House File 1026 - Introduced HOUSE FILE 1026 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO HF 965) A BILL FOR An Act relating to the adoption tax credit available against 1 the individual income tax, and including effective date and 2 retroactive applicability provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 1903HV (1) 91 jm/jh
H.F. 1026 Section 1. Section 422.12A, subsection 2, Code 2025, is 1 amended to read as follows: 2 2. The taxes imposed under this subchapter , less the 3 credits allowed under section 422.12 , shall be reduced by an 4 adoption tax credit equal to the amount of qualified adoption 5 expenses paid or incurred by the taxpayer in connection with 6 the adoption of a child by the taxpayer, not to exceed five 7 twenty thousand dollars per adoption. 8 Sec. 2. EFFECTIVE DATE. This Act, being deemed of immediate 9 importance, takes effect upon enactment. 10 Sec. 3. RETROACTIVE APPLICABILITY. This Act applies 11 retroactively to January 1, 2024, for tax years beginning on or 12 after that date if the adoption becomes final on or after that 13 date. 14 EXPLANATION 15 The inclusion of this explanation does not constitute agreement with 16 the explanations substance by the members of the general assembly. 17 This bill relates to the adoption tax credit available 18 against the individual income tax. 19 Currently, the tax credit equals up to $5,000 of qualified 20 adoption expenses per adoption. The bill increases the tax 21 credit to equal up to $20,000 of qualified adoption expenses 22 per adoption. Any credit in excess of the tax liability is 23 refundable. 24 Qualified adoption expenses means unreimbursed expenses 25 paid or incurred in connection with the adoption of a child, 26 including medical and hospital expenses of the biological 27 mother which are incident to the childs birth, welfare agency 28 fees, legal fees, and all other fees and costs which relate to 29 the adoption of a child. 30 Child means an individual under 18 years of age. 31 Current law in Code section 422.12A(4) determines the tax 32 year when qualified adoption expenses are allowed. 33 The bill takes effect upon enactment and applies 34 retroactively to tax years beginning on or after January 1, 35 -1- LSB 1903HV (1) 91 jm/jh 1/ 2
H.F. 1026 2024, for adoptions finalized on or after that date. 1 -2- LSB 1903HV (1) 91 jm/jh 2/ 2