The bill establishes an education opportunity tax credit for Kansas residents with dependent children who are eligible for public school but not enrolled, starting in tax year 2025. Taxpayers can claim a credit based on actual expenditures for private school tuition and related costs, with a maximum of $8,000 for accredited schools and $4,000 for non-accredited schools. The total credits allowed are capped at $125 million for the first year, with potential increases in subsequent years. Eligibility requirements include providing a valid Social Security number for each dependent child and restrictions for those who have received scholarships under a separate program. The bill also mandates annual reporting by the Department of Revenue, includes penalties for fraudulent claims, and clarifies the consultation process with the state department of education regarding public school enrollment status. It repeals the existing section of K.S.A. 2024 Supp. 79-32,117 to incorporate these new provisions into the Kansas income tax act.

Additionally, the bill modifies the Kansas tax code concerning contributions and earnings from savings accounts for first-time home buyers and adoption. For taxable years beginning after December 31, 2024, individuals can contribute up to $6,000 for adoption savings accounts or $3,000 for first-time home buyer savings accounts, with early contributions applicable to the previous tax year. Contributions and earnings will be included in the taxpayer's adjusted gross income unless specific conditions are met. The bill also repeals K.S.A. 2024 Supp. 79-32,117, indicating significant changes in tax modifications, and establishes guidelines for federal net operating losses and timelines for tax refund claims, allowing claims to be filed until April 15, 2025, for certain tax years. The act will take effect upon publication in the statute book, reflecting a shift in tax policy to encourage savings for education and adoption.

Statutes affected:
As introduced: 79-32
As Amended by Senate Committee: 79-32