HF 695 — A bill for an act relating to economic development including child care, grants and tax credits relating to child care, and state child care assistance, and including applicability provisions.

Bill Text

• Introduced View text Current pdf

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The bill establishes new child care tax credits and grant programs, significantly changing existing regulations on child care support.

• Section 422.12C

  the existing subsection → The taxes imposed under this subchapter, less the amounts of nonrefundable credits allowed under this subchapter, shall be reduced by a child and dependent care credit equal to the following percentages of the federal child and dependent care credit provided in section 21 of the Internal Revenue Code, without regard to whether or not the federal credit was limited by the taxpayer’s federal tax liability: a. For a taxpayer with net income of forty-five thousand dollars or less, one hundred percent. b. For a taxpayer with net income exceeding forty-five thousand dollars but not exceeding fifty thousand dollars, eighty-eight percent. c. For a taxpayer with net income exceeding fifty thousand dollars but not exceeding sixty thousand dollars, seventy-five percent. d. For a taxpayer with net income exceeding sixty thousand dollars but not exceeding seventy thousand dollars, sixty-three percent. e. For a taxpayer with net income exceeding seventy thousand dollars but not exceeding eighty thousand dollars, fifty percent. f. For a taxpayer with net income exceeding eighty thousand dollars but not exceeding ninety thousand dollars, thirty-eight percent. g. For a taxpayer with net income exceeding ninety thousand dollars but not exceeding one hundred thousand dollars, twenty-five percent. h. For a taxpayer with net income exceeding one hundred thousand dollars but not exceeding one hundred twenty-five thousand dollars, thirteen percent. i. For a taxpayer with net income exceeding one hundred twenty-five thousand dollars but not exceeding one hundred fifty thousand dollars, ten percent. j. For a taxpayer with net income exceeding one hundred fifty thousand dollars but not exceeding one hundred seventy-five thousand dollars, five percent. k. For a taxpayer with net income exceeding one hundred seventy-five thousand dollars but not exceeding two hundred thousand dollars, three percent. l. For a taxpayer with net income exceeding two hundred thousand dollars but not exceeding two hundred fifty thousand dollars, two percent. m. For a taxpayer with net income exceeding two hundred fifty thousand dollars, zero percent.

  This change introduces a tiered child and dependent care tax credit based on income, replacing the previous law.

• New Section 237D.1

  Definitions of key terms related to child care, including 'Child', 'Child care', 'Child development home', 'Department', 'Facility', 'Fund', 'Home', and 'Licensed child care center'.

  Defines essential terminology for the newly created chapter on child care grants.

• New Section 237D.2

  Establishment of a child care center and child development home grant fund controlled by the department, including provisions for the management of unencumbered funds.

  Creates a dedicated fund to support grants for child care centers and development homes.

• New Section 237D.3

  Establishes a grant program to provide funding for new or expanded child care centers, including eligibility criteria and grant limits.

  Provides structured support and funding for the development of child care facilities.

• New Section 237A.32

  Small business child care tax credit eligibility and qualifications, detailing provisions for benefits provided by small businesses to employees.

  Introduces a new tax credit for small businesses that offer child care benefits to their employees.

• Section 422.12P

  Clarifies that taxes imposed under the subchapter can be reduced by the small business child care tax credit from section 237A.32.

  Allows small businesses to benefit from tax credits, thereby incentivizing child care support.

• Section 422.33

  Addition of a provision to reduce taxes by the small business child care tax credit received pursuant to section 237A.32.

  Expands the tax credit applicability to businesses under this section.

• Section 422.60

  New provision to allow tax reductions via the small business child care tax credit under section 237A.32.

  Further integrates tax relief measures for small businesses that provide child care benefits.

• New Section 432.12P

  Establishes a small business child care tax credit to reduce taxes imposed under this chapter.

  Introduces an incentive for small businesses by allowing tax credits for child care support.

Action History

1. April 10, 2023

   Introduced, referred to Economic Growth and Technology.

Sponsors

• J.D. Scholten · Primary
• Rick L. Olson · Primary
• Dr. Megan L. Srinivas · Primary
• Brian Meyer · Primary
• Timi M. Brown-Powers · Primary
• Tracy A. Ehlert · Primary
• Bob Kressig · Primary
• David Jacoby · Primary
• Mary Lee Madison · Primary
• Ruth Ann Gaines · Primary
• Lindsay James · Primary
• Ross Wilburn · Primary
• Heather Matson · Primary
• STECKMAN · Primary
• Beth Wessel-Kroeschell · Primary
• BUCK · Primary
• Amy Nielsen · Primary
• Jerome Amos Jr. · Primary
• Monica Kurth · Primary
• SCHEETZ · Primary
• Art Staed · Primary
• Elinor A. Levin · Primary
• Josh Turek · Primary
• Austin Baeth · Primary
• Jeff Cooling · Primary
• Elizabeth Wilson · Primary
• Ken Croken · Primary
• CAHILL · Primary
• Sean Bagniewski · Primary
• FORBES · Primary
• Jennifer Konfrst · Primary

Subjects