SECOND REGULAR SESSION
HOUSE COMMITTEE SUBSTITUTE FOR
HOUSE BILL NO. 1407
91ST GENERAL ASSEMBLY
TED WEDEL, Chief Clerk
AN ACT
To amend chapter 135, RSMo, by adding thereto one new section relating solely to the creation of an earned income tax credit.
Section A. Chapter 135, RSMo, is amended by adding thereto one new section, to be known as section 135.760, to read as follows:
135.760. 1. Unless as provided in subsection 4 of this section, for all taxable years beginning on or after January 1, 2005, a resident individual who is allowed a federal earned income tax credit pursuant to Section 32 of the Internal Revenue Code shall be allowed a credit against the tax otherwise due pursuant to chapter 143, RSMo, not including sections 143.191 to 143.265, RSMo, in an amount equal to five percent of the allowable federal earned income tax credit. For all taxable years beginning on or after January 1, 2007, a resident individual who is allowed a federal earned income tax credit pursuant to Section 32 of the Internal Revenue Code shall be allowed a credit against the tax otherwise due pursuant to chapter 143, RSMo, not including sections 143.191 to 143.265, RSMo, in an amount equal to ten percent of the allowable federal earned income tax credit. For all taxable years beginning on or after January 1, 2009, a resident individual who is allowed a federal earned income tax credit pursuant to Section 32 of the Internal Revenue Code shall be allowed a credit against the tax otherwise due pursuant to chapter 143, RSMo, not including sections 143.191 to 143.265, RSMo, in an amount equal to fifteen percent of the allowable federal earned income tax credit. For all taxable years beginning on or after January 1, 2011, a resident individual who is allowed a federal earned income tax credit pursuant to Section 32 of the Internal Revenue Code shall be allowed a credit against the tax otherwise due pursuant to chapter 143, RSMo, not including sections 143.191 to 143.265, RSMo, in an amount equal to twenty percent of the allowable federal earned income tax credit. The tax credit allowed by this section shall be claimed by such individual at the time such individual files a return and shall be applied against the income tax liability imposed by chapter 143, RSMo. Where the amount of the credit exceeds the tax liability, the difference shall be refunded to the taxpayer or carried forward into each subsequent taxable year until such credit is fully used.
2. The director of the department of revenue shall promulgate rules and regulations to administer the provisions of this section. No rule or portion of a rule promulgated pursuant to the authority of this section shall become effective unless it has been promulgated pursuant to chapter 536, RSMo.
3. Notwithstanding the provision of subsection 4 of section 32.057, RSMo, the department of revenue or any duly authorized employee or agent shall determine whether any taxpayer filing a report or return with the department of revenue who has not applied for the credit allowed pursuant to this section may qualify for the credit, and shall notify any qualified claimant of the claimant's potential eligibility, where the department determines such potential eligibility exists.
4. If, prior to January 1, 2005, and every year thereafter, the general assembly determines that state revenues are
not sufficient to pay for the credit authorized by this section, the general assembly may delay the implementation of
the credit by one year by passage of a concurrent resolution specifically authorizing the delay. The concurrent
resolution shall state the new implementation date of the credit, not to exceed one year. If the general assembly fails
to pass a concurrent resolution as provided in this subsection, the credit will become fully implemented and this
subsection shall no longer apply.
Missouri House of Representatives