 property” includes all land and buildings of multiple housing 21 cooperatives organized under chapter 499A and includes land 22 and buildings used primarily for human habitation which land 23 and buildings are owned and operated by organizations that 24 have received tax-exempt status under section 501(c)(3) of the 25 Internal Revenue Code and rental income from the property is 26 not taxed as unrelated business income under section 422.33, 27 subsection 1A 1B . 28 Sec. 8. EFFECTIVE UPON ENACTMENT. This Act, being deemed of 29 immediate importance, takes effect upon enactment. 30 Sec. 9. RETROACTIVE APPLICABILITY. This Act applies 31 retroactively to January 1, 2012, for tax years beginning on 32 or after that date. 33 EXPLANATION 34 This bill relates to the state corporate income tax by 35 -3- LSB 5328YH (2) 84 mm/sc 3/ 4

H.F. 2224 creating a flat tax of $150 on the net income or unrelated 1 business income of a corporation equal to or less than $1 2 million. The net income or unrelated business income of a 3 corporation exceeding $1 million remains subject to the state 4 corporate income tax at the rates established under current 5 law. 6 The bill amends the state alternative minimum tax and 7 the minimum tax credit for corporations to provide that they 8 will only be applicable to amounts of net income exceeding $1 9 million. 10 The bill takes effect upon enactment and applies 11 retroactively to January 1, 2012, for tax years beginning on 12 or after that date. 13 -4- LSB 5328YH (2) 84 mm/sc 4/ 4