Creating the quantum technology tax credit available against the individual and corporate income taxes, and including applicability provisions

This bill creates the quantum technology tax credit (credit) available against the individual and corporate income taxes for eligible projects. _____ investments approved by the Iowa economic development authority (authority). An applicant for the credit may include a group of entities for profit or for nonprofit, or both, including a consortium that are jointly making qualifying investments in an eligible project to create a shared quantum facility. The bill defines “shared quantum facility” to mean a primary location in this state where a qualified applicant performs activities and provides economic benefit related to supporting quantum business and a quantum ecosystem. An applicant for the credit shall submit an application to the authority in a manner prescribed by the authority. The application of a qualified applicant shall include but not be limited to an eligible project placed in service prior to January 1, 2031, and a multimillion dollar federal grant from the economic development administration for the regional technology and innovation program or from a comparable federal grant program. If a qualified applicant is a consortium, the amount of the credit allowed by the authority shall include the aggregate qualifying investment by all the members of the consortium. The bill requires a consortium to designate and disclose the representative to act on behalf of the consortium for tax matters. The representative shall provide the name and taxpayer identification number of each member of the consortium. Upon review of the application and approval by the authority to receive the credit, the authority shall issue a tax credit certificate to a qualified business indicating the amount available to be claimed. The authority may authorize a tax credit in an amount equal to the qualified applicant’s estimated qualifying investment. _____ to the Internal Revenue Code or such amount is allowed to be deducted under section 179 of the Internal Revenue Code. The bill defines “qualifying fixed capital assets” to mean land, tangible personal property, and computer software used exclusively in this state as part of a coordinated plan to create a shared quantum facility. The authority may determine that a qualified applicant is entitled to a credit reservation. The reservation of a credit does not entitle the qualified applicant to the issuance of a tax credit certificate until the qualified applicant complies with all other requirements specified in the bill for the issuance of the credit. When the authority approves a tax credit reservation under the bill, the authority may also impose additional requirements on the qualified applicant before a tax credit certificate is issued to the qualified applicant. The credit is available for tax years beginning on or after January 1, 2026, but before January 1, 2033. The bill limits the aggregate amount of credits and reserved credits awarded each fiscal year to $24 million, and restricts the total tax credits that may be awarded to $44 million in the aggregate. In determining which eligible project to award a credit to, the authority may prioritize eligible projects that demonstrate an ability to meet application requirements, have received a substantial federal award for purposes of cultivating and expanding a quantum-related ecosystem within this state, and have provided detailed explanations of the ways the shared quantum facility benefits the quantum industry in the state. The failure of a qualified applicant in fulfilling any requirement under the bill or any terms and obligations of any agreement may result in the reduction, termination, or rescission of the tax credits claimed. The bill also specifies the procedures for the repayment or recapture of credits. The bill requires the authority to adopt rules to administer the credit. _____ The bill applies to tax years beginning on or after January 1, 2026.