Read the full stored bill text
House
File
2774
-
Introduced
HOUSE
FILE
2774
BY
COMMITTEE
ON
WAYS
AND
MEANS
(SUCCESSOR
TO
HSB
774)
A
BILL
FOR
An
Act
exempting
sales
and
use
taxes
incurred
for
constructing
1
a
regional
water
trail
system
by
a
nonprofit
corporation,
2
and
including
effective
date
and
retroactive
applicability
3
provisions.
4
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
5
TLSB
6945HV
(1)
91
jm/jh
H.F.
2774
Section
1.
Section
423.3,
subsection
18,
Code
2026,
is
1
amended
by
adding
the
following
new
paragraph:
2
NEW
PARAGRAPH
.
h.
A
nonprofit
corporation
that
is
a
3
designated
exempt
entity
under
section
423.4,
subsection
1,
4
paragraph
“a”
,
subparagraph
(11).
5
Sec.
2.
Section
423.3,
subsection
80,
paragraph
c,
6
subparagraph
(1),
Code
2026,
is
amended
to
read
as
follows:
7
(1)
With
regard
to
a
written
construction
contract
with
8
a
designated
exempt
entity
described
in
paragraph
“a”
,
9
subparagraph
(1),
the
sales
price
of
building
materials,
10
supplies,
equipment,
or
services
is
exempt
from
tax
by
11
this
subsection
only
to
the
extent
the
building
materials,
12
supplies,
equipment,
or
services
are
completely
consumed
in
the
13
performance
of
the
construction
contract
with
the
a
designated
14
exempt
entity,
and
only
if
the
property
that
is
the
subject
15
of
the
construction
project
becomes
public
property
or
the
16
property
of
the
a
designated
exempt
entity.
17
Sec.
3.
Section
423.4,
subsection
1,
paragraph
a,
Code
2026,
18
is
amended
by
adding
the
following
new
subparagraph:
19
NEW
SUBPARAGRAPH
.
(11)
A
domestic
nonprofit
corporation
20
organized
under
chapter
504
that
has
a
majority
of
voting
board
21
members
appointed
by
political
subdivisions
of
the
state,
22
implements
a
regional
recreational
and
dam
safety
plan,
and
23
constructs
horizontal
and
vertical
infrastructure
on
land
and
24
within
rivers
and
watersheds
as
part
of
a
regional
water
trail
25
system.
26
Sec.
4.
EFFECTIVE
DATE.
This
Act,
being
deemed
of
immediate
27
importance,
takes
effect
upon
enactment.
28
Sec.
5.
RETROACTIVE
APPLICABILITY.
This
Act
applies
29
retroactively
to
January
1,
2025,
to
all
tangible
personal
30
property
or
specified
digital
products
sold,
or
services
31
furnished,
to
a
designated
exempt
entity
described
in
section
32
423.4,
subsection
1,
paragraph
“a”,
subparagraph
(11),
if
33
enacted
by
this
Act,
occurring
on
or
after
that
date.
34
Sec.
6.
RETROACTIVE
APPLICABILITY.
This
Act
applies
35
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2774
retroactively
to
January
1,
2025,
to
building
materials,
1
supplies,
equipment,
or
services
furnished
to
a
contractor
2
and
used
in
the
performance
of
a
written
contract
with
a
3
designated
exempt
entity
described
in
section
423.4,
subsection
4
1,
paragraph
“a”,
subparagraph
(11),
if
enacted
by
this
Act,
5
occurring
on
or
after
that
date.
6
EXPLANATION
7
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
8
the
explanation’s
substance
by
the
members
of
the
general
assembly.
9
This
bill
exempts
sales
and
use
taxes
incurred
by
a
nonprofit
10
corporation
for
the
construction
of
a
regional
water
trail
11
system.
12
The
bill
makes
a
nonprofit
corporation
(nonprofit)
organized
13
under
Code
chapter
504
a
designated
exempt
entity,
which
allows
14
the
nonprofit
corporation
to
apply
to
the
department
of
revenue
15
for
the
refund
of
the
sales
and
use
tax
upon
sales
of
building
16
materials,
supplies,
and
equipment,
or
from
services
furnished,
17
by
a
contractor
in
the
performance
of
a
written
contract
with
18
the
nonprofit.
The
nonprofit
is
generally
defined
to
mean
an
19
Iowa
nonprofit
corporation
that
has
a
majority
of
voting
board
20
members
appointed
by
political
subdivisions
of
the
state,
that
21
implements
a
regional
recreational
and
dam
safety
plan,
and
22
constructs
a
regional
water
trail
system.
23
The
bill
also
exempts
from
the
sales
tax
the
sales
price
of
24
tangible
personal
property
or
specified
digital
products
sold
25
or
of
services
furnished
to
the
nonprofit.
26
By
designating
the
nonprofit
a
designated
exempt
entity
27
under
the
bill,
construction
services
provided
to
the
28
nonprofit
also
become
exempt
from
the
sales
tax
under
Code
29
section
423.3(80).
The
bill
makes
changes
to
Code
section
30
423.3(80)(c)(1)
to
specify
written
contracts
with
an
exempt
31
entity
for
the
sales
tax
exemption
even
if
another
designated
32
exempt
entity
ultimately
owns
the
property
subject
to
the
33
construction
project.
34
By
operation
of
Code
section
423.6,
an
item
exempt
from
the
35
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2774
imposition
of
the
sales
tax
is
also
exempt
from
the
use
tax
1
imposed
in
Code
section
423.5.
2
The
bill
takes
effect
upon
enactment
and
applies
3
retroactively
to
January
1,
2025,
to
all
tangible
personal
4
property
or
specified
digital
products
sold,
or
services
5
furnished,
to
the
designated
exempt
entity
occurring
on
or
6
after
that
date.
7
The
bill
also
applies
retroactively
to
January
1,
2025,
to
8
building
materials,
supplies,
equipment,
or
services
furnished
9
to
a
contractor
and
used
in
the
performance
of
a
written
10
contract
with
the
designated
exempt
entity
occurring
on
or
11
after
that
date.
12
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3/
3