Amendment H-8098 to HF 2595

Filed March 6, 2020 in the House by

What it changes

1. By striking everything after the enacting clause and inserting: “DIVISION I Section
2. Section 422.12C, subsection 1, Code 2020, is amended by striking the subsection and inserting in lieu thereof the following:
3. The taxes imposed under this division, less the amounts of nonrefundable credits allowed under this division, shall be reduced by a child and dependent care credit equal to the following percentages of the federal child and dependent care credit provided in section 21 of the Internal Revenue Code, without regard to whether or not the federal credit was limited by the taxpayer’s federal tax liability: a. For a taxpayer with net income of less than forty-five thousand dollars, one hundred percent. b. For a taxpayer with net income of forty-five thousand dollars or more but less than ninety thousand dollars, thirty percent. c. For a taxpayer with net income of ninety thousand dollars or more but less than one hundred thousand dollars, twenty-five percent. d. For a taxpayer with net income of one hundred thousand dollars or more but less than one hundred twenty-five thousand dollars, twenty percent. e. For a taxpayer with net income of one hundred twenty-five thousand dollars or more but less than one hundred fifty thousand dollars, fifteen percent. f. For a taxpayer with net income of one hundred fifty thousand dollars or more but less than one hundred seventy-five thousand dollars, ten percent. g. For a taxpayer with net income of one hundred seventy-five thousand dollars or more but less than two hundred fifty thousand dollars, five percent. h. For a taxpayer with net income of two hundred fifty thousand dollars or more, zero percent. Sec.
4. RETROACTIVE APPLICABILITY. This division of this Act applies retroactively to January 1, 2020 for tax years beginning on or after that date. DIVISION II Sec.
5. NEW SECTION . 237D.1 Definitions. As used in this chapter, unless the context otherwise requires:
6. “Child” means the same as defined in section 237A.1.
7. “Child care” means the same as defined in section 237A.1.
8. “Child development home” means the same as defined in section 237A.1.
9. “Department” means the department of human services.
10. “Facility” means the same as defined in section 237A.1.
11. “Fund” means the child care center and child development home grant fund.
12. “Home” means a child development home.
13. “Licensed child care center” or “center” means a facility providing child care or preschool services for seven or more children that has been issued a license by the department pursuant to section 237A.2.
14. “Program” means the child care center and child development home grant program. Sec.
15. NEW SECTION . 237D.2 Child care center and child development home grant fund.
16. A child care center and child development home grant fund is created and established as a separate and distinct fund in the state treasury under the control of the department.
17. a. The fund may consist of any moneys appropriated by the general assembly for purposes of this chapter and any other moneys that are lawfully available to the department. Moneys in the fund are appropriated to the department and shall be used for the purposes of this chapter. b. Notwithstanding section 8.33, moneys in the fund that remain unencumbered or unobligated at the close of the fiscal year shall not revert but shall remain available for expenditure for the purposes of this section in succeeding fiscal years. Notwithstanding section 12C.7, subsection 2, interest earned on moneys in the fund shall be credited to the fund. Sec.
18. NEW SECTION . 237D.3 Child care center and child development home grant program.
19. The department shall adopt rules to establish and administer a child care center and child development home grant program to provide for the allocation of money in the fund in the form of grants, not to exceed fifty thousand dollars per grant, to eligible persons for costs related to the establishment of a new licensed child care center or a new child development home, or for the expansion of an existing licensed child care center or the expansion of an existing child development home. For any one fiscal year, the department shall not approve more than four million dollars in grants. The rules adopted by the department shall specify the eligibility requirements for applicants of the program and the items eligible for a program grant. Items eligible for a program grant must include the costs related to licensing or registration, supplies, and infrastructure.
20. A new center or a new home must be licensed or registered and fully operational within two years of the date of an applicant’s receipt of a grant.
21. Of the children for whom a new or expanded center or a new or expanded home provide child care, a minimum of twenty percent of the children must be from a family that qualifies for state child care assistance pursuant to section 237A.13.
22. A person that is awarded a grant shall enter into an agreement with the department that specifies the requirements that must be maintained throughout the period of the agreement in order for the person to retain the grant. The agreement must contain, at a minimum, provisions addressing all of the following: a. The legal name of the person receiving the grant. b. The amount of the grant. c. Annual certification by the person to the department of compliance with the requirements of the agreement, the program, and this chapter. d. The repayment of the grant, or a portion of the grant, if the person does not meet all of the requirements of the agreement, the program, and this chapter. e. If a new center or a new home for which the grant was received goes out of business within two years of the date the new center or new home becomes fully operational pursuant to subsection 2, the grant shall be subject to repayment. If an expanded center or an expanded home for which the grant was received goes out of business within two years of the date on which the grant was received, the grant shall be subject to repayment. DIVISION III Sec.
23. NEW SECTION . 237A.31 Small business child care tax credit.
24. As used in this section “small business” means any enterprise which is located in this state, which is operated for profit and under a single management, and which has either fewer than twenty employees or an annual gross income of less than four million dollars computed as the average of the three preceding fiscal years. This definition does not apply to any program or activity for which a definition for small business is provided for the program or activity by federal law or regulation or other state law.
25. A small business may receive a child care tax credit for providing child care employee benefits to employees of the business. The credit may be applied against income tax imposed under chapter 422, division II or III, the franchise tax imposed under chapter 422, division V, the gross premiums tax imposed under chapter 432, or the moneys and credits tax imposed in section 533.329. The amount of the credit equals the costs to provide the benefit up to three thousand dollars per employee per year.
26. The aggregate amount of tax credits authorized pursuant to this section shall not exceed a total of two million dollars per fiscal year, and shall be awarded on a first-come, first-served basis.
27. To be eligible for a small business child care tax credit, the small business must provide child care employee benefits to employees of the business through any of the following: a. Build a new structure or rehabilitate an existing structure to be used as a child care center at or near the small business where the children of the employees of the business are provided child care. A small business may construct or rehabilitate the structure in conjunction with another business but only the actual cost of the business shall be considered in determining the credit. b. Operate or lease a child care center at or near the small business where the children of the employees of the business are provided child care.
28. Any credit in excess of the tax liability is not refundable but the excess for the tax year may be credited to the tax liability for the following five years or until depleted, whichever is earlier. The director of revenue shall adopt rules to implement this section. Sec.
29. NEW SECTION . 422.12O Small business child care tax credit.
30. The taxes imposed under this division, less the credits allowed under section 422.12, shall be reduced by a small business child care tax credit received pursuant to section 237A.31.
31. An individual may claim the tax credit allowed a partnership, S corporation, limited liability company, estate, or trust electing to have the income taxed directly to the individual. The amount claimed by the individual shall be based upon the pro rata share of the individual’s earnings of a partnership, S corporation, limited liability company, estate, or trust. Sec.
32. Section 422.33, Code 2020, is amended by adding the following new subsection: NEW SUBSECTION .
33. The taxes imposed under this division shall be reduced by a small business child care tax credit received pursuant to section 237A.31. Sec.
34. Section 422.60, Code 2020, is amended by adding the following new subsection: NEW SUBSECTION .
35. The taxes imposed under this division shall be reduced by a small business child care tax credit received pursuant to section 237A.31. Sec.
36. NEW SECTION . 432.12N Small business child care tax credit. The taxes imposed under this chapter shall be reduced by a small business child care tax credit received pursuant to section 237A.31. Sec.
37. Section 533.329, subsection 2, Code 2020, is amended by adding the following new paragraph: NEW PARAGRAPH . l. The moneys and credits tax imposed under this section shall be reduced by a small business child care tax credit received pursuant to section 237A.31. Sec.
38. APPLICABILITY. This division of this Act applies to tax years beginning on or after January 1,
39. DIVISION IV Sec.
40. Section 237A.13, subsection 7, paragraph c, Code 2020, is amended to read as follows: c. Families with an income of more than one hundred percent but not more than one two hundred forty-five percent of the federal poverty level whose members, for at least twenty-eight hours per week in the aggregate, are employed or are participating at a satisfactory level in an approved training program or educational program. Sec.
41. DIRECTIVE TO DEPARTMENT OF HUMAN SERVICES —— CHILD CARE ASSISTANCE.
42. The department of human services shall amend its administrative rules pursuant to chapter 17A to do all of the following: a. Provide income eligibility for state child care assistance, according to family size for children needing basic care, to families whose nonexempt gross monthly income does not exceed two hundred percent of the federal poverty level. b. Adjust the state child care assistance copayment schedule in incrementally increased amounts for families whose nonexempt gross monthly income does not exceed two hundred percent of the federal poverty level.
43. The rules adopted pursuant to this section shall take effect January 1,
44. ”
45. Title page, by striking lines 1 through 5 and inserting “An Act relating to child care, grants and tax credits relating to child care, state child care assistance, and including applicability and retroactive applicability provisions.”

Official amendment (PDF) · In the Bill Book