Bill Text: OR SB500 | 2013 | Regular Session | Introduced

Oregon Senate Bill 500 (Prior Session Legislation)

Bill Title: Relating to tax credits for educational expenses; prescribing an effective date.

Sponsorship: Partisan Bill (Republican 1)

Status: (Failed) 2013-07-08 - In committee upon adjournment. [SB500 Detail]

Download: Oregon-2013-SB500-Introduced.html



     77th OREGON LEGISLATIVE ASSEMBLY--2013 Regular Session

NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .

LC 2493

                         Senate Bill 500

Sponsored by Senator CLOSE

                             SUMMARY

The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.

  Creates tax credits for educational expenses or for
contributions to qualified scholarship granting organization.
  Applies to tax years beginning on or after January 1, 2015.
  Takes effect only if Senate Joint Resolution 23 (2013) is
approved by people at next regular general election. Takes effect
on effective date of constitutional amendment proposed in Senate
Joint Resolution 23 (2013).

                        A BILL FOR AN ACT
Relating to tax credits for educational expenses; and prescribing
  an effective date.
Be It Enacted by the People of the State of Oregon:
  SECTION 1.  { + Sections 2 and 3 of this 2013 Act are added to
and made a part of ORS chapter 315. + }
  SECTION 2.  { + As used in this section and section 3 of this
2013 Act:
  (1)(a) 'Educational expenses' means expenses paid in
furtherance of educating an eligible student in a public school
or in a program that meets the requirements of ORS 339.030 (1)
for:
  (A) Tuition and fees for educational services, including
tutoring, whether delivered in person or by electronic means.
  (B) Transportation related to educational activities.
  (C) Educational association memberships.
  (D) Testing fees.
  (E) Educational materials, including books, school supplies,
academic lessons, instructional software and academic curricula.
  (b) 'Educational expenses' does not include fees or expenses
for athletic activities.
  (2) 'Educational scholarship' means a grant from a scholarship
granting organization to an eligible student to cover part or all
of the educational expenses of the eligible student.
  (3) 'Eligible student' means a student who:
  (a) Is a resident of this state;
  (b) Is five years of age or older but not more than 21 years of
age; and
  (c) Has not graduated from high school.
  (4) 'Parent' includes a guardian, custodian or other person
with authority to act on behalf of the student.
  (5) 'Scholarship granting organization' means an organization
that:
  (a) Receives donations from taxpayers;
  (b) Gives educational scholarships to eligible students;
  (c) Spends at least 90 percent of its donations on educational
scholarships;
  (d) Spends all interest and proceeds from investments on
educational scholarships; and
  (e) Is recognized as tax exempt under section 501(c)(3) of the
Internal Revenue Code. + }
  SECTION 3.  { + (1) A credit against the taxes otherwise due
under ORS chapter 316 shall be allowed for educational expenses
actually paid or incurred during the tax year on behalf of an
eligible student of whom the taxpayer is a parent. The amount of
the credit allowed under this subsection shall equal $1,000
multiplied by the number of eligible students for whom the
taxpayer is claiming the credit.
  (2) A credit against the taxes otherwise due under ORS chapter
316 (or, if the taxpayer is a corporation, under ORS chapter 317
or 318) shall be allowed for contributions to a scholarship
granting organization made during the tax year. The credit
allowed under this subsection shall equal:
  (a) In the case of a credit allowed against taxes imposed under
ORS chapter 316, up to $1,000 of the taxpayer's contributions.
  (b) In the case of a credit allowed against taxes imposed under
ORS chapter 317 or 318, up to $10,000 of the taxpayer's
contributions.
  (3) The Department of Revenue shall adjust the credit limit
amounts in subsections (1) and (2) of this section according to
the cost-of-living adjustment for the calendar year. The
department shall annually recompute the credit limit amounts for
the current tax year by multiplying each dollar amount by the
percentage (if any) by which the monthly averaged U.S. City
Average Consumer Price Index for the 12 consecutive months ending
August 31 of the prior calendar year exceeds the monthly averaged
U.S. City Average Consumer Price Index for the 12 consecutive
months ending August 31, 2013.
  (4) If a credit limit amount computed under subsections (1),
(2) or (3) of this section is not a multiple of $50, the amount
shall be rounded to the next lower multiple of $50.
  (5) A credit allowed under this section in any one tax year may
not exceed the tax liability of the taxpayer.
  (6) A credit is not allowed if the taxpayer designates the
taxpayer's contributions to a scholarship granting organization
for the direct benefit of any dependent of the taxpayer, or if
the taxpayer designates a student beneficiary as a condition of
the taxpayer's contribution to the scholarship granting
organization.  A credit is not allowed if the taxpayer, with the
intent to benefit the taxpayer's dependent, agrees with one or
more taxpayers to designate each taxpayer's contribution to the
scholarship granting organization for the direct benefit of the
other taxpayer's dependent.
  (7) Any tax credit otherwise allowable under this section that
is not used by the taxpayer in a particular year may be carried
forward and offset against the taxpayer's tax liability for the
next succeeding tax year. Any credit remaining unused in the next
succeeding tax year may be carried forward and used in the second
succeeding tax year, and likewise, any credit not used in that
second succeeding tax year may be carried forward and used in the
third succeeding tax year, but may not be carried forward for any
tax year thereafter.
  (8) In the case of a credit allowed under this section for
purposes of ORS chapter 316:
  (a) A nonresident shall be allowed the credit under this
section in the proportion provided in ORS 316.117.
  (b) If a change in the status of a taxpayer from resident to
nonresident or from nonresident to resident occurs, the credit

allowed by this section shall be determined in a manner
consistent with ORS 316.117.
  (c) A husband and wife who file separate returns for a taxable
year may each claim a share of the tax credit that would have
been allowed on a joint return in proportion to the contribution
of each.
  (d) If a change in the taxable year of a taxpayer occurs as
described in ORS 314.085, or if the Department of Revenue
terminates the taxpayer's taxable year under ORS 314.440, the
credit allowed under this section shall be prorated or computed
in a manner consistent with ORS 314.085.
  (9) The Department of Revenue shall adopt rules establishing
policies and procedures for certifying taxpayers as eligible for
the credits allowed under subsections (1) and (2) of this
section. + }
  SECTION 4.  { + Sections 2 and 3 of this 2013 Act apply to tax
years beginning on or after January 1, 2015. + }
  SECTION 5.  { + This 2013 Act does not take effect unless the
amendment to the Oregon Constitution proposed by Senate Joint
Resolution 23 (2013) is approved by the people at the next
regular general election held throughout this state. This 2013
Act takes effect on the effective date of Senate Joint Resolution
23 (2013). + }
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