HB 1005-1_ Filed 02/14/2011, 11:17 Battles

Text Box

    PREVAILED      Roll Call No. _______
    FAILED        Ayes _______
    WITHDRAWN        Noes _______





    I move that House Bill 1005 be amended to read as follows:

SOURCE: Page 2, line 20; (11)MO100501.2. -->     Page 2, between lines 20 and 21, begin a new paragraph and insert:
     Chapter 34. Employer Tax Credit for Tuition Expenses
    Sec. 1. This chapter applies only to taxable years beginning after December 31, 2011.
    Sec. 2. As used in this chapter, "employer" means an entity that has employees, including:
        (1) an individual acting as a sole proprietor;
        (2) a pass through entity; and
        (3) a corporation.
    Sec. 3. As used in this chapter, "pass through entity" means:
        (1) a corporation that is exempt from the adjusted gross income tax under IC 6-3-2-2.8(2);
        (2) a partnership;
        (3) a limited liability company; or
        (4) a limited liability partnership.
    Sec. 4. As used in this chapter, "state educational institution" has the meaning set forth in IC 21-7-13-32.
    Sec. 5. As used in this chapter, "state tax liability" means a taxpayer's total tax liability that is incurred under:
        (1) IC 6-3-1 through IC 6-3-7 (the adjusted gross income tax);
        (2) IC 6-5.5 (the financial institutions tax); and
        (3) IC 27-1-18-2 (the insurance premiums tax);
as computed after the application of the credits that under IC 6-3.1-1-2 are to be applied before the credit provided by this chapter.
    Sec. 6. As used in this chapter, "taxpayer" means a person, corporation, partnership, or other entity that has any state tax liability.
    Sec. 7. As used in this chapter, "tuition" includes required books, course supplies, and course fees.
    Sec. 8. (a) Each taxable year, subject to subsection (b), an employer that incurs tuition expenses for an employee who attends a state educational institution during the taxable year is entitled to a credit against state tax liability for the amount of tuition expenses incurred during the taxable year for a course in which the employee achieves a final grade of at least:
        (1) 2.0, if a 4.0 grading scale is used; or
        (2) a grade equivalent to the grade specified in subdivision (1), if another grading scale is used.
    (b) The credit provided by subsection (a) is not allowed for tuition expenses to the extent a taxpayer has claimed a deduction from the taxpayer's federal gross income for the tuition expenses in determining the taxpayer's Indiana adjusted gross income.
    Sec. 9. An employer that claims the credit provided by this chapter shall keep the following records for each tuition payment the employer makes for a course taken by an employee at a state educational institution:
        (1) The name of the employee.
        (2) The state educational institution at which the course was taken.
        (3) The name of the course.
        (4) The academic semester or other period in which the course was taken.
        (5) The amount of the tuition payment.
        (6) The employee's final grade in the course.
        (7) Any other reasonable information required by the department.
    Sec. 10. If a pass through entity does not have state tax liability for a taxable year but is otherwise entitled to the tax credit provided by this chapter, each shareholder, partner, or member of the pass through entity is entitled to a share of the tax credit equal to:
        (1) the amount of the tax credit determined for the pass through entity for the taxable year; multiplied by
        (2) the percentage of the pass through entity's distributive income to which the shareholder, partner, or member is entitled.
    Sec. 11. (a) If the credit provided by this chapter exceeds a

taxpayer's state tax liability for the taxable year for which the credit is first claimed, the excess may be carried forward to succeeding taxable years and used as a credit against the taxpayer's state tax liability during those taxable years. Each time the credit is carried forward to a succeeding taxable year, the credit is to be reduced by the amount that was used as a credit during the immediately preceding taxable year. The credit provided by this chapter may be carried forward and applied to succeeding taxable years for not more than five (5) taxable years following the first year for which the credit is claimed.
    (b) A taxpayer is not entitled to a carryback or refund of any unused credit under this chapter.

    Sec. 12. To receive the tax credit under this chapter, a taxpayer must claim the credit on the taxpayer's annual state tax return or returns in the manner prescribed by the department.".
    Renumber all SECTIONS consecutively.
    (Reference is to HB 1005 as printed February 11, 2011.)


Representative Battles

MO100501/DI 51     2011