Bill Text: OH HB408 | 2013-2014 | 130th General Assembly | Engrossed

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Bill Title: To authorize an income tax credit for donations to the permanent endowment fund of an eligible community foundation and to require the Director of Budget and Management to reimburse the Local Government Fund and the Public Library Fund for revenue lost because of the credit.

Spectrum: Moderate Partisan Bill (Republican 31-6)

Status: (Engrossed - Dead) 2014-03-13 - To Finance [HB408 Detail]

Download: Ohio-2013-HB408-Engrossed.html

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As Passed by the House

130th General Assembly Regular Session 2013-2014

Sub. H. B. No. 408

Representatives Sears, Amstutz 

Cosponsors: Representatives Burkley, Duffey, Ruhl, McGregor, Baker, Stebelton, Sprague, Brenner, Derickson, Romanchuk, Smith, Schuring, Ashford, Antonio, Beck, Anielski, Barnes, Boose, Brown, Conditt, Dovilla, Green, Grossman, Hackett, Hall, Hayes, Hill, Johnson, Maag, McClain, Ramos, Sheehy, Terhar, Young Speaker Batchelder 

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A BILL

To amend sections 131.51 and 5747.98 and to enact

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section 5747.78 of the Revised Code to authorize

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an income tax credit for donations to the

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permanent endowment fund of an eligible community

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foundation and to require the Director of Budget

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and Management to reimburse the Local Government

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Fund and the Public Library Fund for revenue lost

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because of the credit.

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BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1.  That sections 131.51 and 5747.98 be amended and	9
section 5747.78 of the Revised Code be enacted to read as follows:	10

Sec. 131.51.  (A) On or before July 5, 2013, the tax	11
commissioner shall compute the following amounts and certify those	12
amounts to the director of budget and management:	13

(1) A percentage calculated by multiplying one hundred by the	14
quotient obtained by dividing the total amount credited to the	15
local government fund in fiscal year 2013 by the total amount of	16
tax revenue credited to the general revenue fund in fiscal year	17
2013. The percentage shall be rounded to the nearest one-hundredth	18
of one per cent.	19

(2) A percentage calculated by multiplying one hundred by the	20
quotient obtained by dividing the total amount credited to the	21
public library fund in fiscal year 2013 by the total amount of tax	22
revenue credited to the general revenue fund in fiscal year 2013.	23
The percentage shall be rounded to the nearest one-hundredth of	24
one per cent.	25

(B) On or before the seventh day of each month, the director	26
of budget and management shall credit to the local government fund	27
an amount equal to the product obtained by multiplying the	28
percentage calculated under division (A)(1) of this section by the	29
total tax revenue credited to the general revenue fund during the	30
preceding month. In determining the total tax revenue credited to	31
the general revenue fund during the preceding month, the director	32
shall include amounts transferred from the fund during the	33
preceding month under this division and division (C) of this	34
section. Money shall be distributed from the local government fund	35
as required under section 5747.50 of the Revised Code during the	36
same month in which it is credited to the fund.	37

(C) On or before the seventh day of each month, the director	38
of budget and management shall credit to the public library fund	39
an amount equal to the product obtained by multiplying the	40
percentage calculated under division (A)(2) of this section by the	41
total tax revenue credited to the general revenue fund during the	42
preceding month. In determining the total tax revenue credited to	43
the general revenue fund during the preceding month, the director	44
shall include amounts transferred from the fund during the	45
preceding month under this division and division (B) of this	46
section. Money shall be distributed from the public library fund	47
as required under section 5747.47 of the Revised Code during the	48
same month in which it is credited to the fund.	49

(D)(1) On or before the seventh day of each June, the	50
director of budget and management shall credit to the local	51
government fund an amount equal to the product obtained by	52
multiplying the percentage calculated under division (A)(1) of	53
this section by the aggregate amount of credits claimed by	54
taxpayers under section 5747.78 of the Revised Code for taxable	55
years ending during the preceding year.	56

(2) On or before the seventh day of each June, the director	57
of budget and management shall credit to the public library fund	58
an amount equal to the product obtained by multiplying the	59
percentage calculated under division (A)(2) of this section by the	60
aggregate amount of credits claimed by taxpayers under section	61
5747.78 of the Revised Code for taxable years ending during the	62
preceding year.	63

(3) The tax commissioner shall provide any information to the	64
director that the director requires to perform the duties required	65
by division (D) of this section.	66

(E) The director of budget and management shall develop a	67
schedule identifying the specific tax revenue sources to be used	68
to make the monthly transfers required under divisions (B) and (C)	69
of this section and the annual transfers required under division	70
(D) of this section. The director may, from time to time, revise	71
the schedule as the director considers necessary.	72

Sec. 5747.78.  (A)(1) "Eligible community foundation" means a	73
qualified community foundation as defined in section 2109.303 of	74
the Revised Code that has been accredited by the community	75
foundations national standards board.	76

(2) "Authorized donation" means a donation authorized by the	77
department of taxation and made to a permanent endowment fund of	78
an eligible community foundation within sixty days after the date	79
of authorization by the department.	80

(3) "Donation" means an irrevocable gift of cash or publicly	81
traded securities.	82

(4) "Permanent endowment fund" means a fund that is held in	83
perpetuity by an eligible community foundation, that is used for	84
the benefit of charitable causes in this state, and that has an	85
annual spending rate of five per cent or less.	86

(B) A nonrefundable credit is allowed against the tax imposed	87
by section 5747.02 of the Revised Code for a taxpayer that makes	88
an authorized donation to a permanent endowment fund of an	89
eligible community foundation in a taxable year beginning on or	90
after January 1, 2014, and before January 1, 2019. For total	91
authorized donations during a taxpayer's taxable year of less than	92
one thousand dollars, the credit shall equal fifty per cent of the	93
authorized donations. For total authorized donations during a	94
taxpayer's taxable year of one thousand dollars or more, the	95
credit shall equal twenty per cent of the amount of the authorized	96
donations made during the taxable year, not to exceed ten thousand	97
dollars in the case of an individual return or twenty thousand	98
dollars in the case of a joint return.	99

The credit shall be claimed in the order required under	100
section 5747.98 of the Revised Code. The amount of the credit may	101
not exceed the tax otherwise due after allowing for all other	102
credits in that order. The taxpayer may carry forward any balance	103
of the credit in excess of the amount claimed for up to five	104
ensuing taxable years, and shall deduct any amount claimed for	105
such a year from the amount claimed in any ensuing year.	106

(C) Before making a donation, a taxpayer shall apply to the	107
department of taxation for authorization of the donation in the	108
manner prescribed by the department. The department shall approve	109
or deny the application and shall issue written notice of the	110
department's decision to the taxpayer within twenty days after	111
receiving the application. The department shall review	112
applications in the order in which the applications are received.	113

The department shall approve an application if the taxpayer	114
agrees to make a donation to a permanent endowment fund of an	115
eligible community foundation and if the total annual credit limit	116
has not been reached. If the application is approved, the	117
department's notice shall indicate the amount of the credit	118
authorized. If the donation is not received by the intended	119
recipient eligible community foundation within sixty days after	120
the date of the approval, the eligible community foundation shall	121
so notify the department, and the department shall deduct the	122
amount of the authorized credit from the total amount of credits	123
the agency has authorized for the purpose of determining whether	124
the total annual credit limit has been reached. If the donation is	125
received within sixty days after the date of approval, the	126
recipient eligible community foundation shall issue a receipt to	127
the taxpayer. For the purposes of this division, the "total annual	128
credit limit" equals twenty million dollars each calendar year.	129

(D) The department of taxation is authorized to charge a	130
reasonable fee for the filing of an application under division (C)	131
of this section to defray the costs of processing the application	132
and administering this section.	133

(E) The tax commissioner shall request from each eligible	134
community foundation for which the commissioner approves an	135
application under division (C) of this section a report from the	136
foundation of the total amount of all donations the foundation	137
received in the preceding calendar or foundation fiscal year and	138
the number of donations received in that period in each of the	139
following ranges: less than five hundred dollars, five hundred to	140
one thousand dollars, more than one thousand dollars to two	141
thousand five hundred dollars, more than two thousand five hundred	142
dollars to five thousand dollars, more than five thousand dollars	143
to ten thousand dollars, and more than ten thousand dollars. The	144
commissioner may disapprove applications under division (C) of	145
this section for donations to any eligible community foundation	146
that fails to comply with the commissioner's request within ninety	147
days after the request is made.	148

(F) Not later than the last day of June 2015, 2016, 2017,	149
2018, and 2019, the tax commissioner shall prepare a report	150
showing, for the twelve-month period ending with the preceding	151
April, the number of authorized donations for which a credit was	152
claimed under this section, the total amount of such donations,	153
and the amount of credits granted for such donations. Each of the	154
reports prepared in 2016, 2017, 2018, and 2019 shall include that	155
information from each report prepared under this division for	156
preceding years.	157

The commissioner shall submit copies of the report to the	158
governor, the office of budget and management, the president and	159
minority leader of the senate, the speaker and minority leader of	160
the house of representatives, and the chairpersons and ranking	161
members of the standing committees primarily responsible for	162
appropriations and for taxation.	163

(G) The department of taxation shall adopt rules as necessary	164
to implement this section.	165

Sec. 5747.98.  (A) To provide a uniform procedure for	166
calculating the amount of tax due under section 5747.02 of the	167
Revised Code, a taxpayer shall claim any credits to which the	168
taxpayer is entitled in the following order:	169

(1) The retirement income credit under division (B) of	170
section 5747.055 of the Revised Code;	171

(2) The senior citizen credit under division (C) of section	172
5747.05 of the Revised Code;	173

(3) The lump sum distribution credit under division (D) of	174
section 5747.05 of the Revised Code;	175

(4) The dependent care credit under section 5747.054 of the	176
Revised Code;	177

(5) The lump sum retirement income credit under division (C)	178
of section 5747.055 of the Revised Code;	179

(6) The lump sum retirement income credit under division (D)	180
of section 5747.055 of the Revised Code;	181

(7) The lump sum retirement income credit under division (E)	182
of section 5747.055 of the Revised Code;	183

(8) The low-income credit under section 5747.056 of the	184
Revised Code;	185

(9) The credit for displaced workers who pay for job training	186
under section 5747.27 of the Revised Code;	187

(10) The campaign contribution credit under section 5747.29	188
of the Revised Code;	189

(11) The twenty-dollar personal exemption credit under	190
section 5747.022 of the Revised Code;	191

(12) The joint filing credit under division (G) of section	192
5747.05 of the Revised Code;	193

(13) The nonresident credit under division (A) of section	194
5747.05 of the Revised Code;	195

(14) The credit for a resident's out-of-state income under	196
division (B) of section 5747.05 of the Revised Code;	197

(15) The earned income credit under section 5747.71 of the	198
Revised Code;	199

(16) The credit for employers that reimburse employee child	200
care expenses under section 5747.36 of the Revised Code;	201

(17) The credit for adoption of a minor child under section	202
5747.37 of the Revised Code;	203

(18) The credit for purchases of lights and reflectors under	204
section 5747.38 of the Revised Code;	205

(19) The nonrefundable job retention credit under division	206
(B) of section 5747.058 of the Revised Code;	207

(20) The credit for selling alternative fuel under section	208
5747.77 of the Revised Code;	209

(21) The second credit for purchases of new manufacturing	210
machinery and equipment and the credit for using Ohio coal under	211
section 5747.31 of the Revised Code;	212

(22) The job training credit under section 5747.39 of the	213
Revised Code;	214

(23) The enterprise zone credit under section 5709.66 of the	215
Revised Code;	216

(24) The credit for the eligible costs associated with a	217
voluntary action under section 5747.32 of the Revised Code;	218

(25) The credit for employers that establish on-site child	219
day-care centers under section 5747.35 of the Revised Code;	220

(26) The ethanol plant investment credit under section	221
5747.75 of the Revised Code;	222

(27) The credit for donations to a permanent endowment fund	223
of an eligible community foundation under section 5747.78 of the	224
Revised Code;	225

(28) The credit for purchases of qualifying grape production	226
property under section 5747.28 of the Revised Code;	227

(28)(29) The small business investment credit under section	228
5747.81 of the Revised Code;	229

(29)(30) The enterprise zone credits under section 5709.65 of	230
the Revised Code;	231

(30)(31) The research and development credit under section	232
5747.331 of the Revised Code;	233

(31)(32) The credit for rehabilitating a historic building	234
under section 5747.76 of the Revised Code;	235

(32)(33) The refundable credit for rehabilitating a historic	236
building under section 5747.76 of the Revised Code;	237

(33)(34) The refundable jobs creation credit or job retention	238
credit under division (A) of section 5747.058 of the Revised Code;	239

(34)(35) The refundable credit for taxes paid by a qualifying	240
entity granted under section 5747.059 of the Revised Code;	241

(35)(36) The refundable credits for taxes paid by a	242
qualifying pass-through entity granted under division (J) of	243
section 5747.08 of the Revised Code;	244

(36)(37) The refundable credit under section 5747.80 of the	245
Revised Code for losses on loans made to the Ohio venture capital	246
program under sections 150.01 to 150.10 of the Revised Code;	247

(37)(38) The refundable motion picture production credit	248
under section 5747.66 of the Revised Code.;	249

(38)(39) The refundable credit for financial institution	250
taxes paid by a pass-through entity granted under section 5747.65	251
of the Revised Code.	252

(B) For any credit, except the refundable credits enumerated	253
in this section and the credit granted under division (I) of	254
section 5747.08 of the Revised Code, the amount of the credit for	255
a taxable year shall not exceed the tax due after allowing for any	256
other credit that precedes it in the order required under this	257
section. Any excess amount of a particular credit may be carried	258
forward if authorized under the section creating that credit.	259
Nothing in this chapter shall be construed to allow a taxpayer to	260
claim, directly or indirectly, a credit more than once for a	261
taxable year.	262

Section 2.  That existing sections 131.51 and 5747.98 of the	263
Revised Code are hereby repealed.	264