Bill Text: IA SF483 | 2015-2016 | 86th General Assembly | Introduced
Bill Title: A bill for an act relating to an electric or natural gas vehicle facility tax credit and including effective date and retroactive applicability provisions. (Formerly SF 143; see SF 2319.)
Spectrum: Committee Bill
Status: (Introduced - Dead) 2016-04-14 - Returned to committee. [SF483 Detail]
Download: Iowa-2015-SF483-Introduced.html
Senate File 483 - Introduced SENATE FILE BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO SF 143) A BILL FOR 1 An Act relating to an electric or natural gas vehicle facility 2 tax credit and including effective date and retroactive 3 applicability provisions. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: TLSB 1380SV (4) 86 da/sc PAG LIN 1 1 Section 1. Section 422.7, Code 2015, is amended by adding 1 2 the following new subsection: 1 3 NEW SUBSECTION. 51. a. A taxpayer taking a depreciation 1 4 allowance under section 168 of the Internal Revenue Code for 1 5 property described in section 422.11G is not allowed to take 1 6 the allowance for purposes of this division to the extent that 1 7 a tax credit is taken for the purchase and installation of 1 8 the property under section 422.11G. If a credit is taken for 1 9 the purchase and installation of the property under section 1 10 422.11G, the taxpayer shall add the amount of the allowance 1 11 taken on such property to the extent of the amount of the 1 12 credit. 1 13 b. A taxpayer taking an expensing allowance under section 1 14 179 of the Internal Revenue Code for property described in 1 15 section 422.11G is not allowed to take the allowance for 1 16 purposes of this division to the extent that a tax credit 1 17 is taken for the purchase and installation of such property 1 18 under section 422.11G. If a credit is taken for the purchase 1 19 and installation of the property under section 422.11G, the 1 20 taxpayer shall add the amount of the allowance taken on such 1 21 property to the extent of the amount of the credit. 1 22 c. This subsection is repealed on January 1, 2023. 1 23 Sec. 2. NEW SECTION. 422.11G Electric or natural gas 1 24 vehicle facility tax credit. 1 25 1. As used in this section, "motor vehicle" means the same 1 26 as defined in section 322.2. 1 27 2. The taxes imposed under this division, less the credits 1 28 allowed under section 422.12, shall be reduced by an electric 1 29 or natural gas vehicle facility tax credit. In order to be 1 30 eligible to claim the tax credit, the taxpayer must comply with 1 31 this section and rules adopted by the director pursuant to 1 32 chapter 17A necessary to administer and enforce this section. 1 33 3. a. The taxpayer claiming the tax credit on an 1 34 agricultural basis as provided in subsection 9 must purchase 1 35 and install any of the following: 2 1 (1) An electric vehicle facility that serves a motor vehicle 2 2 designed by a manufacturer to operate using electricity. 2 3 (2) A natural gas vehicle facility that serves a motor 2 4 vehicle that is any of the following: 2 5 (a) Designed by the manufacturer to operate using 2 6 compressed natural gas. 2 7 (b) Converted as an aftermarket alternative fuel vehicle 2 8 to operate using compressed natural gas if the conversion 2 9 equipment is certified by the United States environmental 2 10 protection agency, including as provided in 40 C.F.R. pt. 85. 2 11 b. The taxpayer claiming the tax credit on a commercial 2 12 basis as provided in subsection 9 must purchase and install any 2 13 of the following: 2 14 (1) An electric vehicle facility that serves a motor vehicle 2 15 designed by a manufacturer to operate using electricity. 2 16 (2) A natural gas vehicle facility that serves a motor 2 17 vehicle that is any of the following: 2 18 (a) Designed by the manufacturer to operate using 2 19 compressed natural gas. 2 20 (b) Converted as an aftermarket alternative fuel vehicle 2 21 to operate using compressed natural gas if the conversion 2 22 equipment is certified by the United States environmental 2 23 protection agency, including as provided in 40 C.F.R. pt. 85. 2 24 c. The taxpayer claiming the tax credit on a residential 2 25 basis as provided in subsection 9 must purchase and install an 2 26 electric vehicle facility that serves a motor vehicle designed 2 27 by a manufacturer to operate using electricity. 2 28 4. a. After verifying the eligibility for an electric or 2 29 natural gas vehicle facility tax credit as provided in this 2 30 section, the department of revenue shall issue the taxpayer an 2 31 electric or natural gas vehicle facility tax credit certificate 2 32 which must be attached to the taxpayer's tax return. An 2 33 electric or natural gas vehicle facility tax credit certificate 2 34 shall include all of the following: 2 35 (1) The taxpayer's name, address, tax identification 3 1 number, and any other information required by the department 3 2 of revenue. 3 3 (2) A description of the infrastructure, equipment, or 3 4 machinery being purchased and installed which is eligible for 3 5 the tax credit to be claimed on the taxpayer's tax return. 3 6 (3) The amount of the tax credit being claimed. 3 7 (4) The date that the electric or natural gas vehicle 3 8 facility was placed in service. 3 9 b. The director shall adopt rules establishing criteria 3 10 for the receipt of applications for electric or natural gas 3 11 vehicle facility tax credit certificates and the issuance of 3 12 those certificates. A tax credit certificate shall be issued 3 13 in the taxpayer's name and shall expire on or after the last 3 14 day of the taxable year for which the taxpayer is claiming the 3 15 tax credit. A tax credit certificate is nontransferable. 3 16 5. The aggregate amount of electric or natural gas vehicle 3 17 facility tax credit certificates that may be issued pursuant 3 18 to this section shall not exceed five million dollars for all 3 19 tax years that the tax credit is available under this section. 3 20 The department shall issue the tax credit certificates on a 3 21 first=come, first=served basis to qualified applicants as 3 22 follows: 3 23 a. Two million dollars for electric vehicle facilities. 3 24 b. Two million dollars for natural gas vehicle facilities. 3 25 (1) Except as provided in subparagraph (2), a person is not 3 26 entitled to apply for tax credit certificates for all natural 3 27 gas vehicle facilities equal to more than two hundred thousand 3 28 dollars. 3 29 (2) A person is not entitled to apply for tax credit 3 30 certificates equal to more than four hundred thousand dollars 3 31 for all natural gas vehicle facilities that are part of a 3 32 business or businesses selling compressed natural gas on a 3 33 retail basis. A person is not eligible to apply for a tax 3 34 credit under both this subparagraph and subparagraph (1). 3 35 c. One million dollars for either electric vehicle 4 1 facilities as provided in paragraph "a" or natural gas vehicle 4 2 facilities as provided in paragraph "b". 4 3 d. Of the aggregate amount of the tax credit unobligated 4 4 or unexpended on July 1, 2017, for either electric vehicle 4 5 facilities as provided in paragraph "a" or natural gas vehicle 4 6 facilities as provided in paragraph "b". However, paragraph 4 7 "b", subparagraph (2), is not applicable to natural gas vehicle 4 8 facilities receiving a tax credit certificate under this 4 9 paragraph "d". 4 10 6. An electric or natural gas vehicle facility is limited 4 11 to infrastructure, equipment, or machinery used to store, 4 12 dispense, dry, and meter electricity or compressed natural 4 13 gas. For electricity, it may include charging equipment, 4 14 infrastructure, or batteries. For compressed natural gas, it 4 15 may include pipes, compressors, dryers, or vaporizers. 4 16 7. The amount of the electric or natural gas vehicle 4 17 facility tax credit equals thirty percent of the total cost to 4 18 the taxpayer of purchasing the infrastructure, equipment, or 4 19 machinery and thirty percent of the total cost to the taxpayer 4 20 of installing the infrastructure, equipment, or machinery. 4 21 8. The electric or natural gas vehicle facility must comply 4 22 with any applicable federal and state standards and the latest 4 23 applicable and available ASTM international specifications. 4 24 9. The electric or natural gas vehicle facility tax credit 4 25 may be claimed by a person on an agricultural, commercial, or 4 26 residential basis as follows: 4 27 a. A person may claim the tax credit on an agricultural 4 28 basis if the electric or natural gas vehicle facility is 4 29 located on land primarily used in the production of a crop as 4 30 defined in section 202.1 or livestock as defined in section 4 31 717.1. The electric or natural gas vehicle facility must be 4 32 used by an agricultural producer as defined in section 15E.202 4 33 or a person under the management of the agricultural producer. 4 34 The tax credit must be taken in equal installments in three 4 35 consecutive tax years, beginning with the tax year in which the 5 1 electric or natural gas vehicle facility is placed in service. 5 2 If any part of the electric or natural gas vehicle facility 5 3 is taken out of service and not immediately replaced and the 5 4 facility placed back in service, the tax credit expires and 5 5 the taxpayer cannot take any remaining installment of the tax 5 6 credit. 5 7 b. A person may claim the tax credit on a commercial basis 5 8 if the electric or natural gas vehicle facility is part of a 5 9 business selling electricity or compressed natural gas on a 5 10 retail basis, or may claim the tax credit if the electric or 5 11 natural gas vehicle facility is used by a business for its own 5 12 vehicle fleet or employees. The tax credit must be taken in 5 13 equal installments in three consecutive tax years, beginning 5 14 with the tax year in which the electric or natural gas vehicle 5 15 facility is placed in service. If any part of the electric 5 16 or natural gas vehicle facility is taken out of service and 5 17 not immediately replaced and the facility placed back in 5 18 service, the tax credit expires and the taxpayer cannot take 5 19 any remaining installment of the tax credit. 5 20 c. A person may claim the tax credit on a residential basis 5 21 only for an electric vehicle facility that is for personal, 5 22 family, or household use. The entire amount of the tax credit 5 23 must be claimed in the tax year in which the electric vehicle 5 24 facility is first placed in service. 5 25 10. Any tax credit in excess of the taxpayer's tax liability 5 26 shall be refunded. In lieu of claiming a refund, the taxpayer 5 27 may elect to have the overpayment shown on the taxpayer's 5 28 final, completed return credited to the tax liability for the 5 29 following tax year. 5 30 11. An individual may claim the tax credit allowed a 5 31 partnership, limited liability company, S corporation, estate, 5 32 or trust electing to have the income taxed directly to the 5 33 individual. The amount claimed by the individual shall be 5 34 based upon the pro rata share of the individual's earnings of 5 35 the partnership, limited liability company, S corporation, 6 1 estate, or trust. 6 2 12. A person shall not claim a tax credit under this section 6 3 for an electric or natural gas vehicle facility that was placed 6 4 in service on or after January 1, 2018. However, a person 6 5 claiming the tax credit on an agricultural or commercial basis 6 6 who placed the electric or natural gas vehicle facility in 6 7 service prior to January 1, 2018, may continue to claim the tax 6 8 credit for tax years ending on or after January 1, 2018, as 6 9 provided in subsection 9. 6 10 13. This section is repealed on January 1, 2023. 6 11 Sec. 3. Section 422.33, Code 2015, is amended by adding the 6 12 following new subsection: 6 13 NEW SUBSECTION. 11. The taxes imposed under this division 6 14 shall be reduced by an electric or natural gas vehicle facility 6 15 tax credit for each tax year that the taxpayer is eligible to 6 16 claim the tax credit under this subsection. 6 17 a. The taxpayer must claim the tax credit on an agricultural 6 18 or commercial basis in the same manner as provided in section 6 19 422.11G. The taxpayer must claim the tax credit according 6 20 to the same requirements, for the same amount, and for the 6 21 same period as provided in section 422.11G. The amount of the 6 22 tax credit shall be calculated in the same manner as provided 6 23 in section 422.11G. A taxpayer claiming a tax credit on an 6 24 agricultural or commercial basis is subject to the same penalty 6 25 for taking the electric or natural gas vehicle facility out of 6 26 service as provided in section 422.11G. 6 27 b. This subsection is repealed on January 1, 2023. 6 28 Sec. 4. Section 422.35, Code 2015, is amended by adding the 6 29 following new subsection: 6 30 NEW SUBSECTION. 15. a. A taxpayer taking a depreciation 6 31 allowance under section 168 of the Internal Revenue Code for 6 32 property described in section 422.33, subsection 11, is not 6 33 allowed to take the allowance for purposes of this division 6 34 to the extent that a tax credit is taken for the purchase and 6 35 installation of the property under section 422.33, subsection 7 1 11. If a credit is taken for the purchase and installation of 7 2 the property under section 422.33, subsection 11, the taxpayer 7 3 shall add the amount of the allowance taken on such property to 7 4 the extent of the amount of the credit. 7 5 b. A taxpayer taking an expensing allowance under section 7 6 179 of the Internal Revenue Code for property described in 7 7 section 422.33, subsection 11, is not allowed to take the 7 8 allowance for purposes of this division to the extent that a 7 9 tax credit is taken for the purchase and installation of such 7 10 property under section 422.33, subsection 11. If a credit 7 11 is taken for the purchase and installation of the property 7 12 under section 422.33, subsection 11, the taxpayer shall add the 7 13 amount of the allowance taken on such property to the extent of 7 14 the amount of the credit. 7 15 c. This subsection is repealed on January 1, 2023. 7 16 Sec. 5. EFFECTIVE UPON ENACTMENT. This Act, being deemed of 7 17 immediate importance, takes effect upon enactment. 7 18 Sec. 6. RETROACTIVE APPLICABILITY. This Act applies 7 19 retroactively to January 1, 2015, for tax years beginning on 7 20 or after that date. 7 21 EXPLANATION 7 22 The inclusion of this explanation does not constitute agreement with 7 23 the explanation's substance by the members of the general assembly. 7 24 This bill creates an electric or natural gas vehicle 7 25 facility tax credit for persons who purchase and install an 7 26 electric vehicle facility or a natural gas vehicle facility. 7 27 The amount of the tax credit is 30 percent of the cost of 7 28 purchasing and 30 percent of the cost of installing the 7 29 facility. A person may claim the tax credit on an agricultural 7 30 (farmer), commercial (business), or residential (personal, 7 31 family, or household) basis. The bill provides that $5 million 7 32 is dedicated for the issuance of tax credit certificates 7 33 which must be attached to a person's tax return in order to 7 34 claim the tax credit. A person claiming the tax credit on 7 35 an agricultural or commercial basis may claim the tax credit 8 1 for an electric or natural gas facility. The person must 8 2 claim one=third of the tax credit for each of three tax years 8 3 beginning in the tax year that the facility was placed in 8 4 service. A person claiming the tax credit on a residential 8 5 basis may claim the tax credit for only the electric vehicle 8 6 facility. The person must claim the tax credit in the tax year 8 7 in which the electric vehicle facility was placed in service. 8 8 Any tax credit in excess of the taxpayer's tax liability is 8 9 refundable or may be credited to the tax liability for the 8 10 following tax year. 8 11 The taxpayer must place the facility in service before 8 12 January 1, 2018, but those taxpayers claiming on an 8 13 agricultural or commercial basis may continue to claim the tax 8 14 credit after that date for purposes of meeting the requirement 8 15 that one=third of the credit be taken each year for three years 8 16 and the authorization to carry forward the excess for one year. 8 17 The aggregate amount of electric or natural gas vehicle 8 18 facility tax credit certificates that may be issued cannot 8 19 exceed $5 million for all tax years that the tax credit is 8 20 available. Two million dollars is allocated to electric 8 21 vehicle facilities, $2 million is allocated to natural gas 8 22 facilities, and $1 million is allocated to either electric 8 23 vehicle facilities or natural gas vehicle facilities. As of 8 24 July 1, 2017, any remaining unobligated or unexpended moneys 8 25 are allocated to either type of facility. 8 26 The tax credit applies retroactively to tax years beginning 8 27 on and after January 1, 2015. The bill's provisions are 8 28 repealed on January 1, 2023. The bill takes effect upon 8 29 enactment. LSB 1380SV (4) 86 da/sc
