H.B. 140
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7 LONG TITLE
8 General Description:
9 This bill addresses provisions related to tax credits.
10 Highlighted Provisions:
11 This bill:
12 . enacts tax credits for the employment of persons who are homeless;
13 . repeals provisions related to tax credits and enacts the Tax Credit Administration
14 Act; and
15 . enacts the Tax Credit for Employment of Persons Who Are Homeless Act,
16 including:
17 . defining terms;
18 . addressing the procedures and requirements for the Department of Workforce
19 Services to authorize, and a person to claim, a tax credit; and
20 . requires the Department of Workforce Services to make certain reports to the
21 Legislature.
22 Money Appropriated in this Bill:
23 None
24 Other Special Clauses:
25 This bill provides effective dates.
26 Utah Code Sections Affected:
27 ENACTS:
28 35A-5-301 , Utah Code Annotated 1953
29 35A-5-302 , Utah Code Annotated 1953
30 35A-5-303 , Utah Code Annotated 1953
31 35A-5-304 , Utah Code Annotated 1953
32 35A-5-305 , Utah Code Annotated 1953
33 35A-5-306 , Utah Code Annotated 1953
34 59-7-616 , Utah Code Annotated 1953
35 59-7-901 , Utah Code Annotated 1953
36 59-7-902 , Utah Code Annotated 1953
37 59-7-903 , Utah Code Annotated 1953
38 59-10-1032 , Utah Code Annotated 1953
39 REPEALS:
40 59-7-615 , as enacted by Laws of Utah 2002, Chapter 62
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42 Be it enacted by the Legislature of the state of Utah:
43 Section 1. Section 35A-5-301 is enacted to read:
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45 35A-5-301. Title.
46 This part is known as the "Tax Credit for Employment of Persons Who Are Homeless
47 Act."
48 Section 2. Section 35A-5-302 is enacted to read:
49 35A-5-302. Definitions.
50 As used in this part:
51 (1) "Date of hire" means the date a person who is homeless first performs labor or
52 services for compensation for an employer.
53 (2) "Governmental entity" is as defined in Section 59-2-511 .
54 (3) "Permanent housing, permanent supportive, or transitional facility" means a
55 facility:
56 (a) located within the state;
57 (b) that provides supervision of residents of the facility; and
58 (c) that is:
59 (i) a publicly or privately operated shelter:
60 (A) designed to provide temporary living accommodations, including a welfare hotel,
61 congregate shelter, or transitional housing for the mentally ill; and
62 (B) that receives federal homeless assistance funding distributed by the United States
63 Department of Housing and Urban Development; or
64 (ii) an emergency shelter that receives homeless assistance funding from a county, city,
65 or town.
66 (4) "Person who is homeless" means an individual whose primary nighttime residence
67 is a permanent housing, permanent supportive, or transitional facility.
68 (5) "Wage requirement" means that an employer pays a person who is homeless $4,000
69 or more in wages during a time period that:
70 (a) begins on the date of hire; and
71 (b) ends no later than the last day of a three-calendar-quarter period, the first day of
72 which is the first day of the first calendar quarter that begins on or after the date of hire.
73 Section 3. Section 35A-5-303 is enacted to read:
74 35A-5-303. Application for tax credit certificate.
75 (1) An employer who employs a person who is homeless and seeks to receive a tax
76 credit certificate under this part shall file an application with the department with respect to
77 each person who is homeless that the employer employs.
78 (2) The application shall be on a form the department provides to the employer.
79 (3) The application shall require the employer to certify that:
80 (a) the person who is homeless who the employer employs:
81 (i) on the date of hire, has a primary nighttime residence at a permanent housing,
82 permanent supportive, or transitional facility;
83 (ii) is an employee, and not an independent contractor, of the employer;
84 (iii) is legally eligible to work in the United States; and
85 (iv) has not worked for the employer for more than 40 hours during the 60-day period
86 immediately preceding the date of hire; and
87 (b) the employer:
88 (i) complies with all state, federal, or local requirements related to the employment of
89 the person who is homeless; and
90 (ii) is not a governmental entity.
91 (4) The application:
92 (a) shall list, for each person who is homeless that the employer employs:
93 (i) the person's name;
94 (ii) the person's taxpayer identification number; and
95 (iii) the person's current address;
96 (b) shall list the employer's taxpayer identification number; and
97 (c) may require additional information as determined by the department.
98 (5) An employer shall provide documentation to the department to support the
99 certifications and other information the employer provides in the application described in this
100 section.
101 (6) If the department determines that, on the basis of the documentation and other
102 information the employer provides, the employer has satisfied the certification requirements of
103 Subsection (3) and provided the information described in Subsection (4), the department shall
104 enter into a participation agreement with the employer as provided in Section 35A-5-304 for
105 each person who is homeless who the employer employs.
106 (7) If the department determines that, on the basis of the documentation and other
107 information the employer provides, the employer has not satisfied the certification
108 requirements of Subsection (3) or provided the information described in Subsection (4), the
109 department:
110 (a) shall deny the application; or
111 (b) inform the employer that the documentation the employer provided is inadequate
112 and request the employer to submit new or additional documentation.
113 Section 4. Section 35A-5-304 is enacted to read:
114 35A-5-304. Participation agreements.
115 (1) If the department enters into a participation agreement with an employer, the
116 participation agreement shall:
117 (a) be provided by the department; and
118 (b) establish the requirements the employer is required to meet to be eligible to receive
119 a tax credit certificate, including:
120 (i) requiring the employer to meet the certification requirements of Subsection
121 35A-5-303 (3);
122 (ii) requiring the employer to provide written notice to the department within 10 days
123 after the date the employer meets the wage requirement; and
124 (iii) requiring the employer to provide documentation or other information the
125 department requests:
126 (A) to establish the hours and dates that the person who is homeless works for the
127 employer; and
128 (B) to support the employer's eligibility to receive a tax credit certificate under this
129 part.
130 (2) An agreement under this section does constitute a right to receive a tax credit
131 certificate under this part.
132 Section 5. Section 35A-5-305 is enacted to read:
133 35A-5-305. Tax credit certificate.
134 (1) An employer shall provide written notice to the department within 10 days after the
135 date the employer meets the wage requirement as provided in the participation agreement
136 described in Section 35A-5-304 .
137 (2) No later than 90 days after the date that an employer provides the written notice
138 described in Subsection (1) to the department, the department shall determine whether the
139 employer has met the requirements of the participation agreement under Section 53A-5-304 to
140 receive a tax credit certificate.
141 (3) Subject to the other provisions of this section, if the department determines that an
142 employer has met the requirements of the participation agreement under Section 53A-5-304 to
143 receive a tax credit certificate, the department may issue a tax credit certificate to the employer.
144 (4) A tax credit certificate under this section:
145 (a) shall list the amount of tax credit allowable for the taxable year in an amount that
146 does not exceed $2,000;
147 (b) shall list the name and taxpayer identification number of the employer;
148 (c) shall list the name, taxpayer identification number, and current address of the
149 person who is homeless with respect to whom the employer has met the wage requirement; and
150 (d) may include any other information required by the department.
151 (5) Subject to Subsections (6) and (7), the department shall issue tax credit certificates
152 under this section in the order that the department receives the written notice described in
153 Subsection (1).
154 (6) The department may not issue tax credit certificates that total more than $100,000
155 in a fiscal year.
156 (7) (a) Subject to Subsection (7)(b), if the department would have issued tax credit
157 certificates that total more than $100,000 in a fiscal year but for the limit provided in
158 Subsection (6), the department shall issue the tax credit certificates that exceed $100,000 in the
159 next fiscal year.
160 (b) If the department issues tax credit certificates in accordance with Subsection (7)(a):
161 (i) the tax credit certificates may not total more than $100,000; and
162 (ii) the department may not issue tax credit certificates for an amount that exceeds the
163 limit described in Subsection (7)(b)(i) in a future fiscal year.
164 (8) The department shall provide a copy of a tax credit certificate the department issues
165 under this section to the State Tax Commission.
166 Section 6. Section 35A-5-306 is enacted to read:
167 35A-5-306. Report to the Legislature.
168 Beginning with the 2016 interim, the department shall report annually to the Economic
169 Development and Workforce Services Interim Committee and the Revenue and Taxation
170 Interim Committee:
171 (1) on or before the November interim meeting; and
172 (2) on the amount of tax credits the department grants under this part.
173 Section 7. Section 59-7-616 is enacted to read:
174 59-7-616. Nonrefundable tax credit for employment of a person who is homeless.
175 (1) As used in this section:
176 (a) "Eligible employer" means a person who receives a tax credit certificate from the
177 Department of Workforce Services in accordance with Title 35A, Chapter 5, Part 3, Tax Credit
178 for Employment of Persons Who Are Homeless Act.
179 (b) "Person who is homeless" is as defined in Section 35A-5-302 .
180 (2) Subject to the other provisions of this section, an eligible employer that is a
181 corporation may claim a nonrefundable tax credit as provided in this section against a tax under
182 this chapter.
183 (3) The tax credit under this section is the amount of tax credit listed on a tax credit
184 certificate that the Department of Workforce Services issues to an employer for a taxable year
185 under Title 35A, Chapter 5, Part 3, Tax Credit for Employment of Persons Who Are Homeless
186 Act.
187 (4) An eligible employer may carry forward a tax credit under this section for a period
188 that does not exceed the next five taxable years if:
189 (a) the eligible employer is allowed to claim a tax credit under this section; and
190 (b) the amount of the tax credit exceeds the eligible employer's tax liability under this
191 chapter for that taxable year.
192 (5) An eligible employer shall retain a tax credit certificate the eligible employer
193 receives from the Department of Workforce Services for the same time period a person is
194 required to keep books and records under Section 59-1-1406 .
195 Section 8. Section 59-7-901 is enacted to read:
196
197 59-7-901. Title.
198 This part is known as the "Tax Credit Administration Act."
199 Section 9. Section 59-7-902 is enacted to read:
200 59-7-902. Definitions.
201 As used in this part:
202 (1) "Tax credit" means a nonrefundable tax credit listed on a tax return.
203 (2) "Tax return" means:
204 (i) a corporate return as defined in Section 59-7-101 filed in accordance with this
205 chapter; or
206 (ii) a tax return filed in accordance with Chapter 8, Gross Receipts Tax on Certain
207 Corporations Not Required to Pay Corporate Franchise or Income Tax Act.
208 Section 10. Section 59-7-903 is enacted to read:
209 59-7-903. Removal of tax credit from tax return -- Prohibition on claiming or
210 carrying forward a tax credit -- Commission reporting requirements.
211 (1) Subject to Subsection (2), the commission shall remove a tax credit from a tax
212 return and a person filing a tax return may not claim or carry forward the tax credit if:
213 (a) the total amount of tax credit claimed or carried forward by all persons who file a
214 tax return is less than $10,000 per taxable year for three consecutive taxable years; and
215 (b) less than 10 persons per year for the three consecutive taxable years described in
216 Subsection (1)(a) file a tax return claiming or carrying forward the tax credit.
217 (2) If the commission determines the requirements of Subsection (1) are met, the
218 commission shall remove a tax credit from a tax return and a person filing a tax return may not
219 claim or carry forward the tax credit beginning two taxable years after the January 1
220 immediately following the date the commission determines the requirements of Subsection (1)
221 are met.
222 (3) The commission shall, on or before the November interim meeting of the year after
223 the taxable year in which the commission determines the requirements of Subsection (1) are
224 met:
225 (a) report to the Revenue and Taxation Interim Committee that, in accordance with this
226 section:
227 (i) the commission is required to remove a tax credit from a return on which the tax
228 credit appears; and
229 (ii) a person filing a tax return may not claim or carry forward the tax credit; and
230 (b) notify each state agency required by statute to assist in the administration of the tax
231 credit that, in accordance with this section:
232 (i) the commission is required to remove a tax credit from a return on which the tax
233 credit appears; and
234 (ii) a person filing a tax return may not claim or carry forward the tax credit.
235 Section 11. Section 59-10-1032 is enacted to read:
236 59-10-1032. Nonrefundable tax credit for employment of a person who is
237 homeless.
238 (1) As used in this section:
239 (a) "Eligible employer" means a person who receives a tax credit certificate from the
240 Department of Workforce Services in accordance with Title 35A, Chapter 5, Part 3, Tax Credit
241 for Employment of Persons Who Are Homeless Act.
242 (b) "Person who is homeless" is as defined in Section 35A-5-302 .
243 (2) Subject to the other provisions of this section, an eligible employer that is a
244 claimant, estate, or trust may claim a nonrefundable tax credit as provided in this section
245 against a tax under this chapter.
246 (3) The tax credit under this section is the amount of tax credit listed on a tax credit
247 certificate that the Department of Workforce Services issues to an employer for a taxable year
248 under Title 35A, Chapter 5, Part 3, Tax Credit for Employment of Persons Who Are Homeless
249 Act.
250 (4) An eligible employer may carry forward a tax credit under this section for a period
251 that does not exceed the next five taxable years if:
252 (a) the eligible employer is allowed to claim a tax credit under this section; and
253 (b) the amount of the tax credit exceeds the eligible employer's tax liability under this
254 chapter for that taxable year.
255 (5) An eligible employer shall retain a tax credit certificate the eligible employer
256 receives from the Department of Workforce Services for the same time period a person is
257 required to keep books and records under Section 59-1-1406 .
258 Section 12. Effective dates.
259 (1) Except as provided in Subsection (2), this bill takes effect on May 13, 2014.
260 (2) The actions affecting the following sections take effect for a taxable year beginning
261 on or after January 1, 2015:
262 (a) Section 59-7-616 ;
263 (b) Section 59-7-901 ;
264 (c) Section 59-7-902 ;
265 (d) Section 59-7-903 ; and
266 (e) Section 59-10-1032 .
267 Section 13. Repealer.
268 This bill repeals:
269 Section 59-7-615 , Removal of tax credit from tax form and prohibition on claiming
270 or carrying forward a tax credit -- Conditions for removal and prohibition on claiming or
271 carrying forward a tax credit -- Commission reporting requirements.
Legislative Review Note
as of 2-14-14 5:18 PM