Kansas 2023 2023-2024 Regular Session

Kansas House Bill HB2197 Amended / Bill

                    HOUSE BILL No. 2197
AN ACT concerning financial institutions; relating to the first-time home buyer savings 
account act; authorizing the state treasurer to market the first-time home buyer 
savings account program to account holders and financial institutions; providing a 
procedure for the distribution of the account balance upon the death of an account 
holder; changing the term "transfer on death" to "payable on death" regarding 
beneficiaries; resolving a conflict when beneficiaries differ on a financial institution's 
account records and on first-time home buyer savings account tax forms required by 
the secretary of revenue; amending K.S.A. 2022 Supp. 58-4903, 58-4904, 58-4906 
and 79-32,117 and repealing the existing sections.
Be it enacted by the Legislature of the State of Kansas:
New Section 1. (a) The state treasurer may have non-exclusive 
authority to market the first-time home buyer savings account program 
to account holders and financial institutions throughout the state and 
may report on the marketing initiatives in the state treasurer's office 
annual report.
(b) This section shall be a part of and supplemental to the first-
time home buyer savings account act.
Sec. 2. K.S.A. 2022 Supp. 58-4903 is hereby amended to read as 
follows: 58-4903. (a) On and after July 1, 2022, any individual may 
open an account with a financial institution and designate the account, 
in its entirety, as a first-time home buyer savings account to be used to 
pay or reimburse a designated beneficiary's eligible expenses for the 
purchase or construction of a primary residence in this state. An 
individual may be the account holder of multiple accounts and an 
individual may jointly own the account with another individual if such 
individuals file a joint income tax return. An account holder shall 
comply with the requirements of this act to be eligible for the 
modifications set forth in K.S.A. 79-32,117, and amendments thereto.
(b) (1) An account holder shall designate, no later than April 15 of 
the year following the taxable year during which the account is 
established, a first-time home buyer as the designated beneficiary of the 
account. Nothing in this section shall prohibit an account holder from 
designating such account holder as the designated beneficiary of an 
account. An account holder may change the designated beneficiary at 
any time, but no account shall have more than one designated 
beneficiary at any time. An individual may be designated as the 
designated beneficiary of more than one account if such accounts are 
held by separate account holders. No account holder shall be authorized 
to designate the same designated beneficiary on multiple accounts held 
by such account owner.
(2) The naming of a designated beneficiary shall not create a 
survivorship interest in the account for such designated beneficiary. In 
the event of the death of an account holder, the balance of such account 
shall be paid to the payable on death beneficiary in accordance with 
K.S.A. 9-1215, and amendments thereto, or, in the absence of a named 
payable on death beneficiary, in accordance with the provisions of the 
Kansas probate code.
(c) (1) The following limits apply to an account established 
pursuant to this act:
(A) The maximum contribution to an account in any tax year shall 
be $3,000 for an individual and $6,000 for a married couple filing a 
joint return;
(B) the maximum amount of all contributions into an account in 
all tax years shall be $24,000 for an individual and $48,000 for a 
married couple filing a joint return; and
(C) the maximum total amount in an account shall be $50,000.
(2) If a limit in paragraph (1) is exceeded, then thereafter all 
interest or other income earned on the investment of moneys in an 
account shall be subject to the tax imposed by the Kansas income tax 
act. HOUSE BILL No. 2197—page 2
(3) Moneys may remain in an account for an unlimited duration 
without the interest or income being subject to recapture or penalty.
(d) The account holder shall not use moneys in an account to pay 
expenses of administering the account, except that a service fee may be 
deducted from the account by a financial institution. The account 
holder shall be responsible for maintaining documentation for the 
account and for eligible expenses related to the designated beneficiary's 
purchase or construction of a primary residence.
Sec. 3. K.S.A. 2022 Supp. 58-4904 is hereby amended to read as 
follows: 58-4904. (a) (1) The moneys in a first-time home buyer 
savings account may be:
(A) Used for eligible expenses related to a designated 
beneficiary's purchase or construction of a primary residence located in 
this state;
(B) used for eligible expenses related to a designated beneficiary's 
purchase or construction of a primary residence located outside of this 
state if such designated beneficiary is active-duty military and was 
stationed in Kansas for any time after the creation of the account;
(C) used for eligible expenses that would have qualified pursuant 
to paragraph (1)(A) or (1)(B) but the contract for purchase or 
construction did not close;
(D) transferred to another newly created account; and
(E) used to pay service fees assessed by the financial institution.
(2) This subsection shall apply even if a designated beneficiary is 
a joint owner of a primary residence with another person who is not a 
designated beneficiary of an account. Moneys in an account shall not 
be used to purchase a manufactured or mobile home that is not taxed as 
real property.
(b) Moneys withdrawn from an account shall be subject to 
recapture by the secretary in the tax year in which they were withdrawn 
if:
(1) At the time of the withdrawal, it has been less than a year since 
the first deposit in the account; or
(2) the moneys are used for any purpose other than the expenses 
or transactions authorized pursuant to subsection (a)(1).
(c) Moneys that are subject to recapture shall be an amount equal 
to the moneys withdrawn from an account and shall be added to the 
Kansas adjusted gross income pursuant to K.S.A. 79-32,117(b)(xxvii), 
and amendments thereto, of the account holder or, if the account holder 
is no longer living, the designated beneficiary. If any moneys are 
subject to recapture, the account holder shall pay a penalty in the 
following amounts: (1) If the withdrawal of moneys occurred 10 or less 
years after the first deposit in the account, 5% of the amount subject to 
recapture; and (2) if the withdrawal of moneys occurred more than 10 
years after the first deposit in the account, 10% of the amount subject to 
recapture.
(d) The penalties provided in subsection (c) shall not apply if: (1) 
The withdrawn moneys are used for eligible expenses related to a 
designated beneficiary's purchase or construction of a primary 
residence outside of this state; or (2) the withdrawn moneys are from an 
account in which the designated beneficiary died, and the account 
holder did not designate a new designated beneficiary during the same 
tax year.
(e) If the account holder dies or, if the account is jointly owned 
and the account owners die, and the account does not have a surviving 
transfer payable on death beneficiary, then all of the moneys in the 
account resulting from contributions or income earned from assets in 
the account pursuant to K.S.A. 79-32,117, and amendments thereto, 
shall be subject to recapture in the tax year of the death or deaths, but  HOUSE BILL No. 2197—page 3
no penalty shall be assessed pursuant to subsection (c).
Sec. 4. K.S.A. 2022 Supp. 58-4906 is hereby amended to read as 
follows: 58-4906. (a) No financial institution shall be required to:
(1) Designate an account as a first-time home buyer savings 
account or designate the beneficiaries of an account in the financial 
institution's account contracts or systems or in any other way;
(2) track the use of moneys withdrawn from an account; or
(3) report any information to the department of revenue or any 
other governmental agency that is not otherwise required by law.
(b) No financial institution shall be responsible or liable for:
(1) Determining or ensuring that an account holder is eligible for a 
Kansas adjusted gross income modification pursuant to K.S.A. 79-
32,117, and amendments thereto;
(2) determining or ensuring that moneys in the account are used 
for eligible expenses; or
(3) reporting or remitting taxes or penalties related to the use of 
account moneys.
(c) A financial institution may rely on such financial institution's 
account records for determining a payable on death beneficiary for a 
first-time home buyer savings account. If the payable on death 
beneficiary in a financial institution's account records conflicts with 
the designated beneficiary on any form required by the secretary under 
the first-time home buyer savings account act, the payable on death 
beneficiary in such financial institution's account records shall control.
Sec. 5. K.S.A. 2022 Supp. 79-32,117 is hereby amended to read as 
follows: 79-32,117. (a) The Kansas adjusted gross income of an 
individual means such individual's federal adjusted gross income for 
the taxable year, with the modifications specified in this section.
(b) There shall be added to federal adjusted gross income:
(i) Interest income less any related expenses directly incurred in 
the purchase of state or political subdivision obligations, to the extent 
that the same is not included in federal adjusted gross income, on 
obligations of any state or political subdivision thereof, but to the 
extent that interest income on obligations of this state or a political 
subdivision thereof issued prior to January 1, 1988, is specifically 
exempt from income tax under the laws of this state authorizing the 
issuance of such obligations, it shall be excluded from computation of 
Kansas adjusted gross income whether or not included in federal 
adjusted gross income. Interest income on obligations of this state or a 
political subdivision thereof issued after December 31, 1987, shall be 
excluded from computation of Kansas adjusted gross income whether 
or not included in federal adjusted gross income.
(ii) Taxes on or measured by income or fees or payments in lieu of 
income taxes imposed by this state or any other taxing jurisdiction to 
the extent deductible in determining federal adjusted gross income and 
not credited against federal income tax. This paragraph shall not apply 
to taxes imposed under the provisions of K.S.A. 79-1107 or 79-1108, 
and amendments thereto, for privilege tax year 1995, and all such years 
thereafter.
(iii) The federal net operating loss deduction, except that the 
federal net operating loss deduction shall not be added to an 
individual's federal adjusted gross income for tax years beginning after 
December 31, 2016.
(iv) Federal income tax refunds received by the taxpayer if the 
deduction of the taxes being refunded resulted in a tax benefit for 
Kansas income tax purposes during a prior taxable year. Such refunds 
shall be included in income in the year actually received regardless of 
the method of accounting used by the taxpayer. For purposes hereof, a 
tax benefit shall be deemed to have resulted if the amount of the tax  HOUSE BILL No. 2197—page 4
had been deducted in determining income subject to a Kansas income 
tax for a prior year regardless of the rate of taxation applied in such 
prior year to the Kansas taxable income, but only that portion of the 
refund shall be included as bears the same proportion to the total refund 
received as the federal taxes deducted in the year to which such refund 
is attributable bears to the total federal income taxes paid for such year. 
For purposes of the foregoing sentence, federal taxes shall be 
considered to have been deducted only to the extent such deduction 
does not reduce Kansas taxable income below zero.
(v) The amount of any depreciation deduction or business expense 
deduction claimed on the taxpayer's federal income tax return for any 
capital expenditure in making any building or facility accessible to the 
handicapped, for which expenditure the taxpayer claimed the credit 
allowed by K.S.A. 79-32,177, and amendments thereto.
(vi) Any amount of designated employee contributions picked up 
by an employer pursuant to K.S.A. 12-5005, 20-2603, 74-4919 and 74-
4965, and amendments thereto.
(vii) The amount of any charitable contribution made to the extent 
the same is claimed as the basis for the credit allowed pursuant to 
K.S.A. 79-32,196, and amendments thereto.
(viii) The amount of any costs incurred for improvements to a 
swine facility, claimed for deduction in determining federal adjusted 
gross income, to the extent the same is claimed as the basis for any 
credit allowed pursuant to K.S.A. 79-32,204, and amendments thereto.
(ix) The amount of any ad valorem taxes and assessments paid and 
the amount of any costs incurred for habitat management or 
construction and maintenance of improvements on real property, 
claimed for deduction in determining federal adjusted gross income, to 
the extent the same is claimed as the basis for any credit allowed 
pursuant to K.S.A. 79-32,203, and amendments thereto.
(x) Amounts received as nonqualified withdrawals, as defined by 
K.S.A. 75-643, and amendments thereto, if, at the time of contribution 
to a family postsecondary education savings account, such amounts 
were subtracted from the federal adjusted gross income pursuant to 
K.S.A. 79-32,117(c)(xv), and amendments thereto, subsection (c)(xv) 
or if such amounts are not already included in the federal adjusted gross 
income.
(xi) The amount of any contribution made to the same extent the 
same is claimed as the basis for the credit allowed pursuant to K.S.A. 
74-50,154, and amendments thereto.
(xii) For taxable years commencing after December 31, 2004, 
amounts received as withdrawals not in accordance with the provisions 
of K.S.A. 74-50,204, and amendments thereto, if, at the time of 
contribution to an individual development account, such amounts were 
subtracted from the federal adjusted gross income pursuant to 
subsection (c)(xiii), or if such amounts are not already included in the 
federal adjusted gross income.
(xiii) The amount of any expenditures claimed for deduction in 
determining federal adjusted gross income, to the extent the same is 
claimed as the basis for any credit allowed pursuant to K.S.A. 79-
32,217 through 79-32,220 or 79-32,222, and amendments thereto.
(xiv) The amount of any amortization deduction claimed in 
determining federal adjusted gross income to the extent the same is 
claimed for deduction pursuant to K.S.A. 79-32,221, and amendments 
thereto.
(xv) The amount of any expenditures claimed for deduction in 
determining federal adjusted gross income, to the extent the same is 
claimed as the basis for any credit allowed pursuant to K.S.A. 79-
32,223 through 79-32,226, 79-32,228 through 79-32,231, 79-32,233  HOUSE BILL No. 2197—page 5
through 79-32,236, 79-32,238 through 79-32,241, 79-32,245 through 
79-32,248 or 79-32,251 through 79-32,254, and amendments thereto.
(xvi) The amount of any amortization deduction claimed in 
determining federal adjusted gross income to the extent the same is 
claimed for deduction pursuant to K.S.A. 79-32,227, 79-32,232, 79-
32,237, 79-32,249, 79-32,250 or 79-32,255, and amendments thereto.
(xvii) The amount of any amortization deduction claimed in 
determining federal adjusted gross income to the extent the same is 
claimed for deduction pursuant to K.S.A. 79-32,256, and amendments 
thereto.
(xviii) For taxable years commencing after December 31, 2006, 
the amount of any ad valorem or property taxes and assessments paid to 
a state other than Kansas or local government located in a state other 
than Kansas by a taxpayer who resides in a state other than Kansas, 
when the law of such state does not allow a resident of Kansas who 
earns income in such other state to claim a deduction for ad valorem or 
property taxes or assessments paid to a political subdivision of the state 
of Kansas in determining taxable income for income tax purposes in 
such other state, to the extent that such taxes and assessments are 
claimed as an itemized deduction for federal income tax purposes.
(xix) For taxable years beginning after December 31, 2012, and 
ending before January 1, 2017, the amount of any: (1) Loss from 
business as determined under the federal internal revenue code and 
reported from schedule C and on line 12 of the taxpayer's form 1040 
federal individual income tax return; (2) loss from rental real estate, 
royalties, partnerships, S corporations, except those with wholly owned 
subsidiaries subject to the Kansas privilege tax, estates, trusts, residual 
interest in real estate mortgage investment conduits and net farm rental 
as determined under the federal internal revenue code and reported 
from schedule E and on line 17 of the taxpayer's form 1040 federal 
individual income tax return; and (3) farm loss as determined under the 
federal internal revenue code and reported from schedule F and on line 
18 of the taxpayer's form 1040 federal income tax return; all to the 
extent deducted or subtracted in determining the taxpayer's federal 
adjusted gross income. For purposes of this subsection, references to 
the federal form 1040 and federal schedule C, schedule E, and schedule 
F, shall be to such form and schedules as they existed for tax year 2011, 
and as revised thereafter by the internal revenue service.
(xx) For taxable years beginning after December 31, 2012, and 
ending before January 1, 2017, the amount of any deduction for self-
employment taxes under section 164(f) of the federal internal revenue 
code as in effect on January 1, 2012, and amendments thereto, in 
determining the federal adjusted gross income of an individual 
taxpayer, to the extent the deduction is attributable to income reported 
on schedule C, E or F and on line 12, 17 or 18 of the taxpayer's form 
1040 federal income tax return.
(xxi) For taxable years beginning after December 31, 2012, and 
ending before January 1, 2017, the amount of any deduction for 
pension, profit sharing, and annuity plans of self-employed individuals 
under section 62(a)(6) of the federal internal revenue code as in effect 
on January 1, 2012, and amendments thereto, in determining the federal 
adjusted gross income of an individual taxpayer.
(xxii) For taxable years beginning after December 31, 2012, and 
ending before January 1, 2017, the amount of any deduction for health 
insurance under section 162(l) of the federal internal revenue code as in 
effect on January 1, 2012, and amendments thereto, in determining the 
federal adjusted gross income of an individual taxpayer.
(xxiii) For taxable years beginning after December 31, 2012, and 
ending before January 1, 2017, the amount of any deduction for  HOUSE BILL No. 2197—page 6
domestic production activities under section 199 of the federal internal 
revenue code as in effect on January 1, 2012, and amendments thereto, 
in determining the federal adjusted gross income of an individual 
taxpayer.
(xxiv) For taxable years commencing after December 31, 2013, 
that portion of the amount of any expenditure deduction claimed in 
determining federal adjusted gross income for expenses paid for 
medical care of the taxpayer or the taxpayer's spouse or dependents 
when such expenses were paid or incurred for an abortion, or for a 
health benefit plan, as defined in K.S.A. 65-6731, and amendments 
thereto, for the purchase of an optional rider for coverage of abortion in 
accordance with K.S.A. 40-2,190, and amendments thereto, to the 
extent that such taxes and assessments are claimed as an itemized 
deduction for federal income tax purposes.
(xxv) For taxable years commencing after December 31, 2013, 
that portion of the amount of any expenditure deduction claimed in 
determining federal adjusted gross income for expenses paid by a 
taxpayer for health care when such expenses were paid or incurred for 
abortion coverage, a health benefit plan, as defined in K.S.A. 65-6731, 
and amendments thereto, when such expenses were paid or incurred for 
abortion coverage or amounts contributed to health savings accounts 
for such taxpayer's employees for the purchase of an optional rider for 
coverage of abortion in accordance with K.S.A. 40-2,190, and 
amendments thereto, to the extent that such taxes and assessments are 
claimed as a deduction for federal income tax purposes.
(xxvi) For all taxable years beginning after December 31, 2016, 
the amount of any charitable contribution made to the extent the same 
is claimed as the basis for the credit allowed pursuant to K.S.A. 72-
4357, and amendments thereto, and is also claimed as an itemized 
deduction for federal income tax purposes.
(xxvii) For all taxable years commencing after December 31, 
2020, the amount deducted by reason of a carryforward of disallowed 
business interest pursuant to section 163(j) of the federal internal 
revenue code of 1986, as in effect on January 1, 2018.
(xxviii) For all taxable years beginning after December 31, 2021, 
the amount of any contributions to, or earnings from, a first-time home 
buyer savings account if distributions from the account were not used 
to pay for expenses or transactions authorized pursuant to K.S.A. 2022 
Supp. 58-4904, and amendments thereto, or were not held for the 
minimum length of time required pursuant to K.S.A. 2022 Supp. 58-
4904, and amendments thereto. Contributions to, or earnings from, 
such account shall also include any amount resulting from the account 
holder not designating a surviving transfer payable on death beneficiary 
pursuant to K.S.A. 2022 Supp. 58-4904(e), and amendments thereto.
(c) There shall be subtracted from federal adjusted gross income:
(i) Interest or dividend income on obligations or securities of any 
authority, commission or instrumentality of the United States and its 
possessions less any related expenses directly incurred in the purchase 
of such obligations or securities, to the extent included in federal 
adjusted gross income but exempt from state income taxes under the 
laws of the United States.
(ii) Any amounts received which are included in federal adjusted 
gross income but which are specifically exempt from Kansas income 
taxation under the laws of the state of Kansas.
(iii) The portion of any gain or loss from the sale or other 
disposition of property having a higher adjusted basis for Kansas 
income tax purposes than for federal income tax purposes on the date 
such property was sold or disposed of in a transaction in which gain or 
loss was recognized for purposes of federal income tax that does not  HOUSE BILL No. 2197—page 7
exceed such difference in basis, but if a gain is considered a long-term 
capital gain for federal income tax purposes, the modification shall be 
limited to that portion of such gain which is included in federal 
adjusted gross income.
(iv) The amount necessary to prevent the taxation under this act of 
any annuity or other amount of income or gain which was properly 
included in income or gain and was taxed under the laws of this state 
for a taxable year prior to the effective date of this act, as amended, to 
the taxpayer, or to a decedent by reason of whose death the taxpayer 
acquired the right to receive the income or gain, or to a trust or estate 
from which the taxpayer received the income or gain.
(v) The amount of any refund or credit for overpayment of taxes 
on or measured by income or fees or payments in lieu of income taxes 
imposed by this state, or any taxing jurisdiction, to the extent included 
in gross income for federal income tax purposes.
(vi) Accumulation distributions received by a taxpayer as a 
beneficiary of a trust to the extent that the same are included in federal 
adjusted gross income.
(vii) Amounts received as annuities under the federal civil service 
retirement system from the civil service retirement and disability fund 
and other amounts received as retirement benefits in whatever form 
which were earned for being employed by the federal government or 
for service in the armed forces of the United States.
(viii) Amounts received by retired railroad employees as a 
supplemental annuity under the provisions of 45 U.S.C. §§ 228b(a) and 
228c(a)(1) et seq.
(ix) Amounts received by retired employees of a city and by 
retired employees of any board of such city as retirement allowances 
pursuant to K.S.A. 13-14,106, and amendments thereto, or pursuant to 
any charter ordinance exempting a city from the provisions of K.S.A. 
13-14,106, and amendments thereto.
(x) For taxable years beginning after December 31, 1976, the 
amount of the federal tentative jobs tax credit disallowance under the 
provisions of 26 U.S.C. § 280C. For taxable years ending after 
December 31, 1978, the amount of the targeted jobs tax credit and work 
incentive credit disallowances under 26 U.S.C. § 280C.
(xi) For taxable years beginning after December 31, 1986, 
dividend income on stock issued by Kansas venture capital, inc.
(xii) For taxable years beginning after December 31, 1989, 
amounts received by retired employees of a board of public utilities as 
pension and retirement benefits pursuant to K.S.A. 13-1246, 13-1246a 
and 13-1249, and amendments thereto.
(xiii) For taxable years beginning after December 31, 2004, 
amounts contributed to and the amount of income earned on 
contributions deposited to an individual development account under 
K.S.A. 74-50,201 et seq., and amendments thereto.
(xiv) For all taxable years commencing after December 31, 1996, 
that portion of any income of a bank organized under the laws of this 
state or any other state, a national banking association organized under 
the laws of the United States, an association organized under the 
savings and loan code of this state or any other state, or a federal 
savings association organized under the laws of the United States, for 
which an election as an S corporation under subchapter S of the federal 
internal revenue code is in effect, which accrues to the taxpayer who is 
a stockholder of such corporation and which is not distributed to the 
stockholders as dividends of the corporation. For taxable years 
beginning after December 31, 2012, and ending before January 1, 2017, 
the amount of modification under this subsection shall exclude the 
portion of income or loss reported on schedule E and included on line  HOUSE BILL No. 2197—page 8
17 of the taxpayer's form 1040 federal individual income tax return.
(xv) For all taxable years beginning after December 31, 2017, the 
cumulative amounts not exceeding $3,000, or $6,000 for a married 
couple filing a joint return, for each designated beneficiary that are 
contributed to: (1) A family postsecondary education savings account 
established under the Kansas postsecondary education savings program 
or a qualified tuition program established and maintained by another 
state or agency or instrumentality thereof pursuant to section 529 of the 
internal revenue code of 1986, as amended, for the purpose of paying 
the qualified higher education expenses of a designated beneficiary; or 
(2) an achieving a better life experience (ABLE) account established 
under the Kansas ABLE savings program or a qualified ABLE program 
established and maintained by another state or agency or 
instrumentality thereof pursuant to section 529A of the internal revenue 
code of 1986, as amended, for the purpose of saving private funds to 
support an individual with a disability. The terms and phrases used in 
this paragraph shall have the meaning respectively ascribed thereto by 
the provisions of K.S.A. 75-643 and 75-652, and amendments thereto, 
and the provisions of such sections are hereby incorporated by 
reference for all purposes thereof.
(xvi) For all taxable years beginning after December 31, 2004, 
amounts received by taxpayers who are or were members of the armed 
forces of the United States, including service in the Kansas army and 
air national guard, as a recruitment, sign up or retention bonus received 
by such taxpayer as an incentive to join, enlist or remain in the armed 
services of the United States, including service in the Kansas army and 
air national guard, and amounts received for repayment of educational 
or student loans incurred by or obligated to such taxpayer and received 
by such taxpayer as a result of such taxpayer's service in the armed 
forces of the United States, including service in the Kansas army and 
air national guard.
(xvii) For all taxable years beginning after December 31, 2004, 
amounts received by taxpayers who are eligible members of the Kansas 
army and air national guard as a reimbursement pursuant to K.S.A. 48-
281, and amendments thereto, and amounts received for death benefits 
pursuant to K.S.A. 48-282, and amendments thereto, to the extent that 
such death benefits are included in federal adjusted gross income of the 
taxpayer.
(xviii) For the taxable year beginning after December 31, 2006, 
amounts received as benefits under the federal social security act which 
are included in federal adjusted gross income of a taxpayer with federal 
adjusted gross income of $50,000 or less, whether such taxpayer's filing 
status is single, head of household, married filing separate or married 
filing jointly; and for all taxable years beginning after December 31, 
2007, amounts received as benefits under the federal social security act 
which are included in federal adjusted gross income of a taxpayer with 
federal adjusted gross income of $75,000 or less, whether such 
taxpayer's filing status is single, head of household, married filing 
separate or married filing jointly.
(xix) Amounts received by retired employees of Washburn 
university as retirement and pension benefits under the university's 
retirement plan.
(xx) For taxable years beginning after December 31, 2012, and 
ending before January 1, 2017, the amount of any: (1) Net profit from 
business as determined under the federal internal revenue code and 
reported from schedule C and on line 12 of the taxpayer's form 1040 
federal individual income tax return; (2) net income, not including 
guaranteed payments as defined in section 707(c) of the federal internal 
revenue code and as reported to the taxpayer from federal schedule K- HOUSE BILL No. 2197—page 9
1, (form 1065-B), in box 9, code F or as reported to the taxpayer from 
federal schedule K-1, (form 1065) in box 4, from rental real estate, 
royalties, partnerships, S corporations, estates, trusts, residual interest 
in real estate mortgage investment conduits and net farm rental as 
determined under the federal internal revenue code and reported from 
schedule E and on line 17 of the taxpayer's form 1040 federal 
individual income tax return; and (3) net farm profit as determined 
under the federal internal revenue code and reported from schedule F 
and on line 18 of the taxpayer's form 1040 federal income tax return; 
all to the extent included in the taxpayer's federal adjusted gross 
income. For purposes of this subsection, references to the federal form 
1040 and federal schedule C, schedule E, and schedule F, shall be to 
such form and schedules as they existed for tax year 2011 and as 
revised thereafter by the internal revenue service.
(xxi) For all taxable years beginning after December 31, 2013, 
amounts equal to the unreimbursed travel, lodging and medical 
expenditures directly incurred by a taxpayer while living, or a 
dependent of the taxpayer while living, for the donation of one or more 
human organs of the taxpayer, or a dependent of the taxpayer, to 
another person for human organ transplantation. The expenses may be 
claimed as a subtraction modification provided for in this section to the 
extent the expenses are not already subtracted from the taxpayer's 
federal adjusted gross income. In no circumstances shall the subtraction 
modification provided for in this section for any individual, or a 
dependent, exceed $5,000. As used in this section, "human organ" 
means all or part of a liver, pancreas, kidney, intestine, lung or bone 
marrow. The provisions of this paragraph shall take effect on the day 
the secretary of revenue certifies to the director of the budget that the 
cost for the department of revenue of modifications to the automated 
tax system for the purpose of implementing this paragraph will not 
exceed $20,000.
(xxii) For taxable years beginning after December 31, 2012, and 
ending before January 1, 2017, the amount of net gain from the sale of: 
(1) Cattle and horses, regardless of age, held by the taxpayer for draft, 
breeding, dairy or sporting purposes, and held by such taxpayer for 24 
months or more from the date of acquisition; and (2) other livestock, 
regardless of age, held by the taxpayer for draft, breeding, dairy or 
sporting purposes, and held by such taxpayer for 12 months or more 
from the date of acquisition. The subtraction from federal adjusted 
gross income shall be limited to the amount of the additions recognized 
under the provisions of subsection (b)(xix) attributable to the business 
in which the livestock sold had been used. As used in this paragraph, 
the term "livestock" shall not include poultry.
(xxiii) For all taxable years beginning after December 31, 2012, 
amounts received under either the Overland Park, Kansas police 
department retirement plan or the Overland Park, Kansas fire 
department retirement plan, both as established by the city of Overland 
Park, pursuant to the city's home rule authority.
(xxiv) For taxable years beginning after December 31, 2013, and 
ending before January 1, 2017, the net gain from the sale from 
Christmas trees grown in Kansas and held by the taxpayer for six years 
or more.
(xxv) For all taxable years commencing after December 31, 2020, 
100% of global intangible low-taxed income under section 951A of the 
federal internal revenue code of 1986, before any deductions allowed 
under section 250(a)(1)(B) of such code.
(xxvi) For all taxable years commencing after December 31, 2020, 
the amount disallowed as a deduction pursuant to section 163(j) of the 
federal internal revenue code of 1986, as in effect on January 1, 2018. HOUSE BILL No. 2197—page 10
(xxvii) For taxable years commencing after December 31, 2020, 
the amount disallowed as a deduction pursuant to section 274 of the 
federal internal revenue code of 1986 for meal expenditures shall be 
allowed to the extent such expense was deductible for determining 
federal income tax and was allowed and in effect on December 31, 
2017.
(xxviii) For all taxable years beginning after December 31, 2021: 
(1) The amount contributed to a first-time home buyer savings account 
pursuant to K.S.A. 2022 Supp. 58-4903, and amendments thereto, in an 
amount not to exceed $3,000 for an individual or $6,000 for a married 
couple filing a joint return; or (2) amounts received as income earned 
from assets in a first-time home buyer savings account.
(d) There shall be added to or subtracted from federal adjusted 
gross income the taxpayer's share, as beneficiary of an estate or trust, of 
the Kansas fiduciary adjustment determined under K.S.A. 79-32,135, 
and amendments thereto.
(e) The amount of modifications required to be made under this 
section by a partner which relates to items of income, gain, loss, 
deduction or credit of a partnership shall be determined under K.S.A. 
79-32,131, and amendments thereto, to the extent that such items affect 
federal adjusted gross income of the partner.
(f) No taxpayer shall be assessed penalties and interest from the 
underpayment of taxes due to changes to this section that became law 
on July 1, 2017, so long as such underpayment is rectified on or before 
April 17, 2018.
Sec. 6. K.S.A. 2022 Supp. 58-4903, 58-4904, 58-4906 and 79-
32,117 are hereby repealed.
Sec. 7. This act shall take effect and be in force from and after its 
publication in the statute book.
I hereby certify that the above BILL originated in the HOUSE, and passed 
that body
Speaker of the House.
Chief Clerk of the House.
         
Passed the SENATE      ______________________________________________________________________________
President of the Senate.
Secretary of the Senate.
APPROVED __________________________________________________________________________________________________
Governor.