HF 463 (LSB 2144YH (3) 89)

HOUSE FILE 463

BY  WHEELER

A BILL FOR

An Act creating a private investigator tax credit available against the individual income tax, and including effective date and retroactive applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  NEW SECTION.  422.12O  Private investigator tax credit.
   1.  As used in this section:
   a.  “Cold case” means an investigative case involving a missing family member after the initial investigation into the disappearance of the missing family member by a law enforcement agency has been completed and the family member is still missing, or the family member was reported missing to a law enforcement agency and the family member is still missing after ninety days, whichever is earlier.
   b.  “Family member” means a spouse, son, daughter, brother, sister, uncle, aunt, first cousin, nephew, niece, father-in-law, mother-in-law, son-in-law, daughter-in-law, brother-in-law, sister-in-law, father, mother, stepfather, stepmother, stepson, stepdaughter, stepbrother, stepsister, half brother, or half sister.
   c.  “Private investigator” means a licensee under chapter 80A other than a bail enforcement business. “Private investigator” includes an employee of a licensee under chapter 80A other than an employee of a bail enforcement business, who has the same qualifications of the licensee as required by section 80A.4, subsection 3.
   2.  The taxes imposed under this subchapter, less the credits imposed under section 422.12, shall be reduced by a private investigator tax credit equal to twenty-five percent of the first one thousand dollars paid by the taxpayer to a private investigator to investigate a cold case which has been reported to a law enforcement agency within the previous twelve months. 
   3.  A credit in excess of the tax liability is not refundable but the excess of the tax liability for the tax year may be credited to the tax liability for the following five years or until depleted, whichever occurs first.
   4.  A taxpayer is eligible to claim the credit one time per cold case up to the maximum credit value allowed pursuant to this section.
   5.  Married taxpayers electing to file separate returns or filing separately on a combined return may avail themselves of the private investigator tax credit by allocating the private investigator tax credit to each spouse in proportion that each spouse’s respective earned income bears to the total combined earned income.
    Sec. 2.  EFFECTIVE DATE.  This Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 3.  RETROACTIVE APPLICABILITY.  This Act applies retroactively to January 1, 2021, for tax years beginning on or after that date.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill creates a private investigator tax credit available against the individual income tax.
   The bill defines “private investigator” to mean a licensee or an employee of a licensee under Code chapter 80A other than a bail enforcement business.
   The amount of the credit shall equal 25 percent of the first $1,000 of the investigation fees paid by the taxpayer to a private investigator to investigate a cold case which has been reported to a law enforcement agency within the previous 12 months. A taxpayer is eligible to claim the credit one time per cold case up to the maximum credit allowed under the bill.
   The bill defines “cold case” to mean an investigative case involving a missing family member after the initial investigation into the disappearance of the missing family member by a law enforcement agency has been completed, or the family member was reported missing to a law enforcement agency and the family member is still missing after 90 days, whichever is earlier.
   The bill takes effect upon enactment and applies retroactively to January 1, 2021, for tax years beginning on or after that date.