S-2061.1  _______________________________________________

                    SUBSTITUTE SENATE BILL 5549

          _______________________________________________

State of Washington      55th Legislature     1997 Regular Session

By Senate Committee on Education (originally sponsored by Senators Hochstatter, Hargrove, Zarelli, Finkbeiner, Strannigan, Johnson, Stevens and Schow)

Read first time 03/03/97.

Allowing business and occupation tax credits for educational expenses at private schools.

    AN ACT Relating to business and occupation tax credits for educational expenses at private K-12 schools; adding a new section to chapter 82.04 RCW; providing an effective date; and declaring an emergency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1.  A new section is added to chapter 82.04 RCW to read as follows:

    In computing the tax imposed under this chapter, a credit is allowed against the amount of tax otherwise due under this chapter equal to the amounts paid during the tax year for educational expenses of students incurred in attending private K-12 schools, subject to the following limitations:

    (1) No credit may be taken in excess of four percent of the tax liability for the year;

    (2) No more than one hundred scholarships may be given by the company in the year and used as credit under this section;

    (3) No credit may be taken unless annual tax liability is equal to or greater than two thousand five hundred dollars;

    (4) No credit in excess of one hundred thousand dollars may be claimed by an individual business for the year; and

    (5) No credit may carry over to a subsequent tax year.

    The department shall provide a simplified procedure for claiming the credit authorized under this section, including a simple report form.

    As used in this section, "educational expenses" means tuition expenses.

NEW SECTION. Sec. 2.  This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 1997.

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