House File 2017 - Introduced HOUSE FILE 2017 BY INGELS A BILL FOR An Act creating a state work opportunity tax credit available 1 against the individual and corporate income taxes, and 2 including retroactive applicability provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 5223YH (3) 91 jm/jh

H.F. 2017 Section 1. NEW SECTION . 422.12R Work opportunity tax 1 credit. 2 1. The taxes imposed under this subchapter less the credits 3 allowed under section 422.12 shall be reduced by a work 4 opportunity tax credit for tax years beginning on or after 5 January 1, 2026, that is equal to one hundred percent of the 6 federal work opportunity tax credit provided in section 51 of 7 the Internal Revenue Code. 8 2. Any credit in excess of tax liability is not refundable 9 but the excess for the tax year may be credited to the tax 10 liability for the following tax year. 11 Sec. 2. Section 422.33, Code 2026, is amended by adding the 12 following new subsection: 13 NEW SUBSECTION . 4. a. The taxes imposed under this 14 subchapter shall be reduced by a work opportunity tax credit 15 for tax years beginning on or after January 1, 2026, that is 16 equal to one hundred percent of the federal work opportunity 17 tax credit provided in section 51 of the Internal Revenue Code. 18 b. The taxpayer may claim the credit pursuant to this 19 subsection according to the same requirements, conditions, and 20 limitations as provided pursuant to section 422.12R. 21 Sec. 3. RETROACTIVE APPLICABILITY. This Act applies 22 retroactively to January 1, 2026, for tax years beginning on 23 or after that date. 24 EXPLANATION 25 The inclusion of this explanation does not constitute agreement with 26 the explanation’s substance by the members of the general assembly. 27 This bill creates a state work opportunity tax credit 28 available against the individual and corporate income taxes. 29 The bill reduces individual or corporate income taxes, as 30 applicable, by a work opportunity tax credit that is equal to 31 100 percent of the federal work opportunity tax credit provided 32 in section 51 of the Internal Revenue Code. 33 The federal work opportunity tax credit is a credit based 34 upon a percentage of wages paid by employers to persons who may 35 -1- LSB 5223YH (3) 91 jm/jh 1/ 2

H.F. 2017 face barriers to entering the workforce. 1 The tax credit is not refundable but the excess for the tax 2 year may be credited to the tax liability for the following 3 year. 4 The bill applies retroactively to tax years beginning on or 5 after January 1, 2026. 6 -2- LSB 5223YH (3) 91 jm/jh 2/ 2