Bill Text: MS SB3064 | 2019 | Regular Session | Introduced
Bill Title: Children's Promise Act; create.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Failed) 2019-02-27 - Died In Committee [SB3064 Detail]
Download: Mississippi-2019-SB3064-Introduced.html
MISSISSIPPI LEGISLATURE
2019 Regular Session
To: Finance
By: Senator(s) Fillingane
Senate Bill 3064
AN ACT TO CREATE THE CHILDREN'S PROMISE ACT; TO AUTHORIZE AN INCOME TAX CREDIT FOR VOLUNTARY CASH CONTRIBUTIONS BY BUSINESS ENTERPRISES TO ELIGIBLE CHARITABLE ORGANIZATIONS; TO LIMIT THE AMOUNT OF THE CREDIT; TO PROVIDE THAT UNUSED PORTIONS OF A CREDIT MAY BE CARRIED FORWARD FOR FIVE CONSECUTIVE YEARS FROM THE CLOSE OF THE TAX YEAR IN WHICH THE CREDIT WAS EARNED; TO PROVIDE THAT CONTRIBUTIONS FOR WHICH CREDITS ARE CLAIMED UNDER THIS ACT MAY NOT BE USED AS DEDUCTIONS FOR STATE TAX PURPOSES; TO PROVIDE THE CRITERIA THAT AN ELIGIBLE CHARITABLE ORGANIZATION MUST MEET IN ORDER FOR A CONTRIBUTION TO THE ORGANIZATION TO QUALIFY FOR THE CREDIT AUTHORIZED BY THIS ACT; TO AMEND SECTION 27-7-22.39, MISSISSIPPI CODE OF 1972, WHICH AUTHORIZES INCOME TAX CREDITS FOR VOLUNTARY CASH CONTRIBUTIONS TO QUALIFYING CHARITABLE ORGANIZATIONS AND QUALIFYING FOSTER CARE CHARITABLE ORGANIZATIONS, TO REVISE THE DEFINITIONS OF THE TERMS "QUALIFYING CHARITABLE ORGANIZATION," "QUALIFYING FOSTER CARE CHARITABLE ORGANIZATION" AND "SERVICES" FOR THE PURPOSES OF SUCH SECTION OF LAW; TO REVISE CERTAIN PROVISIONS REGARDING CERTIFICATIONS THAT CHARITABLE ORGANIZATIONS MUST FILE WITH THE DEPARTMENT OF REVENUE; TO INCREASE THE MAXIMUM AGGREGATE AMOUNT OF THE INCOME TAX CREDITS THAT MAY BE AWARDED IN A CALENDAR YEAR; TO EXTEND THE DATE OF THE REPEALER ON SUCH SECTION; TO AMEND SECTION 27-7-22.32, MISSISSIPPI CODE OF 1972, WHICH AUTHORIZES AN INCOME TAX CREDIT FOR EXPENSES INCURRED FOR THE ADOPTION OF A CHILD, TO EXTEND THE REVERTER ON THE PROVISION OF LAW THAT PROVIDES THAT THE MAXIMUM AMOUNT OF THE TAX CREDIT CANNOT EXCEED $5,000.00 FOR A CHILD AND THE PROVISION THAT AUTHORIZES AN INCOME TAX CREDIT FOR CHILDREN ADOPTED THROUGH THE MISSISSIPPI DEPARTMENT OF CHILD PROTECTION SERVICES; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. This act shall be known and may be cited as the Children's Promise Act.
SECTION 2. (1) For the purposes of this section, the following words and phrases shall have the meanings ascribed in this section unless the context clearly indicates otherwise:
(a) "Department" means the Department of Revenue.
(b) "Eligible charitable organization" means an organization that is exempt from federal income taxation under Section 501(c)(3) of the Internal Revenue Code and is:
(i) Licensed by or under contract or agreement with the Department of Child Protection Services and provides services for:
1. The prevention and diversion of children from custody with the Department of Child Protection Services;
2. The safety, care and well-being of children in custody with the Department of Child Protection Services; or
3. The express purpose of creating permanency for children through adoption; or
(ii) Certified by the department as a job training, workforce development or educational services charitable organization and provides services to:
1. Children in a foster care placement program established by the Department of Child Protection Services, children placed under the Safe Families for Children model, or children at significant risk of entering a foster care placement program established by the Department of Child Protection Services;
2. Children who have a chronic illness or physical, intellectual, developmental or emotional disability; or
3. Children eligible for free or reduced price meals programs under Section 37-11-7.
(2) (a) The tax credit authorized in this section shall be available only to a taxpayer who is a business enterprise engaged in commercial, industrial or professional activities and operating as a corporation, limited liability company, partnership or sole proprietorship. Except as otherwise provided in this section, a credit is allowed against the taxes imposed by Sections 27-7-5, 27-15-103, 27-15-109 and 27-15-123, for voluntary cash contributions made by a taxpayer during the taxable year to an eligible charitable organization. The amount of credit that may be utilized by a taxpayer in a taxable year shall be limited to an amount not to exceed fifty percent (50%) of the total tax liability of the taxpayer for the taxes imposed by such sections of law. Any tax credit claimed under this section but not used in any taxable year may be carried forward for five (5) consecutive years from the close of the tax year in which the credits were earned.
(b) A contribution to an eligible charitable organization for which a credit is claimed under this section does not qualify for and shall not be included in any credit that may be claimed under Section 27-7-22.39.
(c) A contribution for which a credit is claimed under this section may not be used as a deduction by the taxpayer for state income tax purposes.
(3) Taxpayers taking a credit authorized by this section shall provide the name of the eligible charitable organization and the amount of the contribution to the department on forms provided by the department.
(4) An eligible charitable organization shall provide the department with a written certification that it meets all criteria to be considered an eligible charitable organization. The organization shall also notify the department of any changes that may affect eligibility under this section.
(5) The eligible charitable organization's written certification must be signed by an officer of the organization under penalty of perjury. The written certification shall include the following:
(a) Verification of the organization's status under Section 501(c)(3) of the Internal Revenue Code;
(b) A statement that the organization does not provide, pay for or provide coverage of abortions and does not financially support any other entity that provides, pays for or provides coverage of abortions;
(c) Any other information that the department requires to administer this section.
(6) The department shall review each written certification and determine whether the organization meets all the criteria to be considered an eligible charitable organization and notify the organization of its determination. The department may also periodically request recertification from the organization. The department shall compile and make available to the public a list of eligible charitable organizations.
(7) Tax credits authorized by this section that are earned by a partnership, limited liability company, S corporation or other similar pass-through entity, shall be allocated among all partners, members or shareholders, respectively, either in proportion to their ownership interest in such entity or as the partners, members or shareholders mutually agree as provided in an executed document.
(8) A taxpayer shall apply for credits with the department on forms prescribed by the department. In the application the taxpayer shall certify to the department the dollar amount of the contributions made or to be made during the calendar year. Within thirty (30) days after the receipt of an application, the department shall allocate credits based on the dollar amount of contributions as certified in the application. However, if the department cannot allocate the full amount of credits certified in the application due to the limit on the aggregate amount of credits that may be awarded under this section in a calendar year, the department shall so notify the applicant within thirty (30) days with the amount of credits, if any, that may be allocated to the applicant in the calendar year. Once the department has allocated credits to a taxpayer, if the contribution for which a credit is allocated has not been made as of the date of the allocation, then the contribution must be made not later than sixty (60) days from the date of the allocation. If the contribution is not made within such time period, the allocation shall be canceled and returned to the department for reallocation. Upon final documentation of the contributions, if the actual dollar amount of the contributions is lower than the amount estimated, the department shall adjust the tax credit allowed under this section.
(9) The aggregate amount of tax credits that may be allocated by the department under this section during a calendar year shall not exceed Fifteen Million Dollars ($15,000,000.00), and not more than fifty percent (50%) of tax credits allocated during a calendar year may be allocated for contributions to eligible charitable organizations described in subsection (1)(b)(ii) of this section.
(10) The department shall not allocate any credits under this section after January 1, 2025.
SECTION 3. Section 27-7-22.39, Mississippi Code of 1972, is amended as follows:
27-7-22.39. (1) As used in this section:
(a) "Low-income residents" means persons whose household income is less than one hundred fifty percent (150%) of the federal poverty level.
(b) "Qualifying charitable
organization" means a charitable organization that is exempt from federal
income taxation under Section 501(c)(3) of the Internal Revenue Code or is a
designated community action agency that receives community services block grant
program monies pursuant to 42 USC 9901. The organization must spend at least fifty
percent (50%) of its budget on services to residents of this state who receive
temporary assistance for needy families benefits or low-income residents of
this state and their households or to children who have a chronic illness or
physical, intellectual, developmental or emotional disability who are residents
of this state. A charitable organization that is exempt from federal income
tax under Section 501(c)(3) of the Internal Revenue Code and that meets all
other requirements of this paragraph except that it does not spend at least
fifty percent (50%) of its overall budget in Mississippi may be a qualifying
charitable organization if it spends at least fifty percent (50%) of its
Mississippi budget on services to qualified individuals in Mississippi and it
certifies to the department that one hundred percent (100%) of the voluntary
cash contributions from the taxpayer will be spent on services to * * * qualified
individuals in Mississippi. Taxpayers choosing to make donations through
an umbrella charitable organization that collects donations on behalf of member
charities shall designate that the donation be directed to a member charitable
organization that would qualify under this section on a stand-alone basis.
Qualifying charitable organization does not include any entity that provides,
pays for or provides coverage of abortions or that financially supports any
other entity that provides, pays for or provides coverage of abortions.
(c) "Qualifying
foster care charitable organization" means a qualifying charitable
organization that each operating year provides services to at least one hundred
(100) qualified individuals in this state and spends at least fifty percent
(50%) of its budget on services to qualified individuals in this state. A
charitable organization that is exempt from federal income tax under Section
501(c)(3) of the Internal Revenue Code and that meets all other requirements of
this paragraph except that it does not spend at least fifty percent (50%) of
its overall budget in Mississippi may be a qualifying foster care charitable
organization if it spends at least fifty percent (50%) of its Mississippi
budget on services to qualified individuals in Mississippi and it certifies to
the department that one hundred percent (100%) of the voluntary cash
contributions from the taxpayer will be spent on services to * * * qualified individuals
in Mississippi. For the purposes of this paragraph, "qualified
individual" means a child in a foster care placement program established
by the Department of Child Protection Services, a child placed under the Safe
Families for Children model, or a child at significant risk of entering a
foster care placement program established by the Department of Child Protection
Services.
(d) "Services" means cash assistance, medical care, child care, food, clothing, shelter, job-placement, educational services or funding, and job-training services or any other assistance that is reasonably necessary to meet immediate basic needs or to provide for job-training or educational services or funding, and that is provided and used in this state.
(2) Except as provided in subsections (3) and (4) of this section, a credit is allowed against the taxes imposed by this chapter for voluntary cash contributions by the taxpayer during the taxable year to a qualifying charitable organization, other than a qualifying foster care charitable organization, not to exceed:
(a) The lesser of Four Hundred Dollars ($400.00) or the amount of the contribution in any taxable year for a single individual or a head of household.
(b) The lesser of Eight Hundred Dollars ($800.00) or the amount of the contribution in any taxable year for a married couple filing a joint return.
(3) A separate credit is allowed against the taxes imposed by this chapter for voluntary cash contributions during the taxable year to a qualifying foster care charitable organization. A contribution to a qualifying foster care charitable organization does not qualify for, and shall not be included in, any credit amount under subsection (2) of this section. If the voluntary cash contribution by the taxpayer is to a qualifying foster care charitable organization, the credit shall not exceed:
(a) The lesser of Five Hundred Dollars ($500.00) or the amount of the contribution in any taxable year for a single individual or a head of household.
(b) The lesser of One Thousand Dollars ($1,000.00) or the amount of the contribution in any taxable year for a married couple filing a joint return.
(4) Subsections (2) and (3) of this section provide separate credits against taxes imposed by this chapter depending on the recipients of the contributions. A taxpayer, including a married couple filing a joint return, in the same taxable year, may either or both:
(a) Contribute to a qualifying charitable organization, other than a qualifying foster care charitable organization, and claim a credit under subsection (2) of this section.
(b) Contribute to a qualifying foster care charitable organization and claim a credit under subsection (3) of this section.
(5) A husband and wife who file separate returns for a taxable year in which they could have filed a joint return may each claim only one-half (1/2) of the tax credit that would have been allowed for a joint return.
(6) If the allowable tax credit exceeds the taxes otherwise due under this chapter on the claimant's income, or if there are no taxes due under this chapter, the taxpayer may carry forward the amount of the claim not used to offset the taxes under this chapter for not more than five (5) consecutive taxable years' income tax liability.
(7) The credit allowed by this section is in lieu of a deduction pursuant to Section 170 of the Internal Revenue Code and taken for state tax purposes.
(8) Taxpayers taking a credit authorized by this section shall provide the name of the qualifying charitable organization and the amount of the contribution to the department on forms provided by the department.
(9) A qualifying charitable organization shall provide the department with a written certification that it meets all criteria to be considered a qualifying charitable organization. The organization shall also notify the department of any changes that may affect the qualifications under this section.
(10) The charitable organization's written certification must be signed by an officer of the organization under penalty of perjury. The written certification shall include the following:
(a) Verification of the organization's status under Section 501(c)(3) of the Internal Revenue Code or verification that the organization is a designated community action agency that receives community services block grant program monies pursuant to 42 USC 9901.
(b) Financial data indicating the organization's budget for the organization's prior operating year and the amount of that budget spent on services to residents of this state who either:
(i) Receive temporary assistance for needy families benefits;
(ii) Are low-income residents of this state;
(iii) Are children who have a chronic illness or physical, intellectual, developmental or emotional disability; or
(iv) Are children in a foster care placement program established by the Department of Child Protection Services, children placed under the Safe Families for Children model or children at significant risk of entering a foster care placement program established by the Department of Child Protection Services.
(c) A statement that
the organization plans to continue spending at least fifty percent (50%) of its
budget on services to residents of this state who receive temporary assistance
for needy families benefits, who are low-income residents of this state, who
are children who have a chronic illness or physical, intellectual,
developmental or emotional disability or who are children in a foster care
placement program established by the Department of Child Protection Services,
children placed under the Safe Families for Children model or children at
significant risk of entering a foster care placement program established by the
Department of Child Protection Services. A charitable organization that is
exempt from federal income tax under Section 501(c)(3) of the Internal Revenue
Code and that meets all other requirements for a qualifying charitable
organization or qualifying foster care charitable organization except that it
does not spend at least fifty percent (50%) of its overall budget in
Mississippi shall submit a statement that it spends at least fifty percent
(50%) of its Mississippi budget on services to qualified individuals in
Mississippi and that one hundred percent (100%) of the voluntary cash
contributions it receives from Mississippi taxpayers will be spent on services
to * * * qualified individuals in Mississippi.
(d) In the case of a foster care charitable organization, a statement that each operating year it provides services to at least one hundred (100) qualified individuals in this state.
(e) A statement that the organization does not provide, pay for or provide coverage of abortions and does not financially support any other entity that provides, pays for or provides coverage of abortions.
(f) Any other information that the department requires to administer this section.
(11) The department shall review each written certification and determine whether the organization meets all the criteria to be considered a qualifying charitable organization and notify the organization of its determination. The department may also periodically request recertification from the organization. The department shall compile and make available to the public a list of the qualifying charitable organizations.
(12) The aggregate amount
of tax credits that may be awarded under this section in any calendar year
shall not exceed * * * Three Million Dollars
($3,000,000.00).
(13) A taxpayer shall apply for credits with the department on forms prescribed by the department. In the application the taxpayer shall certify to the department the dollar amount of the contributions made or to be made during the calendar year. Within thirty (30) days after the receipt of an application, the department shall allocate credits based on the dollar amount of contributions as certified in the application. However, if the department cannot allocate the full amount of credits certified in the application due to the limit on the aggregate amount of credits that may be awarded under this section in a calendar year, the department shall so notify the applicant within thirty (30) days with the amount of credits, if any, that may be allocated to the applicant in the calendar year. Once the department has allocated credits to a taxpayer, if the contribution for which a credit is allocated has not been made as of the date of the allocation, then the contribution must be made not later than sixty (60) days from the date of the allocation. If the contribution is not made within such time period, the allocation shall be canceled and returned to the department for reallocation. Upon final documentation of the contributions, if the actual dollar amount of the contributions is lower than the amount estimated, the department shall adjust the tax credit allowed under this section.
( * * *14) This section shall be repealed
from and after January 1, * * *2020 2021.
SECTION 4. Section 27-7-22.32, Mississippi Code of 1972, is amended as follows:
[Through December
31, * * * 2020,
this section shall read as follows:]
27-7-22.32. (1) (a) There shall be allowed as a credit against the tax imposed by this chapter the amount of the qualified adoption expenses paid or incurred, not to exceed Two Thousand Five Hundred Dollars ($2,500.00), for each dependent child legally adopted by a taxpayer under the laws of this state during calendar year 2006 or during any calendar year thereafter through calendar year 2017, and not to exceed Five Thousand Dollars ($5,000.00) for each dependent child legally adopted by a taxpayer under the laws of this state during any calendar year thereafter. A taxpayer claiming a credit under this paragraph (a) may not claim a credit under paragraph (b) of this subsection for the adoption of the same child.
(b) There shall be allowed as a credit against the tax imposed by this chapter the amount of Five Thousand Dollars ($5,000.00) for each dependent child legally adopted by a taxpayer under the laws of this state through the Mississippi Department of Child Protection Services during calendar year 2018 or during any calendar year thereafter. A taxpayer claiming a credit under this paragraph (b) may not claim a credit under paragraph (a) of this subsection for the adoption of the same child.
(2) The tax credit under this section may be claimed for the taxable year in which the adoption becomes final under the laws of this state. Any tax credit claimed under this section but not used in any taxable year may be carried forward for the five (5) succeeding tax years. A tax credit is allowed under this section for any child for which an exemption is claimed during the same taxable year under Section 27-7-21(e). For the purposes of this section, the term "qualified adoption expenses" means and has the same definition as that term has in 26 USCS 36C.
[From and after January 1, * * * 2021, this section shall read as
follows:]
27-7-22.32. There shall be allowed as a credit against the tax imposed by this chapter the amount of the qualified adoption expenses paid or incurred, not to exceed Two Thousand Five Hundred Dollars ($2,500.00), for each dependent child legally adopted by a taxpayer under the laws of this state during calendar year 2006 or during any calendar year thereafter. The tax credit under this section may be claimed for the taxable year in which the adoption becomes final under the laws of this state. Any tax credit claimed under this section but not used in any taxable year may be carried forward for the three (3) succeeding tax years. A tax credit is allowed under this section for any child for which an exemption is claimed during the same taxable year under Section 27-7-21(e). For the purposes of this section, the term "qualified adoption expenses" means and has the same definition as that term has in 26 USCS 36C.
SECTION 5. Section 2 of this act shall be codified as a new section in Title 27, Chapter 7, Mississippi Code of 1972.
SECTION 6. Nothing in this act shall affect or defeat any claim, assessment, appeal, suit, right or cause of action for taxes due or accrued under the income tax laws or insurance premium tax laws before the date on which this act becomes effective, whether such claims, assessments, appeals, suits or actions have been begun before the date on which this act becomes effective or are begun thereafter; and the provisions of the income tax laws and insurance premium tax laws are expressly continued in full force, effect and operation for the purpose of the assessment, collection and enrollment of liens for any taxes due or accrued and the execution of any warrant under such laws before the date on which this act becomes effective, and for the imposition of any penalties, forfeitures or claims for failure to comply with such laws.
SECTION 7. This act shall take effect and be in force from and after January 1, 2019.
