Bill Text: IA HF334 | 2017-2018 | 87th General Assembly | Introduced

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Bill Title: A bill for an act providing a deduction from the individual income tax for the amount of interest paid on a qualified education loan and including retroactive applicability provisions.

Spectrum: Moderate Partisan Bill (Republican 18-3)

Status: (Introduced - Dead) 2018-02-08 - Subcommittee recommends passage. [HF334 Detail]

Download: Iowa-2017-HF334-Introduced.html

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House File 334 - Introduced




                                 HOUSE FILE       
                                 BY  R. TAYLOR, KAUFMANN,
                                     CARLIN, BALTIMORE,
                                     HIGHFILL, MOORE,
                                     WHEELER, DOLECHECK,
                                     HOLT, GUSTAFSON,
                                     McKEAN, BACON, COWNIE,
                                     WILLS, LANDON, OURTH,
                                     FORBES, JONES,
                                     BROWN=POWERS, KOESTER,
                                     and HINSON

                                      A BILL FOR

  1 An Act providing a deduction from the individual income tax for
  2    the amount of interest paid on a qualified education loan
  3    and including retroactive applicability provisions.
  4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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PAG LIN



  1  1    Section 1.  Section 422.7, Code 2017, is amended by adding
  1  2 the following new subsection:
  1  3    NEW SUBSECTION.  18.  Subtract, to the extent not already
  1  4 excluded, the amount of interest paid by the taxpayer during
  1  5 the tax year on a qualified education loan, as defined in
  1  6 section 221 of the Internal Revenue Code.
  1  7    Sec. 2.  RETROACTIVE APPLICABILITY.  This Act applies
  1  8 retroactively to January 1, 2017, for tax years beginning on
  1  9 or after that date.
  1 10                           EXPLANATION
  1 11 The inclusion of this explanation does not constitute agreement with
  1 12 the explanation's substance by the members of the general assembly.
  1 13    This bill relates to the deduction of student loan interest
  1 14 for purposes of the individual income tax.
  1 15    Under current law for federal income tax purposes and Iowa
  1 16 income tax purposes, an individual is allowed to deduct up to
  1 17 $2,500 of interest paid on a qualified education loan (section
  1 18 221 of the Internal Revenue Code).  However, this deduction is
  1 19 gradually phased out for individuals with income in excess of
  1 20 $65,000 ($135,000 for a married couple filing a joint return),
  1 21 and is completely phased out for individuals with income of
  1 22 $80,000 or more ($165,000 for a married couple filing a joint
  1 23 return). These income phase=out levels are adjusted for
  1 24 inflation each year according to federal law.
  1 25    The bill allows an individual to deduct, for Iowa income tax
  1 26 purposes, the total amount of interest paid during the tax year
  1 27 on a qualified education loan.
  1 28    The bill applies retroactively to tax years beginning on or
  1 29 after January 1, 2017.
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