BILL REQ. #:  S-4144.1 

Read first time 01/13/2006.   Referred to Committee on Financial Institutions, Housing & Consumer Protection.

     AN ACT Relating to tax credits for contributions to low-income housing efforts; and adding a new chapter to Title 82 RCW.

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

NEW SECTION.  Sec. 1   It is the previously declared public policy of the state to assist in making affordable and decent housing available throughout the state. The legislature recognizes that despite ongoing efforts there is still a lack of affordable housing in many areas. To ensure further aid, the legislature hereby establishes tax credits for persons who make financial contributions to low-income housing assistance programs.

NEW SECTION.  Sec. 2   Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.
     (1) "Applicant" means a person applying for a tax credit under this chapter.
     (2) "Contribution" means cash or in-kind contributions.
     (3) "Department" means the department of revenue.
     (4) "Person" has the meaning given in RCW 82.04.030.
     (5) "Program" means a nonprofit organization under internal revenue code section 501(c)(3) which builds homes and provides homeownership opportunities for persons of low-income as defined in RCW 35.81.015.
     (6) "Housing trust fund" means the Washington housing trust fund created in RCW 43.185.030.

NEW SECTION.  Sec. 3   (1) Application for tax credits under this chapter must be made to the department before making a contribution to a program or the housing trust fund. The application shall be made to the department in a form and manner prescribed by the department. The application shall contain information regarding the proposed amount of contribution to a program or the housing trust fund, and other information required by the department to determine eligibility under this act. The department shall rule on the application within forty-five days. Applications shall be approved on a first-come basis.
     (2) The person must make the contribution described in the approved application by the end of the calendar year in which the application is approved to claim a credit allowed under section 4 of this act.
     (3) The department shall not accept any applications before January 1, 2007.

NEW SECTION.  Sec. 4   (1) Subject to the limitations in this chapter, a credit is allowed against the tax imposed by chapters 82.04 and 82.16 RCW for approved contributions that are made by a person to a program or the housing trust fund.
     (2) The credit allowed under this section is limited to an amount equal to:
     (a) Seventy-five percent of the approved contribution made by a person to a program; or
     (b) Fifty percent of the approved contribution made by a person to the housing trust fund.
     (3) The department shall keep a running total of all credits approved under this chapter for each calendar year. The department shall not approve any credits under this section that would cause the total amount of approved credits statewide to exceed one million five hundred thousand dollars in any calendar year.
     (4) The total credits allowed under this chapter for contributions made to each program may not exceed two hundred fifty thousand dollars in a calendar year. The total credits allowed under this chapter for a person may not exceed five hundred thousand dollars in a calendar year.
     (5) The credit may be claimed against any tax due under chapters 82.04 and 82.16 RCW only in the calendar year immediately following the calendar year in which the credit was approved by the department and the contribution was made to the program or the housing trust fund. Credits may not be carried over to subsequent years. No refunds may be granted for credits under this chapter.
     (6) The total amount of the credit claimed in any calendar year by a person may not exceed the lesser amount of the approved credit, or seventy-five percent of the amount of the contribution that is made by the person to a program and fifty percent of the amount of the contribution that is made by the person to the housing trust fund, in the prior calendar year.

NEW SECTION.  Sec. 5   To claim a credit under this chapter, a person must electronically file with the department all returns, forms, and other information the department requires in an electronic format as provided or approved by the department. Any return, form, or information required to be filed in an electronic format under this section is not filed until received by the department in an electronic format. As used in this subsection, "returns" has the same meaning as "return" in RCW 82.32.050.

NEW SECTION.  Sec. 6   Chapter 82.32 RCW applies to the administration of this chapter.

NEW SECTION.  Sec. 7   Sections 1 through 6 of this act constitute a new chapter in Title 82 RCW.