Department of Finance and Administration
Legislative Impact Statement
Bill: HB1422
Bill Subtitle: TO ENACT THE PRECEPTOR TAX INCENTIVE PROGRAM; AND TO PROVIDE
INCENTIVES FOR CERTAIN MEDICAL OR COUNSELING PROFESSIONALS TO TRAIN
STUDENTS WHO ARE LEARNING TO BECOME MEDICAL OR COUNSELING PROFESSIONALS.
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Basic Change :
Sponsor: Rep. L. Johnson
HB1422 creates a refundable income tax credit for a faculty preceptor who provides qualifying
preceptorship rotations to certain medical, nursing, or counseling students.
An individual who can serve as a faculty preceptor for purposes of the income tax credit includes a:
 Physician licensed by the Arkansas State Medical Board;
 Registered nurse, advanced practice registered nurse, or registered nurse practitioner licensed by
the Arkansas State Board of Nursing;
 Physician assistant licensed by the Arkansas State Medical Board; or
 Professional counselor, associate counselor, or marriage and family counselor licensed by the
Arkansas Board of Examiners in Counseling.
HB1422 defines a "preceptorship rotation" as community-based preceptorship training of at least 160
hours.
HB1422 defines an "uncompensated faculty preceptor" as a faculty preceptor who provides a
preceptorship rotation and receives no financial remuneration for conducting the preceptorship rotation.
The bill provides an uncompensated faculty preceptor a tax credit in the amount of $1,000 per student
during a calendar year with a maximum tax credit of $10,000 per year.
HB1422 defines a "compensated faculty preceptor" as a faculty preceptor who provides a
preceptorship rotation and receives payment as an independent contractor for conducting the
preceptorship rotation. The bill provides a compensated faculty preceptor a tax credit in an amount
equal to the amount the taxpayer received as compensation for conducting the preceptor training with
a maximum tax credit of $6,000 per year.
HB1422 is effective for tax years beginning on or after January 1, 2023.
Revenue Impact :
FY2024 - $1 million General Revenue Reduction
Taxpayer Impact :
An uncompensated faculty preceptor will be allowed a refundable income tax credit in the amount of
$1,000 per student who participated in preceptor training during the calendar year up to a total of
$10,000 in credits per year. A compensated faculty preceptor will be allowed an income tax credit in an
amount equal to compensation received for preceptor training, not to exceed $6,000 per year. A
taxpayer will be required to maintain records documenting medical or counseling licensure, preceptor
contracts with educations institutions, preceptor rotations and document qualified students.
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 Department of Finance and Administration
Legislative Impact Statement
Bill: HB1422
Bill Subtitle: TO ENACT THE PRECEPTOR TAX INCENTIVE PROGRAM; AND TO PROVIDE
INCENTIVES FOR CERTAIN MEDICAL OR COUNSELING PROFESSIONALS TO TRAIN
STUDENTS WHO ARE LEARNING TO BECOME MEDICAL OR COUNSELING PROFESSIONALS.
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Resources Required :
Computer programs, tax forms, and instructions would need to be created. The Arkansas Integrated
Revenue System (AIRS) will require programming for a new income tax credit at an estimated cost of
$32,000. The Tax Credits Section of the Department of Finance and Administration (DFA) would
require additional staff to review a preceptor's medical licensure, to confirm medical or counseling
student enrollment in an Arkansas training program, to verify preceptorship rotations encompassed a
minimum of 160 hours, and to award tax credits. Anticipated personnel cost totaling $49,739.22 per
year for one Tax Auditor.
Time Required :
Adequate time is provided for implementation.
Procedural Changes :
Department employees will need to be educated as to the tax credit as well as the tax community.
Rules for establishing credit eligibility and qualifying amounts may need to be promulgated.
Other Comments :
None.
Legal Analysis :
HB1422 may benefit from an amendment to provide a mechanism for certifying who is entitled to the
income tax credit and the amount of the income tax credit to which someone is entitled.
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