This bill establishes a state work opportunity tax credit applicable to both individual and corporate income taxes, effective for tax years starting on or after January 1, 2026. The credit is set at 100 percent of the federal work opportunity tax credit as outlined in section 51 of the Internal Revenue Code, which incentivizes employers to hire individuals who may face barriers to employment. The bill specifies that while the credit cannot be refunded, any excess amount can be applied to the tax liability of the following year.

Additionally, the bill amends existing tax code sections to incorporate this new credit, ensuring that the same requirements, conditions, and limitations apply as those outlined in the newly created section 422.12R. Importantly, the provisions of this act are retroactively applicable to tax years beginning on or after January 1, 2026, allowing taxpayers to benefit from the credit as soon as it becomes effective.

Statutes affected:
Introduced: 422.12