S.F. 238 Section 1. Section 422.7, Code 2013, is amended by adding 1 the following new subsection: 2 NEW SUBSECTION . 51. a. A taxpayer taking a depreciation 3 allowance under section 168 of the Internal Revenue Code for 4 property described in section 422.11C is not allowed to take 5 the allowance for purposes of this division to the extent that 6 a tax credit is taken for the purchase and installation of 7 the property under section 422.11C. If a credit is taken for 8 the purchase and installation of the property under section 9 422.11C, the taxpayer shall add the amount of the allowance 10 taken on such property to the extent of the amount of the 11 credit. 12 b. A taxpayer taking an expensing allowance under section 13 179 of the Internal Revenue Code for property described in 14 section 422.11C is not allowed to take the allowance for 15 purposes of this division to the extent that a tax credit 16 is taken for the purchase and installation of such property 17 under section 422.11C. If a credit is taken for the purchase 18 and installation of the property under section 422.11C, the 19 taxpayer shall add the amount of the allowance taken on such 20 property to the extent of the amount of the credit. 21 c. This subsection is repealed on January 1, 2020. 22 Sec. 2. NEW SECTION . 422.11C Electric or natural gas 23 vehicle facility tax credit. 24 1. As used in this section, “motor vehicle” means the same 25 as defined in section 322.2. 26 2. The taxes imposed under this division, less the credits 27 allowed under section 422.12, shall be reduced by an electric 28 or natural gas vehicle facility tax credit. In order to be 29 eligible to claim the tax credit, the taxpayer must comply with 30 this section and rules adopted by the department necessary to 31 administer and enforce this section. 32 3. a. The taxpayer claiming the tax credit on an 33 agricultural basis as provided in subsection 8 must construct, 34 install, and place in service any of the following: 35 -1- LSB 1595SS (5) 85 da/sc 1/ 7

S.F. 238 (1) An electric vehicle facility that serves a motor vehicle 1 designed by a manufacturer to operate using electricity. 2 (2) A natural gas vehicle facility that serves a motor 3 vehicle designed by a manufacturer to operate using compressed 4 natural gas. 5 b. The taxpayer claiming the tax credit on a commercial 6 basis as provided in subsection 8 must construct, install, and 7 place in service any of the following: 8 (1) An electric vehicle facility that serves a motor vehicle 9 designed by a manufacturer to operate using electricity. 10 (2) A natural gas vehicle facility that serves a motor 11 vehicle designed by a manufacturer to operate using compressed 12 natural gas. 13 c. The taxpayer claiming the tax credit on a residential 14 basis as provided in subsection 8 must construct, install, 15 and place in service an electric vehicle facility that serves 16 a motor vehicle designed by a manufacturer to operate using 17 electricity. 18 4. a. After verifying the eligibility for an electric or 19 natural gas vehicle facility tax credit as provided in this 20 section, the department of revenue shall issue the taxpayer an 21 electric or natural gas vehicle facility tax credit certificate 22 which must be attached to the taxpayer’s tax return. An 23 electric or natural gas vehicle facility tax credit certificate 24 shall include all of the following: 25 (1) The taxpayer’s name, address, tax identification 26 number, and any other information required by the department 27 of revenue. 28 (2) A description of the infrastructure, equipment, or 29 machinery being purchased and installed which is eligible for 30 the tax credit to be claimed on the taxpayer’s tax return. 31 (3) The amount of the tax credit being claimed. 32 b. The department shall adopt rules establishing criteria 33 for the receipt of applications for electric or natural gas 34 vehicle facility tax credit certificates and the issuance of 35 -2- LSB 1595SS (5) 85 da/sc 2/ 7

S.F. 238 those certificates. A tax credit certificate shall be issued 1 in the taxpayer’s name and shall expire on or after the last 2 day of the taxable year for which the taxpayer is claiming the 3 tax credit. A tax credit certificate is nontransferable. 4 c. The aggregate amount of electric or natural gas vehicle 5 facility tax credit certificates that may be issued pursuant 6 to this section shall not exceed five million dollars for all 7 tax years that the tax credit is available under this section. 8 The department shall issue the tax credit certificates on a 9 first-come, first-served basis to qualified applicants. 10 5. An electric or natural gas vehicle facility is limited 11 to infrastructure, equipment, or machinery used to store, 12 dispense, dry, and meter compressed natural gas or electricity. 13 For compressed natural gas, it may include pipes, compressors, 14 dryers, or vaporizers. For electricity, it may include 15 charging equipment, infrastructure, or batteries. 16 6. The amount of the electric or natural gas vehicle 17 facility tax credit equals thirty percent of the total cost to 18 the taxpayer of purchasing the infrastructure, equipment, or 19 machinery and thirty percent of the total cost to the taxpayer 20 of installing the infrastructure, equipment, or machinery. 21 7. The electric or natural gas vehicle facility must comply 22 with any applicable federal and state standards and the latest 23 applicable and available ASTM international specifications. 24 8. The electric or natural gas vehicle facility tax credit 25 may be claimed by a person on an agricultural, commercial, or 26 residential basis as follows: 27 a. A person may claim the tax credit on an agricultural 28 basis if the electric or natural gas vehicle facility is 29 located on land primarily used in the production of a crop as 30 defined in section 202.1 or livestock as defined in section 31 717.1. The electric or natural gas vehicle facility must be 32 used by an agricultural producer as defined in section 15E.202 33 or a person under the management of the agricultural producer. 34 The tax credit must be taken in equal installments in three 35 -3- LSB 1595SS (5) 85 da/sc 3/ 7

S.F. 238 consecutive tax years, beginning with the tax year in which the 1 electric or natural gas vehicle facility is placed in service. 2 If any part of the electric or natural gas vehicle facility 3 is taken out of service and not immediately replaced, the tax 4 credit expires and the taxpayer cannot take any remaining 5 installment of the tax credit. 6 b. A person may claim the tax credit on a commercial basis 7 if the electric or natural gas vehicle facility is part of a 8 business selling qualified electricity or compressed natural 9 gas on a retail basis, or may claim the tax credit if the 10 electric or natural gas vehicle facility is used by a business 11 for its own vehicle fleet or employees. The tax credit must 12 be taken in equal installments in three consecutive tax years, 13 beginning with the tax year in which the electric or natural 14 gas vehicle facility is placed in service. If any part of 15 the electric or natural gas vehicle facility is taken out of 16 service and not immediately replaced, the tax credit expires 17 and the taxpayer cannot take any remaining installment of the 18 tax credit. 19 c. A person may claim the tax credit on a residential basis 20 only for an electric vehicle facility that is for personal, 21 family, or household use. The entire amount of the tax credit 22 must be claimed in the tax year in which the electric vehicle 23 facility is first placed in service. 24 9. Any tax credit in excess of the taxpayer’s tax liability 25 shall be refunded. In lieu of claiming a refund, the taxpayer 26 may elect to have the overpayment shown on the retail dealer’s 27 final, completed return credited to the tax liability for the 28 following tax year. 29 10. An individual may claim the tax credit allowed a 30 partnership, limited liability company, S corporation, estate, 31 or trust electing to have the income taxed directly to the 32 individual. The amount claimed by the individual shall be 33 based upon the pro rata share of the individual’s earnings of 34 the partnership, limited liability company, S corporation, 35 -4- LSB 1595SS (5) 85 da/sc 4/ 7

S.F. 238 estate, or trust. 1 11. A person shall not claim a tax credit under this section 2 for an electric or natural gas vehicle facility that was placed 3 in service on or after January 1, 2016. However, a person 4 claiming the tax credit on an agricultural or commercial basis 5 who placed the electric or natural gas vehicle facility in 6 service prior to January 1, 2016, may continue to claim the tax 7 credit for tax years ending on or after January 1, 2016, as 8 provided in subsection 8, paragraph “a” . 9 12. This section is repealed on January 1, 2020. 10 Sec. 3. Section 422.33, Code 2013, is amended by adding the 11 following new subsection: 12 NEW SUBSECTION . 11. The taxes imposed under this division 13 shall be reduced by an electric or natural gas vehicle facility 14 tax credit for each tax year that the taxpayer is eligible to 15 claim the tax credit under this subsection. 16 a. The taxpayer must claim the tax credit on an agricultural 17 or commercial basis in the same manner as provided in section 18 422.11C. The taxpayer must claim the tax credit according 19 to the same requirements, for the same amount, and for the 20 same period as provided in section 422.11C. The amount of the 21 tax credit shall be calculated in the same manner as provided 22 in section 422.11C. A taxpayer claiming a tax credit on an 23 agricultural or commercial basis is subject to the same penalty 24 for taking the electric or natural gas vehicle facility out of 25 service as provided in section 422.11C. 26 b. This subsection is repealed on January 1, 2020. 27 Sec. 4. Section 422.35, Code 2013, is amended by adding the 28 following new subsection: 29 NEW SUBSECTION . 15. a. A taxpayer taking a depreciation 30 allowance under section 168 of the Internal Revenue Code for 31 property described in section 422.33, subsection 11, is not 32 allowed to take the allowance for purposes of this division 33 to the extent that a tax credit is taken for the purchase and 34 installation of the property under section 422.33, subsection 35 -5- LSB 1595SS (5) 85 da/sc 5/ 7

S.F. 238 11. If a credit is taken for the purchase and installation of 1 the property under section 422.33, subsection 11, the taxpayer 2 shall add the amount of the allowance taken on such property to 3 the extent of the amount of the credit. 4 b. A taxpayer taking an expensing allowance under section 5 179 of the Internal Revenue Code for property described in 6 section 422.33, subsection 11, is not allowed to take the 7 allowance for purposes of this division to the extent that a 8 tax credit is taken for the purchase and installation of such 9 property under section 422.33, subsection 11. If a credit 10 is taken for the purchase and installation of the property 11 under section 422.33, subsection 11, the taxpayer shall add the 12 amount of the allowance taken on such property to the extent of 13 the amount of the credit. 14 c. This subsection is repealed on January 1, 2020. 15 Sec. 5. EFFECTIVE UPON ENACTMENT. This Act, being deemed of 16 immediate importance, takes effect upon enactment. 17 Sec. 6. RETROACTIVE APPLICABILITY. This Act applies 18 retroactively to January 1, 2013, for tax years beginning on 19 or after that date. 20 EXPLANATION 21 This bill creates an electric or natural gas vehicle 22 facility tax credit for persons who construct, install, and 23 place in service an electric vehicle facility or a natural gas 24 vehicle facility. The amount of the tax credit is 30 percent 25 of the total cost of purchasing and of installing the facility. 26 A person may claim the tax credit on an agricultural (farmer), 27 commercial (business), or residential (personal, family, or 28 household) basis. A person claiming the tax credit on an 29 agricultural or commercial basis may claim the tax credit for 30 the installation of an electric or natural gas facility. The 31 person must claim one-third of the tax credit for each of three 32 tax years. A person claiming the tax credit on a residential 33 basis may claim the tax credit for the installation of an 34 electronic facility. The person must claim the tax credit in 35 -6- LSB 1595SS (5) 85 da/sc 6/ 7

S.F. 238 the tax year in which the electronic vehicle service was first 1 placed in service. Any tax credit in excess of the taxpayer’s 2 tax liability is refundable or may be used in calculating a 3 future tax liability. 4 The taxpayer must place the facility in service before 5 January 1, 2016, but those taxpayers claiming on an 6 agricultural or commercial basis may claim the tax credit for a 7 previous installation after that date. 8 The tax credit applies retroactively to tax years beginning 9 on and after January 1, 2013. The bill’s provisions are 10 repealed on January 1, 2020. The bill takes effect upon 11 enactment. 12 -7- LSB 1595SS (5) 85 da/sc 7/ 7