Sectional Analysis for CS for HB 433 (L&C)

An Act Establishing a Tax Credit for Taxpayers Engaged in a Trade or Business who Employ Certain Persons who are State Residents

By Representative Norman Rokeberg

Section 1. Legislative findings. Sets forth reasons for the legislation.

Section 2. Adds new section to 43.20 providing for a credit for taxpayer employing a state resident. The credit claimed by a taxpayer is $500 for each employee who meets the criteria, with a cap of $75,000 per taxpayer. For an employee to be qualified, the employee, at the time of first employment by the taxpayer/employer, must be a resident of the state and a graduate of or had been a student at a qualifying postsecondary educational institution located in Alaska.

For the purposes of this legislation, a resident is defined as a person who is physically present in the state with the intent to remain permanently and has been physically present in the state for at least one year at the time of the person’s first employment by the taxpayer/employer.

A qualifying postsecondary education would include academic, vocational, technical, home study, business, professional, or other school, college, or university who during the period the employee attended such facility received state fund, grants or other aid (not including student loans, grants, or scholarships).

Taxpayers who have committed civil tax credit fraud are not allowed to participate in the program.

Section 3. Provides that false filings under this program are punishable by a fine equal to five times the credit fraudulently claimed.

Section 4. Effective date is January 1, 1999, and applies to persons employed after December 31, 1998.

ED2:4/23/98

Sectional Analysis for HB 433

An Act Establishing a Tax Credit for Taxpayers Engaged in a Trade or Business Who Employ Certain Persons Who are State Residents

By Representative Norman Rokeberg

Section 1. Legislative findings. Sets forth reasons for the legislation.

Section 2. Adds new section to 43.20 providing for a credit for taxpayer employing a state resident. The credit claimed by a taxpayer is $1,000 for each employee who meets the criteria. For an employee to be qualified, the employee, at the time of first employment by the taxpayer/employer, must be a resident of the state and a graduate of or had been a student at a qualifying postsecondary educational institution located in Alaska.

For the purposes of this legislation, a resident is defined as a person who is physically present in the state with the intent to remain permanently and has been physically present in the state for at least one year at the time of the person’s first employment by the taxpayer/employer.

A qualifying postsecondary education would include academic, vocational, technical, home study, business, professional, or other school, college, or university who during the period the employee attended such facility received state fund, grants or other aid (not including student loans, grants, or scholarships).

Section 3. Effective date is January 1, 1999, and applies to persons employed after December 31, 1998.

ED1: 3/6/98