Text: HF262            Text: HF264
Complete Bill History


House File 263

HOUSE FILE BY PAULSEN Passed House, Date Passed Senate, Date Vote: Ayes Nays Vote: Ayes Nays Approved A BILL FOR 1 An Act relating to disaster recovery by providing individual 2 income tax credits for costs incurred in housing construction 3 and including effective and retroactive applicability date 4 provisions. 5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 6 TLSB 1033YH 83 7 tw/sc/5 PAG LIN 1 1 Section 1. NEW SECTION. 16.191 DISASTER RECOVERY HOUSING 1 2 CONSTRUCTION PROJECT TAX CREDIT. 1 3 1. a. A tax credit shall be allowed against the taxes 1 4 imposed in chapter 422, division II, for a portion of a 1 5 taxpayer's payment of construction costs incurred in the 1 6 construction of a disaster recovery housing construction 1 7 project. To qualify as a disaster recovery housing 1 8 construction project, a property, and the activities affecting 1 9 the property, shall meet all of the following conditions: 1 10 (1) The property is owned by a taxpayer who is an 1 11 individual or business subject to taxation under chapter 422, 1 12 division II. 1 13 (2) At least one housing unit constructed between July 1, 1 14 2008, and June 30, 2009, is located on the property. 1 15 (3) The cost of each housing unit constructed on the 1 16 property is not more than one hundred twenty thousand dollars. 1 17 (4) The property is located in an area declared a disaster 1 18 area by the governor or by a federal official. 1 19 b. An individual may claim a tax credit under this 1 20 subsection of a partnership, limited liability company, S 1 21 corporation, estate, or trust electing to have income taxed 1 22 directly to the individual. The amount claimed by the 1 23 individual shall be based upon the pro rata share of the 1 24 individual's earnings from the partnership, limited liability 1 25 company, S corporation, estate, or trust. 1 26 c. Any tax credit in excess of the taxpayer's liability 1 27 for the tax year is not refundable, but the taxpayer may elect 1 28 to have the excess credited to the tax liability for the 1 29 following five years or until depleted, whichever is earlier. 1 30 A tax credit shall not be carried back to a tax year prior to 1 31 the tax year in which the taxpayer first receives the tax 1 32 credit. 1 33 2. a. To claim a disaster recovery housing construction 1 34 tax credit under this section, a taxpayer must attach one or 1 35 more tax credit certificates to the taxpayer's tax return. 2 1 The tax credit certificate or certificates attached to the 2 2 taxpayer's tax return shall be issued in the taxpayer's name, 2 3 expire on or after the last day of the taxable year for which 2 4 the taxpayer is claiming the tax credit, and show a tax credit 2 5 amount equal to or greater than the tax credit claimed on the 2 6 taxpayer's tax return. 2 7 b. After verifying the eligibility of a taxpayer for a tax 2 8 credit pursuant to this section, the authority shall issue a 2 9 disaster recovery housing construction tax credit certificate 2 10 to be attached to the taxpayer's tax return. The tax credit 2 11 certificate shall contain the taxpayer's name, address, tax 2 12 identification number, the amount of the credit, and any other 2 13 information required by the department of revenue. 2 14 c. The tax credit certificate, unless otherwise void, 2 15 shall be accepted by the department of revenue as payment for 2 16 taxes imposed pursuant to chapter 422, division II, subject to 2 17 any conditions or restrictions placed by the authority upon 2 18 the face of the tax credit certificate and subject to the 2 19 limitations of this section. 2 20 d. Tax credit certificates issued under this section are 2 21 not transferable to any person or entity. 2 22 3. The tax credit shall be in an amount equal to the costs 2 23 incurred by the taxpayer which are directly related to a 2 24 disaster recovery housing construction project. However, the 2 25 amount of the tax credit shall not exceed two thousand 2 26 dollars. 2 27 4. For purposes of the individual income tax, the increase 2 28 in the basis of the property that would otherwise result from 2 29 the disaster recovery housing construction costs shall be 2 30 reduced by the amount of the tax credit allowed under this 2 31 part. 2 32 5. The maximum amount of tax credits issued by the 2 33 authority shall not exceed twenty million dollars. 2 34 6. A payment shall be deemed to have been made on the date 2 35 the disaster recovery housing construction project is 3 1 completed. A payment made prior to July 1, 2008, or after 3 2 June 30, 2009, shall not qualify for a tax credit under this 3 3 part. 3 4 Sec. 2. NEW SECTION. 16.192 APPROVAL == REQUIREMENTS == 3 5 REPAYMENT. 3 6 1. A taxpayer seeking to claim a tax credit pursuant to 3 7 section 16.191 shall apply to the authority which shall have 3 8 the power to approve the amount of tax credit available for 3 9 each disaster recovery housing construction project. 3 10 2. A taxpayer applying for a tax credit shall provide the 3 11 authority with all of the following: 3 12 a. Information showing the total costs incurred in the 3 13 disaster recovery housing construction project. 3 14 b. Information about the financing sources that are 3 15 directly related to the disaster recovery project for which 3 16 the taxpayer is seeking approval for the tax credit. 3 17 3. If a taxpayer receives a tax credit pursuant to section 3 18 16.191, but fails to comply with any of the requirements in 3 19 this section or section 16.191, or fails to comply with local 3 20 zoning or construction ordinances, the tax credit is void, and 3 21 the department of revenue shall seek recovery of the value of 3 22 the credit received. 3 23 Sec. 3. NEW SECTION. 422.11X DISASTER RECOVERY HOUSING 3 24 CONSTRUCTION PROJECT TAX CREDIT. 3 25 The taxes imposed under this division, less the credits 3 26 allowed under section 422.12, shall be reduced by a disaster 3 27 recovery housing construction tax credit allowed under section 3 28 16.191. 3 29 Sec. 4. EFFECTIVE AND RETROACTIVE APPLICABILITY DATES. 3 30 This Act, being deemed of immediate importance, takes effect 3 31 upon enactment and applies retroactively to January 1, 2008, 3 32 for tax years beginning on or after that date. 3 33 EXPLANATION 3 34 This bill relates to disaster recovery by providing 3 35 individual income tax credits for qualified housing 4 1 construction projects. 4 2 The bill allows a qualifying taxpayer to claim a tax credit 4 3 for the costs incurred in the construction of new housing in 4 4 disaster areas. In order to claim the credit, the taxpayer 4 5 must make an investment in a qualifying disaster recovery 4 6 housing construction project. A qualifying disaster recovery 4 7 housing construction project is activity affecting a property 4 8 meeting all of the following conditions: (1) At least one 4 9 housing unit constructed between July 1, 2008, and June 30, 4 10 2009, is located on the property; (2) the property is owned by 4 11 a qualifying taxpayer; (3) the cost of each housing unit 4 12 constructed on the property is not more than $120,000; and (4) 4 13 the property is located in an area declared a disaster area by 4 14 the governor or by a federal official. 4 15 The tax credit is allowed against the individual income tax 4 16 in an amount not to exceed $2,000. The tax credit is not 4 17 refundable, but may be credited to subsequent tax liability 4 18 for five years or until depleted. The tax credits are not 4 19 transferable. The maximum amount of tax credits is limited to 4 20 $20 million. Any increase in a property's basis is reduced by 4 21 the amount of tax credits received. Investments are deemed to 4 22 have been made on the date the disaster recovery project is 4 23 completed. Investments made prior to July 1, 2008, or after 4 24 June 30, 2009, do not qualify for the tax credit. 4 25 The Iowa finance authority approves the tax credits and 4 26 issues tax credit certificates to qualifying taxpayers. A 4 27 taxpayer that does not comply with the requirements loses any 4 28 right to the credit and the department of revenue shall seek 4 29 recovery of the value of the credit received. 4 30 The bill takes effect upon enactment and applies 4 31 retroactively to January 1, 2008, for tax years beginning on 4 32 or after that date. 4 33 LSB 1033YH 83 4 34 tw/sc/5
Text: HF262            Text: HF264 Complete Bill History