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H0275aaS............................................by REVENUE AND TAXATION
INCOME TAX - Amends, repeals and adds to existing law to reduce the
individual income tax rates for taxable year 2001 and 2002 and thereafter;
to provide for rebates of 10.6% of the 1999 income tax paid by individuals,
subject to a $25.00 minimum and $25,000 maximum; to increase the grocery
tax credit for individuals; to increase the capital gains deduction; to
permanently reduce the corporate income tax rate by 0.3%; to provide five
new or expanded income tax credits for research and development
expenditures, creation of new jobs, providing new venture capital,
installing broadband communications equipment, and investing in counties
with high unemployment or low personal income; to change the child care
deduction to a credit equal to one-half the federal credit; to permanently
increase credit for caring for a dependent over 65 years of age or caring
for a person who is developmentally disabled from $100 to $500; to provide
for a capital gains deduction for qualifying taxpayers; to provide income
tax credits for personal property taxes; to provide for treatment of a
General Fund surplus; and to provide an income tax credit for up to two
children under the age of sixty months who are being cared for in their
home by their parent.
02/15 House intro - 1st rdg - to printing
02/16 Rpt prt - to 2nd rdg
02/19 2nd rdg - to 3rd rdg
02/20 3rd rdg - PASSED - 54-14-2
AYES -- Barraclough, Barrett, Bedke, Bell, Bolz, Bradford, Bruneel,
Callister, Campbell, Clark, Collins, Crow, Cuddy, Deal, Denney,
Ellis, Ellsworth, Eskridge, Field(13), Field(20), Gagner, Gould,
Hadley, Hammond, Harwood, Higgins, Hornbeck, Kellogg, Kendell, Kunz,
Lake, Langford, Mader, McKague, Meyer, Montgomery, Mortensen, Moss,
Moyle, Pearce, Pischner, Pomeroy, Raybould, Sali, Schaefer, Sellman,
Smith, Stevenson, Swan, Tilman, Wheeler, Wood, Young, Mr. Speaker
NAYS -- Bieter, Black, Boe, Chase, Henbest, Jaquet, Jones,
Loertscher, Marley, Robison, Shepherd, Smylie, Stone, Trail
Absent and excused -- Ridinger, Roberts
Floor Sponsor -- Crow
Title apvd - to Senate
02/21 Senate intro - 1st rdg - to Loc Gov
03/08 Rpt out - to 14th Ord
03/22 Rpt out amen - to 1st rdg as amen
1st rdg - to 2nd rdg as amen
03/23 2nd rdg - to 3rd rdg as amen
3rd rdg as amen - PASSED - 34-1-0
AYES -- Andreason, Boatright, Branch, Brandt, Bunderson, Burtenshaw,
Cameron, Danielson, Darrington, Davis, Deide, Dunklin, Frasure,
Geddes, Goedde, Hawkins, Ingram, Ipsen, Keough, King-Barrutia, Lee,
Lodge, Noh, Richardson, Risch, Sandy, Schroeder, Sims, Sorensen,
Stegner, Stennett, Thorne, Wheeler, Williams,
NAYS -- Whitworth
Absent and excused -- None
Floor Sponsor --Thorne
Title apvd - to House
03/26 House NOT concurred in Senate amens
To Office of the Chief Clerk
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-sixth Legislature First Regular Session - 2001
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 275
BY REVENUE AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO INCOME TAX RELIEF; AMENDING SECTION 63-3024, IDAHO CODE, TO PRO-
3 VIDE FOR A REDUCTION IN RATES FOR TAXABLE YEAR 2001 AND TO PROVIDE FOR AN
4 ADDITIONAL REDUCTION IN RATES FOR TAXABLE YEAR 2002 AND THEREAFTER; AMEND-
5 ING CHAPTER 30, TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW SECTION
6 63-3081, IDAHO CODE, TO PROVIDE A REBATE OF INCOME TAXES PAID BY INDIVIDU-
7 ALS FOR TAXABLE YEARS BEGINNING IN 1999, TO DETERMINE THE RATE OF THE
8 REBATE, TO SET MAXIMUM AND MINIMUM AMOUNTS, TO PROVIDE PROCEDURES, TO
9 APPROPRIATE MONEYS AND TO AUTHORIZE CONTRACTS; REPEALING SECTION 63-3022D,
10 IDAHO CODE; AMENDING SECTION 63-3022E, IDAHO CODE, TO INCREASE THE DEDUC-
11 TION FOR DEPENDENTS SIXTY-FIVE YEARS OF AGE OR OLDER OR PERSONS WITH
12 DEVELOPMENTAL DISABILITIES FROM ONE THOUSAND DOLLARS TO FIVE THOUSAND DOL-
13 LARS; AMENDING SECTION 63-3022H, IDAHO CODE, TO INCREASE THE DEDUCTION
14 ALLOWED FOR QUALIFIED CAPITAL GAINS AND TO ADD CERTAIN INVESTMENTS HELD BY
15 IDAHO PRIVATE VENTURE CAPITAL COMPANIES FOR A PERIOD OF THREE YEARS TO THE
16 PROPERTY QUALIFYING FOR THE CAPITAL GAINS DEDUCTION AND TO MAKE TECHNICAL
17 CORRECTIONS; AMENDING SECTION 63-3024A, IDAHO CODE, TO INCREASE THE INCOME
18 TAX CREDIT FOR SALES TAXES PAID BY INDIVIDUALS AND TO MAKE TECHNICAL COR-
19 RECTIONS; AMENDING SECTION 63-3025, IDAHO CODE, TO REDUCE THE CORPORATE
20 INCOME TAX RATE FROM EIGHT TO SEVEN AND SEVEN-TENTHS PERCENT FOR TAXABLE
21 YEAR 2001 AND TO SEVEN AND FIVE-TENTHS PERCENT FOR TAXABLE YEAR 2002 AND
22 THEREAFTER; AMENDING SECTION 63-3025A, IDAHO CODE, TO REDUCE THE CORPORATE
23 FRANCHISE TAX RATE FROM EIGHT PERCENT TO THE RATE OF THE CORPORATE INCOME
24 TAX AND TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION 63-3025D, IDAHO
25 CODE, TO INCREASE THE PAYMENT FOR DEPENDENTS SIXTY-FIVE YEARS OF AGE OR
26 OLDER OR PERSONS WITH DEVELOPMENTAL DISABILITIES FROM ONE HUNDRED DOLLARS
27 TO FIVE HUNDRED DOLLARS AND TO MAKE A TECHNICAL CORRECTION; AMENDING SEC-
28 TION 63-3029B, IDAHO CODE, TO PROVIDE THAT TAXPAYERS MAKING EXPENDITURES
29 FOR QUALIFIED BROADBAND EQUIPMENT ARE ENTITLED TO THE CREDIT AND TO REVISE
30 PROCEDURES FOR RECAPTURE; AMENDING SECTIONS 63-3029E AND 63-3029F, IDAHO
31 CODE, TO EXPAND THE NEW JOBS CREDIT BY REMOVING THE LIMITATION OF QUALIFY-
32 ING TAXPAYERS TO REVENUE-PRODUCING ENTERPRISE CREATING VALUE-ADDED NATURAL
33 RESOURCE PRODUCTS; AMENDING CHAPTER 30, TITLE 63, IDAHO CODE, BY THE
34 ADDITION OF A NEW SECTION 63-3029G, IDAHO CODE, TO PROVIDE AN INCOME TAX
35 CREDIT FOR CERTAIN EXPENDITURES RELATING TO RESEARCH ACTIVITIES CONDUCTED
36 IN IDAHO, TO PROVIDE A SUNSET, TO PROVIDE A CARRYOVER OF UNUSED CREDITS,
37 TO PROVIDE DEFINITIONS AND TO PROVIDE PROCEDURES; AMENDING SECTION
38 63-3029H, IDAHO CODE, TO REDESIGNATE THE SECTION; AMENDING CHAPTER 30,
39 TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 63-3029H, IDAHO
40 CODE, TO PROVIDE A CREDIT FOR EXPENSES FOR HOUSEHOLD AND DEPENDENT CARE;
41 AMENDING CHAPTER 30, TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW SEC-
42 TION 63-3029I, IDAHO CODE, TO PROVIDE AN INCOME TAX CREDIT FOR CERTAIN
43 EXPENDITURES RELATING TO HIGH SPEED BROADBAND COMMUNICATIONS ACCESS IN
44 IDAHO, TO PROVIDE A SUNSET, TO PROVIDE A CARRYOVER OF UNUSED CREDITS, TO
45 PROVIDE DEFINITIONS AND TO PROVIDE PROCEDURES; AMENDING CHAPTER 30, TITLE
46 63, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 63-3029J, IDAHO CODE, TO
2
1 PROVIDE AN INCOME TAX CREDIT FOR CERTAIN EXPENDITURES RELATING TO INVEST-
2 MENT IN AREAS IN IDAHO WITH HIGH UNEMPLOYMENT OR LOW PERSONAL INCOME AT
3 THE ELECTION OF THE TAXPAYER, TO PROVIDE A SUNSET, TO PROVIDE A CARRYOVER
4 OF UNUSED CREDITS, TO PROVIDE DEFINITIONS AND TO PROVIDE PROCEDURES;
5 AMENDING CHAPTER 30, TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW SEC-
6 TION 63-3029K, IDAHO CODE, TO PROVIDE A TEN PERCENT INCOME TAX CREDIT FOR
7 INVESTMENTS IN IDAHO PRIVATE VENTURE CAPITAL COMPANIES, TO PROVIDE A SUN-
8 SET, TO PROVIDE A CARRYOVER OF UNUSED CREDITS, TO PROVIDE DEFINITIONS AND
9 TO PROVIDE PROCEDURES; REPEALING SECTIONS 63-3029E AND 63-3029F, IDAHO
10 CODE; AMENDING CHAPTER 30, TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW
11 SECTION 63-3029E, IDAHO CODE, TO PROVIDE DEFINITIONS AND CONSTRUCTION OF
12 TERMS; AMENDING CHAPTER 30, TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW
13 SECTION 63-3029F, IDAHO CODE, TO PROVIDE SPECIAL CREDITS TO THE INCOME TAX
14 FOR NEW EMPLOYEES FOR AN ENTERPRISE THAT PRODUCES, ASSEMBLES, FABRICATES
15 OR PROCESSES NATURAL RESOURCE PRODUCTS; AMENDING CHAPTER 30, TITLE 63,
16 IDAHO CODE, BY THE ADDITION OF A NEW SECTION 63-3022Q, IDAHO CODE, TO PRO-
17 VIDE FOR A DEDUCTION OF CAPITAL GAINS FOR QUALIFYING TAXPAYERS, TO PROVIDE
18 LIMITATION, TO DEFINE TERMS AND TO PROVIDE PROCEDURES; AMENDING CHAPTER
19 30, TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 63-3024D, IDAHO
20 CODE, TO PROVIDE FOR STATE INCOME TAX CREDITS FOR THE PAYMENT OF PERSONAL
21 PROPERTY TAXES BY CERTAIN TAXPAYERS DURING TAX YEAR 2001, TO PROVIDE A
22 DEFINITION OF "AGRICULTURAL MACHINERY AND EQUIPMENT", TO PROVIDE THE MAXI-
23 MUM AMOUNT OF THE CREDIT AND TO PROVIDE PROCEDURES; AMENDING CHAPTER 35,
24 TITLE 67, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 67-3529, IDAHO
25 CODE, TO PROVIDE FOR TREATMENT OF A GENERAL FUND SURPLUS AND TO PROVIDE
26 FOR REMITTANCE OF CERTAIN MONEYS TO THE STATE REFUND FUND AND TO PROVIDE
27 FOR REMITTANCE TO THE GENERAL FUND; AMENDING SECTION 63-3067, IDAHO CODE,
28 TO PROVIDE THAT MONEYS IN THE STATE REFUND FUND MAY BE USED FOR REPAYING
29 TAXPAYERS FOR CERTAIN PERSONAL PROPERTY TAXES PAID AND TO MAKE TECHNICAL
30 CORRECTIONS; AMENDING CHAPTER 30, TITLE 63, IDAHO CODE, BY THE ADDITION OF
31 A NEW SECTION 63-3029L, IDAHO CODE, TO PROVIDE AN INCOME TAX CREDIT FOR
32 EACH QUALIFIED CHILD, FOR UP TO TWO QUALIFYING CHILDREN, CARED FOR AT HOME
33 BY HIS OWN PARENT; PROVIDING FOR NONSEVERABILITY OF CERTAIN PROVISIONS OF
34 THIS ACT; DECLARING AN EMERGENCY, PROVIDING RETROACTIVE APPLICATION FOR
35 CERTAIN PROVISIONS OF THIS ACT AND PROVIDING EFFECTIVE DATES.
36 Be It Enacted by the Legislature of the State of Idaho:
37 SECTION 1. That Section 63-3024, Idaho Code, be, and the same is hereby
38 amended to read as follows:
39 63-3024. INDIVIDUALS' TAX AND TAX ON ESTATES AND TRUSTS. For taxable year
40 20001, a tax measured by Idaho taxable income as defined in this chapter is
41 hereby imposed upon every individual, trust, or estate required by this chap-
42 ter to file a return.
43 (a) (i) The tax imposed upon individuals, trusts and estates shall be
44 computed at the following rates:
45 When Idaho taxable income is: The rate is:
46 Less than $1,000 One and nine eight-tenths percent (1.98%)
47 $1,000 but less than $2,000 $198, plus three and nine eight-tenths
48 percent (3.98%) of the amount over $1,000
49 $2,000 but less than $3,000 $586, plus four and four three-tenths
50 percent (4.43%) of the amount over $2,000
51 $3,000 but less than $4,000 $10299, plus five and four three-tenths
52 percent (5.43%) of the amount over $3,000
3
1 $4,000 but less than $5,000 $1562, plus six and four three-tenths
2 percent (6.43%) of the amount over $4,000
3 $5,000 but less than $7,500 $22015, plus seven
4 and four three-tenths
5 percent (7.43%) of the amount over $5,000
6 $7,500 but less than $20,000 $405397.50, plus
7 seven and seven six-tenths
8 percent (7.76%) of the amount over $7,500
9 Over $20,000 $1,3647.50, plus eight and one-tenth
10 percent (8.10%) of the amount over $20,000
11 (ii) For taxable year 20012 and each taxable year thereafter, a tax mea-
12 sured by Idaho taxable income as defined in this chapter is hereby imposed
13 upon every individual, trust, or estate required by this chapter to file a
14 return.
15 The tax imposed upon individuals, trusts and estates shall be computed at the
16 following rates:
17 When Idaho taxable income is: The rate is:
18 Less than $1,000 Two percent (2.0%)
19 $1,000 but less than $2,000 $20, plus four percent (4.0%)
20 of the amount over $1,000
21 $2,000 but less than $3,000 $60, plus four and one-half percent
22 (4.5%) of the amount over $2,000
23 $3,000 but less than $4,000 $105, plus five and one-half percent
24 (5.5%) of the amount over $3,000
25 $4,000 but less than $5,000 $160, plus six and one-half percent
26 (6.5%) of the amount over $4,000
27 $5,000 but less than $7,500 $225, plus seven and one-half percent
28 (7.5%) of the amount over $5,000
29 $7,500 but less than $20,000 $412.50, plus seven and eight-tenths percent
30 (7.8%) of the amount over $7,500
31 Over $20,000 $1,387.50, plus eight and two-tenths percent
32 (8.2%) of the amount over $20,000
33 Less than $1,000 One and five-tenths percent (1.5%)
34 $1,000 but less than $2,000 $15, plus three and five-tenths percent
35 (3.5%) of the amount over $1,000
36 $2,000 but less than $3,000 $50, plus four percent
37 (4.0%) of the amount over $2,000
38 $3,000 but less than $4,000 $90, plus five percent
39 (5.0%) of the amount over $3,000
40 $4,000 but less than $5,000 $140, plus six percent
41 (6.0%) of the amount over $4,000
42 $5,000 but less than $7,500 $200, plus seven percent
43 (7.0%) of the amount over $5,000
44 $7,500 but less than $20,000 $375, plus seven and three-tenths percent
45 (7.3%) of the amount over $7,500
46 Over $20,000 $1,287.50, plus seven and seven-tenths percent
47 (7.7%) of the amount over $20,000
48 For taxable year 2000 and each year thereafter, the state tax commission
49 shall prescribe a factor which shall be used to compute the Idaho income tax
50 brackets provided in subsections (a)(i) and (a)(ii) of this section. The fac-
51 tor shall provide an adjustment to the Idaho tax brackets so that inflation
52 will not result in a tax increase. The Idaho tax brackets shall be adjusted as
53 follows: multiply the bracket amounts by the percentage (the consumer price
54 index for the calendar year immediately preceding the calendar year to which
55 the adjusted brackets will apply divided by the consumer price index for cal-
4
1 endar year 1998). For the purpose of this computation, the consumer price
2 index for any calendar year is the average of the consumer price index as of
3 the close of the twelve (12) month period for the immediately preceding calen-
4 dar year as adopted by the state tax commission. This adoption shall be exempt
5 from the provisions of chapter 52, title 67, Idaho Code. The consumer price
6 index shall mean the consumer price index for all U.S. urban consumers pub-
7 lished by the United States department of labor. The state tax commission
8 shall annually include the factor as provided in this subsection to multiply
9 against Idaho taxable income in the brackets above to arrive at that year's
10 taxable income for tax bracket purposes.
11 (b) In case a joint return is filed by husband and wife pursuant to the
12 provisions of section 63-3031, Idaho Code, the tax imposed by this section
13 shall be twice the tax which would be imposed on one-half (1/2) of the aggre-
14 gate Idaho taxable income. For the purposes of this section, a return of a
15 surviving spouse, as defined in section 2(a) of the Internal Revenue Code, and
16 a head of household, as defined in section 2(b) of the Internal Revenue Code,
17 shall be treated as a joint return and the tax imposed shall be twice the tax
18 which would be imposed on one-half (1/2) of the Idaho taxable income.
19 (c) The state tax commission shall compute and publish Idaho income tax
20 liability for taxpayers at the midpoint of each bracket of Idaho taxable
21 income in fifty dollar ($50.00) steps to fifty thousand dollars ($50,000),
22 rounding such calculations to the nearest dollar. Taxpayers having income
23 within such brackets shall file returns based upon and pay taxes according to
24 the schedule thus established. The state tax commission shall promulgate rules
25 defining the conditions upon which such returns shall be filed.
26 SECTION 2. That Chapter 30, Title 63, Idaho Code, be, and the same is
27 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
28 ignated as Section 63-3081, Idaho Code, and to read as follows:
29 63-3081. REBATE OF INCOME TAX. (1) Subject to the limitations of this
30 section, in regard to each individual income tax return required to be filed
31 pursuant to section 63-3030, Idaho Code, and that is actually filed, for a
32 twelve (12) month taxable year beginning in 1999 for which tax is imposed by
33 section 63-3024, Idaho Code, on at least one dollar ($1.00) of Idaho taxable
34 income, the state tax commission shall, on a one-time basis, rebate to the
35 taxpayer named on the return the amount specified in subsection (2) of this
36 section. In the case of a joint return, the rebate shall be paid to both tax-
37 payers jointly.
38 (2) (a) The rebate provided by subsection (1) of this section shall be
39 ten and six-tenths percent (10.6%) of the amount of tax computed under
40 section 63-3024, Idaho Code, reduced by credits provided by:
41 (i) Section 63-3029, Idaho Code, relating to taxes paid to another
42 state;
43 (ii) Sections 63-3029A and 63-3029C, Idaho Code, relating to certain
44 charitable contributions;
45 (iii) Section 63-3029B, Idaho Code, relating to capital investments;
46 (iv) Section 63-3029D, Idaho Code, relating to qualified equipment
47 utilizing postconsumer waste or postindustrial waste.
48 (b) When the amount of a rebate payable under subsection (2)(a) of this
49 section is less than twenty-five dollars ($25.00), the amount of the
50 rebate shall be twenty-five dollars ($25.00). When the amount of a rebate
51 payable under subsection (2)(a) of this section is more than two thousand
52 five hundred dollars ($2,500), the amount of the rebate shall be two thou-
53 sand five hundred dollars ($2,500). In the case of married taxpayers fil-
5
1 ing separate returns, only one (1) minimum or maximum rebate shall be
2 paid.
3 (3) No rebate shall be paid pursuant to this section in regard to a
4 return described in subsection (1) of this section if the return is not filed
5 within three (3) years of the original due date of the return, without regard
6 to extensions. In the event that the amount of tax due on a return filed
7 within the time required by this subsection is amended by the taxpayer or
8 changed by the state tax commission the rebate provided by this section shall
9 be adjusted proportionally. The state tax commission may offset a rebate
10 against taxes assessed the taxpayer but unpaid.
11 (4) In the case of a short period return, the rebates provided by this
12 section shall be reduced in proportion to the portion of calendar year 1999 to
13 which the return applies.
14 (5) Except as provided in this subsection, no application for a rebate
15 provided in this section shall be required. The state tax commission shall
16 cause each rebate to be mailed to the taxpayer or taxpayers at the address
17 shown on the return, unless, as a result of a more recent return, a newer
18 address is shown on the commission's records. The state tax commission may
19 provide a procedure by which rebates that are returned or undeliverable may be
20 claimed.
21 (6) Any person aggrieved by any action of the state tax commission in
22 regard to the rebates provided in this section shall file a petition with the
23 state tax commission in the manner provided in section 63-3045, Idaho Code.
24 Such a petition shall be subject to administrative and judicial review in the
25 manner provided by sections 63-3045 through 63-3049, Idaho Code.
26 (7) Rebates authorized by this section shall be paid from the state
27 refund account established by section 63-3067, Idaho Code, from which the
28 amounts necessary to pay the rebates are hereby appropriated. In the event
29 that, at the time the rebates are paid, there is an insufficient balance in
30 the state refund account, the state board of examiners, upon application by
31 the state tax commission, shall transfer sufficient funds from the general
32 fund to make the rebate payments and any other refunds due and payable from
33 the state refund account.
34 (8) The state tax commission, the state treasurer and the state control-
35 ler may contract with a commercial bank for some or all of the services,
36 including issuing payments, relating to payment of the rebate provided in
37 this section.
38 SECTION 3. That Section 63-3022D, Idaho Code, be, and the same is hereby
39 repealed.
40 SECTION 4. That Section 63-3022E, Idaho Code, be, and the same is hereby
41 amended to read as follows:
42 63-3022E. HOUSEHOLD DEDUCTION FOR DEPENDENTS SIXTY-FIVE YEARS OF AGE OR
43 OLDER OR PERSONS WITH DEVELOPMENTAL DISABILITIES. (1) An additional deduction
44 from taxable income shall be allowed in the case of an individual who main-
45 tains a household, which includes as an immediate member of the family resid-
46 ing in that household, one (1) or more individuals sixty-five (65) years of
47 age or older, or a person with developmental disabilities as defined in sub-
48 section (5) of section 66-402, Idaho Code, regardless of the age of the person
49 when such developmental disability appeared, each of whom receives more than
50 one-half (1/2) of his or her support for the year from the individual who
51 maintains the household. The amount of the deduction shall be one five thou-
52 sand dollars ($15,000) for each individual sixty-five (65) years of age or
6
1 older or with developmental disabilities.
2 (2) There shall not be allowed more than three (3) deductions of one five
3 thousand dollars ($15,000) under the provisions of this section on any one (1)
4 return.
5 (3) No deductions shall be allowed under this section for the person(s)
6 in whose name(s) the income tax return is filed except as set forth in subsec-
7 tion (4) of this section.
8 (4) A deduction of one five thousand dollars ($15,000) shall be allowed
9 under this section for a person with a developmental disability, as defined in
10 subsection (5) of section 66-402, Idaho Code, who is filing his own return.
11 SECTION 5. That Section 63-3022H, Idaho Code, be, and the same is hereby
12 amended to read as follows:
13 63-3022H. DEDUCTION OF CAPITAL GAINS. (1) If an individual taxpayer
14 reports a net capital gain in determining taxable income, sixty one hundred
15 percent (6100%) of the net capital gain from the sale or exchange of qualified
16 property shall be a deduction in determining taxable income.
17 (2) The deduction provided in this section is limited to the amount of
18 the net capital gain from all property included in federal taxable income. Net
19 capital gains treated as ordinary income by the iInternal rRevenue cCode do
20 not qualify for the deduction allowed in this section. The deduction otherwise
21 allowable under this section shall be reduced by the amount of any federal
22 capital gains deduction relating to such property, but not below zero.
23 (3) As used in this section "qualified property" means the following
24 property having an Idaho situs at the time of sale:
25 (a) Real property held at least eighteen (18) months;
26 (b) Tangible personal property used in Idaho for at least twelve (12)
27 months by a revenue-producing enterprise;
28 (c) Cattle or horses held for breeding, draft, dairy or sporting purposes
29 for at least twenty-four (24) months if more than one-half (1/2) of the
30 taxpayer's gross income (as defined in section 61(a) of the iInternal
31 rRevenue cCode) for the taxable year is from farming or ranching opera-
32 tions in Idaho;
33 (d) Breeding livestock other than cattle or horses held at least twelve
34 (12) months if more than one-half (1/2) of the taxpayer's gross income (as
35 defined in section 61(a) of the iInternal rRevenue cCode) for the taxable
36 year is from farming or ranching operations in Idaho;
37 (e) Timber grown in Idaho and held at least twenty-four (24) months;
38 (f) An equity interest held by an Idaho private venture capital company
39 as defined in section 63-3029K, Idaho Code, including stock in a corpora-
40 tion, interest in a partnership or membership in a limited liability com-
41 pany, if:
42 (i) The Idaho private venture capital company or its investors have
43 held the equity interest for at least three (3) years from the date
44 of the original investment; and
45 (ii) The equity interest is issued by a business enterprise that is
46 headquartered and managed in Idaho whose business activity for the
47 entity's three (3) taxable years immediately preceding the sale is
48 entirely in Idaho or at least fifty percent (50%) in Idaho as deter-
49 mined by the average property and payroll factors under section
50 63-3027, Idaho Code.
51 (g) In determining the period for which property subject to this section
52 has been held by a taxpayer, the provisions of section 1223 of the
53 iInternal rRevenue cCode shall apply, except that when the holding period
7
1 includes any period during which the taxpayer held property other than the
2 property sold, all property held during the holding period must qualify
3 under this section.
4 (4) If an individual reports a capital gain from qualified property from
5 an S corporation or a partnership, a deduction shall be allowed under this
6 section only to the extent the individual held his interest in the income of
7 the S corporation or the partnership for the time required by subsection (3)
8 of this section for the property sold.
9 (5) If an individual reports a capital gain from an estate, no deduction
10 shall be allowed under this section unless the holding period required in sub-
11 section (3) of this section was satisfied by the decedent, the estate, or the
12 beneficiary, or a combination thereof.
13 (6) If an individual reports a capital gain from a trust, no deduction
14 shall be allowed under this section unless the holding period required in sub-
15 section (3) of this section was satisfied by the grantor, the trust, or the
16 beneficiary, or a combination thereof.
17 (7) As used in this section "revenue-producing enterprise" means:
18 (a) The production, assembly, fabrication, manufacture, or processing of
19 any agricultural, mineral or manufactured product;
20 (b) The storage, warehousing, distribution, or sale at wholesale of any
21 products of agriculture, mining or manufacturing;
22 (c) The feeding of livestock at a feedlot;
23 (d) The operation of laboratories or other facilities for scientific,
24 agricultural, animal husbandry, or industrial research, development, or
25 testing.
26 SECTION 6. That Section 63-3024A, Idaho Code, be, and the same is hereby
27 amended to read as follows:
28 63-3024A. CREDITS AND REFUNDS. (a) Any resident individual not entitled
29 to the credit allowed in subsection (b)(1), who is required to file by law and
30 who has filed an Idaho income tax return, shall be allowed a credit against
31 taxes due under the Idaho income tax act equal to the amount of fifteen thirty
32 dollars ($1530.00) for each personal exemption for which a deduction is per-
33 mitted by section 151(b) and (c) of the Internal Revenue Code if such deduc-
34 tion is claimed on the taxpayer's Idaho income tax return, and if the individ-
35 ual for whom the deduction is claimed is a resident of the state of Idaho. If
36 taxes due are less than the total credit allowed, the taxpayer shall be paid a
37 refund equal to the balance of the unused credit. If the credit or refund is
38 not claimed for the year for which the individual income tax return is filed,
39 the right thereafter to claim such credit or refund shall be forfeited. The
40 state tax commission shall prescribe the method by which the refund, if any,
41 is to be made to the taxpayer.
42 (b) (1) A resident individual who has reached his sixty-fifth birthday
43 before the end of his taxable year, who is required to file by law and who
44 has filed an Idaho income tax return, shall be allowed a credit against
45 taxes due under the Idaho income tax act equal to the amount of thirty
46 forty-five dollars ($3045.00) for each personal exemption representing
47 himself, a spouse over the age of sixty-five (65) years, or a dependent
48 over the age of sixty-five (65) years, but shall be allowed a credit
49 against taxes due under the Idaho income tax act equal to fifteen thirty
50 dollars ($1530.00) for each personal exemption representing a spouse or
51 dependent under the age of sixty-five (65) years. If taxes due are less
52 than the total credit allowed, the taxpayer shall be paid a refund equal
53 to the balance of the unused credit. If the credit or refund is not
8
1 claimed for the year for which the individual income tax return is filed,
2 the right thereafter to claim such credit or refund shall be forfeited.
3 The state tax commission shall prescribe the method by which the refund,
4 if any, is to be made to the taxpayer.
5 (2) A resident individual who has reached his sixty-fifth birthday and is
6 not required by law to file an Idaho income tax return and who has
7 received no credit or refund under any other subsection of this section,
8 shall be entitled to a refund of thirty forty-five dollars ($3045.00). Any
9 refund shall be paid to such individual only upon his making application
10 therefor at such time and in such manner as may be prescribed by the state
11 tax commission.
12 (c) A resident individual of the state of Idaho who is:
13 (i) blind, or
14 (ii) a disabled American veteran of any war engaged in by the United
15 States, whose disability is recognized as a service connected disability
16 of a degree of ten per cent percent (10%) or more, or who is in receipt of
17 a pension for nonservice connected disabilities, in accordance with laws
18 and regulations administered by the United States veterans administration,
19 substantiated by a statement as to status signed by a responsible officer
20 of the United States veterans administration, or
21 (iii) over sixty-two (62) years of age, and has been allowed none, or less
22 than all, of the credit provided by subsection (a) or subsection (b) of
23 this section, shall be entitled to a payment from the refund fund in an
24 amount equal to fifteen thirty dollars ($1530.00), or the balance of his
25 unused credit, whichever is less, upon making application therefor at such
26 time and in such manner as the state tax commission may prescribe.
27 (d) Any part-year resident entitled to a credit under this section shall
28 receive a proportionate credit, in the manner above provided, reflecting the
29 part of the year in which he was domiciled in this state.
30 (e) No credit or refund may be claimed for an exemption which represents
31 a person who has himself filed an Idaho income tax return claiming a deduction
32 for his own personal exemption, and in no event shall more than one (1) tax-
33 payer be allowed a credit or refund for the same exemption, or under more than
34 one (1) subsection of this section.
35 (f) The refunds authorized by this section shall be paid from the state
36 refund fund in the same manner as the refunds authorized by section 63-3067,
37 Idaho Code.
38 (g) An application for any refund which is due and payable under the pro-
39 visions of this section must be filed with the state tax commission within
40 three (3) years of:
41 (i) the due date, including extensions, of the return required under sec-
42 tion 63-3030, Idaho Code, if the applicant is required to file a return,
43 or
44 (ii) the 15th day of April of the year following the year to which the
45 application relates if the applicant is not required to file a return.
46 SECTION 7. That Section 63-3025, Idaho Code, be, and the same is hereby
47 amended to read as follows:
48 63-3025. TAX ON CORPORATE INCOME. For taxable years commencing on and
49 after January 1, 1987 2001, a tax is hereby imposed on the Idaho taxable
50 income of a corporation which transacts or is authorized to transact business
51 in this state or which has income attributable to this state. The tax shall be
52 equal to eight seven and seven-tenths percent (87.7%) of Idaho taxable income
53 for taxable year 2001 and seven and five-tenths percent (7.5%) of Idaho tax-
9
1 able income for taxable year 2002 and thereafter; provided, however, that the
2 tax shall not be less than twenty dollars ($20.00); provided further that the
3 twenty dollar ($20.00) minimum payment shall not be collected from nonproduc-
4 tive mining corporations. The tax imposed by this section shall not apply to
5 corporations taxed pursuant to the provisions of section 63-3025A, Idaho Code.
6 SECTION 8. That Section 63-3025A, Idaho Code, be, and the same is hereby
7 amended to read as follows:
8 63-3025A. FRANCHISE TAX. For taxable years commencing on and after Janu-
9 ary 1, 1987 2001, a franchise tax shall be imposed upon any corporation for
10 the privilege of exercising its corporate franchise within the state during
11 such taxable year, including, but not limited to, corporations engaged in
12 business in Idaho for the exclusive purpose of performing contracts with the
13 United States department of energy at the Idaho national engineering and envi-
14 ronmental laboratory, which tax shall be measured by income which is attribut-
15 able to this state under the provisions of this chapter and which tax shall be
16 equal to eight percent (8%) of Idaho taxable income at the rate provided in
17 section 63-3025, Idaho Code; provided, however, that the tax shall not be less
18 than twenty dollars ($20.00); provided further that the twenty dollar ($20.00)
19 minimum payment shall not be collected from nonproductive mining corporations;
20 but the twenty dollar ($20.00) minimum tax shall apply to corporations quali-
21 fied to file returns and actually filing returns under the provisions of sub-
22 chapter "S" of the Internal Revenue Code.
23 SECTION 9. That Section 63-3025D, Idaho Code, be, and the same is hereby
24 amended to read as follows:
25 63-3025D. PAYMENT FOR DEPENDENTS SIXTY-FIVE YEARS OF AGE OR OLDER OR PER-
26 SONS WITH DEVELOPMENTAL DISABILITIES. (1) In lieu of the deduction from tax-
27 able income allowed by section 63-3022E, Idaho Code, a resident individual who
28 maintains a household, which includes as an immediate member of the family
29 residing in that household, one (1) or more individuals sixty-five (65) years
30 of age or older or individuals with developmental disabilities, as defined in
31 subsection (5) of section 66-402, Idaho Code, each of whom receives more than
32 one-half (1/2) of his or her support for the year from the individual who
33 maintains the household, shall be entitled to a payment from the refund
34 account of one five hundred dollars ($1500) for each such elderly member of
35 the family or family member with a developmental disability. Any such payment
36 shall be paid to such individual only upon his making application therefor at
37 such time and in such manner as may be prescribed by the state tax commission.
38 (2) No more than three (3) such payments shall be made under the provi-
39 sions of this section to any one (1) individual in any calendar year.
40 (3) No payment may be claimed under the provisions of this section by the
41 individual himself except as set forth in subsection (4) of this section.
42 (4) A credit of one five hundred dollars ($1500) shall be allowed under
43 this section for a person with a developmental disability as defined in sub-
44 section (5) of section 66-402, Idaho Code, who is filing his own tax return.
45 SECTION 10. That Section 63-3029B, Idaho Code, be, and the same is hereby
46 amended to read as follows:
47 63-3029B. INCOME TAX CREDIT FOR CAPITAL INVESTMENT. (1) At the election
48 of the taxpayer there shall be allowed, subject to the applicable limitations
49 provided herein as a credit against the income tax imposed by chapter 30,
10
1 title 63, Idaho Code, an amount equal to the sum of:
2 (a) The tax credit carryovers; and
3 (b) The tax credit for the taxable year.
4 (2) The maximum allowable amount of the credit for the current taxable
5 year shall be three percent (3%) of the amount of qualified investments made
6 during the taxable year.
7 (3) As used in this section "qualified investment" means certain depre-
8 ciable property which:
9 (a) (i) Is eligible for the federal investment tax credit, as defined in
10 sections 46(c) and 48 of the Internal Revenue Code subject to the
11 limitations provided for certain regulated companies in section 46(f)
12 of the Internal Revenue Code and is not a motor vehicle under eight
13 thousand (8,000) pounds gross weight; or
14 (ii) Is qualified broadband equipment as defined in section 63-3029I,
15 Idaho Code; and
16 (b) Is acquired, constructed, reconstructed, erected or placed into ser-
17 vice after December 31, 1981; and
18 (c) Has a situs in Idaho.
19 (4) Notwithstanding the provisions of subsections (1) and (2) of this
20 section, the amount of the credit allowed shall not exceed fifty percent (50%)
21 of the tax liability of the taxpayer.
22 (5) If the sum of credit carryovers from the credit allowed by subsection
23 (2) of this section and the amount of credit for the taxable year from the
24 credit allowed by subsection (2) of this section exceed the limitation imposed
25 by subsection (4) of this section for the current taxable year, the excess
26 attributable to the current taxable year's credit shall be an investment
27 credit carryover to the fourteen (14) succeeding taxable years. In the case of
28 a group of corporations filing a combined report under section 63-3027, Idaho
29 Code, or sections 63-3027B through 63-3027E, Idaho Code, credit earned by one
30 (1) member of the group but not used by that member may be used by another
31 member of the group, subject to the provisions of subsection (4) of this sec-
32 tion, instead of carried over. The entire amount of unused credit shall be
33 carried forward to the earliest of the succeeding years, wherein the oldest
34 available unused credit shall be used first, so long as the qualified invest-
35 ment property for which the unused credit was granted still maintains Idaho
36 situs. For a combined group of corporations, credit carried forward may be
37 claimed by any member of the group unless the member who earned the credit is
38 no longer included in the combined group.
39 (6) Any recapture of the credit allowed by subsection (2) of this section
40 on property disposed of or ceasing to qualify, prior to the close of its use-
41 ful life the recapture period, shall be determined according to the applicable
42 recapture provisions of the Internal Revenue Code. In the case of a unitary
43 group of corporations, the increase in tax due to the recapture of investment
44 tax credit must be reported by the member of the group who earned the credit
45 regardless of which member claimed the credit against tax.
46 (7) For the purpose of determining whether property placed in service is
47 a "qualified investment" as defined in subsection (3) of this section, the
48 provisions of section 49 of the Internal Revenue Code shall be disregarded.
49 (8) For purposes of this section, property has a situs in Idaho during a
50 taxable year if it is used in Idaho at any time during the taxable year. Prop-
51 erty not used in Idaho during a taxable year does not have a situs in Idaho in
52 the taxable year during which the property is not used in Idaho or in any sub-
53 sequent taxable year. No credit or carryover of credit is permitted under this
54 section if the credit or carryover relates to property that does not have a
55 situs in Idaho during the taxable year for which the credit or carryover is
11
1 claimed. The Idaho situs of property must be established by records maintained
2 by the taxpayer which are created reasonably contemporaneously with the use of
3 the property.
4 (9) In the case of property used both in and outside Idaho, the taxpayer,
5 electing to claim the credit provided in this section, must elect to compute
6 the qualified investment in property with a situs in Idaho for all such
7 investments first qualifying during that year in one (1), but only one (1), of
8 the following ways:
9 (a) The amount of each qualified investment in a specific asset shall be
10 separately computed based on the percentage of the actual use of the prop-
11 erty in Idaho by using a measure of the use, such as total miles or total
12 machine hours, that most accurately reflects the beneficial use during the
13 taxable year in which it is first acquired, constructed, reconstructed,
14 erected or placed into service; provided, that the asset is placed in ser-
15 vice more than ninety (90) days before the end of the taxable year. In the
16 case of assets acquired, constructed, reconstructed, erected or placed
17 into service within ninety (90) days prior to the end of the taxable year
18 in which the investment first qualifies, the measure of the use of that
19 asset within Idaho for that year shall be based upon the percentage of use
20 in Idaho during the first ninety (90) days of use of the asset;
21 (b) The investment in qualified property used both inside and outside
22 Idaho during the taxable year in which it is first acquired, constructed,
23 reconstructed, erected or placed into service shall be multiplied by the
24 percent of the investment that would be included in the numerator of the
25 Idaho property factor determined pursuant to section 63-3027, Idaho Code,
26 for the same year.
27 (10) Only for the purposes of subsections (3)(a) and (7) of this section,
28 references to sections of the "Internal Revenue Code" mean the sections
29 referred to as they existed in the Internal Revenue Code of 1986 prior to
30 November 5, 1990.
31 SECTION 11. That Section 63-3029E, Idaho Code, be, and the same is hereby
32 amended to read as follows:
33 63-3029E. DEFINITIONS -- CONSTRUCTION OF TERMS. As used in this section
34 and in section 63-3029F, Idaho Code:
35 (1) (a) "New employee" means a person from whom Idaho income tax has been
36 withheld, employed by the taxpayer, in a revenue-producing enterprise cre-
37 ating value-added natural resource products, and covered for unemployment
38 insurance purposes under chapter 13, title 72, Idaho Code, during the tax-
39 able year for which the credit allowed by section 63-3029F, Idaho Code, is
40 claimed. A person shall be deemed to be so engaged if such person performs
41 duties on:
42 (i) A regular full-time basis; or
43 (ii) A part-time basis if such person is customarily performing such
44 duties at least twenty (20) hours per week.
45 No credit shall be earned unless the new employee shall have performed
46 such duties for the taxpayer for a minimum of nine (9) months during the
47 taxable year for which the credit is claimed.
48 (b) The provisions of paragraph (a) of this subsection notwithstanding,
49 no credit shall be allowed for employment of persons by a taxpayer who
50 acquires a revenue-producing enterprise from another taxpayer or who oper-
51 ates in a place of business the same or a substantially identical revenue-
52 producing value-added natural resource products enterprise business as
53 operated by another taxpayer within the prior twelve (12) months, except
12
1 as the prior taxpayer would have qualified under the provisions of para-
2 graph (c) of this subsection. Employees transferred from a related tax-
3 payer shall not be included in the computation of the credit.
4 (c) The number of employees during any taxable year for any taxpayer
5 shall be the mathematical average of the number of employees reported to
6 the Idaho department of labor for employment security purposes during the
7 twelve (12) months of the taxable year which qualified under paragraph (a)
8 of this subsection. In the event the business is in operation for less
9 than the entire taxable year, the number of employees of the business for
10 the year shall be the average number actually employed during the months
11 of operation, providing that the qualifications of paragraph (a) of this
12 subsection are met.
13 (2) "Revenue-producing enterprise" means the production, assembly, fabri-
14 cation, manufacture or processing of any natural resource product.
15 (3) "Same or a substantially identical revenue-producing enterprise busi-
16 ness" means a revenue-producing enterprise business in which the products pro-
17 duced or sold, or the activities conducted are the same in character and use
18 and are produced, sold or conducted in the same manner as, or for the same
19 types of customers as, the products or activities produced, sold or conducted
20 in another revenue-producing enterprise business.
21 SECTION 12. That Section 63-3029F, Idaho Code, be, and the same is hereby
22 amended to read as follows:
23 63-3029F. SPECIAL CREDIT AVAILABLE -- NEW EMPLOYEES. (1) Any taxpayer
24 shall be allowed a credit, in an amount determined under subsection (2) of
25 this section, against the tax imposed by this chapter, other than the tax
26 imposed by section 63-3082, Idaho Code, for any taxable year during which the
27 taxpayer's employment of new employees, as defined under section 63-3029E(1),
28 Idaho Code, increases above the taxpayer's average employment for either: (a)
29 the prior taxable year, or (b) the average of three (3) prior taxable years,
30 whichever is higher. No credit shall be allowed under this section unless the
31 number of new employees equals or exceeds one (1) person.
32 (2) The credit authorized in subsection (1) of this section shall be five
33 hundred dollars ($500) per new employee, but the total credit allowed shall
34 not exceed three and one-quarter percent (3.25%) of net income from the
35 taxpayer's corporate, proprietorship, partnership, small business corporation
36 or limited liability company revenue-producing enterprise business in which
37 the employment occurred. Additionally, the total of this and all other credits
38 allowed under this chapter except for the credits allowed under sections
39 63-3024A, 63-3025D and 63-3029, Idaho Code, taken during any taxable year
40 shall not exceed forty-five percent (45%) of the tax otherwise imposed on the
41 taxpayer for the taxable year for which such credit is allowed.
42 (3) If the sum of the credit carryovers from the credit allowed by sub-
43 section (2) of this section and the amount of credit for the taxable year from
44 the credit allowed by subsection (2) of this section exceed the limitation
45 imposed by subsection (2) of this section for the current taxable year, the
46 excess attributable to the current taxable year's credit shall be a credit
47 carryover to the three (3) succeeding taxable years. The entire amount of
48 unused credit shall be carried forward to the earliest of the succeeding
49 years, wherein the oldest available unused credit shall be used first, so long
50 as the employment level for which the credit was granted is still maintained.
51 SECTION 13. That Chapter 30, Title 63, Idaho Code, be, and the same is
52 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
13
1 ignated as Section 63-3029G, Idaho Code, and to read as follows:
2 63-3029G. CREDITS FOR RESEARCH ACTIVITIES CONDUCTED IN THIS STATE --
3 CARRY FORWARD.
4 (1) (a) Subject to the limitations of this section, for taxable years
5 beginning between January 1, 2001, and December 31, 2005, inclusive, there
6 shall be allowed to a taxpayer a nonrefundable credit against taxes
7 imposed by sections 63-3024, 63-3025 and 63-3025A, Idaho Code, for
8 increasing research activities in Idaho during any consecutive five (5)
9 year period beginning, at the election of the taxpayer, either:
10 (i) January 1, 2001, or
11 (ii) The first day of the taxpayer's taxable year beginning in 2001.
12 (b) The credit allowed by subsection (1)(a) of this section shall be the
13 sum of:
14 (i) Five percent (5%) of the excess of qualified research payments
15 for research conducted in Idaho over the base amount; and
16 (ii) Five percent (5%) basic research payments allowable under sub-
17 section (e) of section 41 of the Internal Revenue Code for basic
18 research conducted in Idaho.
19 (c) Subject to the limitation in subsection (3) of this section, a tax-
20 payer making the election permitted by subsection (1)(a)(i) of this sec-
21 tion, credit for research activities occurring prior to the beginning of
22 the taxpayer's taxable year beginning in 2001 shall be claimed on the
23 taxpayer's return for its taxable year 2001 in addition to credit relating
24 to activity in that year.
25 (2) As used in this section:
26 (a) The terms "qualified research payments," "qualified research," "basic
27 research payments" and "basic research" shall be as defined in section 41
28 of the Internal Revenue Code except that the research must be conducted in
29 Idaho.
30 (b) The term "base amount" shall mean an amount calculated as provided in
31 sections 41(c) and 41(h) of the Internal Revenue Code, except that:
32 (i) The base amount does not include the calculation of the alter-
33 native incremental credit provided for in section 41(c)(4) of the
34 Internal Revenue Code;
35 (ii) A taxpayer's gross receipts include only those gross receipts
36 attributable to sources within this state as provided in subsections
37 (q) and (r) of section 63-3027, Idaho Code; and
38 (iii) Notwithstanding section 41(c) of the Internal Revenue Code, for
39 purposes of calculating the base amount, a taxpayer:
40 (A) May elect to be treated as a start-up company as provided
41 in section 41(c)(3)(B) of the Internal Revenue Code, regardless
42 of whether the taxpayer meets the requirements of section
43 41(c)(3)(B)(i)(I) or (II) of the Internal Revenue Code; and
44 (B) May not revoke an election to be treated as a start-up com-
45 pany.
46 (3) The credit allowed by subsection (1)(a) of this section together with
47 any credits carried forward under subsection (5) of this section shall not
48 exceed the amount of tax due under sections 63-3024, 63-3025 and 63-3025A,
49 Idaho Code, after allowance for all other credits permitted by this chapter.
50 When credits earned in more than one (1) taxable year are available, the old-
51 est credits shall be applied first.
52 (4) In the case of a group of corporations filing a combined report under
53 subsection (t) of section 63-3027, Idaho Code, credit earned by one (1) member
54 of the group but not used by that member may be used by another member of the
14
1 group. For a combined group of corporations, any member of the group may claim
2 credit carried forward unless the member who earned the credit is no longer
3 included in the combined group.
4 (5) The credit allowed by subsection (1)(a) of this section shall be
5 claimed for the taxable year during which the taxpayer qualifies for the
6 credit. If the credit exceeds the limitation under subsection (3) of this sec-
7 tion, the excess amount may be carried forward for a period that does not
8 exceed the next fourteen (14) taxable years.
9 (6) In addition to other needed rules, the state tax commission may pro-
10 mulgate rules prescribing, in the case of S corporations, partnerships, trusts
11 or estates, a method of attributing the credit under this section to the
12 shareholders, partners or beneficiaries in proportion to their share of the
13 income from the S corporation, partnership, trust or estate.
14 SECTION 14. That Section 63-3029H, Idaho Code, be, and the same is hereby
15 amended to read as follows:
16 63-3029HP. PRIORITY OF CREDITS. When a taxpayer subject to any taxes
17 imposed under this chapter is entitled to two (2) or more credits against such
18 taxes, the priority of credits shall be determined in the following order:
19 (a) Nonrefundable credits. Nonrefundable credits shall be applied to the
20 tax liability before application of refundable credits. If a taxpayer is enti-
21 tled to more than one (1) nonrefundable credit, the credits shall be applied
22 in the order in which the statutes authorizing the credits were enacted by the
23 legislature.
24 (b) Refundable credits. Refundable credits shall be applied to the tax
25 liability after application of any nonrefundable credits.
26 SECTION 15. That Chapter 30, Title 63, Idaho Code, be, and the same is
27 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
28 ignated as Section 63-3029H, Idaho Code, and to read as follows:
29 63-3029H. CREDIT FOR HOUSEHOLD AND DEPENDENT CARE SERVICES NECESSARY FOR
30 GAINFUL EMPLOYMENT. (1) A resident individual who is entitled, for federal
31 income tax purposes, to claim and who does claim the credit provided by sec-
32 tion 21 of the Internal Revenue Code shall be entitled to a nonrefundable
33 credit against taxes imposed by section 63-3024, Idaho Code, equal to one-half
34 (1/2) of the credit allowable on that taxpayer's federal return for the same
35 taxable year.
36 (2) A nonresident or part-year resident individual who is entitled, for
37 federal income tax purposes, to claim and who does claim the credit provided
38 by section 21 of the Internal Revenue Code shall be entitled to a proportional
39 part of the credit otherwise provided in subsection (1) of this section. The
40 proportion shall be determined in accordance with the provisions of section
41 63-3026A(6), Idaho Code.
42 (3) The credit allowed by this section shall not exceed the total amount
43 of taxes due under section 63-3024, Idaho Code, after allowance of all other
44 credits provided in this chapter.
45 SECTION 16. That Chapter 30, Title 63, Idaho Code, be, and the same is
46 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
47 ignated as Section 63-3029I, Idaho Code, and to read as follows:
48 63-3029I. INCOME TAX CREDIT FOR INVESTMENT IN BROADBAND EQUIPMENT. (1)
49 Subject to the limitations of this section, for taxable years beginning
15
1 between January 1, 2001, and December 31, 2005, inclusive, there shall be
2 allowed to a taxpayer a nonrefundable credit against taxes imposed by sections
3 63-3024, 63-3025 and 63-3025A, Idaho Code, for qualified expenditures in qual-
4 ified broadband equipment in Idaho.
5 (2) The credit permitted in subsection (1) of this section shall be three
6 percent (3%) of the qualified investment in qualified broadband equipment in
7 Idaho and shall be in addition to the credit for capital investment permitted
8 by section 63-3029B, Idaho Code.
9 (3) As used in this section the term:
10 (a) "Qualified investment" shall be as defined in section 63-3029B, Idaho
11 Code.
12 (b) "Qualified broadband equipment" means equipment that qualifies for
13 the credit for capital investment permitted by section 63-3029B, Idaho
14 Code, and is capable of transmitting signals at a rate of at least two
15 hundred thousand (200,000) bits per second to a subscriber and at least
16 one hundred twenty-five thousand (125,000) bits per second from a sub-
17 scriber, and
18 (i) In the case of a telecommunications carrier, such qualifying
19 equipment shall be necessary to the provision of broadband service
20 and an integral part of a broadband network. "Telecommunications car-
21 rier" has the meaning given such term by section 3(44) of the commu-
22 nications act of 1934, as amended, but does not include a commercial
23 mobile service provider.
24 (ii) In the case of a commercial mobile service carrier, such quali-
25 fying equipment shall extend from the subscriber side of the mobile
26 telecommunications switching office to a transmitting/receiving
27 antenna, including such antenna, on the outside of the structure in
28 which the subscriber is located. "Commercial mobile service carrier"
29 means any person authorized to provide commercial mobile radio ser-
30 vice to subscribers as defined in section 20.3 of title 47, Code of
31 Federal Regulations (10-1-99 ed.), as amended.
32 (iii) In the case of a cable or open video system operator, such
33 qualifying equipment shall extend from the subscriber's side of the
34 headend to the outside of the structure in which the subscriber is
35 located. The terms "cable operator" and "open video system operator"
36 have the meanings given such terms by sections 602(5) and 653,
37 respectively, of the communications act of 1934, as amended.
38 (iv) In the case of a satellite carrier or a wireless carrier other
39 than listed above, such qualifying equipment is only that equipment
40 that extends from a transmitting/receiving antenna, including such
41 antenna, which transmits and receives signals to or from multiple
42 subscribers to a transmitting/receiving antenna on the outside of the
43 structure in which the subscriber is located. "Satellite carrier"
44 means any person using the facilities of a satellite or satellite
45 services licensed by the federal communications commission and oper-
46 ating a fixed-satellite service or direct broadcast satellite ser-
47 vices to provide point-to-multipoint distribution of signals. "Other
48 wireless carrier" means any person, other than a telecommunications
49 carrier, commercial mobile service carrier, cable operator, open
50 video operator, or satellite carrier, providing broadband services to
51 subscribers through the radio transmission of energy.
52 (v) In the case of packet switching equipment, such packet equip-
53 ment installed in connection with other qualifying equipment listed
54 in subsections (2)(b)(i) through (2)(b)(iv) of this section, provided
55 it is the last in a series of equipment that transmits signals to a
16
1 subscriber or the first in a series of equipment that transmits sig-
2 nals from a subscriber. "Packet switching" means controlling or
3 routing the path of a digital transmission signal which is assembled
4 into packets or cells.
5 (vi) In the case of multiplexing and demultiplexing equipment, such
6 equipment only to the extent that it is deployed in connection with
7 providing broadband services in locations between packet switching
8 equipment and the structure in which the subscriber is located.
9 "Multiplexing" means the transmission of two (2) or more signals over
10 a communications circuit without regard to the communications tech-
11 nology.
12 (vii) Any property not primarily used to provide services in Idaho to
13 public subscribers is not qualified broadband equipment.
14 (3) No equipment described in subsections (2)(b)(i) through (2)(b)(vi) of
15 this section shall qualify for the credit provided in subsection (1) of this
16 section until the taxpayer applies to and obtains from the Idaho public utili-
17 ties commission an order confirming that the installed equipment is qualified
18 broadband equipment. Applications submitted to the commission shall be gov-
19 erned by the commission's rules of procedure. The commission may issue proce-
20 dural orders necessary to implement this section.
21 (4) The credit allowed by subsection (1) of this section together with
22 any credits carried forward under subsection (6) of this section shall not, in
23 any one (1) taxable year, exceed the lesser of:
24 (a) The amount of tax due under sections 63-3024, 63-3025 and 63-3025A,
25 Idaho Code, after allowance for all other credits permitted by this chap-
26 ter; or
27 (b) Seven hundred fifty thousand dollars ($750,000).
28 When credits earned in more than one (1) taxable year are available, the old-
29 est credits shall be applied first.
30 (5) In the case of a group of corporations filing a combined report under
31 subsection (t) of section 63-3027, Idaho Code, credit earned by one (1) member
32 of the group but not used by that member may be used by another member of the
33 group, subject to the provisions of subsection (6) of this section, instead of
34 carried over. For a combined group of corporations, credit carried forward may
35 be claimed by any member of the group unless the member who earned the credit
36 is no longer included in the combined group.
37 (6) If the credit allowed by subsection (1) of this section exceeds the
38 limitation under subsection (4) of this section, the excess amount may be car-
39 ried forward for a period that does not exceed the next fourteen (14) taxable
40 years.
41 (7) In the event that qualified broadband equipment upon which the credit
42 allowed by this section has been used ceases to qualify for the credit allowed
43 by section 63-3029B, Idaho Code, or is subject to recapture of that credit,
44 the recapture of credit under this section shall be in the same proportion and
45 subject to the same provisions as the amount of credit required to be recap-
46 tured under section 63-3029B, Idaho Code.
47 (8) (a) Subject to the requirements of this subsection, a taxpayer enti-
48 tled to the credit or to an unused portion of the credit allowed by this
49 section may transfer the unused credit to another taxpayer required to
50 file a return under this chapter.
51 (b) Before completing a transfer under this subsection, the transferor
52 shall notify the state tax commission of its intention to transfer the
53 credit and the identity of the transferee. The state tax commission shall
54 provide the transferor with a written statement of the amount of credit
55 available under this section as then appearing in the commission's records
17
1 and the number of years the credit may be carried over. The transferee
2 shall attach a copy of the statement to any return in regard to which the
3 transferred credit is claimed.
4 (c) In the event that after the transfer the state tax commission deter-
5 mines that the amount of credit properly available under this section is
6 less than the amount claimed by the transferor of the credit or that the
7 credit is subject to recapture, the commission shall assess the amount of
8 overstated or recaptured credit as taxes due from the transferor and not
9 the transferee. The assessment shall be made in the manner provided for a
10 deficiency in taxes under this chapter.
11 (9) In addition to other needed rules, the state tax commission may pro-
12 mulgate rules prescribing, in the case of S corporations, partnerships, trusts
13 or estates, a method of attributing the credit under this section to the
14 shareholders, partners or beneficiaries in proportion to their share of the
15 income from the S corporation, partnership, trust or estate.
16 SECTION 17. That Chapter 30, Title 63, Idaho Code, be, and the same is
17 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
18 ignated as Section 63-3029J, Idaho Code, and to read as follows:
19 63-3029J. INCENTIVE INCOME TAX INVESTMENT CREDIT. (1) Subject to the lim-
20 itations of this section, for taxable years beginning between January 1, 2001,
21 and December 31, 2005, inclusive, there shall be allowed to a taxpayer a non-
22 refundable credit against taxes imposed by sections 63-3024, 63-3025 and
23 63-3025A, Idaho Code, in the amount allowed by subsection (2) of this section
24 for qualified investments in Idaho. The credit shall be in addition to the
25 credit for capital investment permitted by section 63-3029B, Idaho Code.
26 (2) The credit permitted in subsection (1) of this section shall be at
27 the percentage rate determined under either subsection (2)(a) or (2)(b) of
28 this section at the election of the taxpayer.
29 (a) (i) One-half (1/2) of the amount by which the average three-year
30 unemployment rate in the county in which the property is located
31 exceeds six percent (6%). In the case of mobile property, the prop-
32 erty shall be located in the county in which it is primarily based.
33 (ii) For purposes of this section the director of the department of
34 labor shall, on or before the first day of September of each calendar
35 year, establish and certify to the state tax commission the average
36 three-year unemployment rate in each county in Idaho for the immedi-
37 ately preceding three (3) calendar years. The rates thus certified
38 shall apply to the calculation of the credit under subsection
39 (2)(a)(i) of this section for property qualifying in the taxable year
40 beginning during the next calendar year.
41 (b) (i) One-tenth of one percent (.1%) for each full percent that the
42 three-year average per capita personal income level in the county in
43 which the property is located is below ninety percent (90%) of the
44 average statewide per capita personal income level.
45 (ii) For purposes of this section the director of the department of
46 commerce shall, on or before the first day of September of each cal-
47 endar year, establish and certify to the state tax commission the
48 most current three-year average per capita personal income level in
49 each county in Idaho and the statewide per capita personal income
50 level for the most current preceding three (3) calendar years. The
51 levels thus certified shall apply to the calculation of the credit
52 under subsection (2)(b)(i) of this section for property qualifying in
53 the taxable year beginning during the next calendar year.
18
1 (3) As used in this section the term "qualified investment" shall be
2 defined as in section 63-3029B, Idaho Code.
3 (4) The credit allowed by subsection (1) of this section together with
4 any credits carried forward under subsection (6) of this section shall not
5 exceed in any one (1) taxable year the lesser of:
6 (a) The amount of tax due under sections 63-3024, 63-3025 and 63-3025A,
7 Idaho Code, after allowance for all other credits permitted by this chap-
8 ter; or
9 (b) Five hundred thousand dollars ($500,000).
10 (c) When credits earned in more than one (1) taxable year are available,
11 the oldest credits shall be applied first.
12 (5) In the case of a group of corporations filing a combined report under
13 subsection (t) of section 63-3027, Idaho Code, credit earned by one (1) member
14 of the group but not used by that member may be used by another member of the
15 group, subject to the provisions of subsection (6) of this section, instead of
16 carried over. For a combined group of corporations, credit carried forward may
17 be claimed by any member of the group unless the member who earned the credit
18 is no longer included in the combined group.
19 (6) If the credit allowed by subsection (1) of this section exceeds the
20 limitation under subsection (4) of this section, the excess amount may be car-
21 ried forward for a period that does not exceed the next fourteen (14) taxable
22 years.
23 (7) In the event that property upon which the credit allowed by this sec-
24 tion has been used ceases to qualify for the credit allowed by section
25 63-3029B, Idaho Code, the recapture of credit under this section shall be in
26 the same proportion and subject to the same provisions as the amount of credit
27 required to be recaptured under section 63-3029B, Idaho Code.
28 (8) (a) Subject to the requirements of this subsection, a taxpayer enti-
29 tled to the credit or to an unused portion of the credit allowed by this
30 section may transfer the unused credit to another taxpayer required to
31 file a return under this chapter.
32 (b) Before completing a transfer under this subsection, the transferor
33 shall notify the state tax commission of its intention to transfer the
34 credit and the identity of the transferee. The state tax commission shall
35 provide the transferor with a written statement of the amount of credit
36 available under this section as then appearing in the commission's records
37 and the number of years the credit may be carried over. The transferor
38 shall provide the transferee with the original statement. The transferee
39 shall attach a copy of the statement to any return in regard to which the
40 transferred credit is claimed.
41 (c) In the event that after the transfer the state tax commission deter-
42 mines that the amount of credit properly available under this section is
43 less than the amount claimed by the transferor of the credit and shown in
44 the statement described in subsection (8)(b) of this section or that the
45 credit is subject to recapture, the commission shall assess the amount of
46 overstated credit as taxes due from the transferor and not the transferee.
47 The assessment shall be made in the manner provided for a deficiency in
48 taxes under this chapter.
49 (9) In addition to other needed rules, the state tax commission may pro-
50 mulgate rules prescribing:
51 (a) In the case of S corporations, partnerships, trusts or estates, a
52 method of attributing the credit under this section to the shareholders,
53 partners or beneficiaries in proportion to their share of the income from
54 the S corporation, partnership, trust or estate.
55 (b) A requirement that a transferor under subsection (8) of this section,
19
1 prior to obtaining the written statement provided in subsection (8)(b) of
2 this section, post such bond or security as the state tax commission may
3 require to secure any liability referred to in subsection (8)(c) of this
4 section. Such rules shall provide an opportunity for a taxpayer, upon a
5 showing of financial responsibility, to have the bond waiver, for notice
6 of denial of waiver in accordance with section 63-3045, Idaho Code, and
7 for review in accordance with section 63-3045B, Idaho Code.
8 SECTION 18. That Chapter 30, Title 63, Idaho Code, be, and the same is
9 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
10 ignated as Section 63-3029K, Idaho Code, and to read as follows:
11 63-3029K. VENTURE CAPITAL INCOME TAX INVESTMENT CREDIT. (1) Subject to
12 the limitations of this section, for taxable years beginning between January
13 1, 2001, and December 31, 2005, inclusive, there shall be allowed to a tax-
14 payer a nonrefundable credit against taxes imposed by sections 63-3024,
15 63-3025 and 63-3025A, Idaho Code, in the amount allowed by subsection (2) of
16 this section for investments described in subsection (2) of this section made
17 in Idaho. The credit shall be in addition to the credit for capital invest-
18 ment permitted by section 63-3029B, Idaho Code.
19 (2) The credit permitted in subsection (1) of this section shall be ten
20 percent (10%) of the taxpayer's investment made during the taxable year in an
21 Idaho private venture capital company.
22 (3) As used in this section:
23 (a) Definition. "Idaho private venture capital company" means a corpora-
24 tion, limited liability company, partnership or other entity, with its
25 principal place of business located within Idaho which meets the following
26 criteria:
27 (i) Committed capitalization of not less than five million dollars
28 ($5,000,000) and contributed capital of not less than twenty-five
29 percent (25%) of its committed capitalization;
30 (ii) Having a purpose and objective of making at least fifty percent
31 (50%) of its venture or risk capital available to business enter-
32 prises that are headquartered and managed in Idaho and whose primary
33 business activities are reasonably expected to establish or expand
34 the development of business and industry within Idaho; and
35 (iii) Investment of not more than twenty-five percent (25%) of its
36 committed funds in any one (1) company.
37 (b) Certification. An entity shall not qualify as an Idaho private ven-
38 ture capital company until the company applies to and obtains from the
39 director of the Idaho department of finance, hereafter referred to as
40 "director," a certificate confirming that it meets the criteria of this
41 section. Applications submitted to the director shall contain such infor-
42 mation relating to the applicant as the director shall require, and a fee
43 as set by the director in an amount not to exceed five hundred dollars
44 ($500). Unless the Idaho private venture capital company is decertified as
45 described in subsection (3)(f) of this section, a copy of the certifica-
46 tion shall be provided by the Idaho private venture capital company to the
47 investor seeking the credit allowed by this section who shall attach a
48 copy to the original return on which the credit is claimed.
49 (c) Requirements to maintain certification. To continue in certifica-
50 tion, an Idaho private venture capital company shall:
51 (i) Invest at least thirty percent (30%) of its original capital-
52 ization at the end of the initial three (3) years in such a manner as
53 to acquire equity in the ventures in which the investments are made;
20
1 (ii) Have invested at least fifty percent (50%) in the same manner
2 at the end of five (5) years;
3 (iii) At the time of an initial investment, have no investor or com-
4 bination of investors in that Idaho private venture capital company
5 who own a controlling equity interest in a business in which the ven-
6 ture capital company is investing;
7 (iv) Not invest funds for use by an Idaho business for oil and gas
8 exploration and development, for real estate development or apprecia-
9 tion, or for banking or lending operations. Any investment by an
10 Idaho private venture capital company in any of these sectors shall
11 not be counted as equity investments for the purpose of continuing
12 certification under this section;
13 (v) Meet such books and records or other requirements as the direc-
14 tor may, by rule or order, direct; and
15 (vi) Pay an annual renewal fee in an amount set by the director not
16 to exceed five hundred dollars ($500).
17 (d) Reporting requirements. Each certified Idaho private venture capital
18 company shall report to the director on an annual basis such information
19 as the director requires to be submitted to maintain certification. As a
20 part of such information, each Idaho private venture capital company shall
21 report the name, address and taxpayer identification number of each inves-
22 tor who has invested in such company, the amounts invested by each such
23 investor and the companies in which the Idaho private venture capital com-
24 pany has invested. The director shall provide the information contained in
25 this subsection to the state tax commission on an annual basis.
26 (e) Compliance examinations. All the records of a certified Idaho private
27 venture capital company are subject at any time to such reasonable peri-
28 odic, special or other examinations by representatives of the director, as
29 the director deems necessary or appropriate in the public interest. The
30 director, or his designee, may examine under oath any of the officers,
31 directors, agents, employees, or investors of an Idaho private venture
32 capital company regarding the affairs and business of the company. The
33 director may administer oaths, subpoena witnesses, require the production
34 of any books, papers, correspondence, or other documents or records which
35 the director deems relevant or material to the inquiry. In the case of
36 refusal to obey a subpoena issued to a person, any court of competent
37 jurisdiction, upon application of the director, may issue to that person
38 an order requiring him to appear before the director or the officer desig-
39 nated by him, there to produce documentary evidence if so ordered or to
40 give evidence relating to the matter under inquiry. Any failure to obey
41 such order of the court may be punished by the court as contempt of court.
42 (f) Decertification. If the director determines that a certified Idaho
43 private venture capital company is not in substantial compliance with the
44 requirements for continuing certification or is in violation of any other
45 provision of this act, the director shall, by written notice, inform the
46 officers of the company and the board of directors or partners that they
47 will be decertified in one hundred twenty (120) days from the date of
48 mailing of the notice unless they correct the deficiencies and are once
49 again in compliance with the requirements for certification. At the end
50 of the one hundred twenty (120) day period, if the Idaho private venture
51 capital company is still not in substantial compliance, the director shall
52 send a notice of decertification to the company and to the state tax com-
53 mission.
54 (g) Liability disclaimed. The state of Idaho, the department of finance
55 and its employees and agents may not be held civilly or criminally liable
21
1 or liable upon their official bonds to any person including, but not lim-
2 ited to, investors, Idaho private venture capital companies, and appli-
3 cants to become an Idaho private venture capital company, for action taken
4 under this section or for any failure to act under it.
5 (h) To facilitate furtherance of the purposes of this section with other
6 state and federal programs including, but not limited to, small business
7 investment companies and business and industrial development companies,
8 the director shall have authority to waive any provision of this subsec-
9 tion (3) which for good cause shown, he deems appropriate and in the pub-
10 lic interest.
11 (i) The director may promulgate rules or issue orders as necessary to
12 implement this section.
13 (j) Documents and other materials submitted by Idaho private venture cap-
14 ital companies or by Idaho businesses pursuant to this subsection shall be
15 exempt from public disclosure.
16 (4) The credit allowed by subsection (1) of this section together with
17 any credits carried forward under subsection (6) of this section shall not
18 exceed in any one (1) taxable year either:
19 (a) Fifty percent (50%) of the amount of tax due under sections 63-3024,
20 63-3025 and 63-3025A, Idaho Code, after allowance for all other credits
21 permitted by this chapter; or
22 (b) One hundred fifty thousand dollars ($150,000).
23 (5) In the case of a group of corporations filing a combined report under
24 subsection (t) of section 63-3027, Idaho Code, credit earned by one (1) member
25 of the group but not used by that member may be used by another member of the
26 group, subject to the provisions of subsection (6) of this section, instead of
27 carried over. For a combined group of corporations, credit carried forward may
28 be claimed by any member of the group unless the member who earned the credit
29 is no longer included in the combined group.
30 (6) If the credit allowed by subsection (1) of this section exceeds the
31 limitation under subsection (4) of this section the excess amount may be car-
32 ried forward for a period that does not exceed the next fourteen (14) taxable
33 years. When credits earned in more than one (1) taxable year are available,
34 the oldest credits shall be applied first.
35 (7) In the event that the company in which the investment was made ceases
36 to qualify as an Idaho private venture capital company before the expiration
37 of the carryover period provided in subsection (6) of this section, the por-
38 tion of the credit equal to the portion of the carryover period during which
39 the company did not so qualify shall be subject to recapture. The recapture
40 must be reported on the income tax return of the taxpayer who earned the
41 credit subject to the requirements for amounts recaptured under section
42 63-3029B, Idaho Code.
43 (8) (a) Subject to the requirements of this subsection, a taxpayer enti-
44 tled to the credit or to an unused portion of the credit allowed by this
45 section may transfer the unused credit to another taxpayer required to
46 file a return under this chapter.
47 (b) Before completing a transfer under this subsection, the transferor
48 shall notify the state tax commission of its intention to transfer the
49 credit and the identity of the transferee. The state tax commission shall
50 provide the transferor with a written statement of the amount of credit
51 available under this section as then appearing in the commission's records
52 and the number of years the credit may be carried over. The transferor
53 shall provide the transferee with the original statement. The transferee
54 shall attach a copy of the statement to any return in regard to which the
55 transferred credit is claimed.
22
1 (c) In the event that after the transfer the state tax commission deter-
2 mines that the amount of credit properly available under this section is
3 less than the amount claimed by the transferor of the credit and shown in
4 the statement described in subsection (8)(b) of this section, the commis-
5 sion shall assess the amount of overstated credit as taxes due from the
6 transferor and not the transferee. The assessment shall be made in the
7 manner provided for a deficiency in taxes under this chapter.
8 (9) In addition to other needed rules, the state tax commission may pro-
9 mulgate rules prescribing:
10 (a) In the case of S corporations, partnerships, trusts or estates, a
11 method of attributing the credit under this section to the shareholders,
12 partners or beneficiaries in proportion to their share of the income from
13 the S corporation, partnership, trust or estate.
14 (b) A requirement that a transferor under subsection (8) of this section,
15 prior to obtaining the written statement provided in subsection (8)(b) of
16 this section, post such bond or security as the state tax commission may
17 require to secure any liability referred to in subsection (8)(c) of this
18 section. Such rule shall provide an opportunity for a taxpayer, upon a
19 showing of financial responsibility, to have the bond waiver, for notice
20 of denial of waiver in accordance with section 63-3045, Idaho Code, and
21 for review in accordance with section 63-3045B, Idaho Code.
22 SECTION 19. That Sections 63-3029E and 63-3029F, Idaho Code, be, and the
23 same are hereby repealed.
24 SECTION 20. That Chapter 30, Title 63, Idaho Code, be, and the same is
25 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
26 ignated as Section 63-3029E, Idaho Code, and to read as follows:
27 63-3029E. DEFINITIONS -- CONSTRUCTION OF TERMS. As used in this section
28 and in section 63-3029F, Idaho Code:
29 (1) (a) "New employee" means a person from whom Idaho income tax has
30 been withheld, employed by the taxpayer in a revenue-producing enterprise
31 creating value-added natural resource products, and covered for unemploy-
32 ment insurance purposes under chapter 13, title 72, Idaho Code, during the
33 taxable year for which the credit allowed by section 63-3029F, Idaho Code,
34 is claimed. A person shall be deemed to be so engaged if such person per-
35 forms duties on:
36 (i) A regular full-time basis; or
37 (ii) A part-time basis if such person is customarily performing such
38 duties at least twenty (20) hours per week.
39 No credit shall be earned unless the new employee shall have performed
40 such duties for the taxpayer for a minimum of nine (9) months during the
41 taxable year for which the credit is claimed.
42 (b) The provisions of paragraph (a) of this subsection notwithstanding,
43 no credit shall be allowed for employment of persons by a taxpayer who
44 acquires a revenue-producing enterprise from another taxpayer or who oper-
45 ates in a place of business the same or a substantially identical revenue-
46 producing value-added natural resource products enterprise as operated by
47 another taxpayer within the prior twelve (12) months, except as the prior
48 taxpayer would have qualified under the provisions of paragraph (c) of
49 this subsection. Employees transferred from a related taxpayer shall not
50 be included in the computation of the credit.
51 (c) The number of employees during any taxable year for any taxpayer
52 shall be the mathematical average of the number of employees reported to
23
1 the Idaho department of labor for employment security purposes during the
2 twelve (12) months of the taxable year which qualified under paragraph (a)
3 of this subsection. In the event the business is in operation for less
4 than the entire taxable year, the number of employees of the business for
5 the year shall be the average number actually employed during the months
6 of operation, providing that the qualifications of paragraph (a) of this
7 subsection are met.
8 (2) "Revenue-producing enterprise" means the production, assembly, fabri-
9 cation, manufacture or processing of any natural resource product.
10 (3) "Same or a substantially identical revenue-producing enterprise"
11 means a revenue-producing enterprise in which the products produced or sold,
12 or the activities conducted are the same in character and use and are pro-
13 duced, sold or conducted in the same manner as, or for the same types of cus-
14 tomers as, the products or activities produced, sold or conducted in another
15 revenue-producing enterprise.
16 SECTION 21. That Chapter 30, Title 63, Idaho Code, be, and the same is
17 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
18 ignated as Section 63-3029F, Idaho Code, and to read as follows:
19 63-3029F. SPECIAL CREDIT AVAILABLE -- NEW EMPLOYEES. (1) Any taxpayer
20 shall be allowed a credit, in an amount determined under subsection (2) of
21 this section, against the tax imposed by this chapter, other than the tax
22 imposed by section 63-3082, Idaho Code, for any taxable year during which the
23 taxpayer's employment of new employees, as defined under section 63-3029E(1),
24 Idaho Code, increases above the taxpayer's average employment for either: (a)
25 the prior taxable year, or (b) the average of three (3) prior taxable years,
26 whichever is higher. No credit shall be allowed under this section unless the
27 number of new employees equals or exceeds one (1) person.
28 (2) The credit authorized in subsection (1) of this section shall be five
29 hundred dollars ($500) per new employee, but the total credit allowed shall
30 not exceed three and one-quarter percent (3.25%) of net income from the
31 taxpayer's corporate, proprietorship, partnership, small business corporation
32 or limited liability company revenue-producing enterprise in which the employ-
33 ment occurred. Additionally, the total of this and all other credits allowed
34 under this chapter except for the credits allowed under sections 63-3024A,
35 63-3025D and 63-3029, Idaho Code, taken during any taxable year shall not
36 exceed forty-five percent (45%) of the tax otherwise imposed on the taxpayer
37 for the taxable year for which such credit is allowed.
38 (3) If the sum of the credit carryovers from the credit allowed by sub-
39 section (2) of this section and the amount of credit for the taxable year from
40 the credit allowed by subsection (2) of this section exceed the limitation
41 imposed by subsection (2) of this section for the current taxable year, the
42 excess attributable to the current taxable year's credit shall be a credit
43 carryover to the three (3) succeeding taxable years. The entire amount of
44 unused credit shall be carried forward to the earliest of the succeeding
45 years, wherein the oldest available unused credit shall be used first, so long
46 as the employment level for which the credit was granted is still maintained.
47 SECTION 22. That Chapter 30, Title 63, Idaho Code, be, and the same is
48 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
49 ignated as Section 63-3022Q, Idaho Code, and to read as follows:
50 63-3022Q. DEDUCTION OF CAPITAL GAINS FOR QUALIFYING TAXPAYERS. (1) If a
51 qualifying taxpayer reports a net capital gain in determining taxable income,
24
1 one hundred percent (100%) of the net capital gain from the sale or exchange
2 of qualified property shall be a deduction in determining taxable income.
3 (2) The deduction provided in this section is limited to the amount of
4 the net capital gain from all property included in federal taxable income. Net
5 capital gains treated as ordinary income by the Internal Revenue Code do not
6 qualify for the deduction allowed in this section. The deduction otherwise
7 allowable under this section shall be reduced by the amount of any federal
8 capital gains deduction relating to such property, but not below zero (0).
9 (3) As used in this section "qualified property" means the following
10 property having an Idaho situs at the time of sale:
11 (a) Real property held at least eighteen (18) months;
12 (b) Tangible personal property used in Idaho for at least twelve (12)
13 months by a revenue-producing enterprise;
14 (c) Cattle or horses held for breeding, draft, dairy or sporting purposes
15 for at least twenty-four (24) months if more than one-half (1/2) of the
16 taxpayer's gross income, as defined in section 61(a) of the Internal Reve-
17 nue Code, for the taxable year is from farming or ranching operations in
18 Idaho;
19 (d) Breeding livestock other than cattle or horses held at least twelve
20 (12) months if more than one-half (1/2) of the taxpayer's gross income, as
21 defined in section 61(a) of the Internal Revenue Code, for the taxable
22 year is from farming or ranching operations in Idaho;
23 (e) Timber grown in Idaho and held at least twenty-four (24) months;
24 (f) An equity interest held by an Idaho private venture capital company
25 as defined in section 63-3029K, Idaho Code, including stock in a corpora-
26 tion, interest in a partnership or membership in a limited liability com-
27 pany, if:
28 (i) The Idaho private venture capital company or its investors have
29 held the equity interest for at least three (3) years; and
30 (ii) The equity interest is used by a business enterprise that is
31 headquartered and managed in Idaho whose business activity for the
32 entity's three (3) taxable years immediately preceding the sale is
33 entirely in Idaho or at least fifty percent (50%) in Idaho as deter-
34 mined by the average property and payroll factors under section
35 63-3027, Idaho Code.
36 (g) In determining the period for which property subject to this section
37 has been held by a qualifying taxpayer, the provisions of section 1223 of
38 the Internal Revenue Code shall apply, except that when the holding period
39 includes any period during which the qualifying taxpayer held property
40 other than the property sold, all property held during the holding period
41 must qualify under this section.
42 (4) If a qualifying taxpayer reports a capital gain from qualified prop-
43 erty from an S corporation or a partnership, a deduction shall be allowed
44 under this section only to the extent the qualifying taxpayer held his inter-
45 est in the income of the S corporation or the partnership for the time
46 required by subsection (3) of this section for the property sold.
47 (5) If a qualifying taxpayer reports a capital gain from an estate, no
48 deduction shall be allowed under this section unless the holding period
49 required in subsection (3) of this section was satisfied by the decedent, the
50 estate, or the beneficiary, or a combination thereof.
51 (6) If a qualifying taxpayer reports a capital gain from a trust, no
52 deduction shall be allowed under this section unless the holding period
53 required in subsection (3) of this section was satisfied by the grantor, the
54 trust, or the beneficiary, or a combination thereof.
55 (7) As used in this section, "revenue-producing enterprise" means:
25
1 (a) The production, assembly, fabrication, manufacture or processing of
2 any agricultural, mineral, timber or manufactured product;
3 (b) The storage, warehousing, distribution, or sale at wholesale of any
4 products of agriculture, mining, timber or manufacturing;
5 (c) The feeding of livestock at a feedlot;
6 (d) The operation of laboratories or other facilities for scientific,
7 agricultural, animal husbandry, or industrial research, development or
8 testing.
9 (8) As used in this section, "qualifying taxpayer" means a corporation, a
10 trust, estate, partnership, an association, a limited liability company, or an
11 S corporation, but does not include an individual.
12 SECTION 23. That Chapter 30, Title 63, Idaho Code, be, and the same is
13 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
14 ignated as Section 63-3024D, Idaho Code, and to read as follows:
15 63-3024D. INCOME TAX CREDITS FOR PERSONAL PROPERTY TAXES. (1) For taxable
16 year 2001 only, there shall be allowed as a credit against taxes due under
17 this chapter one hundred percent (100%) of the amount of taxes due in Decem-
18 ber 2001 on class 2 property that is agricultural machinery and equipment and
19 is defined in section 63-204, Idaho Code, and used solely in agriculture dur-
20 ing that tax year. For purposes of this section:
21 (a) "Agricultural machinery and equipment" shall mean any machinery and
22 equipment that is used in:
23 (i) Production of field crops including, but not limited to,
24 grains, feed crops, fruits and vegetables; or
25 (ii) The grazing, feeding, or raising of livestock, fur-bearing ani-
26 mals, fish, fowl, and bees to be sold or used as part of a net profit
27 making agricultural enterprise or dairy.
28 (b) Buildings shall not be considered to be agricultural machinery and
29 equipment.
30 (2) The maximum amount of the credit established by this section shall be
31 that enumerated in subsection (1) of this section. If taxes due are less than
32 the total credit allowed, the taxpayer shall be paid a refund. If the credit
33 or refund is not claimed for the year for which the income tax return is
34 filed, the right thereafter to claim such credit or refund shall be forfeited.
35 The state tax commission shall prescribe the method by which the refund, if
36 any, is to be made to the taxpayer.
37 (3) The refunds authorized by this section shall be paid from the state
38 refund fund in the same manner as the refunds authorized by section 63-3067,
39 Idaho Code. An application for any refund which is due and payable under the
40 provisions of this section must be filed with the state tax commission by the
41 due date, including extensions, of the return required under section 63-3030,
42 Idaho Code, if the applicant is required to file a return or the fifteenth day
43 of April of the year following the year to which the application relates if
44 the applicant is not required to file a return.
45 (4) The state tax commission may promulgate rules to implement the provi-
46 sions of this section. The commission may require such receipts and documenta-
47 tion from taxpayers and county assessors necessary to implement the provisions
48 of this section. If sufficient moneys are not available in the state refund
49 fund to pay in full credits or refunds, the state tax commission may grant a
50 pro rata share to all taxpayers based on the amount of the credit for personal
51 property taxes paid pursuant to the formula provided in this section to
52 ensure soundness of the fund.
26
1 SECTION 24. That Chapter 35, Title 67, Idaho Code, be, and the same is
2 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
3 ignated as Section 67-3529, Idaho Code, and to read as follows:
4 67-3529. TREATMENT OF GENERAL FUND SURPLUS -- MONEYS FOR PROPERTY TAX
5 RELIEF. Subject to the requirements of section 63-3203, Idaho Code, if the
6 state controller certifies that the fiscal year has ended with an unexpended
7 and unencumbered balance in the general fund, the unexpended and unencumbered
8 balance shall be treated as follows during 2001 only:
9 (1) The state controller shall deduct any funds to be transferred to the
10 budget stabilization fund in the following fiscal year, pursuant to section
11 57-814, Idaho Code.
12 (2) If any unexpended and unencumbered balance remains after the imple-
13 mentation of subsection (1) of this section, then the state controller shall
14 deduct this excess from the unexpended and unencumbered balance, up to a maxi-
15 mum of one percent (1%) of the general fund revenue collection for the fiscal
16 year just ended to be retained by the general fund.
17 (3) If any unexpended and unencumbered balance remains after the imple-
18 mentation of subsections (1) and (2) of this section, and this unexpended and
19 unencumbered balance represents more than one percent (1%) of the general fund
20 revenue collections for the fiscal year just ended, then seventy-five percent
21 (75%) of this remaining unexpended and unencumbered balance shall be remitted
22 to the state refund fund in section 63-3067, Idaho Code, for payment of the
23 income tax credits and refunds of personal property taxes pursuant to section
24 63-3024D, Idaho Code, for taxable year 2001.
25 SECTION 25. That Section 63-3067, Idaho Code, be, and the same is hereby
26 amended to read as follows:
27 63-3067. REVENUE RECEIVED -- STATE REFUND ACCOUNT FUND. (1) A sum equal
28 to the amount withheld under section 63-3035A, Idaho Code, shall be distrib-
29 uted fifty percent (50%) to the public school income fund to be utilized to
30 facilitate and provide substance abuse programs in the public school system,
31 and fifty percent (50%) shall be distributed to the counties to be utilized
32 for county juvenile probation services. These funds shall be distributed quar-
33 terly to the counties based upon the percentage the population of the county
34 bears to the population of the state as a whole.
35 (2) All moneys except as provided in subsection (1) of this section, and
36 except as hereinafter provided, received by the state of Idaho under this act
37 shall be deposited by the state tax commission, as received by it, with the
38 state treasurer and shall be placed in and become a part of the general
39 account fund under the custody of the state treasurer. Providing however, that
40 an amount equal to twenty percent (20%) of the amount deposited with the state
41 treasurer shall be placed in the "state refund account fund" which is hereby
42 created for the purpose of repaying overpayments, for the purpose of repaying
43 taxpayers for personal property taxes paid as provided in section 63-3024D,
44 Idaho Code, for the purpose of depositing in the trust accounts specified in
45 section 63-3067A, Idaho Code, such amounts as may be designated by individuals
46 for the purpose of depositing in the Idaho ag in the classroom account an
47 amount as may be designated by the individual receiving a refund for such
48 overpayment, and for the purpose of paying any other erroneous receipts ille-
49 gally assessed or collected, penalties collected without authority and taxes
50 and licenses unjustly assessed, collected or which are excessive in amount.
51 Whenever necessary for the purpose of making prompt payment of refunds, the
52 board of examiners, upon request from the state tax commission, and after
27
1 review, may authorize the state tax commission to transfer any additional spe-
2 cific amount from income tax collections to the "state refund account fund."
3 There is appropriated out of the state refund account fund so much thereof as
4 may be necessary for the payment of the refunds herein provided. Claims for,
5 and payment of refunds under the provisions of this section shall be made in
6 the same manner as other claims against the state of Idaho.
7 Any unencumbered balance remaining in the state refund account fund on
8 June 30 of each and every year in excess of the sum of one million five hun-
9 dred thousand dollars ($1,500,000) shall be transferred to the general account
10 fund and the state controller is hereby authorized and directed on such dates
11 to make such transfers unless the board of examiners, which is hereby autho-
12 rized to do so, changes the date of transfer or sum to be transferred.
13 SECTION 26. That Chapter 30, Title 63, Idaho Code, be, and the same is
14 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
15 ignated as Section 63-3029L, Idaho Code, and to read as follows:
16 63-3029L. INCOME TAX CREDIT FOR AT-HOME PARENT. (1) For income tax years
17 beginning on and after January 1, 2001, there shall be allowed at the election
18 of the taxpayer, subject to the applicable limitations provided herein as a
19 credit against the income tax imposed by the provisions of section 63-3024,
20 Idaho Code, a nonrefundable credit of one hundred fifty dollars ($150) for
21 each qualifying child, for up to two (2) qualifying children, if
22 (a) The taxpayer or another taxpayer filing a joint individual income tax
23 return with the taxpayer is an at-home parent; and
24 (b) The federal adjusted gross income of all of the taxpayers filing the
25 individual income tax return is fifty thousand dollars ($50,000) or less;
26 and
27 (c) No taxpayer filing the individual income tax return received public
28 assistance from the state of Idaho or any political subdivision thereof
29 during the taxable year for which the credit is being claimed; and
30 (d) No taxpayer filing the individual income tax return is claiming any
31 federal child care tax credit during the taxable year for which the credit
32 is being claimed.
33 (2) For purposes of this section:
34 (a) "At-home parent" means a parent:
35 (i) Who provides full-time care at the parent's residence for one
36 (1) or more of the parent's own qualifying children; and
37 (ii) Who claims the qualifying child as a dependent on the parent's
38 individual income tax return for the taxable year for which the par-
39 ent claims the credit.
40 (b) "Parent" means an individual who:
41 (i) Is the biological mother or father of a qualifying child;
42 (ii) Is the stepfather or stepmother of a qualifying child;
43 (iii) Has legally adopted a qualifying child;
44 (iv) Is a foster parent of a qualifying child; or
45 (v) Is a legal guardian of a qualifying child.
46 (c) "Qualifying child" means a child who is no older than sixty (60)
47 months of age on the last day of the taxable year for which the credit is
48 claimed.
49 (3) If the credit is not claimed for the year in which the income tax
50 return is filed, the right thereafter to claim such credit shall be forfeited.
51 (4) The state tax commission may promulgate rules as necessary to imple-
52 ment the provisions of this section.
28
1 SECTION 27. The provisions of Section 5, Sections 10 through 13 and Sec-
2 tions 16, 17 and 18 of this act are hereby declared to be nonseverable from
3 other provisions within each section and if any provision of any of those sec-
4 tions or the application of such provision to any person or circumstance is
5 declared invalid for any reason, such declaration shall render the entire sec-
6 tion invalid but not other sections of this act.
7 SECTION 28. An emergency existing therefor, which emergency is hereby
8 declared to exist, Sections 1 through 18 and Sections 22 through 27 of this
9 act shall be in full force and effect on and after passage and approval, and
10 retroactively to January 1, 2001. Sections 19, 20 and 21 of this act shall be
11 in full force and effect on and after January 1, 2006.
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-fifth Legislature Second Regular Session - 2000
Moved by Thorne
Seconded by Bunderson
IN THE SENATE
SENATE AMENDMENTS TO H.B. NO. 275
1 AMENDMENT TO THE BILL
2 On page 2 of the printed bill, delete lines 37 through 52; and delete
3 pages 3 through 28, and insert:
4 "SECTION 1. That Section 63-3024, Idaho Code, be, and the same is hereby
5 amended to read as follows:
6 63-3024. INDIVIDUALS' TAX AND TAX ON ESTATES AND TRUSTS. For taxable year
7 20001, a tax measured by Idaho taxable income as defined in this chapter is
8 hereby imposed upon every individual, trust, or estate required by this chap-
9 ter to file a return.
10 (a) (i) The tax imposed upon individuals, trusts and estates shall be
11 computed at the following rates:
12 When Idaho taxable income is: The rate is:
13 Less than $1,000 One and ninefive-tenths percent (1.95%)
14 $1,000 but less than $2,000 $195, plus three and ninefive-tenths
15 percent (3.95%) of the amount over $1,000
16 $2,000 but less than $3,000 $580, plus four and four-tenths
17 percent (4.4%) of the amount over $2,000
18 $3,000 but less than $4,000 $10290, plus five and four-tenths
19 percent (5.4%) of the amount over $3,000
20 $4,000 but less than $5,000 $15640, plus six and four-tenths
21 percent (6.4%) of the amount over $4,000
22 $5,000 but less than $7,500 $2200, plus seven and four-tenths
23 percent (7.4%) of the amount over $5,000
24 $7,500 but less than $20,000 $40375, plus seven and seventhree-tenths
25 percent (7.73%) of the amount over $7,500
26 Over $20,000 $1,36287.50, plus eight and oneseven and
27 seven-tenths percent (8.17.7%) of the
28 amount over $20,000
29 (ii) For taxable year 20012 and each taxable year thereafter, a tax mea-
30 sured by Idaho taxable income as defined in this chapter is hereby imposed
31 upon every individual, trust, or estate required by this chapter to file a
32 return.
33 The tax imposed upon individuals, trusts and estates shall be computed at
34 the following rates:
35 When Idaho taxable income is: The rate is:
36 Less than $1,000 Two percent (2.0%)
37 $1,000 but less than $2,000 $20, plus four percent (4.0%)
38 of the amount over $1,000
39 $2,000 but less than $3,000 $60, plus four and one-half percent
40 (4.5%) of the amount over $2,000
41 $3,000 but less than $4,000 $105, plus five and one-half percent
42 (5.5%) of the amount over $3,000
43 $4,000 but less than $5,000 $160, plus six and one-half percent
2
1 (6.5%) of the amount over $4,000
2 $5,000 but less than $7,500 $225, plus seven and one-half percent
3 (7.5%) of the amount over $5,000
4 $7,500 but less than $20,000 $412.50, plus seven and eight-tenths percent
5 (7.8%) of the amount over $7,500
6 Over $20,000 $1,387.50, plus eight and two-tenths percent
7 (8.2%) of the amount over $20,000
8 Less than $1,000 One and seventy-five hundredths
9 percent (1.75%)
10 $1,000 but less than $2,000 $17.50, plus three and seventy-five
11 hundredths percent (3.75%)
12 of the amount over $1,000
13 $2,000 but less than $3,000 $55, plus four and twenty-five
14 hundredths percent (4.25%)
15 of the amount over $2,000
16 $3,000 but less than $4,000 $97.50, plus five and twenty-five
17 hundredths percent (5.25%)
18 of the amount over $3,000
19 $4,000 but less than $5,000 $150, plus six and twenty-five
20 hundredths percent (6.25%)
21 of the amount over $4,000
22 $5,000 but less than $7,500 $212.50, plus seven and twenty-five
23 hundredths percent (7.25%)
24 of the amount over $5,000
25 $7,500 but less than $20,000 $393.75, plus seven and fifty-five
26 hundredths percent (7.55%)
27 of the amount over $7,500
28 Over $20,000 $1,337.50, plus seven and ninety-five
29 hundredths percent (7.95%)
30 of the amount over $20,000
31 For taxable year 2000 and each year thereafter, the state tax commission
32 shall prescribe a factor which shall be used to compute the Idaho income tax
33 brackets provided in subsections (a)(i) and (a)(ii) of this section. The fac-
34 tor shall provide an adjustment to the Idaho tax brackets so that inflation
35 will not result in a tax increase. The Idaho tax brackets shall be adjusted as
36 follows: multiply the bracket amounts by the percentage (the consumer price
37 index for the calendar year immediately preceding the calendar year to which
38 the adjusted brackets will apply divided by the consumer price index for cal-
39 endar year 1998). For the purpose of this computation, the consumer price
40 index for any calendar year is the average of the consumer price index as of
41 the close of the twelve (12) month period for the immediately preceding calen-
42 dar year as adopted by the state tax commission. This adoption shall be exempt
43 from the provisions of chapter 52, title 67, Idaho Code. The consumer price
44 index shall mean the consumer price index for all U.S. urban consumers pub-
45 lished by the United States department of labor. The state tax commission
46 shall annually include the factor as provided in this subsection to multiply
47 against Idaho taxable income in the brackets above to arrive at that year's
48 taxable income for tax bracket purposes.
49 (b) In case a joint return is filed by husband and wife pursuant to the
50 provisions of section 63-3031, Idaho Code, the tax imposed by this section
51 shall be twice the tax which would be imposed on one-half (1/2) of the aggre-
52 gate Idaho taxable income. For the purposes of this section, a return of a
53 surviving spouse, as defined in section 2(a) of the Internal Revenue Code, and
54 a head of household, as defined in section 2(b) of the Internal Revenue Code,
55 shall be treated as a joint return and the tax imposed shall be twice the tax
3
1 which would be imposed on one-half (1/2) of the Idaho taxable income.
2 (c) The state tax commission shall compute and publish Idaho income tax
3 liability for taxpayers at the midpoint of each bracket of Idaho taxable
4 income in fifty dollar ($50.00) steps to fifty thousand dollars ($50,000),
5 rounding such calculations to the nearest dollar. Taxpayers having income
6 within such brackets shall file returns based upon and pay taxes according to
7 the schedule thus established. The state tax commission shall promulgate rules
8 defining the conditions upon which such returns shall be filed.
9 SECTION 2. That Section 63-3024A, Idaho Code, be, and the same is hereby
10 amended to read as follows:
11 63-3024A. CREDITS AND REFUNDS. (a) Any resident individual not entitled
12 to the credit allowed in subsection (b)(1), who is required to file by law and
13 who has filed an Idaho income tax return, shall be allowed a credit against
14 taxes due under the Idaho income tax act equal to the amount of fifteen twenty
15 dollars ($1520.00) for each personal exemption for which a deduction is per-
16 mitted by section 151(b) and (c) of the Internal Revenue Code if such deduc-
17 tion is claimed on the taxpayer's Idaho income tax return, and if the individ-
18 ual for whom the deduction is claimed is a resident of the state of Idaho. If
19 taxes due are less than the total credit allowed, the taxpayer shall be paid a
20 refund equal to the balance of the unused credit. If the credit or refund is
21 not claimed for the year for which the individual income tax return is filed,
22 the right thereafter to claim such credit or refund shall be forfeited. The
23 state tax commission shall prescribe the method by which the refund, if any,
24 is to be made to the taxpayer.
25 (b) (1) A resident individual who has reached his sixty-fifth birthday
26 before the end of his taxable year, who is required to file by law and who
27 has filed an Idaho income tax return, shall be allowed a credit against
28 taxes due under the Idaho income tax act equal to the amount of
29 thirty-five dollars ($305.00) for each personal exemption representing
30 himself, a spouse over the age of sixty-five (65) years, or a dependent
31 over the age of sixty-five (65) years, but shall be allowed a credit
32 against taxes due under the Idaho income tax act equal to fifteen twenty
33 dollars ($1520.00) for each personal exemption representing a spouse or
34 dependent under the age of sixty-five (65) years. If taxes due are less
35 than the total credit allowed, the taxpayer shall be paid a refund equal
36 to the balance of the unused credit. If the credit or refund is not
37 claimed for the year for which the individual income tax return is filed,
38 the right thereafter to claim such credit or refund shall be forfeited.
39 The state tax commission shall prescribe the method by which the refund,
40 if any, is to be made to the taxpayer.
41 (2) A resident individual who has reached his sixty-fifth birthday and is
42 not required by law to file an Idaho income tax return and who has
43 received no credit or refund under any other subsection of this section,
44 shall be entitled to a refund of thirty-five dollars ($305.00). Any refund
45 shall be paid to such individual only upon his making application therefor
46 at such time and in such manner as may be prescribed by the state tax com-
47 mission.
48 (c) A resident individual of the state of Idaho who is:
49 (i) blind, or
50 (ii) a disabled American veteran of any war engaged in by the United
51 States, whose disability is recognized as a service connected disability
52 of a degree of ten per cent percent (10%) or more, or who is in receipt of
53 a pension for nonservice connected disabilities, in accordance with laws
4
1 and regulations administered by the United States veterans administration,
2 substantiated by a statement as to status signed by a responsible officer
3 of the United States veterans administration, or
4 (iii) over sixty-two (62) years of age, and has been allowed none, or less
5 than all, of the credit provided by subsection (a) or subsection (b) of
6 this section, shall be entitled to a payment from the refund fund in an
7 amount equal to fifteen twenty dollars ($1520.00), or the balance of his
8 unused credit, whichever is less, upon making application therefor at such
9 time and in such manner as the state tax commission may prescribe.
10 (d) Any part-year resident entitled to a credit under this section shall
11 receive a proportionate credit, in the manner above provided, reflecting the
12 part of the year in which he was domiciled in this state.
13 (e) No credit or refund may be claimed for an exemption which represents
14 a person who has himself filed an Idaho income tax return claiming a deduction
15 for his own personal exemption, and in no event shall more than one (1) tax-
16 payer be allowed a credit or refund for the same exemption, or under more than
17 one (1) subsection of this section.
18 (f) The refunds authorized by this section shall be paid from the state
19 refund fund in the same manner as the refunds authorized by section 63-3067,
20 Idaho Code.
21 (g) An application for any refund which is due and payable under the pro-
22 visions of this section must be filed with the state tax commission within
23 three (3) years of:
24 (i) the due date, including extensions, of the return required under sec-
25 tion 63-3030, Idaho Code, if the applicant is required to file a return,
26 or
27 (ii) the 15th day of April of the year following the year to which the
28 application relates if the applicant is not required to file a return.
29 SECTION 3. That Section 63-3025, Idaho Code, be, and the same is hereby
30 amended to read as follows:
31 63-3025. TAX ON CORPORATE INCOME. For taxable years commencing on and
32 after January 1, 1987 2001, a tax is hereby imposed on the Idaho taxable
33 income of a corporation which transacts or is authorized to transact business
34 in this state or which has income attributable to this state. The tax shall be
35 equal to eight seven and five-tenths percent (87.5%) of Idaho taxable income
36 for taxable year 2001 and seven and seventy-five hundredths percent (7.75%) of
37 Idaho taxable income for taxable year 2002 and thereafter; provided, however,
38 that the tax shall not be less than twenty dollars ($20.00); provided further
39 that the twenty dollar ($20.00) minimum payment shall not be collected from
40 nonproductive mining corporations. The tax imposed by this section shall not
41 apply to corporations taxed pursuant to the provisions of section 63-3025A,
42 Idaho Code.
43 SECTION 4. That Section 63-3025A, Idaho Code, be, and the same is hereby
44 amended to read as follows:
45 63-3025A. FRANCHISE TAX. For taxable years commencing on and after Janu-
46 ary 1, 1987 2001, a franchise tax shall be imposed upon any corporation for
47 the privilege of exercising its corporate franchise within the state during
48 such taxable year, including, but not limited to, corporations engaged in
49 business in Idaho for the exclusive purpose of performing contracts with the
50 United States department of energy at the Idaho national engineering and envi-
51 ronmental laboratory, which tax shall be measured by income which is attribut-
5
1 able to this state under the provisions of this chapter and which tax shall be
2 equal to eight percent (8%) of Idaho taxable income at the rate provided in
3 section 63-3025, Idaho Code; provided, however, that the tax shall not be less
4 than twenty dollars ($20.00); provided further that the twenty dollar ($20.00)
5 minimum payment shall not be collected from nonproductive mining corporations;
6 but the twenty dollar ($20.00) minimum tax shall apply to corporations quali-
7 fied to file returns and actually filing returns under the provisions of sub-
8 chapter "S" of the Internal Revenue Code.
9 SECTION 5. That Section 63-3029B, Idaho Code, be, and the same is hereby
10 amended to read as follows:
11 63-3029B. INCOME TAX CREDIT FOR CAPITAL INVESTMENT. (1) At the election
12 of the taxpayer there shall be allowed, subject to the applicable limitations
13 provided herein as a credit against the income tax imposed by chapter 30,
14 title 63, Idaho Code, an amount equal to the sum of:
15 (a) The tax credit carryovers; and
16 (b) The tax credit for the taxable year.
17 (2) The maximum allowable amount of the credit for the current taxable
18 year shall be three percent (3%) of the amount of qualified investments made
19 during the taxable year.
20 (3) As used in this section "qualified investment" means certain depre-
21 ciable property which:
22 (a) (i) Is eligible for the federal investment tax credit, as defined in
23 sections 46(c) and 48 of the Internal Revenue Code subject to the
24 limitations provided for certain regulated companies in section 46(f)
25 of the Internal Revenue Code and is not a motor vehicle under eight
26 thousand (8,000) pounds gross weight; or
27 (ii) Is qualified broadband equipment as defined in section 63-3029I,
28 Idaho Code; and
29 (b) Is acquired, constructed, reconstructed, erected or placed into ser-
30 vice after December 31, 1981; and
31 (c) Has a situs in Idaho.
32 (4) Notwithstanding the provisions of subsections (1) and (2) of this
33 section, the amount of the credit allowed shall not exceed fifty percent (50%)
34 of the tax liability of the taxpayer.
35 (5) If the sum of credit carryovers from the credit allowed by subsection
36 (2) of this section and the amount of credit for the taxable year from the
37 credit allowed by subsection (2) of this section exceed the limitation imposed
38 by subsection (4) of this section for the current taxable year, the excess
39 attributable to the current taxable year's credit shall be an investment
40 credit carryover to the fourteen (14) succeeding taxable years. In the case of
41 a group of corporations filing a combined report under section 63-3027, Idaho
42 Code, or sections 63-3027B through 63-3027E, Idaho Code, credit earned by one
43 (1) member of the group but not used by that member may be used by another
44 member of the group, subject to the provisions of subsection (4) of this sec-
45 tion, instead of carried over. The entire amount of unused credit shall be
46 carried forward to the earliest of the succeeding years, wherein the oldest
47 available unused credit shall be used first, so long as the qualified invest-
48 ment property for which the unused credit was granted still maintains Idaho
49 situs. For a combined group of corporations, credit carried forward may be
50 claimed by any member of the group unless the member who earned the credit is
51 no longer included in the combined group.
52 (6) Any recapture of the credit allowed by subsection (2) of this section
53 on property disposed of or ceasing to qualify, prior to the close of its use-
6
1 ful life the recapture period, shall be determined according to the applicable
2 recapture provisions of the Internal Revenue Code. In the case of a unitary
3 group of corporations, the increase in tax due to the recapture of investment
4 tax credit must be reported by the member of the group who earned the credit
5 regardless of which member claimed the credit against tax.
6 (7) For the purpose of determining whether property placed in service is
7 a "qualified investment" as defined in subsection (3) of this section, the
8 provisions of section 49 of the Internal Revenue Code shall be disregarded.
9 (8) For purposes of this section, property has a situs in Idaho during a
10 taxable year if it is used in Idaho at any time during the taxable year. Prop-
11 erty not used in Idaho during a taxable year does not have a situs in Idaho in
12 the taxable year during which the property is not used in Idaho or in any sub-
13 sequent taxable year. No credit or carryover of credit is permitted under this
14 section if the credit or carryover relates to property that does not have a
15 situs in Idaho during the taxable year for which the credit or carryover is
16 claimed. The Idaho situs of property must be established by records maintained
17 by the taxpayer which are created reasonably contemporaneously with the use of
18 the property.
19 (9) In the case of property used both in and outside Idaho, the taxpayer,
20 electing to claim the credit provided in this section, must elect to compute
21 the qualified investment in property with a situs in Idaho for all such
22 investments first qualifying during that year in one (1), but only one (1), of
23 the following ways:
24 (a) The amount of each qualified investment in a specific asset shall be
25 separately computed based on the percentage of the actual use of the prop-
26 erty in Idaho by using a measure of the use, such as total miles or total
27 machine hours, that most accurately reflects the beneficial use during the
28 taxable year in which it is first acquired, constructed, reconstructed,
29 erected or placed into service; provided, that the asset is placed in ser-
30 vice more than ninety (90) days before the end of the taxable year. In the
31 case of assets acquired, constructed, reconstructed, erected or placed
32 into service within ninety (90) days prior to the end of the taxable year
33 in which the investment first qualifies, the measure of the use of that
34 asset within Idaho for that year shall be based upon the percentage of use
35 in Idaho during the first ninety (90) days of use of the asset;
36 (b) The investment in qualified property used both inside and outside
37 Idaho during the taxable year in which it is first acquired, constructed,
38 reconstructed, erected or placed into service shall be multiplied by the
39 percent of the investment that would be included in the numerator of the
40 Idaho property factor determined pursuant to section 63-3027, Idaho Code,
41 for the same year.
42 (10) Only for the purposes of subsections (3)(a) and (7) of this section,
43 references to sections of the "Internal Revenue Code" mean the sections
44 referred to as they existed in the Internal Revenue Code of 1986 prior to
45 November 5, 1990.
46 SECTION 6. That Chapter 30, Title 63, Idaho Code, be, and the same is
47 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
48 ignated as Section 63-3029G, Idaho Code, and to read as follows:
49 63-3029G. CREDITS FOR RESEARCH ACTIVITIES CONDUCTED IN THIS STATE --
50 CARRY FORWARD.
51 (1) (a) Subject to the limitations of this section, for taxable year 2001
52 only, there shall be allowed to a taxpayer a nonrefundable credit against
53 taxes imposed by sections 63-3024, 63-3025 and 63-3025A, Idaho Code, for
7
1 increasing research activities in Idaho during any twelve (12) month
2 period beginning, at the election of the taxpayer, either:
3 (i) January 1, 2001, or
4 (ii) The first day of the taxpayer's taxable year beginning in 2001.
5 (b) The credit allowed by subsection (1)(a) of this section shall be the
6 sum of:
7 (i) Five percent (5%) of the excess of qualified research payments
8 for research conducted in Idaho over the base amount; and
9 (ii) Five percent (5%) basic research payments allowable under sub-
10 section (e) of section 41 of the Internal Revenue Code for basic
11 research conducted in Idaho.
12 (2) As used in this section:
13 (a) The terms "qualified research payments," "qualified research," "basic
14 research payments" and "basic research" shall be as defined in section 41
15 of the Internal Revenue Code except that the research must be conducted in
16 Idaho.
17 (b) The term "base amount" shall mean an amount calculated as provided in
18 sections 41(c) and 41(h) of the Internal Revenue Code, except that:
19 (i) The base amount does not include the calculation of the alter-
20 native incremental credit provided for in section 41(c)(4) of the
21 Internal Revenue Code;
22 (ii) A taxpayer's gross receipts include only those gross receipts
23 attributable to sources within this state as provided in subsections
24 (q) and (r) of section 63-3027, Idaho Code; and
25 (iii) Notwithstanding section 41(c) of the Internal Revenue Code, for
26 purposes of calculating the base amount, a taxpayer:
27 (A) May elect to be treated as a start-up company as provided
28 in section 41(c)(3)(B) of the Internal Revenue Code, regardless
29 of whether the taxpayer meets the requirements of section
30 41(c)(3)(B)(i)(I) or (II) of the Internal Revenue Code; and
31 (B) May not revoke an election to be treated as a start-up com-
32 pany.
33 (3) The credit allowed by subsection (1)(a) of this section together with
34 any credits carried forward under subsection (5) of this section shall not
35 exceed the amount of tax due under sections 63-3024, 63-3025 and 63-3025A,
36 Idaho Code, after allowance for all other credits permitted by this chapter.
37 When credits earned in more than one (1) taxable year are available, the old-
38 est credits shall be applied first.
39 (4) In the case of a group of corporations filing a combined report under
40 subsection (t) of section 63-3027, Idaho Code, credit earned by one (1) member
41 of the group but not used by that member may be used by another member of the
42 group. For a combined group of corporations, any member of the group may claim
43 credit carried forward unless the member who earned the credit is no longer
44 included in the combined group.
45 (5) The credit allowed by subsection (1)(a) of this section shall be
46 claimed for the taxable year during which the taxpayer qualifies for the
47 credit. If the credit exceeds the limitation under subsection (3) of this sec-
48 tion, the excess amount may be carried forward for a period that does not
49 exceed the next fourteen (14) taxable years.
50 (6) In addition to other needed rules, the state tax commission may pro-
51 mulgate rules prescribing, in the case of S corporations, partnerships, trusts
52 or estates, a method of attributing the credit under this section to the
53 shareholders, partners or beneficiaries in proportion to their share of the
54 income from the S corporation, partnership, trust or estate.
8
1 SECTION 7. That Section 63-3029H, Idaho Code, be, and the same is hereby
2 amended to read as follows:
3 63-3029HP. PRIORITY OF CREDITS. When a taxpayer subject to any taxes
4 imposed under this chapter is entitled to two (2) or more credits against such
5 taxes, the priority of credits shall be determined in the following order:
6 (a) Nonrefundable credits. Nonrefundable credits shall be applied to the
7 tax liability before application of refundable credits. If a taxpayer is enti-
8 tled to more than one (1) nonrefundable credit, the credits shall be applied
9 in the order in which the statutes authorizing the credits were enacted by the
10 legislature.
11 (b) Refundable credits. Refundable credits shall be applied to the tax
12 liability after application of any nonrefundable credits.
13 SECTION 8. That Chapter 30, Title 63, Idaho Code, be, and the same is
14 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
15 ignated as Section 63-3029I, Idaho Code, and to read as follows:
16 63-3029I. INCOME TAX CREDIT FOR INVESTMENT IN BROADBAND EQUIPMENT. (1)
17 Subject to the limitations of this section, for taxable year 2001 only, there
18 shall be allowed to a taxpayer a nonrefundable credit against taxes imposed by
19 sections 63-3024, 63-3025 and 63-3025A, Idaho Code, for qualified expenditures
20 in qualified broadband equipment in Idaho.
21 (2) The credit permitted in subsection (1) of this section shall be three
22 percent (3%) of the qualified investment in qualified broadband equipment in
23 Idaho and shall be in addition to the credit for capital investment permitted
24 by section 63-3029B, Idaho Code.
25 (3) As used in this section the term:
26 (a) "Qualified investment" shall be as defined in section 63-3029B, Idaho
27 Code.
28 (b) "Qualified broadband equipment" means equipment that qualifies for
29 the credit for capital investment permitted by section 63-3029B, Idaho
30 Code, and is capable of transmitting signals at a rate of at least two
31 hundred thousand (200,000) bits per second to a subscriber and at least
32 one hundred twenty-five thousand (125,000) bits per second from a sub-
33 scriber, and
34 (i) In the case of a telecommunications carrier, such qualifying
35 equipment shall be necessary to the provision of broadband service
36 and an integral part of a broadband network. "Telecommunications car-
37 rier" has the meaning given such term by section 3(44) of the commu-
38 nications act of 1934, as amended, but does not include a commercial
39 mobile service provider.
40 (ii) In the case of a commercial mobile service carrier, such quali-
41 fying equipment shall extend from the subscriber side of the mobile
42 telecommunications switching office to a transmitting/receiving
43 antenna, including such antenna, on the outside of the structure in
44 which the subscriber is located. "Commercial mobile service carrier"
45 means any person authorized to provide commercial mobile radio ser-
46 vice to subscribers as defined in section 20.3 of title 47, Code of
47 Federal Regulations (10-1-99 ed.), as amended.
48 (iii) In the case of a cable or open video system operator, such
49 qualifying equipment shall extend from the subscriber's side of the
50 headend to the outside of the structure in which the subscriber is
51 located. The terms "cable operator" and "open video system operator"
52 have the meanings given such terms by sections 602(5) and 653,
9
1 respectively, of the communications act of 1934, as amended.
2 (iv) In the case of a satellite carrier or a wireless carrier other
3 than listed above, such qualifying equipment is only that equipment
4 that extends from a transmitting/receiving antenna, including such
5 antenna, which transmits and receives signals to or from multiple
6 subscribers to a transmitting/receiving antenna on the outside of the
7 structure in which the subscriber is located. "Satellite carrier"
8 means any person using the facilities of a satellite or satellite
9 services licensed by the federal communications commission and oper-
10 ating a fixed-satellite service or direct broadcast satellite ser-
11 vices to provide point-to-multipoint distribution of signals. "Other
12 wireless carrier" means any person, other than a telecommunications
13 carrier, commercial mobile service carrier, cable operator, open
14 video operator, or satellite carrier, providing broadband services to
15 subscribers through the radio transmission of energy.
16 (v) In the case of packet switching equipment, such packet equip-
17 ment installed in connection with other qualifying equipment listed
18 in subsections (2)(b)(i) through (2)(b)(iv) of this section, provided
19 it is the last in a series of equipment that transmits signals to a
20 subscriber or the first in a series of equipment that transmits sig-
21 nals from a subscriber. "Packet switching" means controlling or
22 routing the path of a digital transmission signal which is assembled
23 into packets or cells.
24 (vi) In the case of multiplexing and demultiplexing equipment, such
25 equipment only to the extent that it is deployed in connection with
26 providing broadband services in locations between packet switching
27 equipment and the structure in which the subscriber is located.
28 "Multiplexing" means the transmission of two (2) or more signals over
29 a communications circuit without regard to the communications tech-
30 nology.
31 (vii) Any property not primarily used to provide services in Idaho to
32 public subscribers is not qualified broadband equipment.
33 (4) No equipment described in subsections (2)(b)(i) through (2)(b)(vi) of
34 this section shall qualify for the credit provided in subsection (1) of this
35 section until the taxpayer applies to and obtains from the Idaho public utili-
36 ties commission an order confirming that the installed equipment is qualified
37 broadband equipment. Applications submitted to the commission shall be gov-
38 erned by the commission's rules of procedure. The commission may issue proce-
39 dural orders necessary to implement this section.
40 (5) The credit allowed by subsection (1) of this section together with
41 any credits carried forward under subsection (7) of this section shall not, in
42 any one (1) taxable year, exceed the lesser of:
43 (a) The amount of tax due under sections 63-3024, 63-3025 and 63-3025A,
44 Idaho Code, after allowance for all other credits permitted by this chap-
45 ter; or
46 (b) Seven hundred fifty thousand dollars ($750,000).
47 When credits earned in more than one (1) taxable year are available, the old-
48 est credits shall be applied first.
49 (6) In the case of a group of corporations filing a combined report under
50 subsection (t) of section 63-3027, Idaho Code, credit earned by one (1) member
51 of the group but not used by that member may be used by another member of the
52 group, subject to the provisions of subsection (7) of this section, instead of
53 carried over. For a combined group of corporations, credit carried forward may
54 be claimed by any member of the group unless the member who earned the credit
55 is no longer included in the combined group.
10
1 (7) If the credit allowed by subsection (1) of this section exceeds the
2 limitation under subsection (5) of this section, the excess amount may be car-
3 ried forward for a period that does not exceed the next fourteen (14) taxable
4 years.
5 (8) In the event that qualified broadband equipment upon which the credit
6 allowed by this section has been used ceases to qualify for the credit allowed
7 by section 63-3029B, Idaho Code, or is subject to recapture of that credit,
8 the recapture of credit under this section shall be in the same proportion and
9 subject to the same provisions as the amount of credit required to be recap-
10 tured under section 63-3029B, Idaho Code.
11 (9) (a) Subject to the requirements of this subsection, a taxpayer enti-
12 tled to the credit or to an unused portion of the credit allowed by this
13 section may transfer the unused credit to another taxpayer required to
14 file a return under this chapter.
15 (b) Before completing a transfer under this subsection, the transferor
16 shall notify the state tax commission of its intention to transfer the
17 credit and the identity of the transferee. The state tax commission shall
18 provide the transferor with a written statement of the amount of credit
19 available under this section as then appearing in the commission's records
20 and the number of years the credit may be carried over. The transferee
21 shall attach a copy of the statement to any return in regard to which the
22 transferred credit is claimed.
23 (c) In the event that after the transfer the state tax commission deter-
24 mines that the amount of credit properly available under this section is
25 less than the amount claimed by the transferor of the credit or that the
26 credit is subject to recapture, the commission shall assess the amount of
27 overstated or recaptured credit as taxes due from the transferor and not
28 the transferee. The assessment shall be made in the manner provided for a
29 deficiency in taxes under this chapter.
30 (10) In addition to other needed rules, the state tax commission may pro-
31 mulgate rules prescribing, in the case of S corporations, partnerships, trusts
32 or estates, a method of attributing the credit under this section to the
33 shareholders, partners or beneficiaries in proportion to their share of the
34 income from the S corporation, partnership, trust or estate.
35 SECTION 9. That Chapter 30, Title 63, Idaho Code, be, and the same is
36 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
37 ignated as Section 63-3022P, Idaho Code, and to read as follows:
38 63-3022P. HEALTH INSURANCE COSTS. With respect to a taxpayer, an amount
39 equal to the amount paid by the taxpayer during the taxable year for insurance
40 which constitutes medical care for the taxpayer and the spouse and dependents
41 of the taxpayer which is not otherwise deducted by the taxpayer for federal
42 income tax purposes shall be allowed as a deduction against taxable income. As
43 used in this section, "insurance which constitutes medical care" includes any
44 hospital or medical policy or certificate, any subscriber contract provided by
45 a hospital or professional service corporation or mutual insurer, or any
46 health maintenance organization subscriber contract, policies or certificates
47 of insurance for specific disease, hospital confinement indemnity, accident-
48 only, credit, dental, vision, single employer self-funded coverage, meaning
49 that portion of health insurance which is the retained risk of the employer,
50 student health benefits only or coverage for medical care or treatment issued
51 as a supplement to liability insurance.
52 SECTION 10. That Chapter 6, Title 63, Idaho Code, be, and the same is
11
1 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
2 ignated as Section 63-602EE, Idaho Code, and to read as follows:
3 63-602EE. PROPERTY EXEMPT FROM TAXATION -- CERTAIN TANGIBLE PERSONAL
4 PROPERTY. The following property is exempt from taxation: class 2 property
5 that is agricultural machinery and equipment and exclusively used in agricul-
6 ture during the immediately preceding tax year. For purposes of this section:
7 (1) "Agricultural machinery and equipment" shall mean any machinery and
8 equipment that is used in:
9 (a) Production of field crops including, but not limited to, grains, feed
10 crops, fruits and vegetables; or
11 (b) The grazing, feeding or raising of livestock, fur-bearing animals,
12 fish, fowl and bees to be sold or used as part of a net profit-making
13 agricultural enterprise or dairy.
14 (2) Buildings shall not be considered to be agricultural machinery and
15 equipment.
16 SECTION 11. That Section 63-3067, Idaho Code, be, and the same is hereby
17 amended to read as follows:
18 63-3067. REVENUE RECEIVED -- STATE REFUND ACCOUNT. (1) A sum equal to the
19 amount withheld under section 63-3035A, Idaho Code, shall be distributed fifty
20 percent (50%) to the public school income fund to be utilized to facilitate
21 and provide substance abuse programs in the public school system, and fifty
22 percent (50%) shall be distributed to the counties to be utilized for county
23 juvenile probation services. These funds shall be distributed quarterly to the
24 counties based upon the percentage the population of the county bears to the
25 population of the state as a whole.
26 (2) All moneys except as provided in subsection (1) of this section, and
27 except as hereinafter provided, received by the state of Idaho under this act
28 shall be deposited by the state tax commission, as received by it, with the
29 state treasurer and shall be placed in and become a part of the general
30 account under the custody of the state treasurer. Providing however, that an
31 amount equal to twenty percent (20%) of the amount deposited with the state
32 treasurer shall be placed in the "state refund account" which is hereby cre-
33 ated for the purpose of repaying overpayments, for the purpose of remitting to
34 counties and taxing districts for personal property exempt from taxation pur-
35 suant to section 63-602EE, Idaho Code, as provided in subsection (3) of this
36 section, for the purpose of depositing in the trust accounts specified in sec-
37 tion 63-3067A, Idaho Code, such amounts as may be designated by individuals
38 for the purpose of depositing in the Idaho ag in the classroom account an
39 amount as may be designated by the individual receiving a refund for such
40 overpayment, and for the purpose of paying any other erroneous receipts ille-
41 gally assessed or collected, penalties collected without authority and taxes
42 and licenses unjustly assessed, collected or which are excessive in amount.
43 Whenever necessary for the purpose of making prompt payment of refunds, the
44 board of examiners, upon request from the state tax commission, and after
45 review, may authorize the state tax commission to transfer any additional spe-
46 cific amount from income tax collections to the "state refund account." There
47 is appropriated out of the state refund account so much thereof as may be nec-
48 essary for the payment of the refunds herein provided. Claims for, and payment
49 of refunds under the provisions of this section shall be made in the same man-
50 ner as other claims against the state of Idaho.
51 (3) The state tax commission shall calculate the amount that each county
52 assessed in taxes in tax year 2000 on property that is exempt from taxation
12
1 pursuant to section 63-602EE, Idaho Code, and shall remit to the county trea-
2 surer for distribution to each taxing district in the county one hundred six
3 percent (106%) of the amount calculated as follows:
4 The county commissioners in each county shall certify to the state tax
5 commission by July 1, 2001, the year 2000 tax charge, applicable to the prop-
6 erty exempt from taxation pursuant to section 63-602EE, Idaho Code, provided
7 that such property was categorized in year 2000 as farm machinery, tools and
8 equipment pursuant to rules of the state tax commission, for the portion of
9 each taxing district or unit within the county. For nonschool districts the
10 state tax commission shall distribute one-fourth (1/4) of this amount certi-
11 fied quarterly to each county beginning in October 2001. For school districts
12 the state tax commission shall distribute one-fourth (1/4) of the amount cer-
13 tified quarterly to each school district beginning in October 2001. For non-
14 school districts, the county auditor shall distribute to each district
15 within thirty (30) calendar days from receipt of moneys from the tax commis-
16 sion. Moneys received by each taxing district for replacement shall be uti-
17 lized in the same manner and in the same proportions as revenues from property
18 taxation. The moneys remitted to the county treasurer for replacement of
19 property exempt from taxation pursuant to section 63-602EE, Idaho Code, may be
20 considered by the counties and other taxing districts and budgeted at the same
21 time, in the same manner and in the same year as revenues from taxation on
22 personal property which these moneys replace. If taxing districts are consoli-
23 dated, the resulting district is entitled to an amount equal to the sum of the
24 amounts which were received in the last calendar quarter by each district pur-
25 suant to this subsection prior to the consolidation. If a taxing district is
26 dissolved or disincorporated, the state tax commission shall continuously dis-
27 tribute to the board of county commissioners an amount equal to the last
28 quarter's distribution prior to dissolution or disincorporation. The board of
29 county commissioners shall determine any redistribution of moneys so received.
30 If a taxing district annexes territory, the distribution of moneys received
31 pursuant to this subsection shall be unaffected. Taxing districts formed after
32 January 1, 2001, are not entitled to a payment under the provisions of this
33 subsection. School districts shall receive an amount determined by multiplying
34 the sum of the year 2000 school district levy plus .001 times the market value
35 on December 31, 2000, in the district of the property exempt from taxation
36 pursuant to section 63-602EE, Idaho Code. For purposes of the limitation pro-
37 vided by section 63-802, Idaho Code, moneys received pursuant to this subsec-
38 tion as property tax replacement for property exempt from taxation pursuant to
39 section 63-602EE, Idaho Code, shall be treated as property tax revenues.
40 (4) Any unencumbered balance remaining in the state refund account on
41 June 30 of each and every year in excess of the sum of one million five hun-
42 dred thousand dollars ($1,500,000) shall be transferred to the general account
43 fund and the state controller is hereby authorized and directed on such dates
44 to make such transfers unless the board of examiners, which is hereby autho-
45 rized to do so, changes the date of transfer or sum to be transferred.
46 SECTION 12. That Chapter 30, Title 63, Idaho Code, be, and the same is
47 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
48 ignated as Section 63-3029J, Idaho Code, and to read as follows:
49 63-3029J. INCENTIVE INCOME TAX INVESTMENT CREDIT. (1) Subject to the lim-
50 itations of this section, for taxable year 2001 only, there shall be allowed
51 to a taxpayer a nonrefundable credit against taxes imposed by sections
52 63-3024, 63-3025 and 63-3025A, Idaho Code, in the amount allowed by subsection
53 (2) of this section for qualified investments in Idaho. The credit shall be in
13
1 addition to the credit for capital investment permitted by section 63-3029B,
2 Idaho Code.
3 (2) The credit permitted in subsection (1) of this section shall be at
4 the percentage rate determined under either subsection (2)(a) or (2)(b) of
5 this section at the election of the taxpayer.
6 (a) (i) One-half (1/2) of the amount by which the average three-year
7 unemployment rate in the county in which the property is located
8 exceeds six percent (6%). In the case of mobile property, the prop-
9 erty shall be located in the county in which it is primarily based.
10 (ii) For purposes of this section the director of the department of
11 labor shall, on or before the first day of September of each calendar
12 year, establish and certify to the state tax commission the average
13 three-year unemployment rate in each county in Idaho for the immedi-
14 ately preceding three (3) calendar years. The rates thus certified
15 shall apply to the calculation of the credit under subsection
16 (2)(a)(i) of this section for property qualifying in the taxable year
17 beginning during the next calendar year.
18 (b) (i) One-tenth of one percent (.1%) for each full percent that the
19 three-year average per capita personal income level in the county in
20 which the property is located is below ninety percent (90%) of the
21 average statewide per capita personal income level.
22 (ii) For purposes of this section the director of the department of
23 commerce shall, on or before the first day of September of each cal-
24 endar year, establish and certify to the state tax commission the
25 most current three-year average per capita personal income level in
26 each county in Idaho and the statewide per capita personal income
27 level for the most current preceding three (3) calendar years. The
28 levels thus certified shall apply to the calculation of the credit
29 under subsection (2)(b)(i) of this section for property qualifying in
30 the taxable year beginning during the next calendar year.
31 (3) As used in this section the term "qualified investment" shall be
32 defined as in section 63-3029B, Idaho Code.
33 (4) The credit allowed by subsection (1) of this section together with
34 any credits carried forward under subsection (6) of this section shall not
35 exceed in any one (1) taxable year the lesser of:
36 (a) The amount of tax due under sections 63-3024, 63-3025 and 63-3025A,
37 Idaho Code, after allowance for all other credits permitted by this chap-
38 ter; or
39 (b) Five hundred thousand dollars ($500,000).
40 (5) In the case of a group of corporations filing a combined report under
41 subsection (t) of section 63-3027, Idaho Code, credit earned by one (1) member
42 of the group but not used by that member may be used by another member of the
43 group, subject to the provisions of subsection (6) of this section, instead of
44 carried over. For a combined group of corporations, credit carried forward may
45 be claimed by any member of the group unless the member who earned the credit
46 is no longer included in the combined group.
47 (6) If the credit allowed by subsection (1) of this section exceeds the
48 limitation under subsection (4) of this section, the excess amount may be car-
49 ried forward for a period that does not exceed the next fourteen (14) taxable
50 years.
51 (7) In the event that property upon which the credit allowed by this sec-
52 tion has been used ceases to qualify for the credit allowed by section
53 63-3029B, Idaho Code, the recapture of credit under this section shall be in
54 the same proportion and subject to the same provisions as the amount of credit
55 required to be recaptured under section 63-3029B, Idaho Code.
14
1 (8) (a) Subject to the requirements of this subsection, a taxpayer enti-
2 tled to the credit or to an unused portion of the credit allowed by this
3 section may transfer the unused credit to another taxpayer required to
4 file a return under this chapter.
5 (b) Before completing a transfer under this subsection, the transferor
6 shall notify the state tax commission of its intention to transfer the
7 credit and the identity of the transferee. The state tax commission shall
8 provide the transferor with a written statement of the amount of credit
9 available under this section as then appearing in the commission's records
10 and the number of years the credit may be carried over. The transferor
11 shall provide the transferee with the original statement. The transferee
12 shall attach a copy of the statement to any return in regard to which the
13 transferred credit is claimed.
14 (c) In the event that after the transfer the state tax commission deter-
15 mines that the amount of credit properly available under this section is
16 less than the amount claimed by the transferor of the credit and shown in
17 the statement described in subsection (8)(b) of this section or that the
18 credit is subject to recapture, the commission shall assess the amount of
19 overstated credit as taxes due from the transferor and not the transferee.
20 The assessment shall be made in the manner provided for a deficiency in
21 taxes under this chapter.
22 (9) In addition to other needed rules, the state tax commission may pro-
23 mulgate rules prescribing:
24 (a) In the case of S corporations, partnerships, trusts or estates, a
25 method of attributing the credit under this section to the shareholders,
26 partners or beneficiaries in proportion to their share of the income from
27 the S corporation, partnership, trust or estate.
28 (b) A requirement that a transferor under subsection (8) of this section,
29 prior to obtaining the written statement provided in subsection (8)(b) of
30 this section, post such bond or security as the state tax commission may
31 require to secure any liability referred to in subsection (8)(c) of this
32 section. Such rules shall provide an opportunity for a taxpayer, upon a
33 showing of financial responsibility, to have the bond waiver, for notice
34 of denial of waiver in accordance with section 63-3045, Idaho Code, and
35 for review in accordance with section 63-3045B, Idaho Code.
36 SECTION 13. That Section 63-3029E, Idaho Code, be, and the same is hereby
37 amended to read as follows:
38 63-3029E. DEFINITIONS -- CONSTRUCTION OF TERMS. As used in this section
39 and in section 63-3029F, Idaho Code:
40 (1) (a) "New employee" means a person from whom Idaho income tax has been
41 withheld, employed by the taxpayer, in a revenue-producing enterprise cre-
42 ating value-added natural resource products, and covered for unemployment
43 insurance purposes under chapter 13, title 72, Idaho Code, during the tax-
44 able year for which the credit allowed by section 63-3029F, Idaho Code, is
45 claimed. A person shall be deemed to be so engaged if such person performs
46 duties on:
47 (i) A regular full-time basis; or
48 (ii) A part-time basis if such person is customarily performing such
49 duties at least twenty (20) hours per week.
50 No credit shall be earned unless the new employee shall have performed
51 such duties for the taxpayer for a minimum of nine (9) months during the
52 taxable year for which the credit is claimed.
53 (b) The provisions of paragraph (a) of this subsection notwithstanding,
15
1 no credit shall be allowed for employment of persons by a taxpayer who
2 acquires a revenue-producing enterprise from another taxpayer or who oper-
3 ates in a place of business the same or a substantially identical revenue-
4 producing value-added natural resource products enterprise business as
5 operated by another taxpayer within the prior twelve (12) months, except
6 as the prior taxpayer would have qualified under the provisions of para-
7 graph (c) of this subsection. Employees transferred from a related tax-
8 payer shall not be included in the computation of the credit.
9 (c) The number of employees during any taxable year for any taxpayer
10 shall be the mathematical average of the number of employees reported to
11 the Idaho department of labor for employment security purposes during the
12 twelve (12) months of the taxable year which qualified under paragraph (a)
13 of this subsection. In the event the business is in operation for less
14 than the entire taxable year, the number of employees of the business for
15 the year shall be the average number actually employed during the months
16 of operation, providing that the qualifications of paragraph (a) of this
17 subsection are met.
18 (2) "Revenue-producing enterprise" means the production, assembly, fabri-
19 cation, manufacture or processing of any natural resource product.
20 (3) "Same or a substantially identical revenue-producing enterprise busi-
21 ness" means a revenue-producing enterprise business in which the products pro-
22 duced or sold, or the activities conducted are the same in character and use
23 and are produced, sold or conducted in the same manner as, or for the same
24 types of customers as, the products or activities produced, sold or conducted
25 in another revenue-producing enterprise business.
26 SECTION 14. That Section 63-3029F, Idaho Code, be, and the same is hereby
27 amended to read as follows:
28 63-3029F. SPECIAL CREDIT AVAILABLE -- NEW EMPLOYEES. (1) Any taxpayer
29 shall be allowed a credit, in an amount determined under subsection (2) of
30 this section, against the tax imposed by this chapter, other than the tax
31 imposed by section 63-3082, Idaho Code, for any taxable year during which the
32 taxpayer's employment of new employees, as defined under section 63-3029E(1),
33 Idaho Code, increases above the taxpayer's average employment for either: (a)
34 the prior taxable year, or (b) the average of three (3) prior taxable years,
35 whichever is higher. No credit shall be allowed under this section unless the
36 number of new employees equals or exceeds one (1) person.
37 (2) The credit authorized in subsection (1) of this section shall be five
38 hundred dollars ($500) per new employee, but the total credit allowed shall
39 not exceed three and one-quarter percent (3.25%) of net income from the
40 taxpayer's corporate, proprietorship, partnership, small business corporation
41 or limited liability company revenue-producing enterprise business in which
42 the employment occurred. Additionally, the total of this and all other credits
43 allowed under this chapter except for the credits allowed under sections
44 63-3024A, 63-3025D and 63-3029, Idaho Code, taken during any taxable year
45 shall not exceed forty-five percent (45%) of the tax otherwise imposed on the
46 taxpayer for the taxable year for which such credit is allowed.
47 (3) If the sum of the credit carryovers from the credit allowed by sub-
48 section (2) of this section and the amount of credit for the taxable year from
49 the credit allowed by subsection (2) of this section exceed the limitation
50 imposed by subsection (2) of this section for the current taxable year, the
51 excess attributable to the current taxable year's credit shall be a credit
52 carryover to the three (3) succeeding taxable years. The entire amount of
53 unused credit shall be carried forward to the earliest of the succeeding
16
1 years, wherein the oldest available unused credit shall be used first, so long
2 as the employment level for which the credit was granted is still maintained.
3 SECTION 15. That Sections 63-3029E and 63-3029F, Idaho Code, be, and the
4 same are hereby repealed.
5 SECTION 16. That Chapter 30, Title 63, Idaho Code, be, and the same is
6 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
7 ignated as Section 63-3029E, Idaho Code, and to read as follows:
8 63-3029E. DEFINITIONS -- CONSTRUCTION OF TERMS. As used in this section
9 and in section 63-3029F, Idaho Code:
10 (1) (a) "New employee" means a person from whom Idaho income tax has
11 been withheld, employed by the taxpayer in a revenue-producing enterprise
12 creating value-added natural resource products, and covered for unemploy-
13 ment insurance purposes under chapter 13, title 72, Idaho Code, during the
14 taxable year for which the credit allowed by section 63-3029F, Idaho Code,
15 is claimed. A person shall be deemed to be so engaged if such person per-
16 forms duties on:
17 (i) A regular full-time basis; or
18 (ii) A part-time basis if such person is customarily performing such
19 duties at least twenty (20) hours per week.
20 No credit shall be earned unless the new employee shall have performed
21 such duties for the taxpayer for a minimum of nine (9) months during the
22 taxable year for which the credit is claimed.
23 (b) The provisions of paragraph (a) of this subsection notwithstanding,
24 no credit shall be allowed for employment of persons by a taxpayer who
25 acquires a revenue-producing enterprise from another taxpayer or who oper-
26 ates in a place of business the same or a substantially identical revenue-
27 producing value-added natural resource products enterprise as operated by
28 another taxpayer within the prior twelve (12) months, except as the prior
29 taxpayer would have qualified under the provisions of paragraph (c) of
30 this subsection. Employees transferred from a related taxpayer shall not
31 be included in the computation of the credit.
32 (c) The number of employees during any taxable year for any taxpayer
33 shall be the mathematical average of the number of employees reported to
34 the Idaho department of labor for employment security purposes during the
35 twelve (12) months of the taxable year which qualified under paragraph (a)
36 of this subsection. In the event the business is in operation for less
37 than the entire taxable year, the number of employees of the business for
38 the year shall be the average number actually employed during the months
39 of operation, providing that the qualifications of paragraph (a) of this
40 subsection are met.
41 (2) "Revenue-producing enterprise" means the production, assembly, fabri-
42 cation, manufacture or processing of any natural resource product.
43 (3) "Same or a substantially identical revenue-producing enterprise"
44 means a revenue-producing enterprise in which the products produced or sold,
45 or the activities conducted are the same in character and use and are pro-
46 duced, sold or conducted in the same manner as, or for the same types of cus-
47 tomers as, the products or activities produced, sold or conducted in another
48 revenue-producing enterprise.
49 SECTION 17. That Chapter 30, Title 63, Idaho Code, be, and the same is
50 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
51 ignated as Section 63-3029F, Idaho Code, and to read as follows:
17
1 63-3029F. SPECIAL CREDIT AVAILABLE -- NEW EMPLOYEES. (1) Any taxpayer
2 shall be allowed a credit, in an amount determined under subsection (2) of
3 this section, against the tax imposed by this chapter, other than the tax
4 imposed by section 63-3082, Idaho Code, for any taxable year during which the
5 taxpayer's employment of new employees, as defined under section 63-3029E(1),
6 Idaho Code, increases above the taxpayer's average employment for either: (a)
7 the prior taxable year, or (b) the average of three (3) prior taxable years,
8 whichever is higher. No credit shall be allowed under this section unless the
9 number of new employees equals or exceeds one (1) person.
10 (2) The credit authorized in subsection (1) of this section shall be five
11 hundred dollars ($500) per new employee, but the total credit allowed shall
12 not exceed three and one-quarter percent (3.25%) of net income from the
13 taxpayer's corporate, proprietorship, partnership, small business corporation
14 or limited liability company revenue-producing enterprise in which the employ-
15 ment occurred. Additionally, the total of this and all other credits allowed
16 under this chapter except for the credits allowed under sections 63-3024A,
17 63-3025D and 63-3029, Idaho Code, taken during any taxable year shall not
18 exceed forty-five percent (45%) of the tax otherwise imposed on the taxpayer
19 for the taxable year for which such credit is allowed.
20 (3) If the sum of the credit carryovers from the credit allowed by sub-
21 section (2) of this section and the amount of credit for the taxable year from
22 the credit allowed by subsection (2) of this section exceed the limitation
23 imposed by subsection (2) of this section for the current taxable year, the
24 excess attributable to the current taxable year's credit shall be a credit
25 carryover to the three (3) succeeding taxable years. The entire amount of
26 unused credit shall be carried forward to the earliest of the succeeding
27 years, wherein the oldest available unused credit shall be used first, so long
28 as the employment level for which the credit was granted is still maintained.
29 SECTION 18. The provisions of Sections 5, 6, 8, 12, 13 and 14 of this act
30 are hereby declared to be nonseverable from other provisions within each sec-
31 tion and if any provision of any of those sections or the application of such
32 provision to any person or circumstance is declared invalid for any reason,
33 such declaration shall render the entire section invalid but not other sec-
34 tions of this act.
35 SECTION 19. An emergency existing therefor, which emergency is hereby
36 declared to exist, Sections 1 through 14 and Section 18 of this act shall be
37 in full force and effect on and after passage and approval, and retroactively
38 to January 1, 2001. Sections 15, 16 and 17 of this act shall be in full force
39 and effect on and after January 1, 2002.".
40 CORRECTION TO TITLE
41 On page 1, delete lines 2 through 46; and on page 2, delete lines 1
42 through 35, and insert:
43 "RELATING TO TAXATION AND TAX RELIEF; AMENDING SECTION 63-3024, IDAHO CODE, TO
44 PROVIDE FOR PERSONAL INCOME TAX RATES FOR TAXABLE YEAR 2001 AND TO PROVIDE
45 FOR PERSONAL INCOME TAX RATES FOR TAXABLE YEAR 2002 AND EACH YEAR THEREAF-
46 TER; AMENDING SECTION 63-3024A, IDAHO CODE, TO INCREASE THE INCOME TAX
47 CREDIT FOR SALES TAXES PAID BY CERTAIN INDIVIDUALS AND TO MAKE TECHNICAL
48 CORRECTIONS; AMENDING SECTION 63-3025, IDAHO CODE, TO PROVIDE THE CORPO-
49 RATE INCOME TAX RATE FOR TAXABLE YEAR 2001 AND TO PROVIDE THE CORPORATE
50 INCOME TAX RATE FOR TAXABLE YEAR 2002 AND EACH YEAR THEREAFTER; AMENDING
51 SECTION 63-3025A, IDAHO CODE, TO REDUCE THE CORPORATE FRANCHISE TAX RATE
52 FROM EIGHT PERCENT TO THE RATE OF THE CORPORATE INCOME TAX AND TO MAKE
18
1 TECHNICAL CORRECTIONS; AMENDING SECTION 63-3029B, IDAHO CODE, TO PROVIDE
2 THAT TAXPAYERS MAKING EXPENDITURES FOR QUALIFIED BROADBAND EQUIPMENT ARE
3 ENTITLED TO THE CREDIT AND TO REVISE PROCEDURES FOR RECAPTURE; AMENDING
4 CHAPTER 30, TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW SECTION
5 63-3029G, IDAHO CODE, TO PROVIDE AN INCOME TAX CREDIT FOR CERTAIN EXPENDI-
6 TURES RELATING TO RESEARCH ACTIVITIES CONDUCTED IN IDAHO FOR TAXABLE YEAR
7 2001, TO PROVIDE A CARRYOVER OF UNUSED CREDITS, TO PROVIDE DEFINITIONS AND
8 TO PROVIDE PROCEDURES; AMENDING SECTION 63-3029H, IDAHO CODE, TO REDESIG-
9 NATE THE SECTION; AMENDING CHAPTER 30, TITLE 63, IDAHO CODE, BY THE ADDI-
10 TION OF A NEW SECTION 63-3029I, IDAHO CODE, TO PROVIDE AN INCOME TAX
11 CREDIT FOR CERTAIN EXPENDITURES RELATING TO HIGH SPEED BROADBAND COMMUNI-
12 CATIONS ACCESS IN IDAHO FOR TAXABLE YEAR 2001, TO PROVIDE A CARRYOVER OF
13 UNUSED CREDITS, TO PROVIDE DEFINITIONS AND TO PROVIDE PROCEDURES; AMENDING
14 CHAPTER 30, TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW SECTION
15 63-3022P, IDAHO CODE, TO PROVIDE, WITH RESPECT TO A TAXPAYER, AN AMOUNT
16 EQUAL TO THE AMOUNT PAID BY THE TAXPAYER DURING THE TAXABLE YEAR FOR
17 INSURANCE WHICH CONSTITUTES MEDICAL CARE FOR THE TAXPAYER AND THE SPOUSE
18 AND DEPENDENTS OF THE TAXPAYER WHICH IS NOT OTHERWISE DEDUCTED BY THE TAX-
19 PAYER FOR FEDERAL INCOME TAX PURPOSES SHALL BE ALLOWED AS A DEDUCTION
20 AGAINST TAXABLE INCOME, AND TO PROVIDE A DEFINITION OF "INSURANCE WHICH
21 CONSTITUTES MEDICAL CARE"; AMENDING CHAPTER 6, TITLE 63, IDAHO CODE, BY
22 THE ADDITION OF A NEW SECTION 63-602EE, IDAHO CODE, TO PROVIDE THAT CER-
23 TAIN TANGIBLE PERSONAL PROPERTY IS EXEMPT FROM TAXATION; AMENDING SECTION
24 63-3067, IDAHO CODE, TO PROVIDE FOR REMITTANCE OF INCOME TAX MONEYS TO
25 REPLACE PROPERTY TAXES ON CERTAIN PERSONAL PROPERTY EXEMPT FROM TAXATION,
26 TO PROVIDE A FORMULA AND TO MAKE A TECHNICAL CORRECTION; AMENDING CHAPTER
27 30, TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 63-3029J, IDAHO
28 CODE, TO PROVIDE AN INCOME TAX CREDIT FOR CERTAIN EXPENDITURES RELATING TO
29 INVESTMENT IN AREAS IN IDAHO WITH HIGH UNEMPLOYMENT OR LOW PERSONAL INCOME
30 AT THE ELECTION OF THE TAXPAYER FOR TAXABLE YEAR 2001, TO PROVIDE A CARRY-
31 OVER OF UNUSED CREDITS, TO PROVIDE DEFINITIONS AND TO PROVIDE PROCEDURES;
32 AMENDING SECTIONS 63-3029E AND 63-3029F, IDAHO CODE, TO EXPAND THE NEW
33 JOBS CREDIT BY REMOVING THE LIMITATION OF QUALIFYING TAXPAYERS TO REVENUE-
34 PRODUCING ENTERPRISE CREATING VALUE-ADDED NATURAL RESOURCE PRODUCTS;
35 REPEALING SECTIONS 63-3029E AND 63-3029F, IDAHO CODE; AMENDING CHAPTER 30,
36 TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 63-3029E, IDAHO
37 CODE, TO PROVIDE DEFINITIONS AND CONSTRUCTION OF TERMS; AMENDING CHAPTER
38 30, TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 63-3029F, IDAHO
39 CODE, TO PROVIDE SPECIAL CREDITS TO THE INCOME TAX FOR NEW EMPLOYEES FOR
40 AN ENTERPRISE THAT PRODUCES, ASSEMBLES, FABRICATES OR PROCESSES NATURAL
41 RESOURCE PRODUCTS; PROVIDING FOR NONSEVERABILITY OF CERTAIN PROVISIONS OF
42 THIS ACT; DECLARING AN EMERGENCY AND PROVIDING RETROACTIVE APPLICATION FOR
43 CERTAIN PROVISIONS OF THIS ACT, AND PROVIDING AN EFFECTIVE DATE FOR CER-
44 TAIN PROVISIONS OF THIS ACT.".
STATEMENT OF PURPOSE
RS 11142
This income tax and property tax relief bill reduces all
individual income tax rates by 0.2 percentage point for Tax Year
2001, then lowers these rates an additional 0.3 percentage point
beginning in Tax Year 2002. Rebates 10.6% of 1999 income tax paid
to individuals subject to a $25 minimum and $2,500 maximum.
Permanently increases grocery tax credit $15 for everyone. It
permanently reduces the corporate income tax rate 0.3 percentage
point for Taxable Year 2001 and an additional 0.2 percentage
point beginning in Tax Year 2002. It expands the current capital
gains exclusion from 60% to 100% for certain tangible assets, and
adds capital gain elimination for non-individual taxpayers. It
provides five new or expanded credits for Idaho business
development including: research and development expenditures,
creation of new jobs, providing new venture capital credit,
installing broadband communications equipment credit and
investing in counties with high unemployment or low personal
income. It changes the child care deduction to a credit equal to
half the federal credit and income tax credit for at-home parent
of $150 for each qualifying child, two children maximum. It
permanently increases the elderly dependant care credit from $100
to $500. For the taxable year 2001, only, income tax credit for
personal property for agricultural machinery and equipment
FISCAL IMPACT
FY 2001 FY 2002 FY 2003
Reduce individual income tax rates $29.2 $76.5
Reduce corporate income tax rates 5.1 8.5
Increase grocery tax credit, $15 16.8 16.9
Business Credits:
Research and Development 7.0 7.7
New Jobs Credit 1.5 1.5
Incentive ITC 7.2 7.2
Venture Capital 2.0 2.0
Broadband ITC 3.5 3.5
Child Care $1.5
Stay at-home parent 6.6 8.1 8.1
Elderly Dependent Care Credit 1.2 1.2
Capital Gains Tax (eliminate 40% portion) 8.7 8.7
Eliminate Capital Gains Tax
for Non Individual Taxpayer 6.6 6.6
Subtotal $96.9 $148.4
Personal Property Credit AG Machinery
and Equipment 12.4 N/A
Individual Rebate $91.0 N/A N/A
TOTAL REDUCTION IN GENERAL FUND $91.0 $109.3 $148.4
Contact
Name: Representative Dolores Crow
Phone:
332 1000
STATEMENT OF PURPOSE/FISCAL NOTE H 275