Bill Text: IA SSB1198 | 2021-2022 | 89th General Assembly | Introduced
Bill Title: A bill for an act relating to pandemic relief by excluding certain COVID-19 related grants from the individual and corporate income taxes and allowing certain deductions relating to the paycheck protection program loan forgiveness, and including effective date and retroactive applicability provisions.
Spectrum: Committee Bill
Status: (Introduced - Dead) 2021-02-16 - Subcommittee: Smith, R., Jochum, and Sinclair. [SSB1198 Detail]
Download: Iowa-2021-SSB1198-Introduced.html
Senate
Study
Bill
1198
-
Introduced
SENATE
FILE
_____
BY
(PROPOSED
COMMITTEE
ON
WAYS
AND
MEANS
BILL
BY
CHAIRPERSON
DAWSON)
A
BILL
FOR
An
Act
relating
to
pandemic
relief
by
excluding
certain
1
COVID-19
related
grants
from
the
individual
and
corporate
2
income
taxes
and
allowing
certain
deductions
relating
to
the
3
paycheck
protection
program
loan
forgiveness,
and
including
4
effective
date
and
retroactive
applicability
provisions.
5
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
6
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DIVISION
I
1
COVID-19
RELATED
GRANTS
——
TAXATION
2
Section
1.
Section
422.7,
subsection
62,
Code
2021,
is
3
amended
to
read
as
follows:
4
62.
a.
Subtract,
to
the
extent
included,
the
amount
of
5
any
financial
assistance
qualifying
COVID-19
grant
provided
to
6
an
eligible
small
issued
to
an
individual
or
business
by
the
7
economic
development
authority
under
the
Iowa
small
business
8
relief
grant
program
created
during
calendar
year
2020
to
9
provide
financial
assistance
to
eligible
small
businesses
10
economically
impacted
by
the
COVID-19
pandemic
,
the
Iowa
11
finance
authority,
or
the
department
of
agriculture
and
land
12
stewardship
.
13
b.
For
purposes
of
this
subsection,
“qualifying
COVID-19
14
grant”
includes
any
grant
identified
by
the
department
by
rule
15
that
was
issued
under
a
grant
program
administered
by
the
16
economic
development
authority,
Iowa
finance
authority,
or
17
the
department
of
agriculture
and
land
stewardship
to
provide
18
financial
assistance
to
individuals
and
businesses
economically
19
impacted
by
the
COVID-19
pandemic.
20
c.
The
economic
development
authority,
Iowa
finance
21
authority,
or
the
department
of
agriculture
and
land
22
stewardship
shall
notify
the
department
of
any
COVID-19
grant
23
program
that
may
qualify
under
this
subsection
in
the
manner
24
and
form
prescribed
by
the
department.
25
d.
This
subsection
is
repealed
January
1,
2024,
and
does
not
26
apply
to
tax
years
beginning
on
or
after
that
date.
27
Sec.
2.
Section
422.35,
subsection
30,
Code
2021,
is
amended
28
to
read
as
follows:
29
30.
a.
Subtract,
to
the
extent
included,
the
amount
of
30
any
financial
assistance
qualifying
COVID-19
grant
provided
31
to
an
eligible
small
issued
to
a
business
by
the
economic
32
development
authority
under
the
Iowa
small
business
relief
33
grant
program
created
during
calendar
year
2020
to
provide
34
financial
assistance
to
eligible
small
businesses
economically
35
-1-
LSB
2443XC
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4
S.F.
_____
impacted
by
the
COVID-19
pandemic
,
the
Iowa
finance
authority,
1
or
the
department
of
agriculture
and
land
stewardship
.
2
b.
For
purposes
of
this
subsection,
“qualifying
COVID-19
3
grant”
includes
any
grant
identified
by
the
department
by
rule
4
that
was
issued
under
a
grant
program
administered
by
the
5
economic
development
authority,
Iowa
finance
authority,
or
6
the
department
of
agriculture
and
land
stewardship
to
provide
7
financial
assistance
to
businesses
economically
impacted
by
the
8
COVID-19
pandemic.
9
c.
The
economic
development
authority,
Iowa
finance
10
authority,
or
the
department
of
agriculture
and
land
11
stewardship
shall
notify
the
department
of
any
COVID-19
grant
12
program
that
may
qualify
under
this
subsection
in
the
manner
13
and
form
prescribed
by
the
department.
14
d.
This
subsection
is
repealed
January
1,
2024,
and
does
not
15
apply
to
tax
years
beginning
on
or
after
that
date.
16
Sec.
3.
EFFECTIVE
DATE.
This
division
of
this
Act,
being
17
deemed
of
immediate
importance,
takes
effect
upon
enactment.
18
Sec.
4.
RETROACTIVE
APPLICABILITY.
This
division
of
this
19
Act
applies
retroactively
to
March
23,
2020,
for
tax
years
20
ending
on
or
after
that
date.
21
DIVISION
II
22
FEDERAL
PAYCHECK
PROTECTION
PROGRAM
23
Sec.
5.
FEDERAL
PAYCHECK
PROTECTION
PROGRAM.
24
Notwithstanding
any
other
provision
of
the
law
to
the
contrary,
25
for
any
tax
year
ending
after
March
27,
2020,
Division
N,
Tit.
26
II,
subtit.
B,
§276
and
§278(a),
of
the
federal
Consolidated
27
Appropriations
Act,
2021,
Pub.
L.
No.
116-260,
applies
in
28
computing
net
income
for
state
tax
purposes
under
section
422.7
29
or
422.35.
30
EXPLANATION
31
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
32
the
explanation’s
substance
by
the
members
of
the
general
assembly.
33
This
bill
relates
to
pandemic
relief
by
excluding
certain
34
COVID-19
related
grants
from
the
individual
and
corporate
35
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_____
income
taxes
and
allowing
certain
deductions
relating
to
the
1
paycheck
protection
program
loan
forgiveness.
2
DIVISION
I
——
COVID-19
RELATED
GRANTS
——
TAXATION.
The
3
bill
excludes
from
the
calculation
of
Iowa
individual
and
4
corporate
income
tax
any
qualifying
COVID-19
grant
issued
to
an
5
individual
or
business
by
the
economic
development
authority,
6
the
Iowa
finance
authority,
or
the
department
of
agriculture
7
and
land
stewardship.
8
Under
the
bill,
a
“qualifying
COVID-19
grant”
includes
9
any
grant
identified
by
the
department
of
revenue
by
rule
10
that
was
issued
under
a
grant
program
administered
by
the
11
economic
development
authority,
Iowa
finance
authority,
or
12
the
department
of
agriculture
and
land
stewardship
to
provide
13
financial
assistance
to
individuals
and
businesses
economically
14
impacted
by
the
COVID-19
pandemic.
15
Under
current
law,
financial
assistance
grants
provided
to
16
small
businesses
by
the
economic
development
authority
under
17
the
Iowa
small
business
COVID-19
relief
grant
program
are
18
excluded
from
the
calculation
of
Iowa
individual
and
corporate
19
income
tax.
20
The
COVID-19
grant
income
tax
exclusion
provided
in
the
bill
21
is
repealed
on
January
1,
2024,
and
does
not
apply
to
tax
years
22
beginning
on
or
after
that
date.
23
The
division
takes
effect
upon
enactment
and
applies
24
retroactively
to
March
23,
2020,
for
tax
years
ending
on
or
25
after
that
date.
26
DIVISION
II
——
FEDERAL
PAYCHECK
PROTECTION
PROGRAM.
Under
27
current
law,
for
the
tax
year
2020
and
later,
Iowa
law
fully
28
conforms
with
the
federal
treatment
of
forgiven
paycheck
29
protection
program
loans
and
excludes
such
amounts
from
net
30
income
and
allows
certain
deductions
for
business
expenses
31
paid
using
those
loans.
For
fiscal-year
filers
who
received
32
paycheck
protection
program
loans
during
the
2019
tax
year,
33
current
law
excludes
such
amounts
from
net
income,
but
does
34
not
allow
certain
deductions
for
business
expenses
paid
using
35
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those
loans.
The
bill
fully
conforms
with
federal
law
for
1
those
fiscal-year
filers
who
previously
were
excluded
from
such
2
conformity
and
allows
such
filers
to
take
business
expense
3
deductions
using
federal
paycheck
protection
program
loan
4
proceeds
that
were
forgiven.
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