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Senate File 121 - IntroducedA Bill ForAn Act 1excluding from the computation of net income for
2purposes of the individual income tax the unreimbursed cost
3of prescribed drugs or insulin of certain taxpayers at
4least sixty-five years of age, and including applicability
5provisions.
6BE 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. 29A. Subtract the unreimbursed cost of
4prescribed drugs or insulin of a taxpayer who is at least
5sixty-five years old on December 31. If a deduction is taken
6under this subsection, the unreimbursed cost of the drugs
7or insulin shall not be considered medical care expenses
8under section 213 of the Internal Revenue Code for state tax
9purposes.
10 Sec. 2. APPLICABILITY. This Act applies January 1, 2022, to
11prescribed drugs or insulin purchased after that date.
12 Sec. 3. APPLICABILITY. This Act applies to tax years
13beginning on or after January 1, 2022.
14EXPLANATION
15The inclusion of this explanation does not constitute agreement with
16the explanation’s substance by the members of the general assembly.
17This bill excludes from the computation of net income for
18purposes of the individual income tax the unreimbursed cost of
19prescribed drugs or insulin of a taxpayer who is at least 65
20years of age.
21Under current law, any taxpayer may deduct from net income
22unreimbursed costs of prescribed drugs or insulin as an
23itemized deduction for state tax purposes, to the extent the
24taxpayer’s total medical and dental expenses exceed 10 percent
25of federal adjusted gross income.
26Under the bill, a taxpayer who is at least 65 years of age
27on December 31 of any tax year beginning on or after January 1,
282022, may exclude from the computation of net income the cost
29of unreimbursed prescription drugs or insulin, if the taxpayer
30excludes any cost of unreimbursed prescription drugs or insulin
31from the medical care expense deduction under section 213 of
32the Internal Revenue Code for state tax purposes.
33The bill applies to tax years beginning on or after January
341, 2022, for prescribed drugs or insulin purchased on or after
35that date.
-1-jm/jh
2purposes of the individual income tax the unreimbursed cost
3of prescribed drugs or insulin of certain taxpayers at
4least sixty-five years of age, and including applicability
5provisions.
6BE 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. 29A. Subtract the unreimbursed cost of
4prescribed drugs or insulin of a taxpayer who is at least
5sixty-five years old on December 31. If a deduction is taken
6under this subsection, the unreimbursed cost of the drugs
7or insulin shall not be considered medical care expenses
8under section 213 of the Internal Revenue Code for state tax
9purposes.
10 Sec. 2. APPLICABILITY. This Act applies January 1, 2022, to
11prescribed drugs or insulin purchased after that date.
12 Sec. 3. APPLICABILITY. This Act applies to tax years
13beginning on or after January 1, 2022.
14EXPLANATION
15The inclusion of this explanation does not constitute agreement with
16the explanation’s substance by the members of the general assembly.
17This bill excludes from the computation of net income for
18purposes of the individual income tax the unreimbursed cost of
19prescribed drugs or insulin of a taxpayer who is at least 65
20years of age.
21Under current law, any taxpayer may deduct from net income
22unreimbursed costs of prescribed drugs or insulin as an
23itemized deduction for state tax purposes, to the extent the
24taxpayer’s total medical and dental expenses exceed 10 percent
25of federal adjusted gross income.
26Under the bill, a taxpayer who is at least 65 years of age
27on December 31 of any tax year beginning on or after January 1,
282022, may exclude from the computation of net income the cost
29of unreimbursed prescription drugs or insulin, if the taxpayer
30excludes any cost of unreimbursed prescription drugs or insulin
31from the medical care expense deduction under section 213 of
32the Internal Revenue Code for state tax purposes.
33The bill applies to tax years beginning on or after January
341, 2022, for prescribed drugs or insulin purchased on or after
35that date.
-1-jm/jh