Iowa House Bill HF2471

Iowa 2023-2024 Regular Session

• Introduced: 2/12/24
• Refer: 2/12/24

Caption

A bill for an act creating an electric outdoor power equipment tax credit available against the individual and corporate income taxes, and including retroactive applicability provisions.

Impact

The bill is set to retroactively apply to purchases made on or after January 1, 2024, thus encouraging early adoption of electric outdoor power equipment. By providing a financial incentive through tax credits, HF2471 is expected to stimulate demand for electric-powered tools, potentially leading to wider adoption of environmentally friendly equipment. This initiative aligns with broader efforts to promote renewable energy use in everyday applications, contributing to environmental sustainability goals. It could also impact sales trends not only in the outdoor equipment market but also in sectors relating to renewable energy technology.

Summary

House File 2471 aims to create an electric outdoor power equipment tax credit that is applicable to individual and corporate income taxes. The legislation defines eligible equipment as battery-powered tools designed for outdoor use, including items such as lawn mowers, trimmers, and blowers. Under the bill, taxpayers can claim a credit equal to 20% of the purchase price of qualifying equipment. This tax credit is non-transferable and is capped at $5 million annually, with provisions reserving $2 million specifically for individual taxpayers. Importantly, any credits that exceed the liability for that tax year can be carried forward to the next year but are not refundable.

Contention

Discussions surrounding HF2471 may arise concerning its financial implications for the state, particularly in regard to the $5 million cap on tax credits. Advocates for the bill argue that the tax credit will incentivize the use of eco-friendly tools and reduce the carbon footprint associated with traditional gas-powered equipment. However, critics may express concerns about the sustainability of such tax incentives amidst budgetary constraints. The bill's potential impact on lowering emissions could be debated, as environmental groups will likely weigh in on whether the benefits of increased electric tool usage justify the cost of tax credits.