Indiana 2025 Regular Session

Indiana House Bill HB1503 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	~~HB1503.1~~
2		-	~~February 6, 2025~~
	1	+
	2	+	Introduced Version
3	3		HOUSE BILL No. 1503
4	4		_____
5		-	DIGEST OF HB 1503 (Updated February 5, 2025 10:25 am - DI 140)
6		-	Citations Affected: IC 5-35.5; IC 6-3; IC 6-3.1; IC 31-19; noncode.
	5	+	DIGEST OF INTRODUCED BILL
	6	+	Citations Affected: IC 5-35.5; IC 6-3-3-12; IC 6-3.1-41.6;
	7	+	IC 31-19-26.5-13.
7	8		Synopsis: Adoption incentive programs. Creates the Indiana adoption
8	9		services authority (authority) and establishes the board of directors of
9	10		the authority. Sets forth the duties and powers of the authority and the
10	11		board. Establishes the zero cost adoption fund (fund) to provide
11	12		financial assistance, benefits, services, or other assistance for specified
12	13		purposes pertaining to foster care, adoption, and postadoption
13	14		assistance, including assistance with college savings and arrangements
14	15		for reduced college tuition for an adopted child. Provides that money
15	16		in the fund may not be used to pay the general operating,
16	17		administrative, and capital expenses and establishes a separate, general
17	18		operating fund for the authority to pay those expenses. Specifies that
18	19		assistance provided from the fund is supplemental to adoption
19	20		assistance payments or an adoption subsidy. Provides a tax credit for
20	21		contributions made to the fund in an amount equal to 50% of the
21	22		contribution. Specifies that the total amount of tax credits allowed may
22	23		not exceed $18,500,000 for each state fiscal year. Makes conforming
23	24		changes. Makes an appropriation.
24	25		Effective: July 1, 2025.
25	26		McGuire, DeVon, Wesco, Rowray
26	27		January 21, 2025, read first time and referred to Committee on Family, Children and
27	28		Human Affairs.
28		-	February 6, 2025, reported — Do Pass. Referred to Committee on Ways and Means
29		-	pursuant to Rule 126.3.
30		-	HB 1503—LS 7551/DI 129 February 6, 2025
	29	+	2025 IN 1503—LS 7551/DI 129 Introduced
31	30		First Regular Session of the 124th General Assembly (2025)
32	31		PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
33	32		Constitution) is being amended, the text of the existing provision will appear in this style type,
34	33		additions will appear in this style type, and deletions will appear in this style type.
35	34		Additions: Whenever a new statutory provision is being enacted (or a new constitutional
36	35		provision adopted), the text of the new provision will appear in this style type. Also, the
37	36		word NEW will appear in that style type in the introductory clause of each SECTION that adds
38	37		a new provision to the Indiana Code or the Indiana Constitution.
39	38		Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
40	39		between statutes enacted by the 2024 Regular Session of the General Assembly.
41	40		HOUSE BILL No. 1503
42	41		A BILL FOR AN ACT to amend the Indiana Code concerning state
43	42		offices and administration and to make an appropriation.
44	43		Be it enacted by the General Assembly of the State of Indiana:
45	44		1 SECTION 1. IC 5-35.5 IS ADDED TO THE INDIANA CODE AS
46	45		2 A NEW ARTICLE TO READ AS FOLLOWS [EFFECTIVE JULY 1,
47	46		3 2025]:
48	47		4 ARTICLE 35.5. ADOPTION SERVICES
49	48		5 Chapter 1. Definitions
50	49		6 Sec. 1. The definitions in this chapter apply throughout this
51	50		7 article.
52	51		8 Sec. 2. "Authority" means the Indiana adoption services
53	52		9 authority created by IC 5-35.5-2-1.
54	53		10 Sec. 3. "Board" means the board of directors of the authority
55	54		11 established by IC 5-35.5-3-1.
56	55		12 Sec. 4. "Fund" means the zero cost adoption fund established by
57	56		13 IC 5-35.5-4-1.
58	57		14 Sec. 5. "General operating fund" means the general operating
59	58		15 fund established under IC 5-35.5-5 from which general operating,
60	59		16 administrative, and capital expenses may be paid.
61	60		17 Chapter 2. Indiana Adoption Services Authority
62		-	HB 1503—LS 7551/DI 129 2
	61	+	2025 IN 1503—LS 7551/DI 129 2
63	62		1 Sec. 1. The Indiana adoption services authority is created.
64	63		2 Sec. 2. (a) The authority is a body corporate and politic.
65	64		3 (b) The authority:
66	65		4 (1) is not an agency of the state; and
67	66		5 (2) is an instrumentality of the state performing essential
68	67		6 governmental functions.
69	68		7 Sec. 3. Because the management, operation, and administration
70	69		8 of the fund for the purposes set forth in IC 5-35.5-4-1 and any
71	70		9 other programs, funds, and accounts established under this article
72	71		10 constitute the performance of an essential public function, the
73	72		11 following are exempt from taxation by the state and by any
74	73		12 political subdivision of the state:
75	74		13 (1) The authority's management and operations.
76	75		14 (2) The authority's property and assets.
77	76		15 (3) All property and assets held by or for the authority.
78	77		16 (4) The investment income and earnings (whether interest,
79	78		17 gains, or dividends) on:
80	79		18 (A) the authority's property and assets; and
81	80		19 (B) all property, assets, and funds and accounts held by or
82	81		20 for the authority.
83	82		21 Sec. 4. The authority may contract with public or private
84	83		22 entities or persons for the provision of all or any portion of the
85	84		23 services the board considers necessary for the management and
86	85		24 operations of the authority, including the fund.
87	86		25 Sec. 5. The authority is a public agency for purposes of
88	87		26 IC 5-14-1.5 and IC 5-14-3.
89	88		27 Chapter 3. Authority Board of Directors and Officers
90	89		28 Sec. 1. (a) The board of directors of the authority is established.
91	90		29 The board consists of the following:
92	91		30 (1) The following four (4) members or directors who serve by
93	92		31 virtue of office:
94	93		32 (A) The treasurer of state.
95	94		33 (B) The director of the department of child services.
96	95		34 (C) The secretary of the family and social services
97	96		35 administration.
98	97		36 (D) The budget director.
99	98		37 (2) Five (5) appointed members or directors who:
100	99		38 (A) are appointed by the governor; and
101	100		39 (B) have knowledge, skill, and experience in the field of
102	101		40 adoption, foster care, health and human services, business,
103	102		41 or finance.
104	103		42 (b) During a member's term of service on the board, an
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	104	+	2025 IN 1503—LS 7551/DI 129 3
106	105		1 appointed member of the board may not be an official or employee
107	106		2 of the state.
108	107		3 (c) Not more than three (3) of the appointed members of the
109	108		4 board may belong to the same political party.
110	109		5 (d) An appointed member serves a four (4) year term that ends
111	110		6 on June 30 of the odd-numbered year. However, an appointed
112	111		7 member shall hold over after the expiration of the member's term
113	112		8 until the member's successor is appointed and qualified.
114	113		9 (e) The governor may reappoint an appointed member of the
115	114		10 board.
116	115		11 (f) A vacancy shall be filled for the balance of an unexpired term
117	116		12 in the same manner as the original appointment.
118	117		13 (g) The treasurer of state shall serve as chairperson of the
119	118		14 board. The board shall annually elect one (1) of its members who
120	119		15 serve by virtue of office as vice chairperson, and may elect any
121	120		16 other officer that the board desires.
122	121		17 (h) The governor may remove an appointed member for
123	122		18 misfeasance, malfeasance, willful neglect of duty, or other cause
124	123		19 after notice and a public hearing, unless the member expressly
125	124		20 waives the notice and hearing in writing.
126	125		21 Sec. 2. (a) An appointed member of the board is not entitled to
127	126		22 the minimum salary per diem provided by IC 4-10-11-2.1(b). Each
128	127		23 appointed member is, however, entitled to reimbursement for
129	128		24 traveling expenses and other expenses actually incurred in
130	129		25 connection with the member's duties.
131	130		26 (b) A member of the board who serves by virtue of office is
132	131		27 entitled to reimbursement for traveling expenses and other
133	132		28 expenses actually incurred in connection with the member's duties.
134	133		29 Sec. 3. The board may:
135	134		30 (1) employ a manager, who is not a member of the board; and
136	135		31 (2) delegate necessary and appropriate functions and
137	136		32 authority to the manager.
138	137		33 Sec. 4. (a) Five (5) members of the board are a quorum for:
139	138		34 (1) the transaction of business at a meeting of the board; or
140	139		35 (2) the exercise of a power or function of the authority.
141	140		36 (b) The affirmative vote of a majority of all the members of the
142	141		37 board who are present is necessary for the authority to take action.
143	142		38 A vacancy in the membership of the board does not impair the
144	143		39 right of a quorum to exercise all the rights and perform all the
145	144		40 duties of the authority. An action taken by the board under this
146	145		41 article may be authorized by:
147	146		42 (1) resolution at any regular or special meeting; or
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	147	+	2025 IN 1503—LS 7551/DI 129 4
149	148		1 (2) unanimous consent of all the members who have not
150	149		2 abstained.
151	150		3 A resolution takes effect immediately upon adoption and need not
152	151		4 be published or posted.
153	152		5 (c) The board shall meet at the call of the chairperson and as
154	153		6 provided in the bylaws of the authority.
155	154		7 (d) Meetings of the board may be held anywhere in Indiana.
156	155		8 Sec. 5. The board is a governing body for purposes of
157	156		9 IC 5-14-1.5.
158	157		10 Sec. 6. The board has the powers necessary and appropriate to
159	158		11 carry out and effectuate the purposes of this chapter, including the
160	159		12 following:
161	160		13 (1) To develop and implement criteria to provide or to
162	161		14 facilitate the provision of financial assistance, benefits,
163	162		15 services, or other assistance from the fund through:
164	163		16 (A) rules adopted under IC 4-22-2; or
165	164		17 (B) rules, guidelines, procedures, or policies established by
166	165		18 the board.
167	166		19 (2) To retain professional services, including the following:
168	167		20 (A) Advisers and managers, including investment advisers.
169	168		21 (B) Custodians and other fiduciaries.
170	169		22 (C) Accountants and auditors.
171	170		23 (D) Consultants or other experts.
172	171		24 (E) Actuarial services providers.
173	172		25 (F) Attorneys.
174	173		26 (3) To secure office space.
175	174		27 (4) To employ persons, if the board chooses, and as may be
176	175		28 necessary, and to fix the terms of employment.
177	176		29 (5) To recommend legislation to the governor and the general
178	177		30 assembly.
179	178		31 (6) To apply for designation as a tax exempt entity under the
180	179		32 Internal Revenue Code.
181	180		33 (7) To sue and be sued.
182	181		34 (8) To have perpetual succession.
183	182		35 (9) To develop marketing plans and promotional material.
184	183		36 (10) To do all things necessary and appropriate to carry out
185	184		37 the purposes of this chapter.
186	185		38 Sec. 7. The authority may accept gifts, devises, and bequests of
187	186		39 real and personal property and any other aid from any source and
188	187		40 agree to and comply with conditions attached to the gift, devise,
189	188		41 bequest, or aid, as applicable.
190	189		42 Sec. 8. The authority shall prepare an annual report of its
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	190	+	2025 IN 1503—LS 7551/DI 129 5
192	191		activities 1 and promptly transmit the annual report to the governor
193	192		2 and the general assembly. A report transmitted under this section
194	193		3 to the general assembly must be in an electronic format under
195	194		4 IC 5-14-6.
196	195		5 Sec. 9. (a) The funds, accounts, management, and operations of
197	196		6 the authority are subject to annual audit by an independent public
198	197		7 accounting firm retained by the board.
199	198		8 (b) The authority shall promptly transmit copies of each annual
200	199		9 audit to the governor and the general assembly. The annual audit
201	200		10 transmitted to the general assembly must be in an electronic
202	201		11 format under IC 5-14-6. Upon request, the authority shall make
203	202		12 available copies of the audit to the public.
204	203		13 Sec. 10. A manager or another person designated by resolution
205	204		14 of the authority:
206	205		15 (1) shall keep a record of the proceedings of the authority;
207	206		16 (2) shall be custodian of:
208	207		17 (A) all books, documents, and papers filed with the
209	208		18 authority; and
210	209		19 (B) the minute book or journal of the authority; and
211	210		20 (3) may copy all minutes and other records and documents of
212	211		21 the authority and may give certificates of the authority to the
213	212		22 effect that the copies are true copies. A person who deals with
214	213		23 the authority may rely upon the certificates.
215	214		24 Sec. 11. Before any financial assistance, benefits, services, or
216	215		25 other assistance are provided from the fund, the:
217	216		26 (1) chairperson;
218	217		27 (2) vice chairperson;
219	218		28 (3) manager; and
220	219		29 (4) any officer elected by the authority or member of the
221	220		30 authority authorized by resolution to handle funds or sign
222	221		31 checks;
223	222		32 shall execute a surety bond in the penal sum of one hundred
224	223		33 thousand dollars ($100,000). The surety bond shall be conditioned
225	224		34 upon the faithful performance of the duties of the office of the
226	225		35 principal and shall be executed by a surety company authorized to
227	226		36 transact business in Indiana. The authority shall pay the cost of the
228	227		37 bonds.
229	228		38 Sec. 12. The authority shall do the following:
230	229		39 (1) Provide the board and each member, officer, employee,
231	230		40 consultant, counsel, and agent of the authority or the board a
232	231		41 defense in a suit arising out of the performance of duties for
233	232		42 or on behalf of the authority or the board, if the board
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	233	+	2025 IN 1503—LS 7551/DI 129 6
235	234		1 determines that the duties were performed in good faith.
236	235		2 (2) Save a person described in subdivision (1) or the board
237	236		3 harmless from any liability, cost, or damage in connection
238	237		4 with an action arising out of the performance of duties for or
239	238		5 on behalf of the authority or the board, including the payment
240	239		6 of any legal fees, except where the liability, cost, or damage is
241	240		7 predicated on, or arises out of, the bad faith of the person or
242	241		8 the board, or is based on the person's or board's malfeasance
243	242		9 in the performance of duties.
244	243		10 Sec. 13. Notwithstanding any other law, it is not a conflict of
245	244		11 interest or violation of any other law for a person to serve as a
246	245		12 member of the authority. However, a member shall disclose a
247	246		13 conflict of interest relating to actions of the authority as required
248	247		14 and in a manner provided by IC 35-44.1-1-4.
249	248		15 Chapter 4. Zero Cost Adoption Fund
250	249		16 Sec. 1. The zero cost adoption fund is established for the
251	250		17 following purposes:
252	251		18 (1) To support proven community based intervention methods
253	252		19 to prevent children from entering foster care.
254	253		20 (2) To promote adoption and recruit potential adoptive
255	254		21 families.
256	255		22 (3) To award grants to implement adoption sensitive care in
257	256		23 health care settings.
258	257		24 (4) To provide postadoption assistance for reimbursement of
259	258		25 up-front adoption costs, counseling services, and other vital
260	259		26 care.
261	260		27 (5) To make education more affordable for adopted children
262	261		28 as follows:
263	262		29 (A) Contributing ten thousand dollars ($10,000) per
264	263		30 adopted child into a college choice 529 plan established
265	264		31 under IC 21-9.
266	265		32 (B) Negotiating with Indiana based public and private
267	266		33 colleges for reduced tuition for Indiana adoptees.
268	267		34 Sec. 2. The fund consists of the following:
269	268		35 (1) Appropriations made by the general assembly.
270	269		36 (2) Grants, gifts, donations, or contributions from any source.
271	270		37 (3) Interest deposited under section 3 of this chapter.
272	271		38 Sec. 3. The treasurer of state shall invest the money in the fund
273	272		39 not currently needed to meet the obligations of the fund in the same
274	273		40 manner as other public money may be invested. Interest that
275	274		41 accrues from these investments shall be deposited in the fund.
276	275		42 Sec. 4. The board shall administer the fund. In administering the
277		-	HB 1503—LS 7551/DI 129 7
	276	+	2025 IN 1503—LS 7551/DI 129 7
278	277		1 fund, the board may consult or contract with other public or
279	278		2 private entities to assist the board in providing or in facilitating the
280	279		3 provision of financial assistance, benefits, services, or other
281	280		4 assistance from the fund in accordance with the criteria developed
282	281		5 under IC 5-35.5-3-6.
283	282		6 Sec. 5. Money in the fund may be used only to provide financial
284	283		7 assistance, benefits, services, or other assistance to a person for the
285	284		8 purposes set forth in section 1 of this chapter and may not be used
286	285		9 to pay any general operating, administrative, and capital expenses
287	286		10 of the authority.
288	287		11 Sec. 6. Assistance provided from the fund to a person is
289	288		12 supplemental to:
290	289		13 (1) adoption assistance under 42 U.S.C. 673, including federal
291	290		14 and state regulations; or
292	291		15 (2) an adoption subsidy under IC 31-19-26.5.
293	292		16 Sec. 7. Money in the fund does not revert to the state general
294	293		17 fund at the end of a fiscal year.
295	294		18 Chapter 5. General Operating Fund.
296	295		19 Sec. 1. The general operating fund is established. The general
297	296		20 operating fund consists of appropriations made by the general
298	297		21 assembly.
299	298		22 Sec. 2. The authority shall establish and implement investment
300	299		23 policies in accordance with IC 5-13 for money in the general
301	300		24 operating fund.
302	301		25 Sec. 3. General operating, administrative, and capital expenses
303	302		26 of the authority may be paid from amounts appropriated for those
304	303		27 purposes by the general assembly. Appropriations for those
305	304		28 purposes must be deposited in the general operating fund.
306	305		29 SECTION 2. IC 6-3-3-12, AS AMENDED BY P.L.236-2023,
307	306		30 SECTION 65, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
308	307		31 JULY 1, 2025]: Sec. 12. (a) As used in this section, "account" has the
309	308		32 meaning set forth in IC 21-9-2-2.
310	309		33 (b) As used in this section, "account beneficiary" has the meaning
311	310		34 set forth in IC 21-9-2-3.
312	311		35 (c) As used in this section, "account owner" has the meaning set
313	312		36 forth in IC 21-9-2-4.
314	313		37 (d) As used in this section, "college choice 529 education savings
315	314		38 plan" refers to a college choice 529 plan established under IC 21-9.
316	315		39 (e) As used in this section, "contribution" means the amount of
317	316		40 money directly provided to a college choice 529 education savings plan
318	317		41 account by a taxpayer. A contribution does not include any of the
319	318		42 following:
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	319	+	2025 IN 1503—LS 7551/DI 129 8
321	320		1 (1) Money credited to an account as a result of bonus points or
322	321		2 other forms of consideration earned by the taxpayer that result in
323	322		3 a transfer of money to the account.
324	323		4 (2) Money transferred from any other qualified tuition program
325	324		5 under Section 529 of the Internal Revenue Code or from any other
326	325		6 similar plan.
327	326		7 (3) Money transferred from any qualified ABLE program under
328	327		8 Section 529A of the Internal Revenue Code or any other similar
329	328		9 plan.
330	329		10 (4) Money transferred to an account from the zero cost
331	330		11 adoption fund established by IC 5-35.5-4-1.
332	331		12 (f) As used in this section, "nonqualified withdrawal" means a
333	332		13 withdrawal or distribution from a college choice 529 education savings
334	333		14 plan that is not a qualified withdrawal.
335	334		15 (g) As used in this section, "qualified higher education expenses"
336	335		16 has the meaning set forth in IC 21-9-2-19.5, except that the term does
337	336		17 not include qualified education loan repayments under Section
338	337		18 529(c)(9) of the Internal Revenue Code.
339	338		19 (h) As used in this section, "qualified K-12 education expenses"
340	339		20 means expenses that are for tuition in connection with enrollment or
341	340		21 attendance at an elementary or secondary public, private, or religious
342	341		22 school located in Indiana and are permitted under Section 529 of the
343	342		23 Internal Revenue Code.
344	343		24 (i) As used in this section, "qualified withdrawal" means a
345	344		25 withdrawal or distribution from a college choice 529 education savings
346	345		26 plan that is made:
347	346		27 (1) to pay for qualified higher education expenses, excluding any
348	347		28 withdrawals or distributions used to pay for qualified higher
349	348		29 education expenses, if the withdrawals or distributions are made
350	349		30 from an account of a college choice 529 education savings plan
351	350		31 that is terminated within twelve (12) months after the account is
352	351		32 opened;
353	352		33 (2) as a result of the death or disability of an account beneficiary;
354	353		34 (3) because an account beneficiary received a scholarship that
355	354		35 paid for all or part of the qualified higher education expenses of
356	355		36 the account beneficiary, to the extent that the withdrawal or
357	356		37 distribution does not exceed the amount of the scholarship; or
358	357		38 (4) by a college choice 529 education savings plan as the result of
359	358		39 a transfer of funds by a college choice 529 education savings plan
360	359		40 from one (1) third party custodian to another.
361	360		41 However, a qualified withdrawal does not include a withdrawal or
362	361		42 distribution that will be used for expenses that are for tuition in
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	362	+	2025 IN 1503—LS 7551/DI 129 9
364	363		1 connection with enrollment or attendance at an elementary or
365	364		2 secondary public, private, or religious school unless the school is
366	365		3 located in Indiana. A qualified withdrawal does not include a rollover
367	366		4 distribution or transfer of assets from a college choice 529 education
368	367		5 savings plan to any other qualified tuition program under Section 529
369	368		6 of the Internal Revenue Code, to any qualified ABLE program under
370	369		7 Section 529A other than an Indiana ABLE 529A savings plan adopted
371	370		8 by the state under IC 12-11, or to any other similar plan.
372	371		9 (j) As used in this section, "taxpayer" means:
373	372		10 (1) an individual filing a single return;
374	373		11 (2) a married couple filing a joint return; or
375	374		12 (3) for taxable years beginning after December 31, 2019, a
376	375		13 married individual filing a separate return.
377	376		14 (k) A taxpayer is entitled to a credit against the taxpayer's adjusted
378	377		15 gross income tax imposed by IC 6-3-1 through IC 6-3-7 for a taxable
379	378		16 year equal to the least of the following:
380	379		17 (1) The following amount:
381	380		18 (A) For taxable years beginning before January 1, 2019, the
382	381		19 sum of twenty percent (20%) multiplied by the amount of the
383	382		20 total contributions that are made by the taxpayer to an account
384	383		21 or accounts of a college choice 529 education savings plan
385	384		22 during the taxable year and that will be used to pay for
386	385		23 qualified higher education expenses that are not qualified K-12
387	386		24 education expenses, plus the lesser of:
388	387		25 (i) five hundred dollars ($500); or
389	388		26 (ii) ten percent (10%) multiplied by the amount of the total
390	389		27 contributions that are made by the taxpayer to an account or
391	390		28 accounts of a college choice 529 education savings plan
392	391		29 during the taxable year and that will be used to pay for
393	392		30 qualified K-12 education expenses.
394	393		31 (B) For taxable years beginning after December 31, 2018, the
395	394		32 sum of:
396	395		33 (i) twenty percent (20%) multiplied by the amount of the
397	396		34 total contributions that are made by the taxpayer to an
398	397		35 account or accounts of a college choice 529 education
399	398		36 savings plan during the taxable year and that are designated
400	399		37 to pay for qualified higher education expenses that are not
401	400		38 qualified K-12 education expenses; plus
402	401		39 (ii) twenty percent (20%) multiplied by the amount of the
403	402		40 total contributions that are made by the taxpayer to an
404	403		41 account or accounts of a college choice 529 education
405	404		42 savings plan during the taxable year and that are designated
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407	406		1 to pay for qualified K-12 education expenses.
408	407		2 (2) One thousand five hundred dollars ($1,500), or seven hundred
409	408		3 fifty dollars ($750) in the case of a married individual filing a
410	409		4 separate return.
411	410		5 (3) The amount of the taxpayer's adjusted gross income tax
412	411		6 imposed by IC 6-3-1 through IC 6-3-7 for the taxable year,
413	412		7 reduced by the sum of all credits (as determined without regard to
414	413		8 this section) allowed by IC 6-3-1 through IC 6-3-7.
415	414		9 (l) This subsection applies after December 31, 2018. At the time a
416	415		10 contribution is made to or a withdrawal is made from an account or
417	416		11 accounts of a college choice 529 education savings plan, the person
418	417		12 making the contribution or withdrawal shall designate whether the
419	418		13 contribution is made for or the withdrawal will be used for:
420	419		14 (1) qualified higher education expenses that are not qualified
421	420		15 K-12 education expenses; or
422	421		16 (2) qualified K-12 education expenses.
423	422		17 The Indiana education savings authority (IC 21-9-3) shall use
424	423		18 subaccounting to track the designations.
425	424		19 (m) A taxpayer who makes a contribution to a college choice 529
426	425		20 education savings plan is considered to have made the contribution on
427	426		21 the date that:
428	427		22 (1) the taxpayer's contribution is postmarked or accepted by a
429	428		23 delivery service, for contributions that are submitted to a college
430	429		24 choice 529 education savings plan by mail or delivery service; or
431	430		25 (2) the taxpayer's electronic funds transfer is initiated, for
432	431		26 contributions that are submitted to a college choice 529 education
433	432		27 savings plan by electronic funds transfer.
434	433		28 (n) A taxpayer is not entitled to a carryback, carryover, or refund of
435	434		29 an unused credit.
436	435		30 (o) A taxpayer may not sell, assign, convey, or otherwise transfer the
437	436		31 tax credit provided by this section.
438	437		32 (p) To receive the credit provided by this section, a taxpayer must
439	438		33 claim the credit on the taxpayer's annual state tax return or returns in
440	439		34 the manner prescribed by the department. The taxpayer shall submit to
441	440		35 the department all information that the department determines is
442	441		36 necessary for the calculation of the credit provided by this section.
443	442		37 (q) An account owner of an account of a college choice 529
444	443		38 education savings plan must repay all or a part of the credit in a taxable
445	444		39 year in which any nonqualified withdrawal is made from the account.
446	445		40 The amount the taxpayer must repay is equal to the lesser of:
447	446		41 (1) twenty percent (20%) of the total amount of nonqualified
448	447		42 withdrawals made during the taxable year from the account; or
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450	449		1 (2) the excess of:
451	450		2 (A) the cumulative amount of all credits provided by this
452	451		3 section that are claimed by any taxpayer with respect to the
453	452		4 taxpayer's contributions to the account for all prior taxable
454	453		5 years beginning on or after January 1, 2007; over
455	454		6 (B) the cumulative amount of repayments paid by the account
456	455		7 owner under this subsection for all prior taxable years
457	456		8 beginning on or after January 1, 2008.
458	457		9 (r) Any required repayment under subsection (q) shall be reported
459	458		10 by the account owner on the account owner's annual state income tax
460	459		11 return for any taxable year in which a nonqualified withdrawal is made.
461	460		12 (s) A nonresident account owner who is not required to file an
462	461		13 annual income tax return for a taxable year in which a nonqualified
463	462		14 withdrawal is made shall make any required repayment on the form
464	463		15 required under IC 6-3-4-1(2). If the nonresident account owner does
465	464		16 not make the required repayment, the department shall issue a demand
466	465		17 notice in accordance with IC 6-8.1-5-1.
467	466		18 (t) The executive director of the Indiana education savings authority
468	467		19 shall submit or cause to be submitted to the department a copy of all
469	468		20 information returns or statements issued to account owners, account
470	469		21 beneficiaries, and other taxpayers for each taxable year with respect to:
471	470		22 (1) nonqualified withdrawals made from accounts, including
472	471		23 subaccounts of a college choice 529 education savings plan for
473	472		24 the taxable year; or
474	473		25 (2) account closings for the taxable year.
475	474		26 (u) The following apply to contributions made after December 31,
476	475		27 2023:
477	476		28 (1) For purposes of this section, all or part of a contribution made
478	477		29 after the end of a taxable year, and not later than the due date of
479	478		30 the taxpayer's adjusted gross income tax return for the taxable
480	479		31 year under this article (as determined without regard to any
481	480		32 allowable extensions), shall be considered as having been made
482	481		33 during the taxable year preceding the contribution if:
483	482		34 (A) the taxpayer elects to treat all or part of a contribution as
484	483		35 occurring in the taxable year preceding the contribution;
485	484		36 (B) the taxpayer designates the amounts of the contribution to
486	485		37 be treated as occurring in each taxable year, in the case of a
487	486		38 single contribution that is to be allowable under this section in
488	487		39 two (2) separate years; and
489	488		40 (C) the taxpayer irrevocably waives the right to claim the
490	489		41 contribution claimed in the taxable year preceding the
491	490		42 contribution as occurring in the taxable year of the
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493	492		1 contribution.
494	493		2 (2) The Indiana education savings authority may prescribe any
495	494		3 forms necessary for purposes of this subsection.
496	495		4 SECTION 3. IC 6-3.1-41.6 IS ADDED TO THE INDIANA CODE
497	496		5 AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
498	497		6 JULY 1, 2025]:
499	498		7 Chapter 41.6. Zero Cost Adoption Fund Tax Credit
500	499		8 Sec. 1. This chapter applies to taxable years beginning after
501	500		9 December 31, 2025.
502	501		10 Sec. 2. As used in this chapter, "credit" refers to a credit
503	502		11 allowed under this chapter.
504	503		12 Sec. 3. As used in this chapter, "fund" means the zero cost
505	504		13 adoption fund established by IC 5-35.5-4-1.
506	505		14 Sec. 4. As used in this chapter, "pass through entity" has the
507	506		15 meaning set forth in IC 6-3-1-35.
508	507		16 Sec. 5. As used in this chapter, "state tax liability" means a
509	508		17 taxpayer's total tax liability that is incurred under:
510	509		18 (1) IC 6-3-1 through IC 6-3-7 (the adjusted gross income tax);
511	510		19 (2) IC 6-5.5 (the financial institutions tax); and
512	511		20 (3) IC 27-1-18-2 (the insurance premiums tax) or IC 6-8-15
513	512		21 (the nonprofit agricultural organization health coverage tax);
514	513		22 as computed after the application of the credits that under
515	514		23 IC 6-3.1-1-2 are to be applied before the credit provided by this
516	515		24 chapter.
517	516		25 Sec. 6. As used in this chapter, "taxpayer" means an individual
518	517		26 or entity that has any state tax liability.
519	518		27 Sec. 7. A taxpayer that makes a contribution to the fund is
520	519		28 entitled to a credit against the taxpayer's state tax liability in the
521	520		29 taxable year in which the taxpayer makes the contribution.
522	521		30 Sec. 8. The amount of a taxpayer's credit is equal to fifty percent
523	522		31 (50%) of the amount of the contribution made to the fund.
524	523		32 Sec. 9. (a) If the credit provided by this chapter exceeds the
525	524		33 taxpayer's state tax liability for the taxable year for which the
526	525		34 credit is first claimed, the excess may be carried forward to
527	526		35 succeeding taxable years and used as a credit against the
528	527		36 taxpayer's state tax liability during those taxable years. Each time
529	528		37 the credit is carried forward to a succeeding taxable year, the
530	529		38 credit is reduced by the amount that was used as a credit during
531	530		39 the immediately preceding taxable year. The credit provided by
532	531		40 this chapter may be carried forward and applied to succeeding
533	532		41 taxable years for nine (9) taxable years following the unused credit
534	533		42 year.
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536	535		1 (b) A taxpayer is not entitled to a carryback or refund of any
537	536		2 unused credit.
538	537		3 Sec. 10. If a pass through entity is entitled to a credit under
539	538		4 section 7 of this chapter but does not have state tax liability against
540	539		5 which the tax credit may be applied, a shareholder, partner, or
541	540		6 member of the pass through entity is entitled to a tax credit equal
542	541		7 to:
543	542		8 (1) the tax credit determined for the pass through entity for
544	543		9 the taxable year; multiplied by
545	544		10 (2) the percentage of the pass through entity's distributive
546	545		11 income to which the shareholder, partner, or member is
547	546		12 entitled.
548	547		13 Sec. 11. To apply a credit against the taxpayer's state tax
549	548		14 liability, a taxpayer must claim the credit on the taxpayer's annual
550	549		15 state tax return or returns in the manner prescribed by the
551	550		16 department. The taxpayer shall submit to the department the
552	551		17 information that the department determines is necessary for the
553	552		18 department to determine whether the taxpayer is eligible for the
554	553		19 credit.
555	554		20 Sec. 12. The total amount of tax credits allowed under this
556	555		21 chapter may not exceed eighteen million five hundred thousand
557	556		22 dollars ($18,500,000) for each state fiscal year.
558	557		23 Sec. 13. The department, on a website used by the department
559	558		24 to provide information to the public, shall provide the following
560	559		25 information:
561	560		26 (1) The application for the credit provided in this chapter.
562	561		27 (2) A timeline for receiving the credit provided in this chapter.
563	562		28 (3) The total amount of credits claimed under this chapter
564	563		29 during the current state fiscal year.
565	564		30 SECTION 4. IC 31-19-26.5-13, AS ADDED BY P.L.146-2008,
566	565		31 SECTION 562, IS AMENDED TO READ AS FOLLOWS
567	566		32 [EFFECTIVE JULY 1, 2025]: Sec. 13. This chapter does not affect:
568	567		33 (1) the legal status of an adoptive child;
569	568		34 (2) the rights and responsibilities of the adoptive parents as
570	569		35 provided by law; or
571	570		36 (3) the eligibility of an adoptive child or adoptive parents for
572	571		37 adoption assistance under Title IV-E of the Social Security Act
573	572		38 (42 U.S.C. 673), federal and state regulations applicable to the
574	573		39 Title IV-E adoption assistance program, or determination of the
575	574		40 amount of any assistance provided by the department through the
576	575		41 Title IV-E adoption assistance program; or
577	576		42 (4) the eligibility of an adoptive child or adoptive parents for
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579	578		1 assistance available under IC 5-35.5-4.
580	579		2 SECTION 5. [EFFECTIVE JULY 1, 2025] (a) As used in this
581	580		3 SECTION, "fund" means the zero cost adoption fund established
582	581		4 by IC 5-35.5-4-1, as added by this act.
583	582		5 (b) For the biennium beginning on July 1, 2025, and ending June
584	583		6 30, 2027, there is appropriated twenty-five million dollars
585	584		7 ($25,000,000) from the state general fund to the fund to be used for
586	585		8 the purposes set forth in IC 5-35.5-4-1, as added by this act.
587	586		9 (c) This SECTION expires July 1, 2027.
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589		-	COMMITTEE REPORT
590		-	Mr. Speaker: Your Committee on Family, Children and Human
591		-	Affairs, to which was referred House Bill 1503, has had the same under
592		-	consideration and begs leave to report the same back to the House with
593		-	the recommendation that said bill do pass.
594		-	(Reference is to HB 1503 as introduced.)
595		-	DEVON
596		-	Committee Vote: Yeas 10, Nays 0
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