House
File
2092
-
Introduced
HOUSE
FILE
2092
BY
COMMITTEE
ON
WAYS
AND
MEANS
(SUCCESSOR
TO
HSB
535)
A
BILL
FOR
An
Act
temporarily
updating
the
Code
references
to
the
Internal
1
Revenue
Code
and
decoupling
from
certain
federal
bonus
2
depreciation
provisions,
and
including
effective
date
and
3
retroactive
applicability
provisions.
4
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
5
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2092
Section
1.
INTERNAL
REVENUE
CODE
REFERENCES
FOR
1
2015.
Notwithstanding
the
definition
of
“Internal
Revenue
2
Code”
in
section
15.335,
subsection
7,
section
422.3,
3
subsection
5,
section
422.10,
subsection
3,
section
422.32,
4
subsection
1,
and
section
422.33,
subsection
5,
Code
2016,
5
the
following
shall
apply
for
the
period
beginning
January
1,
6
2015,
and
ending
December
31,
2015,
and
for
tax
years
beginning
7
during
the
2015
calendar
year:
8
1.
The
definition
of
“Internal
Revenue
Code”
for
purposes
9
of
section
15.335,
subsection
7,
section
422.10,
subsection
3,
10
and
section
422.33,
subsection
5,
Code
2016,
and
for
purposes
11
of
references
in
the
2016
Iowa
Code
and
2016
Iowa
Acts
to
the
12
definition
of
“Internal
Revenue
Code”
in
those
sections,
shall
13
mean
the
Internal
Revenue
Code
in
effect
on
January
1,
2016.
14
2.
The
definition
of
“Internal
Revenue
Code”
for
purposes
15
of
sections
422.3
and
422.32,
Code
2016,
and
for
purposes
of
16
references
in
the
2016
Iowa
Code
and
2016
Iowa
Acts
to
the
17
definition
of
“Internal
Revenue
Code”
in
those
sections,
shall
18
mean
the
Internal
Revenue
Code
of
1954,
prior
to
the
date
of
19
its
redesignation
as
the
Internal
Revenue
Code
of
1986
by
the
20
Tax
Reform
Act
of
1986,
or
means
the
Internal
Revenue
Code
of
21
1986
as
amended
to
and
including
January
1,
2016.
22
Sec.
2.
DEDUCTION
FOR
STATE
SALES
AND
USE
TAX
FOR
23
2015.
Notwithstanding
section
422.9,
subsection
2,
paragraph
24
“i”,
Code
2016,
the
deduction
for
state
sales
and
use
taxes
is
25
allowable
under
section
422.9
for
tax
years
beginning
during
26
the
2015
calendar
year,
but
only
if
the
taxpayer
elected
to
27
deduct
the
state
sales
and
use
taxes
in
lieu
of
state
income
28
taxes
under
section
164
of
the
Internal
Revenue
Code.
The
29
deduction
for
state
sales
and
use
taxes
is
not
allowed
if
the
30
taxpayer
has
taken
the
deduction
for
state
income
taxes
or
31
claimed
the
standard
deduction
under
section
63
of
the
Internal
32
Revenue
Code.
33
Sec.
3.
BONUS
DEPRECIATION
FOR
2015.
Notwithstanding
34
section
1
of
this
Act,
or
any
other
provision
of
law
to
the
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2092
contrary,
the
additional
first-year
depreciation
allowance
1
authorized
in
section
168(k)
of
the
Internal
Revenue
Code,
2
as
enacted
by
Pub.
L.
No.
114-113,
§143,
does
not
apply
in
3
computing
net
income
for
state
tax
purposes
for
tax
years
4
ending
on
or
after
January
1,
2015,
but
before
January
1,
5
2016.
If
the
taxpayer
has
taken
the
additional
first-year
6
depreciation
allowance
for
purposes
of
computing
federal
7
adjusted
gross
income
or
federal
taxable
income,
as
the
case
8
may
be,
then
the
taxpayer,
when
computing
net
income
for
9
purposes
of
the
individual
income
tax
under
section
422.7
or
10
the
corporation
income
tax
or
franchise
tax
under
section
11
422.35,
shall
make
the
adjustments
described
in
section
422.7,
12
subsection
39A,
paragraphs
“a”
through
“c”,
Code
2016,
or
13
described
in
section
422.35,
subsection
19A,
paragraphs
“a”
14
through
“c”,
Code
2016,
as
applicable.
15
Sec.
4.
EFFECTIVE
UPON
ENACTMENT.
This
Act,
being
deemed
of
16
immediate
importance,
takes
effect
upon
enactment.
17
Sec.
5.
RETROACTIVE
APPLICABILITY.
This
Act
applies
18
retroactively
to
January
1,
2015.
19
EXPLANATION
20
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
21
the
explanation’s
substance
by
the
members
of
the
general
assembly.
22
This
bill
updates
for
2015
the
Iowa
Code
references
to
the
23
Internal
Revenue
Code
to
make
federal
income
tax
revisions
24
enacted
by
Congress
in
2015
applicable
for
a
certain
period
of
25
time,
to
allow
the
deduction
for
state
sales
and
use
tax,
and
26
to
decouple
with
certain
bonus
depreciation
provisions.
27
INTERNAL
REVENUE
CODE
REFERENCES.
The
bill
provides
that
28
notwithstanding
several
Code
provisions
as
specified
in
the
29
bill,
the
definitions
of
“Internal
Revenue
Code”
in
those
Code
30
provisions
and,
by
internal
reference,
in
other
sections
of
the
31
Iowa
Code
and
Iowa
Acts
shall
mean
the
Internal
Revenue
Code
32
in
effect
on,
or
as
amended
to
and
including,
January
1,
2016.
33
This
definition
change
applies
only
to
the
period
beginning
34
January
1,
2015,
and
ending
December
31,
2015,
and
for
tax
35
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2092
years
beginning
during
the
2015
calendar
year.
1
The
affected
Code
provisions
include
Code
sections
422.3
2
and
422.32,
general
definition
sections
in
the
chapter
of
the
3
Code
that
governs
corporate
and
individual
income
tax
and
the
4
franchise
tax,
and
Code
sections
15.335,
422.10,
and
422.33,
5
which
contain
references
to
the
Internal
Revenue
Code
for
the
6
state
research
activities
credit
for
individuals,
corporations,
7
and
corporations
in
economic
development
areas.
8
Code
section
422.9
provides
individuals
a
deduction
from
9
net
income
for
state
sales
and
use
taxes
if
the
individual
10
chose
to
deduct
sales
and
use
tax
in
lieu
of
state
income
taxes
11
or
the
standard
deduction
for
federal
income
tax
purposes.
12
This
deduction
was
set
to
expire
under
both
federal
and
Iowa
13
law
for
tax
years
beginning
on
or
after
January
1,
2015.
The
14
federal
Protecting
Americans
from
Tax
Hikes
Act
of
2015
made
15
the
federal
deduction
permanent.
The
bill
allows
the
Iowa
16
deduction
for
tax
years
beginning
during
the
2015
calendar
17
year.
18
BONUS
DEPRECIATION.
The
bill
decouples,
for
Iowa
income
tax
19
purposes
for
tax
years
ending
on
or
after
January
1,
2015,
but
20
before
January
1,
2016,
from
the
federal
additional
first-year
21
depreciation
allowance
in
section
168(k)
of
the
Internal
22
Revenue
Code
(bonus
depreciation)
which
was
modified
and
23
extended
through
2019
by
the
federal
Protecting
Americans
from
24
Tax
Hikes
Act
of
2015.
Taxpayers
who
claim
bonus
depreciation
25
for
federal
tax
purposes
are,
for
the
applicable
tax
year,
26
required
to
add
such
depreciation
amounts
back
to
Iowa
net
27
income,
but
are
then
allowed
under
existing
state
law
to
deduct
28
the
amount
of
depreciation
that
would
otherwise
be
allowable
29
under
federal
law,
without
regard
to
the
bonus
depreciation
30
allowance.
31
The
bill
takes
effect
upon
enactment
and
applies
32
retroactively
to
January
1,
2015.
33
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