As Amended by Senate Committee
Session of 2023
SENATE BILL No. 37
By Committee on Federal and State Affairs
1-17
AN ACT concerning taxation; relating to the Kansas housing investor tax
credit act; expanding the transferability of income, privilege and
premium tax credits issued under the act; amending K.S.A. 2022 Supp.
79-32,313 and repealing the existing section.
Be it enacted by the Legislature of the State of Kansas:
Section 1. K.S.A. 2022 Supp. 79-32,313 is hereby amended to read as
follows: 79-32,313. (a) (1) For tax year 2022 and all tax years thereafter, a
credit against the income tax liability imposed pursuant to the Kansas
income tax act, the privilege tax liability imposed upon any national
banking association, state bank, trust company or savings and loan
association pursuant to article 11 of chapter 79 of the Kansas Statutes
Annotated, and amendments thereto, or the premium tax liability imposed
upon an insurance company pursuant to K.S.A. 40-252, and amendments
thereto, shall be allowed to:
(A) A qualified investor for a cash investment in a qualified housing
project that has been approved and issued a tax credit by the director. The
tax credit may be claimed in its entirety in the taxable year the cash
investment is made; and
(B) a project builder or developer of a qualified housing project that
has been approved and issued a tax credit by the director.
(2) To claim such tax credit, the qualified investor or, project builder
or developer or transferee shall provide all information or documentation
in the form and manner required by the secretary of revenue. If the amount
of the credit exceeds the taxpayer's tax liability in any one taxable year, the
remaining portion of the credit may be carried forward in the succeeding
taxable years until the total amount of the credit is used, except that no
credit may be claimed after four taxable years next succeeding the taxable
year that such credit was issued, and any remaining credit shall be
forfeited. Any portion of the credit that is carried forward may be
transferred pursuant to subsection (d) and claimed by the transferee in the
same manner as the transferor.
(b) (1) Tax credits may be issued by the director for a qualified
housing project as follows:
(A) For qualified housing projects located in a county with a
population of not more than 8,000, in an amount not to exceed $35,000 per
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residential unit;
(B) for qualified housing projects located in a county with a
population of more than 8,000 but not more than 25,000, in an amount not
to exceed $32,000 per residential unit; and
(C) for all other qualified housing projects, in an amount not to
exceed $30,000.
(2) A qualified housing project shall be limited to a total of 40 such
residential units per year for both single-family and multi-family
dwellings.
(3) Tax credits may be issued to a qualified investor in the amount of
a cash investment of up to the total amount that may be issued by the
director under this subsection for the qualified housing project, or as
provided in the agreement required by K.S.A. 2022 Supp. 79-32,312, and
amendments thereto. Project builders or developers may apply to the
director each year for tax credits for additional units or phases of a project.
Qualified investors may be issued tax credits for cash investments in
multiple qualified housing projects. Project builders or developers may
apply and be approved for multiple qualified housing projects in the same
tax year.
(4) The aggregate amount of tax credits that may be issued under this
section shall not exceed $13,000,000 each tax year, except that if the
director issues an aggregate amount of tax credits in one tax year that is
less than $13,000,000, then the director may carry forward the difference
and issue such amount of tax credits in the immediately succeeding tax
year in addition to the statutory amount that may be issued under this
section. Of the aggregate amount of tax credits issued in one tax year, the
director shall allocate:
(A) Not less than $2,500,000 in tax credits for qualified housing
projects located in counties with a population of not more than 8,000;
(B) not less than $2,500,000 in tax credits for qualified housing
projects located in counties with a population of more than 8,000 but not
more than 25,000; and
(C) up to $8,000,000 in tax credits for qualified housing projects
located in counties with a population of more than 25,000 but not more
than 75,000.
(c) A cash investment in a qualified housing project shall be deemed
to have been made on the date of acquisition of the qualified security, as
such date is determined by the director.
(d) Any qualified investor without a current tax liability at the time of
the investment in a qualified housing project that does not reasonably
believe such investor will owe any such tax for the current taxable year
and who receives a tax credit pursuant to this section shall be deemed to
acquire an interest in the nature of a transferable credit limited to the
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amount of the credit issued to the qualified investor by the director. This
interest All or a portion of such credit may be transferred by the qualified
investor or any subsequent transferee to any person one or more persons
whether or not such person transferee is then a qualified investor and be
claimed by the transferee as a credit against the transferee's Kansas tax
liability in the same manner as the transferor beginning in the year the
credit is transferred. The credit may be carried forward as permitted by
subsection (a). There shall be no limit on the number of times a credit or
any portion thereof can be transferred. No person shall be entitled to a
refund for any interest on such tax credit that may be created under this
section. Only the full amount of the tax credit for any one qualified
housing project investment may be transferred and may only be transferred
one time. A credit acquired by transfer shall be subject to the limitations
prescribed in this section. Any such transferee succeeds to all remaining
rights and restrictions of the transferor with respect to the credit being
transferred on the date of such transfer. Documentation of any credit
acquired by transfer shall be provided by the taxpayer claiming such credit
in the manner required by the secretary of revenue. The qualified investor
or subsequent transferee transferring such credit shall provide the director
and the secretary of revenue with the name, address and taxpayer
identification number of each person to whom tax credits have been
transferred and such other information as may be required by the director
or the secretary of revenue. The provisions of this subsection shall apply to
credits issued for tax year 2022 and all tax years thereafter.
(e) The secretary of revenue may adopt rules and regulations as
necessary to implement and administer the provisions of this act.
(f) For purposes of calculating any tax due under K.S.A. 40-253,
and amendments thereto, the credit allowed by this section shall be
treated as a tax paid under K.S.A. 40-252, and amendments thereto.
Sec. 2. K.S.A. 2022 Supp. 79-32,313 is hereby repealed.
Sec. 3. This act shall take effect and be in force from and after its
publication in the Kansas register.
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