The proposed bill establishes a new Small Business Disaster Relief Income Tax Credit for small business owners located in areas declared as disaster zones by the governor. Eligible taxpayers, who must not be dependents of another individual, can claim a credit of $5,000 against their income tax liability if they meet specific criteria, including operating for at least two consecutive years, demonstrating a 30% decline in gross revenue due to the disaster, and having annual gross revenue of less than $2 million. The application process requires certification from the economic development department, which will issue a certificate detailing the eligible credit amount and taxable years.

Additionally, the bill outlines the claiming process for the credit, stipulating that it must be claimed within one year of receiving certification. It also includes provisions for married individuals filing separately, allowing them to claim half of the credit, and for business entities taxed as partnerships or limited liability companies, where the credit can be allocated based on ownership interest. The credit will be included in the tax expenditure budget, and the provisions of this act will apply to taxable years beginning on or after January 1, 2025.