Kansas 2023-2024 Regular Session

Kansas Senate Bill SB494

Introduced

2/8/24

Refer

2/9/24

Failed

4/30/24

Caption

Enacting the adoption savings account act, allowing individuals to establish adoption savings accounts with certain financial institutions, providing eligible expenses, requirements and restrictions for such accounts and establishing addition and subtraction modifications for contributions to such accounts under the Kansas income tax act.

Impact

The Adoption Savings Account Act not only aims to provide financial assistance for prospective adoptive families but it also modifies provisions of the Kansas income tax act to include contributions to these new accounts. This means that contributions to an adoption savings account will either be deductible from the account holder's state adjusted income or excluded from taxable income, incentivizing saving for adoption. Furthermore, the bill outlines that any moneys allocated for purposes beyond qualified expenses or exceeding the prescribed limits would be subject to taxation, impacting the overall income calculations for state tax purposes.

Summary

Senate Bill 494, known as the Adoption Savings Account Act, allows individuals to establish adoption savings accounts with qualified financial institutions. These accounts are specifically meant to assist in covering eligible expenses related to the adoption of children in Kansas. Account holders can contribute up to $3,000 per tax year individually or $6,000 for joint filers, with a cap of $50,000 in total contributions. The bill intends to create financial support mechanisms for families looking to adopt, enhancing the resources available to them during the adoption process.

Contention

While the bill primarily aims to support adoption efforts, it also raises several questions regarding its implementation, particularly around the definitions of eligible expenses. Lawmakers have expressed concerns about distinguishing legitimate adoption expenses from potential misuse of funds. Moreover, the requirement for financial institutions to handle these accounts without strict oversight on the use of funds could lead to compliance challenges. This lack of tracking could raise accountability issues for the funds deposited and withdrawn from these accounts, which is a significant point of contention among some legislators.

Latest SB494 Activity

Companion Bills

No companion bills found.

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