Bill Text: IA HF2105 | 2023-2024 | 90th General Assembly | Introduced
Bill Title: A bill for an act excluding nonqualified deferred compensation income from the individual income tax, and including retroactive applicability provisions.(See HF 2638.)
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced) 2024-03-26 - Withdrawn. H.J. 681. [HF2105 Detail]
Download: Iowa-2023-HF2105-Introduced.html
House
File
2105
-
Introduced
HOUSE
FILE
2105
BY
JONES
A
BILL
FOR
An
Act
excluding
nonqualified
deferred
compensation
income
1
from
the
individual
income
tax,
and
including
retroactive
2
applicability
provisions.
3
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
4
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2105
Section
1.
Section
422.7,
subsection
19,
paragraph
a,
Code
1
2024,
is
amended
to
read
as
follows:
2
a.
Subtract,
to
the
extent
included,
the
total
amount
3
received
from
a
governmental
or
other
pension
or
retirement
4
plan,
including
defined
benefit
or
defined
contribution
plans,
5
annuities,
individual
retirement
accounts,
plans
maintained
or
6
contributed
to
by
an
employer,
or
maintained
or
contributed
7
to
by
a
self-employed
person
as
an
employer,
and
qualified
8
and
nonqualified
deferred
compensation
plans
or
any
earnings
9
attributable
to
the
such
deferred
compensation
plans
received
10
by
a
person
who
is
disabled,
or
is
fifty-five
years
of
age
11
or
older,
or
is
the
surviving
spouse
of
an
individual
or
is
12
a
survivor
having
an
insurable
interest
in
an
individual
who
13
would
have
qualified
for
the
exemption
under
this
subsection
14
for
the
tax
year.
15
Sec.
2.
RETROACTIVE
APPLICABILITY.
This
Act
applies
16
retroactively
to
January
1,
2024,
for
tax
years
beginning
on
17
or
after
that
date.
18
EXPLANATION
19
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
20
the
explanation’s
substance
by
the
members
of
the
general
assembly.
21
Under
current
law,
a
taxpayer
may
exclude
retirement
22
income
from
the
computation
of
net
income
for
purposes
of
23
the
individual
income
tax.
In
order
to
be
eligible
for
24
the
retirement
income
exclusion,
a
person
must
be
disabled,
25
at
least
55
years
of
age,
or
be
the
surviving
spouse
of
an
26
individual
or
be
a
survivor
having
an
insurable
interest
in
an
27
individual
who
would
have
qualified
for
the
retirement
income
28
exclusion.
29
This
bill
excludes
nonqualified
deferred
compensation
plan
30
income
from
the
computation
of
net
income
for
purposes
of
31
the
individual
income
tax
under
similar
circumstances
as
the
32
retirement
income
exclusion.
In
order
to
be
eligible
for
the
33
nonqualified
deferred
compensation
plan
income
exclusion,
the
34
taxpayer
must
be
disabled,
at
least
55
years
of
age,
or
be
the
35
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surviving
spouse
of
an
individual
or
be
a
survivor
having
an
1
insurable
interest
in
an
individual
who
would
have
qualified
2
for
the
income
exclusion.
3
The
bill
also
inserts
the
term
“qualified”
in
Code
section
4
422.7(19)(a)
to
ensure
“qualified”
deferred
compensation
plans
5
remain
excludable
from
the
computation
of
net
income
for
6
purposes
of
the
individual
income
tax.
7
A
nonqualified
deferred
compensation
plan
is
deferred
8
compensation
with
no
federal
legal
deferral
limit
that
is
9
subject
to
tax
at
a
later
date,
and
is
usually
made
available
10
to
select
employees.
11
A
qualified
deferred
compensation
plan
is
subject
to
12
compensation
deferral
limits
like
401(k)
plans.
13
The
bill
applies
retroactively
to
January
1,
2024,
for
tax
14
years
beginning
on
or
after
that
date.
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