Bill Text: IA HF2454 | 2013-2014 | 85th General Assembly | Amended

Iowa House Bill 2454 (Prior Session Legislation)

NOTE: There are more recent revisions of this legislation. Read Latest Draft

Bill Title: A bill for an act relating to the beginning farmer tax credit program, including the agricultural assets transfer tax credit and the custom farming contract tax credit, by extending the carryforward period, and including effective date and retroactive applicability provisions. Divisions I, II, and VI effective 5-23-14, Divisions III and VII effective 1-1-15, and Divisions IV and V effective 1-1-18.

Spectrum: Committee Bill

Status: (Passed) 2014-05-23 - Signed by Governor. H.J. 897. [HF2454 Detail]

Download: Iowa-2013-HF2454-Amended.html

House File 2454 - Reprinted HOUSE FILE 2454 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO HF 2401) (SUCCESSOR TO HF 2006) (As Amended and Passed by the House April 1, 2014 ) A BILL FOR An Act relating to the beginning farmer tax credit program, 1 including the agricultural assets transfer tax credit 2 and the custom farming contract tax credit, by extending 3 the carryforward period, and including effective date and 4 retroactive applicability provisions. 5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 6 HF 2454 (2) 85 da/rj/md

H.F. 2454 DIVISION I 1 PAST VERSIONS OF THE AGRICULTURAL ASSETS TRANSFER TAX CREDIT 2 Section 1. APPLICABILITY OF CARRYFORWARD PROVISIONS. 3 1. This section shall apply, notwithstanding any of the 4 following: 5 a. The five-year carryforward period during which a 6 taxpayer may claim a tax credit in excess of the taxpayer’s 7 liability as provided in section 175.37, as enacted in 2006 8 Iowa Acts, chapter 1161, including any subsequent amendments to 9 that section. 10 b. The directive to strike future amendments to section 11 175.37, as provided in 2013 Iowa Acts, chapter 125, section 25, 12 subsection 3. 13 c. The repeal of section 175.37 as provided in 2014 Iowa 14 Acts, Senate File 2328, section 112, if enacted. 15 2. For any tax year commencing in calendar years 2008 16 through 2012, a tax credit that could have been first issued, 17 awarded, or allowed and claimed under section 175.37, as that 18 section applied when the tax credit could have been first 19 claimed, and which is in excess of the taxpayer’s liability, 20 may be credited to the tax liability of that taxpayer for ten 21 tax years following the tax year for which the taxpayer could 22 have first claimed the tax credit, or until depleted, whichever 23 is earlier. 24 3. The carryforward provisions of this section shall 25 continue to be effective until no longer applicable, including 26 by application to tax years beginning on or after January 1, 27 2018. 28 Sec. 2. EFFECTIVE UPON ENACTMENT. This division of this 29 Act, being deemed of immediate importance, takes effect upon 30 enactment. 31 Sec. 3. RETROACTIVE APPLICABILITY. This division of this 32 Act applies retroactively to January 1, 2008, for tax years 33 beginning on or after that date. 34 DIVISION II 35 -1- HF 2454 (2) 85 da/rj/md 1/ 7

H.F. 2454 CURRENT VERSION OF THE AGRICULTURAL ASSETS TRANSFER TAX CREDIT 1 Sec. 4. Section 175.37, subsection 6, Code 2014, is amended 2 to read as follows: 3 6. A tax credit in excess of the taxpayer’s liability for 4 the tax year may be credited to the tax liability for the 5 following five ten tax years or until depleted, whichever is 6 earlier. A tax credit shall not be carried back to a tax year 7 prior to the tax year in which the taxpayer redeems the tax 8 credit. A tax credit shall not be transferable to any other 9 person other than the taxpayer’s estate or trust upon the 10 taxpayer’s death. 11 Sec. 5. APPLICABILITY OF CARRYFORWARD PROVISIONS. 12 1. This section shall apply, notwithstanding any of the 13 following: 14 a. The five-year carryforward period during which a 15 taxpayer may claim a tax credit in excess of the taxpayer’s 16 liability as provided in section 175.37, subsection 7, Code 17 2013. 18 b. The directive to strike future amendments to section 19 175.37, as provided in 2013 Iowa Acts, chapter 125, section 25, 20 subsection 3. 21 c. The repeal of section 175.37 as provided in 2014 Iowa 22 Acts, Senate File 2328, section 112, if enacted. 23 2. For any tax year commencing in calendar year 2013 or 24 2014, a tax credit that could have been or could be first 25 issued, awarded, or allowed and claimed under section 175.37, 26 as that section applies when the tax credit could have been or 27 is first claimed, and in excess of the taxpayer’s liability, 28 may be credited to the tax liability of that taxpayer for ten 29 tax years following the tax year for which the taxpayer could 30 have first claimed or could first claim the tax credit, or 31 until depleted, whichever is earlier. 32 3. a. For any tax year commencing in calendar years 2015 33 through 2017, a tax credit that is first issued, awarded, or 34 allowed and claimed under section 175.37, as that section 35 -2- HF 2454 (2) 85 da/rj/md 2/ 7

H.F. 2454 applies when the tax credit is first claimed, and in excess of 1 the taxpayer’s liability, may be credited to the tax liability 2 of that taxpayer for ten tax years following the tax year that 3 the taxpayer first claims the tax credit, or until depleted, 4 whichever is earlier. 5 b. Paragraph “a” does not apply if 2014 Iowa Acts, Senate 6 File 2328, is enacted. 7 4. The carryforward provisions of this section shall 8 continue to be effective until no longer applicable, including 9 by application to tax years beginning on or after January 1, 10 2018. 11 Sec. 6. EFFECTIVE UPON ENACTMENT. This division of this 12 Act, being deemed of immediate importance, takes effect upon 13 enactment. 14 Sec. 7. RETROACTIVE APPLICABILITY. This division of this 15 Act applies retroactively to January 1, 2013, for tax years 16 beginning on or after that date. 17 DIVISION III 18 CONDITIONAL FUTURE VERSION OF THE AGRICULTURAL ASSETS TRANSFER 19 TAX CREDIT —— 2015 CODE 20 Sec. 8. Section 16.80, subsection 6, if enacted in 2014 21 Iowa Acts, Senate File 2328, section 60, is amended to read as 22 follows: 23 6. A tax credit in excess of the taxpayer’s liability for 24 the tax year may be credited to the tax liability for the 25 following five ten tax years or until depleted, whichever is 26 earlier. A tax credit shall not be carried back to a tax year 27 prior to the tax year in which the taxpayer redeems the tax 28 credit. A tax credit shall not be transferable to any other 29 person other than the taxpayer’s estate or trust upon the 30 taxpayer’s death. 31 Sec. 9. APPLICABILITY OF CARRYFORWARD PROVISIONS. 32 1. This section shall apply, notwithstanding the amendment 33 to section 16.80 as provided in 2014 Iowa Acts, Senate File 34 2328, section 122, if enacted. 35 -3- HF 2454 (2) 85 da/rj/md 3/ 7

H.F. 2454 2. For any tax year commencing in calendar years 2015 1 through 2017, a tax credit that is first issued, awarded, 2 or allowed and claimed under section 16.80, as that section 3 applies when the tax credit is first claimed, and in excess of 4 the taxpayer’s liability, may be credited to the tax liability 5 of that taxpayer for ten tax years following the tax year that 6 the taxpayer first claims the tax credit, or until depleted, 7 whichever is earlier. 8 3. The carryforward provisions of this section shall 9 continue to be effective until no longer applicable, including 10 by application to tax years beginning on or after January 1, 11 2018. 12 Sec. 10. EFFECTIVE DATE —— CONDITION. This division of 13 this Act takes effect January 1, 2015, only if 2014 Iowa Acts, 14 Senate File 2328 is enacted. 15 DIVISION IV 16 FIRST CONDITIONAL FUTURE VERSION OF THE AGRICULTURAL ASSETS 17 TRANSFER TAX CREDIT —— 2018 CODE 18 Sec. 11. APPLICABILITY OF CARRYFORWARD PROVISIONS. Upon 19 the repeal of amendments to section 175.37, as enacted in 2013 20 Iowa Acts, chapter 125, section 25, the following shall apply: 21 Section 175.37, subsection 7, Code 2013, is amended by striking 22 the words “five years” and inserting in lieu thereof the words 23 “ten tax years”. 24 Sec. 12. EFFECTIVE DATE —— CONDITION. This division of 25 this Act takes effect January 1, 2018, only if 2014 Iowa Acts, 26 Senate File 2328, is not enacted. 27 Sec. 13. APPLICABILITY. This division of this Act applies 28 to tax years beginning on and after January 1, 2018. 29 DIVISION V 30 SECOND CONDITIONAL FUTURE VERSION OF THE AGRICULTURAL ASSETS 31 TRANSFER TAX CREDIT —— 2018 CODE 32 Sec. 14. Section 16.80, subsection 7, as amended by 2014 33 Iowa Acts, Senate File 2328, section 122, if enacted, is 34 amended to read as follows: 35 -4- HF 2454 (2) 85 da/rj/md 4/ 7

H.F. 2454 7. A tax credit in excess of the taxpayer’s liability for 1 the tax year may be credited to the tax liability for the 2 following five ten tax years or until depleted, whichever is 3 earlier. A tax credit shall not be carried back to a tax year 4 prior to the tax year in which the taxpayer redeems the tax 5 credit. A tax credit shall not be transferable to any other 6 person other than the taxpayer’s estate or trust upon the 7 taxpayer’s death. 8 Sec. 15. EFFECTIVE DATE —— CONDITION. This division of 9 this Act takes effect January 1, 2018, only if 2014 Iowa Acts, 10 Senate File 2328, is enacted. 11 Sec. 16. APPLICABILITY. This division of this Act applies 12 to tax years beginning on or after January 1, 2018. 13 DIVISION VI 14 CURRENT VERSION OF THE CUSTOM CONTRACT TAX CREDIT 15 Sec. 17. Section 175.38, subsection 9, Code 2014, is amended 16 to read as follows: 17 9. A custom farming contract tax credit in excess of the 18 taxpayer’s liability for the tax year may be credited to the 19 tax liability for the following five ten tax years or until 20 depleted, whichever is earlier. A tax credit shall not be 21 carried back to a tax year prior to the tax year in which the 22 taxpayer redeems the tax credit. A tax credit shall not be 23 transferable to any other person other than the taxpayer’s 24 estate or trust upon the taxpayer’s death. 25 Sec. 18. APPLICABILITY OF CARRYFORWARD PROVISIONS. 26 1. This section shall apply, notwithstanding any of the 27 following: 28 a. The five-year carryforward period during which a 29 taxpayer may claim a tax credit in excess of the taxpayer’s 30 liability as provided in section 175.38, subsection 9, Code 31 2014. 32 b. The repeal of section 175.38, as provided in 2013 Iowa 33 Acts, chapter 125, section 25, subsection 2. 34 c. The directive to strike future amendments to section 35 -5- HF 2454 (2) 85 da/rj/md 5/ 7

H.F. 2454 175.38, as provided in 2013 Iowa Acts, chapter 125, section 25, 1 subsection 3. 2 d. The repeal of section 175.38, as provided in 2014 Iowa 3 Acts, Senate File 2328, section 112, if enacted. 4 2. For any tax year commencing in calendar year 2013 or 5 2014, a tax credit that could have been or could be first 6 issued, awarded, or allowed and claimed under section 175.38, 7 as that section applies when the tax credit could have been 8 or could be first claimed, and in excess of the taxpayer’s 9 liability, may be credited to the tax liability of that 10 taxpayer for ten tax years following the tax year for which the 11 taxpayer first claimed or could first claim the tax credit, or 12 until depleted, whichever is earlier. 13 3. a. For any tax year commencing in calendar years 2015 14 through 2017, a tax credit that is first issued, awarded, or 15 allowed and claimed under section 175.38, as that section 16 applies when the tax credit is first claimed, and in excess of 17 the taxpayer’s liability, may be credited to the tax liability 18 of that taxpayer for ten tax years following the tax year 19 for which the taxpayer first claims the tax credit, or until 20 depleted, whichever is earlier. 21 b. Paragraph “a” does not apply if 2014 Iowa Acts, Senate 22 File 2328, is enacted. 23 4. The carryforward provisions of this section shall 24 continue to be effective until no longer applicable, including 25 by application to tax years beginning on or after January 1, 26 2018. 27 Sec. 19. EFFECTIVE UPON ENACTMENT. This division of this 28 Act, being deemed of immediate importance, takes effect upon 29 enactment. 30 Sec. 20. RETROACTIVE APPLICABILITY. This division of this 31 Act applies retroactively to January 1, 2013, for tax years 32 beginning on or after that date. 33 DIVISION VII 34 CONDITIONAL FUTURE VERSION OF THE CUSTOM CONTRACT TAX 35 -6- HF 2454 (2) 85 da/rj/md 6/ 7

H.F. 2454 CREDIT —— 2015 CODE 1 Sec. 21. Section 16.81, subsection 9, if enacted in 2014 2 Iowa Acts, Senate File 2328, section 61, is amended to read as 3 follows: 4 9. A custom farming contract tax credit in excess of the 5 taxpayer’s liability for the tax year may be credited to the 6 tax liability for the following five ten tax years or until 7 depleted, whichever is earlier. A tax credit shall not be 8 carried back to a tax year prior to the tax year in which the 9 taxpayer redeems the tax credit. A tax credit shall not be 10 transferable to any other person other than the taxpayer’s 11 estate or trust upon the taxpayer’s death. 12 Sec. 22. APPLICABILITY OF CARRYFORWARD PROVISIONS. 13 1. This section shall apply, notwithstanding the repeal of 14 section 16.81 as provided in 2014 Iowa Acts, Senate File 2328, 15 section 120, if enacted. 16 2. For any tax year commencing in calendar years 2015 17 through 2017, a tax credit that is first issued, awarded, 18 or allowed and claimed under section 16.81, as that section 19 applies when the tax credit is first claimed, and in excess of 20 the taxpayer’s liability, may be credited to the tax liability 21 of that taxpayer for ten tax years following the tax year 22 for which the taxpayer first claims the tax credit, or until 23 depleted, whichever is earlier. 24 3. The carryforward provisions of this section shall 25 continue to be effective until no longer applicable, including 26 by application to tax years beginning on or after January 1, 27 2018. 28 Sec. 23. EFFECTIVE DATE —— CONDITION. This division of 29 this Act takes effect January 1, 2015, only if 2014 Iowa Acts, 30 Senate File 2328, is enacted. 31 Sec. 24. APPLICABILITY. This division of this Act applies 32 to tax years beginning on and after January 1, 2015. 33 -7- HF 2454 (2) 85 da/rj/md 7/ 7