Kansas 2023-2024 Regular Session

Kansas Senate Bill SB494 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	Session of 2024
2	2	SENATE BILL No. 494
3	3	By Committee on Assessment and Taxation
4	4	2-8
5	5	AN ACT concerning adoption; relating to the expenses thereof; enacting
6	6	the adoption savings account act; allowing individuals to establish
7	7	adoption savings accounts with certain financial institutions; providing
8	8	eligible expenses, requirements and restrictions for such accounts;
9	9	requiring the secretary of revenue to adopt certain rules and
10	10	regulations; granting nonexclusive marketing authority to the state
11	11	treasurer; establishing addition and subtraction modifications for
12	12	contributions to such accounts under the Kansas income tax act;
13	13	amending K.S.A. 2023 Supp. 79-32,117 and repealing the existing
14	14	section.
15	15	Be it enacted by the Legislature of the State of Kansas:
16	16	New Section 1. The provisions of sections 1 through 7, and
17	17	amendments thereto, shall be known and may be cited as the adoption
18	18	savings account act.
19	19	New Sec. 2. As used in this act:
20	20	(a) "Act" means the adoption savings account act.
21	21	(b) "Account" or "adoption savings account" means an individual
22	22	savings account established in accordance with the provisions of this act.
23	23	(c) "Account holder" means an individual who establishes an account
24	24	that is designated as an adoption savings account pursuant to the
25	25	provisions of section 3, and amendments thereto, with a financial
26	26	institution.
27	27	(d) "Designated beneficiary" means the individual designated by an
28	28	account holder pursuant to the provisions of section 3, and amendments
29	29	thereto, as the individual whose eligible expenses are expected to be paid
30	30	from the account for the adoption of a child in this state.
31	31	(e) "Eligible expenses" means:
32	32	(1) Reasonable fees for legal and other professional services rendered
33	33	in connection with an adoption or placement for adoption not to exceed
34	34	customary fees for similar services by professionals of equivalent
35	35	experience and reputation where the services are performed;
36	36	(2) reasonable fees of a licensed child-placing agency;
37	37	(3) actual and necessary expenses incidental to the adoption or
38	38	placement proceeding;
39	39	(4) actual medical expenses of the mother attributable to pregnancy
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76	76	and birth;
77	77	(5) actual medical expenses of the child; and
78	78	(6) reasonable living expenses of the mother that are incurred during
79	79	or as a result of the pregnancy.
80	80	(f) "Financial institution" means any state or federally chartered bank,
81	81	trust company, savings and loan association or credit union that is:
82	82	(1) Authorized to do business in this state; and
83	83	(2) insured by the federal deposit insurance corporation or the
84	84	national credit union administration.
85	85	(g) "Secretary" means the secretary of revenue.
86	86	New Sec. 3. (a) On and after July 1, 2025, any individual may open
87	87	an account with a financial institution and designate the account, in its
88	88	entirety, as an adoption savings account to be used to pay or reimburse a
89	89	designated beneficiary's eligible expenses for the adoption of a child in this
90	90	state. An individual may be the account holder of multiple accounts and an
91	91	individual may jointly own the account with another individual if such
92	92	individuals file a joint income tax return. An account holder shall comply
93	93	with the requirements of this act to be eligible for the modifications set
94	94	forth in K.S.A. 79-32,117, and amendments thereto.
95	95	(b) (1) An account holder shall designate, not later than April 15 of
96	96	the year following the taxable year during which the account is
97	97	established, a prospective adoptive parent as the designated beneficiary of
98	98	the account. Nothing in this section shall prohibit an account holder from
99	99	designating such account holder as the designated beneficiary of an
100	100	account. An account holder may change the designated beneficiary at any
101	101	time, but no account shall have more than one designated beneficiary at
102	102	any time. An individual may be designated as the designated beneficiary of
103	103	more than one account if such accounts are held by separate account
104	104	holders. No account holder shall be authorized to designate the same
105	105	designated beneficiary on multiple accounts held by such account owner.
106	106	(2) The naming of a designated beneficiary shall not create a
107	107	survivorship interest in the account for such designated beneficiary. In the
108	108	event of the death of an account holder, the balance of such account shall
109	109	be paid to the payable on death beneficiary in accordance with K.S.A. 9-
110	110	1215, and amendments thereto, or, in the absence of a named payable on
111	111	death beneficiary, in accordance with the provisions of the Kansas probate
112	112	code.
113	113	(c) (1) The following limits apply to an account established pursuant
114	114	to this act:
115	115	(A) The maximum contribution to an account in any tax year shall be
116	116	$3,000 for an individual and $6,000 for a married couple filing a joint
117	117	return;
118	118	(B) the maximum amount of all contributions into an account in all
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162	162	tax years shall be $24,000 for an individual and $48,000 for a married
163	163	couple filing a joint return; and
164	164	(C) the maximum total amount in an account shall be $50,000.
165	165	(2) If a limit in paragraph (1) is exceeded, then thereafter all interest
166	166	or other income earned on the investment of moneys in an account shall be
167	167	subject to the tax imposed by the Kansas income tax act.
168	168	(3) Moneys may remain in an account for an unlimited duration
169	169	without the interest or income being subject to recapture or penalty.
170	170	(d) The account holder shall not use moneys in an account to pay
171	171	expenses of administering the account, except that a service fee may be
172	172	deducted from the account by a financial institution. The account holder
173	173	shall be responsible for maintaining documentation for the account and for
174	174	eligible expenses related to the designated beneficiary's adoption of a child
175	175	in this state.
176	176	New Sec. 4. (a) The moneys in an adoption savings account may be:
177	177	(1) Used for eligible expenses related to a designated beneficiary's
178	178	adoption of a child in this state;
179	179	(2) used for eligible expenses that would have qualified pursuant to
180	180	paragraph (1) but the adoption was not completed;
181	181	(3) transferred to another newly created account;
182	182	(4) invested in certificates of deposit; and
183	183	(5) used to pay service fees assessed by the financial institution.
184	184	(b) Moneys withdrawn from an account shall be subject to recapture
185	185	by the secretary in the tax year in which they were withdrawn if:
186	186	(1) At the time of the withdrawal, it has been less than a year since
187	187	the first deposit in the account; or
188	188	(2) the moneys are used for any purpose other than the expenses or
189	189	transactions authorized pursuant to subsection (a)(1).
190	190	(c) Moneys that are subject to recapture shall be an amount equal to
191	191	the moneys withdrawn from an account and shall be added to the Kansas
192	192	adjusted gross income pursuant to K.S.A. 79-32,117(b), and amendments
193	193	thereto, of the account holder or, if the account holder is no longer living,
194	194	the designated beneficiary. If any moneys are subject to recapture, the
195	195	account holder shall pay a penalty in the following amounts:
196	196	(1) If the withdrawal of moneys occurred 10 or less years after the
197	197	first deposit in the account, 5% of the amount subject to recapture; and
198	198	(2) if the withdrawal of moneys occurred more than 10 years after the
199	199	first deposit in the account, 10% of the amount subject to recapture.
200	200	(d) The penalties provided in subsection (c) shall not apply if the
201	201	withdrawn moneys are:
202	202	(1) Used for eligible expenses related to a designated beneficiary's
203	203	adoption outside of this state; or
204	204	(2) from an account after the death of the designated beneficiary, and
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248	248	the account holder did not designate a new designated beneficiary during
249	249	the same tax year.
250	250	(e) If the account holder dies or, if the account is jointly owned and
251	251	the account owners die, and the account does not have a surviving payable
252	252	on death beneficiary, then all of the moneys in the account resulting from
253	253	contributions or income earned from assets in the account shall be subject
254	254	to recapture in the tax year of the death or deaths pursuant to K.S.A. 79-
255	255	32,117, and amendments thereto, but no penalty shall be assessed pursuant
256	256	to subsection (c).
257	257	New Sec. 5. (a) The secretary shall establish forms for an account
258	258	holder to annually report information about any accounts held by such
259	259	account holder. An account holder shall annually file with the account
260	260	holder's state income tax return all forms required by the secretary under
261	261	this section, the form 1099 for the account issued by the financial
262	262	institution and any other supporting documentation the secretary requires.
263	263	(b) Prior to July 1, 2025, the secretary shall adopt rules and
264	264	regulations necessary to administer the provisions of this act.
265	265	New Sec. 6. (a) No financial institution shall be required to:
266	266	(1) Designate an account as an adoption savings account or designate
267	267	the beneficiaries of an account in the financial institution's account
268	268	contracts or systems or in any other way;
269	269	(2) track the use of moneys withdrawn from an account; or
270	270	(3) report any information to the department of revenue or any other
271	271	governmental agency that is not otherwise required by law.
272	272	(b) No financial institution shall be responsible or liable for:
273	273	(1) Determining or ensuring that an account holder is eligible for a
274	274	Kansas adjusted gross income modification pursuant to K.S.A. 79-32,117,
275	275	and amendments thereto;
276	276	(2) determining or ensuring that moneys in the account are used for
277	277	eligible expenses; or
278	278	(3) reporting or remitting taxes or penalties related to the use of
279	279	account moneys.
280	280	(c) A financial institution may rely on such financial institution's
281	281	account records for determining a payable on death beneficiary for an
282	282	adoption savings account. If the payable on death beneficiary in a financial
283	283	institution's account records conflicts with the designated beneficiary on
284	284	any form required by the secretary pursuant to this act, the payable on
285	285	death beneficiary in such financial institution's account records shall
286	286	control.
287	287	New Sec. 7. The state treasurer may have nonexclusive authority to
288	288	market the adoption savings account program to account holders and
289	289	financial institutions throughout the state and may report on the marketing
290	290	initiatives in the state treasurer's office annual report.
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334	334	Sec. 8. K.S.A. 2023 Supp. 79-32,117 is hereby amended to read as
335	335	follows: 79-32,117. (a) The Kansas adjusted gross income of an individual
336	336	means such individual's federal adjusted gross income for the taxable year,
337	337	with the modifications specified in this section.
338	338	(b) There shall be added to federal adjusted gross income:
339	339	(i) Interest income less any related expenses directly incurred in the
340	340	purchase of state or political subdivision obligations, to the extent that the
341	341	same is not included in federal adjusted gross income, on obligations of
342	342	any state or political subdivision thereof, but to the extent that interest
343	343	income on obligations of this state or a political subdivision thereof issued
344	344	prior to January 1, 1988, is specifically exempt from income tax under the
345	345	laws of this state authorizing the issuance of such obligations, it shall be
346	346	excluded from computation of Kansas adjusted gross income whether or
347	347	not included in federal adjusted gross income. Interest income on
348	348	obligations of this state or a political subdivision thereof issued after
349	349	December 31, 1987, shall be excluded from computation of Kansas
350	350	adjusted gross income whether or not included in federal adjusted gross
351	351	income.
352	352	(ii) Taxes on or measured by income or fees or payments in lieu of
353	353	income taxes imposed by this state or any other taxing jurisdiction to the
354	354	extent deductible in determining federal adjusted gross income and not
355	355	credited against federal income tax. This paragraph shall not apply to taxes
356	356	imposed under the provisions of K.S.A. 79-1107 or 79-1108, and
357	357	amendments thereto, for privilege tax year 1995, and all such years
358	358	thereafter.
359	359	(iii) The federal net operating loss deduction, except that the federal
360	360	net operating loss deduction shall not be added to an individual's federal
361	361	adjusted gross income for tax years beginning after December 31, 2016.
362	362	(iv) Federal income tax refunds received by the taxpayer if the
363	363	deduction of the taxes being refunded resulted in a tax benefit for Kansas
364	364	income tax purposes during a prior taxable year. Such refunds shall be
365	365	included in income in the year actually received regardless of the method
366	366	of accounting used by the taxpayer. For purposes hereof, a tax benefit shall
367	367	be deemed to have resulted if the amount of the tax had been deducted in
368	368	determining income subject to a Kansas income tax for a prior year
369	369	regardless of the rate of taxation applied in such prior year to the Kansas
370	370	taxable income, but only that portion of the refund shall be included as
371	371	bears the same proportion to the total refund received as the federal taxes
372	372	deducted in the year to which such refund is attributable bears to the total
373	373	federal income taxes paid for such year. For purposes of the foregoing
374	374	sentence, federal taxes shall be considered to have been deducted only to
375	375	the extent such deduction does not reduce Kansas taxable income below
376	376	zero.
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420	420	(v) The amount of any depreciation deduction or business expense
421	421	deduction claimed on the taxpayer's federal income tax return for any
422	422	capital expenditure in making any building or facility accessible to the
423	423	handicapped, for which expenditure the taxpayer claimed the credit
424	424	allowed by K.S.A. 79-32,177, and amendments thereto.
425	425	(vi) Any amount of designated employee contributions picked up by
426	426	an employer pursuant to K.S.A. 12-5005, 20-2603, 74-4919 and 74-4965,
427	427	and amendments thereto.
428	428	(vii) The amount of any charitable contribution made to the extent the
429	429	same is claimed as the basis for the credit allowed pursuant to K.S.A. 79-
430	430	32,196, and amendments thereto.
431	431	(viii) The amount of any costs incurred for improvements to a swine
432	432	facility, claimed for deduction in determining federal adjusted gross
433	433	income, to the extent the same is claimed as the basis for any credit
434	434	allowed pursuant to K.S.A. 79-32,204, and amendments thereto.
435	435	(ix) The amount of any ad valorem taxes and assessments paid and
436	436	the amount of any costs incurred for habitat management or construction
437	437	and maintenance of improvements on real property, claimed for deduction
438	438	in determining federal adjusted gross income, to the extent the same is
439	439	claimed as the basis for any credit allowed pursuant to K.S.A. 79-32,203,
440	440	and amendments thereto.
441	441	(x) Amounts received as nonqualified withdrawals, as defined by
442	442	K.S.A. 75-643, and amendments thereto, if, at the time of contribution to a
443	443	family postsecondary education savings account, such amounts were
444	444	subtracted from the federal adjusted gross income pursuant to subsection
445	445	(c)(xv) or if such amounts are not already included in the federal adjusted
446	446	gross income.
447	447	(xi) The amount of any contribution made to the same extent the
448	448	same is claimed as the basis for the credit allowed pursuant to K.S.A. 74-
449	449	50,154, and amendments thereto.
450	450	(xii) For taxable years commencing after December 31, 2004,
451	451	amounts received as withdrawals not in accordance with the provisions of
452	452	K.S.A. 74-50,204, and amendments thereto, if, at the time of contribution
453	453	to an individual development account, such amounts were subtracted from
454	454	the federal adjusted gross income pursuant to subsection (c)(xiii), or if
455	455	such amounts are not already included in the federal adjusted gross
456	456	income.
457	457	(xiii) The amount of any expenditures claimed for deduction in
458	458	determining federal adjusted gross income, to the extent the same is
459	459	claimed as the basis for any credit allowed pursuant to K.S.A. 79-32,217
460	460	through 79-32,220 or 79-32,222, and amendments thereto.
461	461	(xiv) The amount of any amortization deduction claimed in
462	462	determining federal adjusted gross income to the extent the same is
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506	506	claimed for deduction pursuant to K.S.A. 79-32,221, and amendments
507	507	thereto.
508	508	(xv) The amount of any expenditures claimed for deduction in
509	509	determining federal adjusted gross income, to the extent the same is
510	510	claimed as the basis for any credit allowed pursuant to K.S.A. 79-32,223
511	511	through 79-32,226, 79-32,228 through 79-32,231, 79-32,233 through 79-
512	512	32,236, 79-32,238 through 79-32,241, 79-32,245 through 79-32,248 or 79-
513	513	32,251 through 79-32,254, and amendments thereto.
514	514	(xvi) The amount of any amortization deduction claimed in
515	515	determining federal adjusted gross income to the extent the same is
516	516	claimed for deduction pursuant to K.S.A. 79-32,227, 79-32,232, 79-
517	517	32,237, 79-32,249, 79-32,250 or 79-32,255, and amendments thereto.
518	518	(xvii) The amount of any amortization deduction claimed in
519	519	determining federal adjusted gross income to the extent the same is
520	520	claimed for deduction pursuant to K.S.A. 79-32,256, and amendments
521	521	thereto.
522	522	(xviii) For taxable years commencing after December 31, 2006, the
523	523	amount of any ad valorem or property taxes and assessments paid to a state
524	524	other than Kansas or local government located in a state other than Kansas
525	525	by a taxpayer who resides in a state other than Kansas, when the law of
526	526	such state does not allow a resident of Kansas who earns income in such
527	527	other state to claim a deduction for ad valorem or property taxes or
528	528	assessments paid to a political subdivision of the state of Kansas in
529	529	determining taxable income for income tax purposes in such other state, to
530	530	the extent that such taxes and assessments are claimed as an itemized
531	531	deduction for federal income tax purposes.
532	532	(xix) For taxable years beginning after December 31, 2012, and
533	533	ending before January 1, 2017, the amount of any: (1) Loss from business
534	534	as determined under the federal internal revenue code and reported from
535	535	schedule C and on line 12 of the taxpayer's form 1040 federal individual
536	536	income tax return; (2) loss from rental real estate, royalties, partnerships, S
537	537	corporations, except those with wholly owned subsidiaries subject to the
538	538	Kansas privilege tax, estates, trusts, residual interest in real estate
539	539	mortgage investment conduits and net farm rental as determined under the
540	540	federal internal revenue code and reported from schedule E and on line 17
541	541	of the taxpayer's form 1040 federal individual income tax return; and (3)
542	542	farm loss as determined under the federal internal revenue code and
543	543	reported from schedule F and on line 18 of the taxpayer's form 1040
544	544	federal income tax return; all to the extent deducted or subtracted in
545	545	determining the taxpayer's federal adjusted gross income. For purposes of
546	546	this subsection, references to the federal form 1040 and federal schedule
547	547	C, schedule E, and schedule F, shall be to such form and schedules as they
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592	592	service.
593	593	(xx) For taxable years beginning after December 31, 2012, and
594	594	ending before January 1, 2017, the amount of any deduction for self-
595	595	employment taxes under section 164(f) of the federal internal revenue
596	596	code as in effect on January 1, 2012, and amendments thereto, in
597	597	determining the federal adjusted gross income of an individual taxpayer, to
598	598	the extent the deduction is attributable to income reported on schedule C,
599	599	E or F and on line 12, 17 or 18 of the taxpayer's form 1040 federal income
600	600	tax return.
601	601	(xxi) For taxable years beginning after December 31, 2012, and
602	602	ending before January 1, 2017, the amount of any deduction for pension,
603	603	profit sharing, and annuity plans of self-employed individuals under
604	604	section 62(a)(6) of the federal internal revenue code as in effect on January
605	605	1, 2012, and amendments thereto, in determining the federal adjusted gross
606	606	income of an individual taxpayer.
607	607	(xxii) For taxable years beginning after December 31, 2012, and
608	608	ending before January 1, 2017, the amount of any deduction for health
609	609	insurance under section 162(l) of the federal internal revenue code as in
610	610	effect on January 1, 2012, and amendments thereto, in determining the
611	611	federal adjusted gross income of an individual taxpayer.
612	612	(xxiii) For taxable years beginning after December 31, 2012, and
613	613	ending before January 1, 2017, the amount of any deduction for domestic
614	614	production activities under section 199 of the federal internal revenue code
615	615	as in effect on January 1, 2012, and amendments thereto, in determining
616	616	the federal adjusted gross income of an individual taxpayer.
617	617	(xxiv) For taxable years commencing after December 31, 2013, that
618	618	portion of the amount of any expenditure deduction claimed in
619	619	determining federal adjusted gross income for expenses paid for medical
620	620	care of the taxpayer or the taxpayer's spouse or dependents when such
621	621	expenses were paid or incurred for an abortion, or for a health benefit plan,
622	622	as defined in K.S.A. 65-6731, and amendments thereto, for the purchase of
623	623	an optional rider for coverage of abortion in accordance with K.S.A. 40-
624	624	2,190, and amendments thereto, to the extent that such taxes and
625	625	assessments are claimed as an itemized deduction for federal income tax
626	626	purposes.
627	627	(xxv) For taxable years commencing after December 31, 2013, that
628	628	portion of the amount of any expenditure deduction claimed in
629	629	determining federal adjusted gross income for expenses paid by a taxpayer
630	630	for health care when such expenses were paid or incurred for abortion
631	631	coverage, a health benefit plan, as defined in K.S.A. 65-6731, and
632	632	amendments thereto, when such expenses were paid or incurred for
633	633	abortion coverage or amounts contributed to health savings accounts for
634	634	such taxpayer's employees for the purchase of an optional rider for
635	635	1
636	636	2
637	637	3
638	638	4
639	639	5
640	640	6
641	641	7
642	642	8
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664	664	30
665	665	31
666	666	32
667	667	33
668	668	34
669	669	35
670	670	36
671	671	37
672	672	38
673	673	39
674	674	40
675	675	41
676	676	42
677	677	43 SB 494 9
678	678	coverage of abortion in accordance with K.S.A. 40-2,190, and
679	679	amendments thereto, to the extent that such taxes and assessments are
680	680	claimed as a deduction for federal income tax purposes.
681	681	(xxvi) For all taxable years beginning after December 31, 2016, the
682	682	amount of any charitable contribution made to the extent the same is
683	683	claimed as the basis for the credit allowed pursuant to K.S.A. 72-4357, and
684	684	amendments thereto, and is also claimed as an itemized deduction for
685	685	federal income tax purposes.
686	686	(xxvii) For all taxable years commencing after December 31, 2020,
687	687	the amount deducted by reason of a carryforward of disallowed business
688	688	interest pursuant to section 163(j) of the federal internal revenue code of
689	689	1986, as in effect on January 1, 2018.
690	690	(xxviii) For all taxable years beginning after December 31, 2021, the
691	691	amount of any contributions to, or earnings from, a first-time home buyer
692	692	savings account if distributions from the account were not used to pay for
693	693	expenses or transactions authorized pursuant to K.S.A. 2023 Supp. 58-
694	694	4904, and amendments thereto, or were not held for the minimum length
695	695	of time required pursuant to K.S.A. 2023 Supp. 58-4904, and amendments
696	696	thereto. Contributions to, or earnings from, such account shall also include
697	697	any amount resulting from the account holder not designating a surviving
698	698	payable on death beneficiary pursuant to K.S.A. 2023 Supp. 58-4904(e),
699	699	and amendments thereto.
700	700	(xxix) For all taxable years beginning after December 31, 2024, the
701	701	amount of any contributions to, or earnings from, an adoption savings
702	702	account if distributions from the account were not used to pay for expenses
703	703	or transactions authorized pursuant to section 4, and amendments thereto,
704	704	or were not held for the minimum length of time required pursuant to
705	705	section 4, and amendments thereto. Contributions to, or earnings from,
706	706	such account shall also include any amount resulting from the account
707	707	holder not designating a surviving payable on death beneficiary pursuant
708	708	to section 4(e), and amendments thereto.
709	709	(c) There shall be subtracted from federal adjusted gross income:
710	710	(i) Interest or dividend income on obligations or securities of any
711	711	authority, commission or instrumentality of the United States and its
712	712	possessions less any related expenses directly incurred in the purchase of
713	713	such obligations or securities, to the extent included in federal adjusted
714	714	gross income but exempt from state income taxes under the laws of the
715	715	United States.
716	716	(ii) Any amounts received which are included in federal adjusted
717	717	gross income but which are specifically exempt from Kansas income
718	718	taxation under the laws of the state of Kansas.
719	719	(iii) The portion of any gain or loss from the sale or other disposition
720	720	of property having a higher adjusted basis for Kansas income tax purposes
721	721	1
722	722	2
723	723	3
724	724	4
725	725	5
726	726	6
727	727	7
728	728	8
729	729	9
730	730	10
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736	736	16
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743	743	23
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750	750	30
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753	753	33
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757	757	37
758	758	38
759	759	39
760	760	40
761	761	41
762	762	42
763	763	43 SB 494 10
764	764	than for federal income tax purposes on the date such property was sold or
765	765	disposed of in a transaction in which gain or loss was recognized for
766	766	purposes of federal income tax that does not exceed such difference in
767	767	basis, but if a gain is considered a long-term capital gain for federal
768	768	income tax purposes, the modification shall be limited to that portion of
769	769	such gain which is included in federal adjusted gross income.
770	770	(iv) The amount necessary to prevent the taxation under this act of
771	771	any annuity or other amount of income or gain which was properly
772	772	included in income or gain and was taxed under the laws of this state for a
773	773	taxable year prior to the effective date of this act, as amended, to the
774	774	taxpayer, or to a decedent by reason of whose death the taxpayer acquired
775	775	the right to receive the income or gain, or to a trust or estate from which
776	776	the taxpayer received the income or gain.
777	777	(v) The amount of any refund or credit for overpayment of taxes on
778	778	or measured by income or fees or payments in lieu of income taxes
779	779	imposed by this state, or any taxing jurisdiction, to the extent included in
780	780	gross income for federal income tax purposes.
781	781	(vi) Accumulation distributions received by a taxpayer as a
782	782	beneficiary of a trust to the extent that the same are included in federal
783	783	adjusted gross income.
784	784	(vii) Amounts received as annuities under the federal civil service
785	785	retirement system from the civil service retirement and disability fund and
786	786	other amounts received as retirement benefits in whatever form which
787	787	were earned for being employed by the federal government or for service
788	788	in the armed forces of the United States.
789	789	(viii) Amounts received by retired railroad employees as a
790	790	supplemental annuity under the provisions of 45 U.S.C. §§ 228b(a) and
791	791	228c(a)(1) et seq.
792	792	(ix) Amounts received by retired employees of a city and by retired
793	793	employees of any board of such city as retirement allowances pursuant to
794	794	K.S.A. 13-14,106, and amendments thereto, or pursuant to any charter
795	795	ordinance exempting a city from the provisions of K.S.A. 13-14,106, and
796	796	amendments thereto.
797	797	(x) For taxable years beginning after December 31, 1976, the amount
798	798	of the federal tentative jobs tax credit disallowance under the provisions of
799	799	26 U.S.C. § 280C. For taxable years ending after December 31, 1978, the
800	800	amount of the targeted jobs tax credit and work incentive credit
801	801	disallowances under 26 U.S.C. § 280C.
802	802	(xi) For taxable years beginning after December 31, 1986, dividend
803	803	income on stock issued by Kansas venture capital, inc.
804	804	(xii) For taxable years beginning after December 31, 1989, amounts
805	805	received by retired employees of a board of public utilities as pension and
806	806	retirement benefits pursuant to K.S.A. 13-1246, 13-1246a and 13-1249,
807	807	1
808	808	2
809	809	3
810	810	4
811	811	5
812	812	6
813	813	7
814	814	8
815	815	9
816	816	10
817	817	11
818	818	12
819	819	13
820	820	14
821	821	15
822	822	16
823	823	17
824	824	18
825	825	19
826	826	20
827	827	21
828	828	22
829	829	23
830	830	24
831	831	25
832	832	26
833	833	27
834	834	28
835	835	29
836	836	30
837	837	31
838	838	32
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840	840	34
841	841	35
842	842	36
843	843	37
844	844	38
845	845	39
846	846	40
847	847	41
848	848	42
849	849	43 SB 494 11
850	850	and amendments thereto.
851	851	(xiii) For taxable years beginning after December 31, 2004, amounts
852	852	contributed to and the amount of income earned on contributions deposited
853	853	to an individual development account under K.S.A. 74-50,201 et seq., and
854	854	amendments thereto.
855	855	(xiv) For all taxable years commencing after December 31, 1996, that
856	856	portion of any income of a bank organized under the laws of this state or
857	857	any other state, a national banking association organized under the laws of
858	858	the United States, an association organized under the savings and loan
859	859	code of this state or any other state, or a federal savings association
860	860	organized under the laws of the United States, for which an election as an
861	861	S corporation under subchapter S of the federal internal revenue code is in
862	862	effect, which accrues to the taxpayer who is a stockholder of such
863	863	corporation and which is not distributed to the stockholders as dividends of
864	864	the corporation. For taxable years beginning after December 31, 2012, and
865	865	ending before January 1, 2017, the amount of modification under this
866	866	subsection shall exclude the portion of income or loss reported on schedule
867	867	E and included on line 17 of the taxpayer's form 1040 federal individual
868	868	income tax return.
869	869	(xv) For all taxable years beginning after December 31, 2017, the
870	870	cumulative amounts not exceeding $3,000, or $6,000 for a married couple
871	871	filing a joint return, for each designated beneficiary that are contributed to:
872	872	(1) A family postsecondary education savings account established under
873	873	the Kansas postsecondary education savings program or a qualified tuition
874	874	program established and maintained by another state or agency or
875	875	instrumentality thereof pursuant to section 529 of the internal revenue
876	876	code of 1986, as amended, for the purpose of paying the qualified higher
877	877	education expenses of a designated beneficiary; or (2) an achieving a
878	878	better life experience (ABLE) account established under the Kansas ABLE
879	879	savings program or a qualified ABLE program established and maintained
880	880	by another state or agency or instrumentality thereof pursuant to section
881	881	529A of the internal revenue code of 1986, as amended, for the purpose of
882	882	saving private funds to support an individual with a disability. The terms
883	883	and phrases used in this paragraph shall have the meaning respectively
884	884	ascribed thereto by the provisions of K.S.A. 75-643 and 75-652, and
885	885	amendments thereto, and the provisions of such sections are hereby
886	886	incorporated by reference for all purposes thereof.
887	887	(xvi) For all taxable years beginning after December 31, 2004,
888	888	amounts received by taxpayers who are or were members of the armed
889	889	forces of the United States, including service in the Kansas army and air
890	890	national guard, as a recruitment, sign up or retention bonus received by
891	891	such taxpayer as an incentive to join, enlist or remain in the armed services
892	892	of the United States, including service in the Kansas army and air national
893	893	1
894	894	2
895	895	3
896	896	4
897	897	5
898	898	6
899	899	7
900	900	8
901	901	9
902	902	10
903	903	11
904	904	12
905	905	13
906	906	14
907	907	15
908	908	16
909	909	17
910	910	18
911	911	19
912	912	20
913	913	21
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923	923	31
924	924	32
925	925	33
926	926	34
927	927	35
928	928	36
929	929	37
930	930	38
931	931	39
932	932	40
933	933	41
934	934	42
935	935	43 SB 494 12
936	936	guard, and amounts received for repayment of educational or student loans
937	937	incurred by or obligated to such taxpayer and received by such taxpayer as
938	938	a result of such taxpayer's service in the armed forces of the United States,
939	939	including service in the Kansas army and air national guard.
940	940	(xvii) For all taxable years beginning after December 31, 2004,
941	941	amounts received by taxpayers who are eligible members of the Kansas
942	942	army and air national guard as a reimbursement pursuant to K.S.A. 48-
943	943	281, and amendments thereto, and amounts received for death benefits
944	944	pursuant to K.S.A. 48-282, and amendments thereto, to the extent that
945	945	such death benefits are included in federal adjusted gross income of the
946	946	taxpayer.
947	947	(xviii) For the taxable year beginning after December 31, 2006,
948	948	amounts received as benefits under the federal social security act which
949	949	are included in federal adjusted gross income of a taxpayer with federal
950	950	adjusted gross income of $50,000 or less, whether such taxpayer's filing
951	951	status is single, head of household, married filing separate or married filing
952	952	jointly; and for all taxable years beginning after December 31, 2007,
953	953	amounts received as benefits under the federal social security act which
954	954	are included in federal adjusted gross income of a taxpayer with federal
955	955	adjusted gross income of $75,000 or less, whether such taxpayer's filing
956	956	status is single, head of household, married filing separate or married filing
957	957	jointly.
958	958	(xix) Amounts received by retired employees of Washburn university
959	959	as retirement and pension benefits under the university's retirement plan.
960	960	(xx) For taxable years beginning after December 31, 2012, and
961	961	ending before January 1, 2017, the amount of any: (1) Net profit from
962	962	business as determined under the federal internal revenue code and
963	963	reported from schedule C and on line 12 of the taxpayer's form 1040
964	964	federal individual income tax return; (2) net income, not including
965	965	guaranteed payments as defined in section 707(c) of the federal internal
966	966	revenue code and as reported to the taxpayer from federal schedule K-1,
967	967	(form 1065-B), in box 9, code F or as reported to the taxpayer from federal
968	968	schedule K-1, (form 1065) in box 4, from rental real estate, royalties,
969	969	partnerships, S corporations, estates, trusts, residual interest in real estate
970	970	mortgage investment conduits and net farm rental as determined under the
971	971	federal internal revenue code and reported from schedule E and on line 17
972	972	of the taxpayer's form 1040 federal individual income tax return; and (3)
973	973	net farm profit as determined under the federal internal revenue code and
974	974	reported from schedule F and on line 18 of the taxpayer's form 1040
975	975	federal income tax return; all to the extent included in the taxpayer's
976	976	federal adjusted gross income. For purposes of this subsection, references
977	977	to the federal form 1040 and federal schedule C, schedule E, and schedule
978	978	F, shall be to such form and schedules as they existed for tax year 2011
979	979	1
980	980	2
981	981	3
982	982	4
983	983	5
984	984	6
985	985	7
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987	987	9
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1019	1019	41
1020	1020	42
1021	1021	43 SB 494 13
1022	1022	and as revised thereafter by the internal revenue service.
1023	1023	(xxi) For all taxable years beginning after December 31, 2013,
1024	1024	amounts equal to the unreimbursed travel, lodging and medical
1025	1025	expenditures directly incurred by a taxpayer while living, or a dependent
1026	1026	of the taxpayer while living, for the donation of one or more human organs
1027	1027	of the taxpayer, or a dependent of the taxpayer, to another person for
1028	1028	human organ transplantation. The expenses may be claimed as a
1029	1029	subtraction modification provided for in this section to the extent the
1030	1030	expenses are not already subtracted from the taxpayer's federal adjusted
1031	1031	gross income. In no circumstances shall the subtraction modification
1032	1032	provided for in this section for any individual, or a dependent, exceed
1033	1033	$5,000. As used in this section, "human organ" means all or part of a liver,
1034	1034	pancreas, kidney, intestine, lung or bone marrow. The provisions of this
1035	1035	paragraph shall take effect on the day the secretary of revenue certifies to
1036	1036	the director of the budget that the cost for the department of revenue of
1037	1037	modifications to the automated tax system for the purpose of
1038	1038	implementing this paragraph will not exceed $20,000.
1039	1039	(xxii) For taxable years beginning after December 31, 2012, and
1040	1040	ending before January 1, 2017, the amount of net gain from the sale of: (1)
1041	1041	Cattle and horses, regardless of age, held by the taxpayer for draft,
1042	1042	breeding, dairy or sporting purposes, and held by such taxpayer for 24
1043	1043	months or more from the date of acquisition; and (2) other livestock,
1044	1044	regardless of age, held by the taxpayer for draft, breeding, dairy or
1045	1045	sporting purposes, and held by such taxpayer for 12 months or more from
1046	1046	the date of acquisition. The subtraction from federal adjusted gross income
1047	1047	shall be limited to the amount of the additions recognized under the
1048	1048	provisions of subsection (b)(xix) attributable to the business in which the
1049	1049	livestock sold had been used. As used in this paragraph, the term
1050	1050	"livestock" shall not include poultry.
1051	1051	(xxiii) For all taxable years beginning after December 31, 2012,
1052	1052	amounts received under either the Overland Park, Kansas police
1053	1053	department retirement plan or the Overland Park, Kansas fire department
1054	1054	retirement plan, both as established by the city of Overland Park, pursuant
1055	1055	to the city's home rule authority.
1056	1056	(xxiv) For taxable years beginning after December 31, 2013, and
1057	1057	ending before January 1, 2017, the net gain from the sale from Christmas
1058	1058	trees grown in Kansas and held by the taxpayer for six years or more.
1059	1059	(xxv) For all taxable years commencing after December 31, 2020,
1060	1060	100% of global intangible low-taxed income under section 951A of the
1061	1061	federal internal revenue code of 1986, before any deductions allowed
1062	1062	under section 250(a)(1)(B) of such code.
1063	1063	(xxvi) For all taxable years commencing after December 31, 2020,
1064	1064	the amount disallowed as a deduction pursuant to section 163(j) of the
1065	1065	1
1066	1066	2
1067	1067	3
1068	1068	4
1069	1069	5
1070	1070	6
1071	1071	7
1072	1072	8
1073	1073	9
1074	1074	10
1075	1075	11
1076	1076	12
1077	1077	13
1078	1078	14
1079	1079	15
1080	1080	16
1081	1081	17
1082	1082	18
1083	1083	19
1084	1084	20
1085	1085	21
1086	1086	22
1087	1087	23
1088	1088	24
1089	1089	25
1090	1090	26
1091	1091	27
1092	1092	28
1093	1093	29
1094	1094	30
1095	1095	31
1096	1096	32
1097	1097	33
1098	1098	34
1099	1099	35
1100	1100	36
1101	1101	37
1102	1102	38
1103	1103	39
1104	1104	40
1105	1105	41
1106	1106	42
1107	1107	43 SB 494 14
1108	1108	federal internal revenue code of 1986, as in effect on January 1, 2018.
1109	1109	(xxvii) For taxable years commencing after December 31, 2020, the
1110	1110	amount disallowed as a deduction pursuant to section 274 of the federal
1111	1111	internal revenue code of 1986 for meal expenditures shall be allowed to
1112	1112	the extent such expense was deductible for determining federal income tax
1113	1113	and was allowed and in effect on December 31, 2017.
1114	1114	(xxviii) For all taxable years beginning after December 31, 2021: (1)
1115	1115	The amount contributed to a first-time home buyer savings account
1116	1116	pursuant to K.S.A. 2023 Supp. 58-4903, and amendments thereto, in an
1117	1117	amount not to exceed $3,000 for an individual or $6,000 for a married
1118	1118	couple filing a joint return; or (2) amounts received as income earned from
1119	1119	assets in a first-time home buyer savings account.
1120	1120	(xxix) For all taxable years beginning after December 31, 2024: (1)
1121	1121	The amount contributed to an adoption savings account pursuant to
1122	1122	section 3, and amendments thereto, in an amount not to exceed $3,000 for
1123	1123	an individual or $6,000 for a married couple filing a joint return; or (2)
1124	1124	amounts received as income earned from assets in an adoption savings
1125	1125	account.
1126	1126	(d) There shall be added to or subtracted from federal adjusted gross
1127	1127	income the taxpayer's share, as beneficiary of an estate or trust, of the
1128	1128	Kansas fiduciary adjustment determined under K.S.A. 79-32,135, and
1129	1129	amendments thereto.
1130	1130	(e) The amount of modifications required to be made under this
1131	1131	section by a partner which relates to items of income, gain, loss, deduction
1132	1132	or credit of a partnership shall be determined under K.S.A. 79-32,131, and
1133	1133	amendments thereto, to the extent that such items affect federal adjusted
1134	1134	gross income of the partner.
1135	1135	Sec. 9. K.S.A. 2023 Supp. 79-32,117 is hereby repealed.
1136	1136	Sec. 10. This act shall take effect and be in force from and after its
1137	1137	publication in the statute book.
1138	1138	1
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