[atlas:bill]

AN ACT Relating to tax incentives to hire recipients of temporary assistance for needy families; adding a new section to chapter 82.04 RCW; and adding a new section to chapter 48.14 RCW.

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:

(1) Subject to the limits in this section, an eligible person is allowed a credit against the tax due under this chapter. The credit is based on qualified employment positions that are filled by recipients of temporary assistance for needy families under chapter 74.12 RCW. The credit is available to persons who are engaged in the provision of business services as defined in this section.

(2)(a) The credit equals two thousand dollars for each qualified employment position created after July 1, 2001. A credit is earned for the calendar year the person is hired to fill the position, plus the two subsequent consecutive years, if the position is maintained for those two years.

(b) Credit may not be taken for hiring of persons into positions that exist on July 1, 2001. Credit is authorized for new employees hired for new positions created after July 1, 2001.

(c) When a position is newly created, if it is filled before July 1st, this position is eligible for the full yearly credit. If it is filled after June 30th, this position is eligible for half of the credit.

(d) Credit may be accrued and carried over until it is used. No refunds will be granted for credits under this section.

(3) For the purposes of this section:

(a) "Eligible person" means a person, as defined in RCW 82.04.030, who is engaged in the business of providing business services;

(b)(i) "Business services" means the provision of a service, as defined under (b)(ii) of this subsection, that is subject to tax under RCW 82.04.290(2);

(ii) Business services are: Computer; data processing; information; legal; accounting and tax preparation; architectural; business consulting; business management; public relations and advertising; surveying; real estate appraisal; or financial services. For the purposes of this section these services mean the following:

(A) "Computer services" are services such as computer programming, custom software modification, customization of canned software, custom software installation, custom software maintenance, custom software repair, training in the use of software, computer systems design, and custom software update services;

(B) "Data processing services" are services such as word processing, data entry, data retrieval, data search, information compilation, payroll processing, business accounts processing, data production, and other computerized data and information storage or manipulation. "Data processing services" also includes the use of a computer or computer time for data processing whether the processing is performed by the provider of the computer or by the purchaser or other beneficiary of the service;

(C) "Information services" are services such as electronic data retrieval or research that entails furnishing financial or legal information, data or research, internet service as defined in RCW 82.04.297, general or specialized news, or current information;

(D) "Legal services" are services such as representation by an attorney, or other person when permitted, in an administrative or legal proceeding, legal drafting, paralegal services, legal research services, and court reporting services, arbitration, and mediation services;

(E) "Accounting and tax preparation services" are services such as accounting, auditing, actuarial, bookkeeping, or tax preparation services;

(F) "Architectural services" are services such as structural or landscape design or architecture, interior design, building design, building program management, and space planning services;

(G) "Business consulting services" are services such as primarily providing operating counsel, advice, or assistance to the management or owner of any business, private, nonprofit, or public organization, including but not limited to those in the following areas: Administrative management consulting; general management consulting; human resource consulting or training; management engineering consulting; management information systems consulting; manufacturing management consulting; marketing consulting; operations research consulting; personnel management consulting; physical distribution consulting; site location consulting; economic consulting; motel, hotel, and resort consulting; restaurant consulting; government affairs consulting; and lobbying;

(H) "Business management services" are services such as administrative management, business management, and office management. "Business management services" does not include property management or property leasing, motel, hotel, and resort management, or automobile parking management;

(I) "Public relations and advertising services" are services such as layout, art direction, graphic design, copy writing, mechanical preparation, opinion research, marketing research, marketing, or production supervision;

(J) "Surveying services" are services such as land surveying;

(K) "Real estate appraisal services" are services such as market appraisal and other real estate valuation; and

(L) "Financial services" are services such as banking, loan, security, investment management, investment advisory, mortgage servicing, contract collection, and finance leasing services, engaged in by financial businesses, or businesses similar to or in competition with financial businesses; and

(c) "Qualified employment position" means a permanent full-time position to provide business services. If an employee is either voluntarily or involuntarily separated from employment, the employment position is considered filled on a full-time basis if the employer is either training or actively recruiting a replacement employee that is a recipient of temporary assistance for needy families under chapter 74.12 RCW.

(4) No application is necessary for the tax credit. The person must keep records necessary for the department to verify eligibility under this section. This information includes:

(a) Employment records for the previous six years;

(b) Information relating to description of business service activity engaged in by the person; and

(5) If at any time the department finds that a person is not eligible for tax credit under this section, the amount of taxes for which a credit has been used is immediately due. The department will assess interest, but not penalties, on the credited taxes for which the person is not eligible. The interest will be assessed at the rate provided for delinquent excise taxes under chapter 82.32 RCW, assessed retroactively to the date the tax credit was taken, and accrue until the taxes for which a credit has been used are repaid.

(6) The department of social and health services will provide to the department of revenue any information needed by the department of revenue to verify eligibility of recipients of temporary assistance for needy families under this section.

NEW SECTION. Sec. 2. A new section is added to chapter 48.14 RCW to read as follows:

(1) Subject to the limits in this section, an eligible person is allowed a credit against the tax due under RCW 48.14.020. The credit is based on qualified employment positions that are filled by recipients of temporary assistance for needy families under chapter 74.12 RCW. The credit is available to persons who are engaged in insurance services as defined in this section.

(b) Credit may not be taken for hiring of persons into positions that exist on July 1, 2001. Credit is authorized for new employees hired for new positions created after July 1, 2001.

(d) Credit may be accrued and carried over until it is used. No refunds may be granted for credits under this section.

(3) For the purposes of this section:

(a) "Eligible person" means a person, as defined in RCW 82.04.030, who is engaged in the business of providing insurance services;

(b) "Insurance services" means a business that provides insurance services related directly to the delivery of the service within the United States or on behalf of persons residing within the United States; and

(c) "Qualified employment position" means a permanent full-time position to provide insurance services. If an employee is either voluntarily or involuntarily separated from employment, the employment position is considered filled on a full-time basis if the employer is either training or actively recruiting a replacement employee that is a recipient of temporary assistance for needy families under chapter 74.12 RCW.

(4) No application is necessary for the tax credit. The person must keep records necessary for the department to verify eligibility under this section. This information includes:

(a) Employment records for the previous six years;

(b) Information relating to description of insurance services activity engaged in by the person; and