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House File 45 - IntroducedA Bill ForAn Act 1excluding from the computation of net income for state
2individual income tax purposes a portion of the net capital
3gain from sales or exchanges of assets, and including
4effective date and retroactive applicability provisions.
5BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 422.7, Code 2021, is amended by adding
2the following new subsection:
3 NEW SUBSECTION. 21A. a. Subtract, to the extent included,
4fifty percent of the net capital gain from the sale or exchange
5of an asset if the asset was held for more than two years.
6b. As used in this subsection:
7(1) “Held” shall be determined with reference to the holding
8period provisions of section 1223 of the Internal Revenue Code
9and the federal regulations adopted pursuant thereto.
10(2) “Net capital gain” means the same as defined in section
111222 of the Internal Revenue Code.
12c. An asset that is the subject of the net capital gain
13deduction under this subsection is not eligible for a net
14capital gain deduction under subsection 21.
15 Sec. 2. EFFECTIVE DATE. This Act, being deemed of immediate
16importance, takes effect upon enactment.
17 Sec. 3. RETROACTIVE APPLICABILITY. This Act applies
18retroactively to January 1, 2021, for tax years beginning on
19or after that date.
20EXPLANATION
21The inclusion of this explanation does not constitute agreement with
22the explanation’s substance by the members of the general assembly.
23This bill excludes 50 percent of the net capital gain from
24the computation of net income for state individual income tax
25purposes if the asset was held for more than two years.
26The term “net capital gain” is defined to mean the same as
27defined in section 1222 of the Internal Revenue Code, and the
28term “held” shall be determined with reference to the holding
29period provisions of section 1223 of the Internal Revenue Code.
30The bill takes effect upon enactment and applies
31retroactively to tax years beginning on or after January 1,
322021.
-1-jm/jh
2individual income tax purposes a portion of the net capital
3gain from sales or exchanges of assets, and including
4effective date and retroactive applicability provisions.
5BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 422.7, Code 2021, is amended by adding
2the following new subsection:
3 NEW SUBSECTION. 21A. a. Subtract, to the extent included,
4fifty percent of the net capital gain from the sale or exchange
5of an asset if the asset was held for more than two years.
6b. As used in this subsection:
7(1) “Held” shall be determined with reference to the holding
8period provisions of section 1223 of the Internal Revenue Code
9and the federal regulations adopted pursuant thereto.
10(2) “Net capital gain” means the same as defined in section
111222 of the Internal Revenue Code.
12c. An asset that is the subject of the net capital gain
13deduction under this subsection is not eligible for a net
14capital gain deduction under subsection 21.
15 Sec. 2. EFFECTIVE DATE. This Act, being deemed of immediate
16importance, takes effect upon enactment.
17 Sec. 3. RETROACTIVE APPLICABILITY. This Act applies
18retroactively to January 1, 2021, for tax years beginning on
19or after that date.
20EXPLANATION
21The inclusion of this explanation does not constitute agreement with
22the explanation’s substance by the members of the general assembly.
23This bill excludes 50 percent of the net capital gain from
24the computation of net income for state individual income tax
25purposes if the asset was held for more than two years.
26The term “net capital gain” is defined to mean the same as
27defined in section 1222 of the Internal Revenue Code, and the
28term “held” shall be determined with reference to the holding
29period provisions of section 1223 of the Internal Revenue Code.
30The bill takes effect upon enactment and applies
31retroactively to tax years beginning on or after January 1,
322021.
-1-jm/jh