H.F. 2374 DIVISION I 1 FUTURE REPEAL OF EXISTING TAX CREDITS 2 Section 1. NEW SECTION . 15.293C Future repeal. 3 Sections 15.293A and 15.293B are repealed on January 1, 4 2024. 5 Sec. 2. Section 15.322, Code 2018, is amended to read as 6 follows: 7 15.322 Future repeal. 8 Section 15.315 , 15.316 , 15.317 , 15.318 , 15.319 , 15.320 , 9 15.321 , and this section , are repealed July 1, 2030 January 1, 10 2024 . 11 Sec. 3. NEW SECTION . 15.337 Future repeal. 12 Sections 15.331A, 15.331C, 15.333, 15.333A, and 15.335, are 13 repealed January 1, 2024. 14 Sec. 4. Section 15A.7, Code 2018, is amended by adding the 15 following new subsection: 16 NEW SUBSECTION . 5. This section is repealed on January 1, 17 2024. 18 Sec. 5. NEW SECTION . 15E.47 Future repeal. 19 Sections 15E.41, 15E.42, 15E.43, 15E.44, 15E.46, and this 20 section are repealed January 1, 2024. 21 Sec. 6. Section 15E.52, Code 2018, is amended by adding the 22 following new subsection: 23 NEW SUBSECTION . 14. This section is repealed on January 1, 24 2024. 25 Sec. 7. Section 16.80, Code 2018, is amended by adding the 26 following new subsection: 27 NEW SUBSECTION . 11. This section is repealed on January 1, 28 2024. 29 Sec. 8. Section 260E.5, Code 2018, is amended by adding the 30 following new subsection: 31 NEW SUBSECTION . 7. This section is repealed on January 1, 32 2024. 33 Sec. 9. Section 260G.4A, Code 2018, is amended by adding the 34 following new subsection: 35 -1- LSB 5538YH (4) 87 mm/jh 1/ 7

H.F. 2374 NEW SUBSECTION . 7. This section is repealed on January 1, 1 2024. 2 Sec. 10. Section 403.19A, Code 2018, is amended by adding 3 the following new subsection: 4 NEW SUBSECTION . 4. This section is repealed on January 1, 5 2024. 6 Sec. 11. Section 422.10, Code 2018, is amended by adding the 7 following new subsection: 8 NEW SUBSECTION . 7. This section is repealed on January 1, 9 2024. 10 Sec. 12. Section 422.10A, Code 2018, is amended by adding 11 the following new subsection: 12 NEW SUBSECTION . 7. This section is repealed on January 1, 13 2024. 14 Sec. 13. Section 422.10B, Code 2018, is amended to read as 15 follows: 16 422.10B Renewable chemical production tax credit. 17 The taxes imposed under this division, less the credits 18 allowed under section 422.12 , shall be reduced by a renewable 19 chemical production tax credit allowed under section 15.319 . 20 This section is repealed January 1, 2033 2024 . 21 Sec. 14. Section 422.11I, Code 2018, is amended to read as 22 follows: 23 422.11I Geothermal heat pump tax credit. 24 1. The taxes imposed under this division, less the credits 25 allowed under section 422.12 , shall be reduced by a geothermal 26 heat pump tax credit equal to twenty percent of the federal 27 residential energy efficient property tax credit allowed for 28 geothermal heat pumps provided in section 25D(a)(5) of the 29 Internal Revenue Code for residential property located in Iowa. 30 Any credit in excess of the tax liability is not refundable 31 but the excess for the tax year may be credited to the tax 32 liability for the following ten years or until depleted, 33 whichever is earlier. 34 2. The director of revenue shall adopt rules to implement 35 -2- LSB 5538YH (4) 87 mm/jh 2/ 7

H.F. 2374 this section . 1 3. This section is repealed on January 1, 2024. 2 Sec. 15. Section 422.11L, Code 2018, is amended by adding 3 the following new subsection: 4 NEW SUBSECTION . 7. This section is repealed on January 1, 5 2024. 6 Sec. 16. Section 422.11O, subsection 8, Code 2018, is 7 amended to read as follows: 8 8. This section is repealed on January 1, 2025 2024 . 9 Sec. 17. Section 422.11P, subsection 8, Code 2018, is 10 amended to read as follows: 11 8. This section is repealed January 1, 2025 2024 . 12 Sec. 18. Section 422.11S, Code 2018, is amended by adding 13 the following new subsection: 14 NEW SUBSECTION . 10. This section is repealed on January 1, 15 2024. 16 Sec. 19. Section 422.11W, Code 2018, is amended by adding 17 the following new subsection: 18 NEW SUBSECTION . 5. This section is repealed on January 1, 19 2024. 20 Sec. 20. Section 422.11Y, subsection 9, Code 2018, is 21 amended to read as follows: 22 9. This section is repealed on January 1, 2025 2024 . 23 Sec. 21. Section 422.33, subsection 5, Code 2018, is amended 24 by adding the following new paragraph: 25 NEW PARAGRAPH . i. This subsection is repealed on January 26 1, 2024. 27 Sec. 22. Section 422.33, subsection 9, Code 2018, is amended 28 by adding the following new paragraph: 29 NEW PARAGRAPH . d. This subsection is repealed on January 30 1, 2024. 31 Sec. 23. Section 422.33, subsection 25, Code 2018, is 32 amended by adding the following new paragraph: 33 NEW PARAGRAPH . d. This subsection is repealed on January 34 1, 2024. 35 -3- LSB 5538YH (4) 87 mm/jh 3/ 7

H.F. 2374 Sec. 24. NEW SECTION . 476B.11 Future repeal. 1 This chapter is repealed effective January 1, 2024. 2 Sec. 25. NEW SECTION . 476C.8 Future repeal. 3 This chapter is repealed effective January 1, 2024. 4 Sec. 26. PRESERVATION OF EXISTING RIGHTS. 5 1. This division of this Act is not intended to and shall 6 not limit, modify, or otherwise adversely affect any amount 7 of tax credit issued, awarded, or allowed prior to January 1, 8 2024, nor shall it limit, modify, or otherwise adversely affect 9 a taxpayer’s right to claim or redeem a tax credit issued, 10 awarded, or allowed prior to January 1, 2024, including but not 11 limited to any tax credit carryforward amount. 12 2. The repeal of a provision of law pursuant to this 13 division of this Act shall not constitute grounds for 14 rescission or modification of agreements entered into under 15 those provisions of law, if any. Any agreement entered into 16 prior to January 1, 2024, under a provision of law repealed 17 in this division of this Act, shall remain in effect until 18 it expires under its own terms, and shall be governed by the 19 applicable provisions of law as they existed immediately prior 20 to January 1, 2024. 21 Sec. 27. CORRESPONDING AMENDMENTS LEGISLATION. Additional 22 legislation is required to fully implement this division of 23 this Act. The director of the department of revenue shall, in 24 compliance with section 2.16, prepare draft legislation for 25 submission to the legislative services agency, as necessary, to 26 implement the repeal of the tax credits under this division of 27 this Act and under other provisions of law. 28 DIVISION II 29 FUTURE REPEAL OF FUTURE TAX CREDIT PROGRAMS 30 Sec. 28. NEW SECTION . 422.3A Future tax credit repeal. 31 1. For purposes of this section, “tax credit program” means 32 any provision of law enacted by the general assembly that 33 provides for an amount of money against the taxes imposed in 34 this chapter, chapter 432, or in section 533.329. 35 -4- LSB 5538YH (4) 87 mm/jh 4/ 7

H.F. 2374 2. Notwithstanding any other provision of law to the 1 contrary, any tax credit program enacted by the general 2 assembly that takes effect on or after January 1, 2019, is 3 repealed on January 1 of the sixth year following the effective 4 date of the tax credit program, unless another provision of the 5 Code provides for an earlier repeal date. 6 3. The repeal of a tax credit program pursuant to subsection 7 2 is not intended to and shall not limit, modify, or otherwise 8 adversely affect any amount of tax credit issued, awarded, or 9 allowed prior to the effective date of the tax credit program 10 repeal pursuant to subsection 2, nor shall it limit, modify, 11 or otherwise adversely affect a taxpayer’s right to claim or 12 redeem a tax credit issued, awarded, or allowed prior to the 13 effective date of the tax credit program repeal pursuant to 14 subsection 2, including but not limited to any tax credit 15 carryforward amount. 16 4. The repeal of a tax credit program pursuant to subsection 17 2 shall not constitute grounds for rescission or modification 18 of agreements entered into under the tax credit program, if 19 any. Any agreement entered into under a tax credit program 20 prior to the effective date of the repeal of the tax credit 21 program under subsection 2 shall remain in effect until it 22 expires under its own terms, and shall be governed by the tax 23 credit program as it existed prior to its repeal pursuant to 24 subsection 2. 25 EXPLANATION 26 The inclusion of this explanation does not constitute agreement with 27 the explanation’s substance by the members of the general assembly. 28 This bill provides for the future repeal of certain existing 29 state income tax credits, and provides for the future repeal of 30 tax credits enacted by the general assembly in the future. 31 DIVISION I —— FUTURE REPEAL OF EXISTING TAX CREDITS. 32 Division I repeals on January 1, 2024, the following tax 33 credits that currently have no repeal date: the accelerated 34 career education program job tax credit; the agricultural 35 -5- LSB 5538YH (4) 87 mm/jh 5/ 7

H.F. 2374 assets transfer tax credit; the assistive device corporate tax 1 credit; the sales and use tax refund, corporate tax credit for 2 certain sales taxes paid by third-party developers, investment 3 tax credit, insurance premiums tax credit, and supplemental 4 research activities tax credit available under the high quality 5 jobs program; the redevelopment tax credits; the school tuition 6 organization tax credit; the solar energy system tax credit; 7 the innovation fund investment tax credit; the tax credit 8 for investments in a qualifying business; the wind energy 9 production tax credit; the charitable conservation contribution 10 tax credit; the geothermal heat pump tax credit; the geothermal 11 tax credit; the new jobs credits from withholding available 12 under the Iowa industrial new job training program; the 13 research activities credits; the renewable energy tax credit; 14 and the targeted jobs withholding tax credit. 15 The bill amends the repeal date of the renewable chemical 16 production tax credit from July 1, 2030, to January 1, 2024. 17 The bill amends the repeal date of the biodiesel blended fuel 18 tax credit, the E-85 gasoline promotion tax credit, and the 19 E-15 plus gasoline promotion tax credit from January 1, 2025, 20 to January 1, 2024. 21 The bill provides that the repeal of a tax credit shall 22 not affect tax credits issued, awarded, or allowed prior to 23 January 1, 2024, or affect a taxpayer’s ability to claim or 24 redeem such tax credits, including but not limited to any tax 25 credit carryforward amount, and further provides that the bill 26 shall not constitute grounds for rescission or modification 27 of agreements entered into for a tax credit, and that such 28 agreements shall remain in effect until they expire under their 29 own terms and shall be governed by the applicable provisions of 30 law as they existed immediately prior to January 1, 2024. 31 The bill provides that additional legislation is required to 32 fully implement the repeal of these tax credits and requires 33 the director of the department of revenue to prepare draft 34 legislation in compliance with Code section 2.16 for submission 35 -6- LSB 5538YH (4) 87 mm/jh 6/ 7

H.F. 2374 to the legislative services agency to implement the repeal of 1 the tax credits. 2 DIVISION II —— FUTURE REPEAL OF FUTURE TAX CREDIT PROGRAMS. 3 Division II provides that any tax credit program available 4 against the individual or corporate income tax, the franchise 5 tax, the insurance premiums tax, or the moneys and credits tax, 6 enacted by the general assembly on or after January 1, 2019, 7 is repealed after five years, unless another provision of law 8 provides for an earlier repeal date. 9 The bill provides that the repeal of a tax credit program 10 pursuant to this provision shall not affect the tax credits or 11 tax credit agreements entered into prior to the repeal of the 12 tax credit program in the same manner as described above for 13 the repeal of the existing tax credits. 14 -7- LSB 5538YH (4) 87 mm/jh 7/ 7