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S1036......................................by LOCAL GOVERNMENT AND TAXATION
COLLEGE SAVINGS ACCOUNT - Amends existing law to provide that if
contributions are made to college savings accounts on or before April 15,
2001, it may be deducted for income tax purposes for tax year 2000; and to
provide that an individual can make another contribution during 2001 and
claim the deduction according to the limits provided for tax year 2001; and
to provide that, in the case of an individual, the amount of a nonqualified
withdrawal from a college savings account will be added to taxable income.
01/25 Senate intro - 1st rdg - to printing
01/26 Rpt prt - to Loc Gov
02/01 Rpt out - rec d/p - to 2nd rdg
02/02 2nd rdg - to 3rd rdg
02/06 3rd rdg - PASSED - 33-0-1(1 vacant)
AYES -- Andreason, Boatright, Branch(Bartlett), Brandt, Bunderson,
Burtenshaw, Cameron, Danielson, Darrington, Davis, Deide, Dunklin,
Frasure, Geddes, Goedde, Hawkins, Ingram, Ipsen, Keough,
King-Barrutia, Lee, Lodge, Noh, Richardson, Sandy, Schroeder,
Sorensen, Stegner, Stennett, Thorne, Wheeler, Whitworth, Williams,
NAYS -- None
Absent and excused -- Risch
Vacant -- Dist. #4
Floor Sponsor -- Ipsen
Title apvd - to House
02/07 House intro - 1st rdg - to Rev/Tax
03/05 Rpt out - rec d/p - to 2nd rdg
03/06 2nd rdg - to 3rd rdg
03/07 3rd rdg - PASSED - 65-0-5
AYES -- Barraclough, Barrett, Bell, Bieter, Black, Boe, Bolz,
Bruneel, Callister, Campbell, Chase, Clark, Collins, Crow, Cuddy,
Deal, Denney, Ellis, Ellsworth, Eskridge, Field(13), Gagner, Gould,
Hadley, Hammond, Harwood, Henbest, Higgins, Hornbeck, Jones, Kellogg,
Kendell, Kunz, Lake, Langford, Loertscher, Mader, Marley, McKague,
Meyer, Montgomery, Mortensen, Moss, Moyle, Pearce, Pischner, Pomeroy,
Raybould, Ridinger, Roberts, Robison, Sali, Schaefer, Sellman,
Shepherd, Smith, Smylie, Stevenson, Stone, Swan, Tilman, Trail,
Wheeler, Wood, Young
NAYS -- None
Absent and excused -- Bedke, Bradford, Field(20), Jaquet, Mr. Speaker
Floor Sponsor -- Gagner
Title apvd - to Senate
03/08 To enrol
03/09 Rpt enrol - Pres signed
03/12 Sp signed
03/13 To Governor
03/19 Governor signed
Session Law Chapter 46
Effective: 01/01/01
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-sixth Legislature First Regular Session - 2001
IN THE SENATE
SENATE BILL NO. 1036
BY LOCAL GOVERNMENT AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO ADJUSTMENTS TO TAXABLE INCOME; AMENDING SECTION 63-3022, IDAHO
3 CODE, TO PROVIDE THAT IF THE CONTRIBUTION IS MADE TO COLLEGE SAVINGS
4 ACCOUNTS ON OR BEFORE APRIL 15, 2001, IT MAY BE DEDUCTED FOR TAX YEAR
5 2000, TO PROVIDE THAT AN INDIVIDUAL CAN MAKE ANOTHER CONTRIBUTION AND
6 CLAIM THE DEDUCTION ACCORDING TO THE LIMITS PROVIDED IN THIS SUBSECTION
7 DURING 2001 FOR TAX YEAR 2001 AS LONG AS THE CONTRIBUTION IS MADE ON OR
8 BEFORE DECEMBER 31, 2001, TO PROVIDE THAT, IN THE CASE OF AN INDIVIDUAL,
9 THE AMOUNT OF A NONQUALIFIED WITHDRAWAL FROM AN INDIVIDUAL TRUST ACCOUNT
10 OR SAVINGS ACCOUNT ESTABLISHED PURSUANT TO CHAPTER 54, TITLE 33, IDAHO
11 CODE, SHALL BE ADDED TO TAXABLE INCOME AND TO MAKE A TECHNICAL CORRECTION;
12 DECLARING AN EMERGENCY AND PROVIDING RETROACTIVE APPLICATION.
13 Be It Enacted by the Legislature of the State of Idaho:
14 SECTION 1. That Section 63-3022, Idaho Code, be, and the same is hereby
15 amended to read as follows:
16 63-3022. ADJUSTMENTS TO TAXABLE INCOME. The additions and subtractions
17 set forth in this section, and in sections 63-3022A through 63-3022M, Idaho
18 Code, are to be applied to the extent allowed in computing Idaho taxable
19 income:
20 (a) Add any state taxes, measured by net income, paid or accrued during
21 the taxable year adjusted for state tax refunds used in arriving at taxable
22 income.
23 (b) Add the net operating loss deduction used in arriving at taxable
24 income.
25 (c) (1) A net operating loss for any taxable year commencing on and after
26 January 1, 2000, shall be a net operating loss carryback not to exceed a
27 total of one hundred thousand dollars ($100,000) to the two (2) immedi-
28 ately preceding taxable years. Any portion of the net operating loss not
29 subtracted in the two (2) preceding years may be subtracted in the next
30 twenty (20) years succeeding the taxable year in which the loss arises in
31 order until exhausted. The sum of the deductions may not exceed the amount
32 of the net operating loss deduction incurred. At the election of the tax-
33 payer, the two (2) year carryback may be foregone and the loss subtracted
34 from income received in taxable years arising in the next twenty (20)
35 years succeeding the taxable year in which the loss arises in order until
36 exhausted. The election shall be made as under section 172(b)(3) of the
37 Internal Revenue Code. An election under this subsection must be in the
38 manner prescribed in the rules of the state tax commission and once made
39 is irrevocable for the year in which it is made. The term "income" as used
40 in this subsection (c) means Idaho taxable income as defined in this chap-
41 ter as modified by section 63-3021(b)(2), (3) and (4), Idaho Code.
42 (2) Net operating losses incurred by a corporation during a year in which
43 such corporation did not transact business in Idaho or was not included in
2
1 a group of corporations combined under subsection (t) of section 63-3027,
2 Idaho Code, may not be subtracted. However, if at least one (1) corpora-
3 tion within a group of corporations combined under subsection (t) of sec-
4 tion 63-3027, Idaho Code, was transacting business in Idaho during the
5 taxable year in which the loss was incurred, then the net operating loss
6 may be subtracted. Net operating losses incurred by a person, other than a
7 corporation, in business activities not taxable by Idaho may not be sub-
8 tracted.
9 (d) In the case of a corporation, add the amount deducted under the pro-
10 visions of sections 243(a) and (c), 244, 245 and 246A of the Internal Revenue
11 Code (relating to dividends received by corporations) as limited by section
12 246(b)(1) of said code.
13 (e) In the case of a corporation, subtract an amount determined under
14 section 78 of the Internal Revenue Code to be taxable as dividends.
15 (f) Subtract the amount of any income received or accrued during the tax-
16 able year which is exempt from taxation by this state, under the provisions of
17 any other law of this state or a law of the United States, if not previously
18 subtracted in arriving at taxable income.
19 (g) For the purpose of determining the Idaho taxable income of the bene-
20 ficiary of a trust or of an estate, distributable net income as defined for
21 federal tax purposes shall be corrected for the other adjustments required by
22 this section. In the event that a nonresident beneficiary of a trust or estate
23 fails to file an Idaho income tax return reporting all or any part of distrib-
24 utable net income taxable in Idaho or fails to pay any tax due thereon, the
25 trust or estate making the payment or distribution shall be taxable upon the
26 amount of such distribution or payment at the rates established by section
27 63-3024, Idaho Code.
28 (h) In the case of an individual who is on active duty as a full-time
29 officer, enlistee or draftee, with the armed forces of the United States,
30 which full-time duty is or will be continuous and uninterrupted for one hun-
31 dred twenty (120) consecutive days or more, deduct compensation paid by the
32 armed forces of the United States for services performed outside this state.
33 The deduction is allowed only to the extent such income is included in taxable
34 income, and provided that appropriate adjustments shall be made in determining
35 the deductions and exemptions allowed pursuant to section 63-3026A(4), Idaho
36 Code.
37 (i) In the case of a corporation, including any corporation included in a
38 group of corporations combined under subsection (t) of section 63-3027, Idaho
39 Code, add any capital loss deducted which loss was incurred during any year in
40 which such corporation did not transact business in Idaho. However, do not add
41 any capital loss deducted if a corporation, including any corporation in a
42 group of corporations combined under subsection (t) of section 63-3027, Idaho
43 Code, was transacting business in Idaho during the taxable year in which the
44 loss was incurred. In the case of persons, other than corporations, add any
45 capital loss deducted which was incurred in business activities not taxable by
46 Idaho at the time such loss was incurred. In computing the income taxable to
47 an S corporation or partnership under this section, deduction shall not be
48 allowed for a carryover or carryback of a net operating loss provided for in
49 subsection (c) of this section or a capital loss provided for in section 1212
50 of the Internal Revenue Code.
51 (j) In the case of an individual, there shall be allowed as a deduction
52 from gross income either (1) or (2) at the option of the taxpayer:
53 (1) The standard deduction as defined in section 63, Internal Revenue
54 Code.
55 (2) Itemized deductions as defined in section 63 of the Internal Revenue
3
1 Code except state income taxes as specified in section 164 of the Internal
2 Revenue Code.
3 (k) Add the taxable amount of any lump sum distribution deducted from
4 gross income pursuant to section 402(d)(3) of the Internal Revenue Code. The
5 taxable amount will include the ordinary income portion and the amount eligi-
6 ble for the capital gain election.
7 (l) Deduct any amounts included in gross income under the provisions of
8 section 86 of the Internal Revenue Code relating to certain social security
9 and railroad benefits.
10 (m) In the case of a self-employed individual, deduct the actual cost of
11 premiums paid to secure worker's compensation insurance for coverage in Idaho,
12 if such cost has not been deducted in arriving at taxable income.
13 (on) In the case of an individual, deduct the amount contributed to a
14 college savings program pursuant to chapter 54, title 33, Idaho Code, but not
15 more than four thousand dollars ($4,000) per tax year. If the contribution is
16 made on or before April 15, 2001, it may be deducted for tax year 2000 and an
17 individual can make another contribution and claim the deduction according to
18 the limits provided in this subsection during 2001 for tax year 2001, as long
19 as the contribution is made on or before December 31, 2001.
20 (o) In the case of an individual, add the amount of a nonqualified with-
21 drawal from an individual trust account or savings account established pursu-
22 ant to chapter 54, title 33, Idaho Code.
23 SECTION 2. An emergency existing therefor, which emergency is hereby
24 declared to exist, this act shall be in full force and effect on and after its
25 passage and approval, and retroactively to January 1, 2001.
STATEMENT OF PURPOSE
RS 10685
There are two needs covered by this bill.
1)
Because of the lateness in getting the College Savings Program limits
in place it was desired, for this year only, to allow a deduction for
the year 2000 to be made until April 15, 2001.
2)
There was a technical correction needed to comply with state tax laws.
This makes that correction.
FISCAL IMPACT
There is no fiscal impact due to the legislation passed last year.
Contact:
Name: Senator Grant R. Ipsen
Phone: 208/332-1326
Name: Senator Evan Frasure
Phone: 208/332-1315
Name: Representative Donna H. Boe
Phone: 208/332-1148
Name: Representative Lee Gagner
Phone: 208/334-4736
STATEMENT OF PURPOSE/FISCAL NOTE S1036