1     
MODIFICATIONS TO INCOME TAX

2     
2015 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Deidre M. Henderson

5     
House Sponsor: Craig Hall

6     

7     LONG TITLE
8     General Description:
9          This bill amends provisions related to income tax credits and contributions.
10     Highlighted Provisions:
11          This bill:
12          ▸     repeals provisions requiring the State Tax Commission to notify certain state
13     agencies that the State Tax Commission is required to remove certain tax credits
14     from tax returns;
15          ▸     enacts provisions requiring the State Tax Commission to publish certain
16     information pertaining to the requirement that the State Tax Commission remove
17     certain tax credits and contributions from tax returns; and
18          ▸     makes technical and conforming changes.
19     Money Appropriated in this Bill:
20          None
21     Other Special Clauses:
22          None
23     Utah Code Sections Affected:
24     AMENDS:
25          59-7-903, as enacted by Laws of Utah 2014, Chapter 315
26          59-10-1002.1, as renumbered and amended by Laws of Utah 2008, Chapter 389
27          59-10-1304, as last amended by Laws of Utah 2013, Chapters 235 and 338
28     

29     Be it enacted by the Legislature of the state of Utah:
30          Section 1. Section 59-7-903 is amended to read:
31          59-7-903. Removal of tax credit from tax return -- Prohibition on claiming or
32     carrying forward a tax credit -- Commission publishing requirements.
33          (1) Subject to Subsection (2), the commission shall remove a tax credit from a tax
34     return and a person filing a tax return may not claim or carry forward the tax credit if:
35          (a) the total amount of tax credit claimed or carried forward by all persons who file a
36     tax return is less than $10,000 per taxable year for three consecutive taxable years; and
37          (b) less than 10 persons per year for the three consecutive taxable years described in
38     Subsection (1)(a) file a tax return claiming or carrying forward the tax credit.
39          (2) If the commission determines the requirements of Subsection (1) are met, the
40     commission shall remove a tax credit from a tax return and a person filing a tax return may not
41     claim or carry forward the tax credit beginning two taxable years after the January 1
42     immediately following the date the commission determines the requirements of Subsection (1)
43     are met.
44          (3) The commission shall, on or before the November interim meeting of the year after
45     the taxable year in which the commission determines the requirements of Subsection (1) are
46     met[: (a)], report to the Revenue and Taxation Interim Committee that, in accordance with this
47     section:
48          [(i)] (a) the commission is required to remove a tax credit from a return on which the
49     tax credit appears; and
50          [(ii)] (b) a person filing a tax return may not claim or carry forward the tax credit[;
51     and].
52          [(b) notify each state agency required by statute to assist in the administration of the tax
53     credit that, in accordance with this section:]
54          [(i) the commission is required to remove a tax credit from a return on which the tax
55     credit appears; and]
56          [(ii) a person filing a tax return may not claim or carry forward the tax credit.]
57          (4) (a) Within a 30-day period after making the report required by Subsection (3), the
58     commission shall publish a list in accordance with Subsection (4)(b) stating each tax credit that
59     the commission will remove from a return on which the tax credit appears.
60          (b) The list shall:
61          (i) be published on:
62          (A) the commission's website; and
63          (B) the public legal notice website in accordance with Section 45-1-101;
64          (ii) include a statement that:
65          (A) the commission is required to remove the tax credit from each return on which the
66     tax credit appears; and
67          (B) the tax credit may not be claimed or carried forward on a return;
68          (iii) state the taxable year for which the removal described in Subsection (4)(a) takes
69     effect; and
70          (iv) remain available for viewing and searching until the commission publishes a new
71     list in accordance with this Subsection (4).
72          Section 2. Section 59-10-1002.1 is amended to read:
73          59-10-1002.1. Removal of tax credit from tax return and prohibition on claiming
74     or carrying forward a tax credit -- Conditions for removal and prohibition on claiming or
75     carrying forward a tax credit -- Commission publishing requirements.
76          (1) As used in this section, "tax return" means a tax return filed in accordance with this
77     chapter.
78          (2) Beginning two taxable years after the requirements of Subsection (3) are met:
79          (a) the commission shall remove a tax credit allowed under this part from each tax
80     return on which the tax credit appears; and
81          (b) a claimant, estate, or trust filing a tax return may not claim or carry forward the tax
82     credit.
83          (3) The commission shall remove a tax credit allowed under this part from a tax return
84     and a claimant, estate, or trust filing a tax return may not claim or carry forward the tax credit
85     as provided in Subsection (2) if:
86          (a) the total amount of the tax credit claimed or carried forward by all claimants,
87     estates, or trusts filing tax returns is less than $10,000 per year for three consecutive taxable
88     years beginning on or after January 1, 2002; and
89          (b) less than 10 claimants, estates, and trusts per year for the three consecutive taxable
90     years described in Subsection (3)(a), file a tax return claiming or carrying forward the tax
91     credit.
92          (4) The commission shall, on or before the November interim meeting of the year after
93     the taxable year in which the requirements of Subsection (3) are met[: (a)], report to the
94     Revenue and Taxation Interim Committee that in accordance with this section:
95          [(i)] (a) the commission is required to remove a tax credit from each tax return on
96     which the tax credit appears; and
97          [(ii)] (b) a claimant, estate, or trust filing a tax return may not claim or carry forward
98     the tax credit[; and].
99          [(b) notify each state agency required by statute to assist in the administration of the tax
100     credit that in accordance with this section:]
101          [(i) the commission is required to remove a tax credit from each tax return on which
102     the tax credit appears; and]
103          [(ii) a claimant, estate, or trust filing a tax return may not claim or carry forward the tax
104     credit.]
105          (5) (a) Within a 30-day period after making the report required by Subsection (4), the
106     commission shall publish a list in accordance with Subsection (5)(b) stating each tax credit that
107     the commission will remove from a return on which the tax credit appears.
108          (b) The list shall:
109          (i) be published on:
110          (A) the commission's website; and
111          (B) the public legal notice website in accordance with Section 45-1-101;
112          (ii) include a statement that:
113          (A) the commission is required to remove the tax credit from each return on which the
114     tax credit appears; and
115          (B) the tax credit may not be claimed or carried forward on a return;
116          (iii) state the taxable year for which the removal described in Subsection (5)(a) takes
117     effect; and
118          (iv) remain available for viewing and searching until the commission publishes a new
119     list in accordance with this Subsection (5).
120          Section 3. Section 59-10-1304 is amended to read:
121          59-10-1304. Removal of designation and prohibitions on collection for certain
122     contributions on income tax return -- Conditions for removal and prohibitions on
123     collection -- Commission publication requirements.
124          (1) (a) If a contribution or combination of contributions described in Subsection (1)(b)
125     generate less than $30,000 per year for three consecutive years, the commission shall remove
126     the designation for the contribution from the individual income tax return and may not collect
127     the contribution from a resident or nonresident individual beginning two taxable years after the
128     three-year period for which the contribution generates less than $30,000 per year.
129          (b) The following contributions apply to Subsection (1)(a):
130          (i) the contribution provided for in Section 59-10-1305;
131          (ii) the contribution provided for in Section 59-10-1306;
132          (iii) the sum of the contributions provided for in Subsection 59-10-1307(1);
133          (iv) the contribution provided for in Section 59-10-1308;
134          (v) the contribution provided for in Section 59-10-1310;
135          (vi) the contribution provided for in Section 59-10-1315;
136          (vii) the sum of the contributions provided for in:
137          (A) Section 59-10-1316; and
138          (B) Section 59-10-1317; or
139          (viii) the contribution provided for in Section 59-10-1318.
140          (2) If the commission removes the designation for a contribution under Subsection (1),
141     the commission shall report to the Revenue and Taxation Interim Committee that the
142     commission removed the designation on or before the November interim meeting of the year in
143     which the commission determines to remove the designation.
144          (3) (a) Within a 30-day period after making the report required by Subsection (2), the
145     commission shall publish a list in accordance with Subsection (3)(b) stating each contribution
146     that the commission will remove from the individual income tax return.
147          (b) The list shall:
148          (i) be published on:
149          (A) the commission's website; and
150          (B) the public legal notice website in accordance with Section 45-1-101;
151          (ii) include a statement that the commission:
152          (A) is required to remove the contribution from the individual income tax return; and
153          (B) may not collect the contribution;
154          (iii) state the taxable year for which the removal described in Subsection (3)(a) takes
155     effect; and
156          (iv) remain available for viewing and searching until the commission publishes a new
157     list in accordance with this Subsection (3).