Repealing or discontinuing certain income tax credit incentives, extending the income tax credit for angel investors and aviation-related employment and providing expanded options in the high performance tax credit program for tax credit transfers.

As Amended by House Committee
Session of 2026
HOUSE BILL No. 2757
By Committee on Commerce, Labor and Economic Development
Requested by Eric Stafford on behalf of the Kansas Chamber of Commerce
2-6
AN ACT concerning taxation; relating to income tax credit incentives;
repealing or discontinuing certain income tax credit incentives; relating
to abandoned well plugging credit, agritourism liability insurance
credit, alternative fuel tax credit, assistive technology contribution
credit, biomass-to-energy plant tax credit and deduction, carbon
dioxide capture and sequestration tax deduction, disabled access credit,
electric cogeneration facility credit and deduction, employer health
insurance contribution credit, environmental compliance credit, friends
of cedar crest association credit, petroleum refinery credit, regional
foundation credit, storage and blending equipment credit and deduction
and swine facility improvement credit; extending the income tax credit
for angel investors and aviation-related employment; providing
expanded options in the high performance tax credit program for tax
credit transfers and wage requirements for rural businesses ; amending
K.S.A. 40-2246, 65-7107, 74-50,131, 74-50,154, 79-229, 79-32,177,
79-32,179, 79-32,180, 79-32,201, 79-32,204, 79-32,207, 79-32,222 and
79-32,256 and K.S.A. 2025 Supp. 32-1438 , 74-8133, and 79-32,160a
and 79-32,176a and repealing the existing sections; also repealing
K.S.A. 79-32,218, 79-32,233, 79-32,234, 79-32,235, 79-32,236, 79-
32,237, 79-32,245, 79-32,246, 79-32,247, 79-32,248, 79-32,249, 79-
32,251, 79-32,252, 79-32,253, 79-32,254 and 79-32,255 and K.S.A.
2025 Supp. 79-32,275 and 79-32,295.
Be it enacted by the Legislature of the State of Kansas:
Section 1. K.S.A. 2025 Supp. 32-1438 is hereby amended to read as
follows: 32-1438. (a) For taxable years commencing on and after
December 31, 2003, December 31, 2004, December 31, 2005, December
31, 2006, and December 31, 2007, and ending before January 1, 2026,
there shall be allowed as a credit against the tax liability of a taxpayer
imposed under the Kansas income tax act, an amount equal to 20% of the
cost of liability insurance paid by a registered agritourism operator who
operates an agritourism activity on the effective date of this act. No tax
credit claimed pursuant to this subsection shall exceed $2,000. If the
amount of such tax credit exceeds the taxpayer's income tax liability for
such taxable year, the amount thereof that exceeds such tax liability may
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be carried over for deduction from the taxpayer's income tax liability in the
next succeeding taxable year or years until the total amount of tax credit
has been deducted from tax liability, except that no such tax credit shall be
carried forward for deduction after the third taxable year succeeding the
taxable year in which the tax credit is claimed.
(b) For the first five taxable years commencing after a taxpayer opens
such taxpayer's business, after the effective date of this act, and before the
taxable year beginning January 1, 2026, there shall be allowed as a credit
against the tax liability of a taxpayer imposed under the Kansas income tax
act, an amount equal to 20% of the cost of liability insurance paid by a
registered agritourism operator who starts an agritourism activity after the
effective date of this act. No tax credit claimed pursuant to this subsection
shall exceed $2,000. If the amount of such tax credit exceeds the
taxpayer's income tax liability for such taxable year, the amount thereof
that exceeds such tax liability may be carried over for deduction from the
taxpayer's income tax liability in the next succeeding taxable year or years
until the total amount of tax credit has been deducted from tax liability,
except that no such tax credit shall be carried forward for deduction after
the third taxable year succeeding the taxable year in which the tax credit is
claimed.
(c) The secretary of commerce shall adopt rules and regulations
establishing criteria for determining those costs which qualify as costs of
liability insurance for agritourism activities of a registered agritourism
operator.
(d) As used in this section, terms mean the same as provided by
K.S.A. 32-1432, and amendments thereto.
(e) For tax year 2013 and all tax years thereafter through tax year
2025, the income tax credit provided by this section shall only be available
to taxpayers subject to the income tax on corporations imposed pursuant to
of K.S.A. 79-32,110(c), and amendments thereto, and shall be applied only
against such taxpayer's corporate income tax liability. No new income tax
credit provided by this section shall be awarded to any taxpayer for any
tax year after tax year 2025.
Sec. 2. K.S.A. 40-2246 is hereby amended to read as follows: 40-
2246. (a) A credit against the taxes otherwise due under the Kansas income
tax act shall be allowed to an employer for amounts paid during the
taxable year for purposes of this act on behalf of an eligible employee as
defined in K.S.A. 40-2239, and amendments thereto, to provide health
insurance or care and amounts contributed to health savings accounts of
eligible covered employees, except that for taxable years commencing
after December 31, 2013, no credit shall be allowed pursuant to this
section for that portion of any amounts paid by an employer for healthcare
expenditures, a health benefit plan, as defined in K.S.A. 65-6731, and
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amendments thereto, or amounts contributed to health savings accounts for
the purchase of an optional rider for coverage of abortion in accordance
with K.S.A. 40-2,190, and amendments thereto.
(b) (1) For employers that have established a small employer health
benefit plan after December 31, 1999, but prior to January 1, 2005, the
amount of the credit allowed by subsection (a) shall be $35 per month per
eligible covered employee or 50% of the total amount paid by the
employer during the taxable year, whichever is less, for the first two years
of participation. In the third year, the credit shall be equal to 75% of the
lesser of $35 per month per employee or 50% of the total amount paid by
the employer during the taxable year. In the fourth year, the credit shall be
equal to 50% of the lesser of $35 per month per employee or 50% of the
total amount paid by the employer during the taxable year. In the fifth year,
the credit shall be equal to 25% of the lesser of $35 per month per
employee or 50% of the total amount paid by the employer during the
taxable year. For the sixth and subsequent years, no credit shall be
allowed.
(2) For employers that have established a small employer health
benefit plan or made contributions to a health savings account of an
eligible covered employee after December 31, 2004, the amount of credit
allowed by subsection (a) shall be $70 per month per eligible covered
employee for the first 12 months of participation, $50 per month per
eligible covered employee for the next 12 months of participation and $35
per eligible covered employee for the next 12 months of participation.
After 36 months of participation, no credit shall be allowed.
(c) If the credit allowed by this section is claimed, the amount of any
deduction allowable under the Kansas income tax act for expenses
described in this section shall be reduced by the dollar amount of the
credit. The election to claim the credit shall be made at the time of filing
the tax return in accordance with law. If the credit allowed by this section
exceeds the taxes imposed under the Kansas income tax act for the taxable
year, that portion of the credit which exceeds those taxes shall be refunded
to the taxpayer.
(d) Any amount of expenses paid by an employer under this act shall
not be included as income to the employee for purposes of the Kansas
income tax act. If such expenses have been included in federal taxable
income of the employee, the amount included shall be subtracted in
arriving at state taxable income under the Kansas income tax act.
(e) The secretary of revenue shall promulgate rules and regulations to
carry out the provisions of this section.
(f) This section shall apply to all taxable years commencing after
December 31, 1999, and ending before January 1, 2026.
(g) For tax year 2013 and all tax years thereafter through tax year
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2025, the income tax credit provided by this section shall only be available
to taxpayers subject to the income tax on corporations imposed pursuant to
subsection (c) of K.S.A. 79-32,110, and amendments thereto, and shall be
applied only against such taxpayer's corporate income tax liability. No new
tax credit provided by this section shall be awarded to any taxpayer for
any tax year after tax year 2025.
Sec. 3. K.S.A. 65-7107 is hereby amended to read as follows: 65-
7107. (a) Appropriate state agencies are hereby directed to amend their
state plans to protect the benefits of those receiving such benefits by
adding language consistent with the following: Any funds in an individual
development account, including accrued interest, shall be disregarded
when determining eligibility to receive the amount of any public assistance
or benefits.
(b) A program contributor shall be allowed a credit against state
income tax imposed under the Kansas income tax act in an amount equal
to 25% of the contribution amount.
(c) The institute shall verify all tax credit claims by contributors. The
administration of the community-based organization, with the cooperation
of the participating financial institutions, shall submit the names of
contributors and the total amount each contributor contributes to the
individual development account reserve fund for the calendar year. The
institute shall determine the date by which such information shall be
submitted to the institute by the local administrator. The institute shall
submit verification of qualified tax credits pursuant to K.S.A. 65-7101
through 65-7107, and amendments thereto, to the department of revenue.
(d) The total tax credits authorized pursuant to this section shall not
exceed $6,250 in any fiscal year.
(e) The provisions of this section shall be applicable to all taxable
years commencing after December 31, 2002, and ending before January 1,
2026.
(f) For tax year 2013 and all tax years thereafter through tax year
2025, the income tax credit provided by this section shall only be available
to taxpayers subject to the income tax on corporations imposed pursuant to
subsection (c) of K.S.A. 79-32,110, and amendments thereto, and shall be
applied only against such taxpayer's corporate income tax liability. No new
tax credit provided by this section shall be awarded to any taxpayer for
any tax year after tax year 2025.
Sec. 4. K.S.A. 74-50,131 is hereby amended to read as follows: 74-
50,131. Commencing after December 31, 1999: (a) As used in this act:
"Qualified firm" means a for-profit business establishment, subject to state
income, sales or property taxes, identified under the North American
industry classification system (NAICS) subsectors 221, 311 to 339, 423 to
425, 481 to 519, 521 to 721 and 811 to 928 or is identified as a corporate
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or regional headquarters or back-office operation of a national or multi-
national corporation regardless of NAICS designation. The secretary of
commerce shall determine eligibility when a difference exists between a
firm's primary business activity and NAICS designation. A business
establishment may be assigned a NAICS designation according to the
primary business activity at a single physical location in the state.
(b) In the case of firms in NAICS subsectors 221, 423 to 425, 481 to
519, 521 to 721 and 811 to 928, the business establishment must also
demonstrate the following:
(1) More than 1/2 of its gross revenues are a result of sales to
commercial or governmental customers outside the state of Kansas; or
(2) more than 1/2 of its gross revenues are a result of sales to Kansas
manufacturing firms within NAICS subsectors 311 to 339; or
(3) more than 1/2 of its gross revenues are a result of a combination of
sales described in (1) and (2).
(c) For purposes of determining whether one of the average wage
options described in subsection (d) below is satisfied, business
establishments located within a metropolitan county, as defined in K.S.A.
74-50,114, and amendments thereto, will be compared only to other
businesses within that metropolitan county, and business establishments
located outside of a metropolitan county will be compared to businesses
within an aggregation of counties representing the business establishment's
region of the state, which regional aggregation will exclude metropolitan
counties. Such aggregation shall be determined by the department of
commerce.
(d) Additionally, a business establishment having met the criteria as
established in subsection (a) or (b), and using the comparison method
described in subsection (c), must meet one of the following criteria:
(1) The establishment with 500 or fewer full-time equivalent
employees will provide an average wage that is above the average wage
paid by all firms with 500 or fewer full-time equivalent employees which
share the appropriate NAICS designation.
(2) The establishment with 500 or fewer full-time equivalent
employees is the sole firm within its appropriate NAICS designation
which has 500 or fewer full-time equivalent employees.
(3) The establishment with more than 500 full-time equivalent
employees will provide an average wage that is above the average wage
paid by firms with more than 500 full-time equivalent employees which
share the appropriate NAICS designation.
(4) The establishment with more than 500 full-time equivalent
employees is the sole firm within its appropriate NAICS designation
which has more than 500 full-time equivalent employees, in which event it
shall either provide an average wage that is above the average wage paid
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by all firms with 500 or fewer full-time equivalent employees which share
the appropriate NAICS designation, or be the sole firm within its
appropriate NAICS designation.
(e) As an alternative to the requirements of subsections (c) and (d), a
firm having met the requirements of subsections (a) or (b), may qualify, if
excluding taxable disbursements to company owners, the business
establishment's annual average wage must be greater than or equal to:
(1) Prior to January 1, 2026, 1.5 times the aggregate average wage
paid by industries covered by the employment security law based on data
maintained by the secretary of labor and beginning on January 1, 2026,
125% of such aggregate wage; or
(2) beginning on January 1, 2026, for a firm that is located outside of
a metropolitan county, 125% of the aggregate average wage for all
counties that are not metropolitan counties as determined by the secretary
of labor based on data maintained by the secretary of labor. Such average
wage for all nonmetropolitan counties shall be published on the website of
the department of labor and updated at least annually.
(f) For the purposes of this section, the number of full-time
equivalent employees shall be determined by dividing the number of hours
worked by part-time employees during the pertinent measurement interval
by an amount equal to the corresponding multiple of a 40-hour work week
and adding the quotient to the number of full-time employees.
(g) (1) Except as provided by paragraph (2), the secretary of
commerce shall certify annually to the secretary of revenue that a firm
meets the criteria for a qualified firm and that the firm is eligible for the
benefits and assistance provided under this act.
(2) If the secretary of commerce has certified a firm as meeting such
requirements in the year that the firm earns the tax credit pursuant to
K.S.A. 79-32,160a, and amendments thereto, such firm shall be deemed to
be certified for purposes of such credit in each taxable year thereafter
during the tax credit carryforward period if the secretary of commerce
determines that such firm continues to meet the average wage requirement
applicable to such firm pursuant to subsection (d) or (e).
(3) The secretary of commerce is hereby authorized to obtain any and
all information necessary to determine such eligibility. Information
obtained under this section shall not be subject to disclosure pursuant to
K.S.A. 45-215 et seq., and amendments thereto, but shall upon request be
made available to the legislative post audit division.
(h) The secretary of commerce shall publish rules and regulations for
the implementation of this act. Such rules and regulations shall include,
but not be limited to:
(1) A definition of "training and education" for purposes of K.S.A.
74-50,132, and amendments thereto.
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(2) Establishment of eligibility requirements and application
procedures for expenditures from the high performance incentive fund
created in K.S.A. 74-50,133, and amendments thereto.
(3) Establishment of approval guidelines for private consultants
authorized pursuant to K.S.A. 74-50,133, and amendments thereto.
(4) Establishment of guidelines for prioritizing business assistance
programs pursuant to K.S.A. 74-50,133, and amendments thereto.
(5) A definition of "commercial customer" for the purpose of K.S.A.
74-50,133, and amendments thereto.
(6) A definition of "headquarters" for the purpose of K.S.A. 74-
50,133, and amendments thereto.
(7) Establishment of guidelines concerning the use and disclosure of
any information obtained to determine the eligibility of a firm for the
assistance and benefits provided for by this act.
Sec. 5. K.S.A. 74-50,154 is hereby amended to read as follows: 74-
50,154. (a) As used in this act: (1) "Business support services" means
business counseling, technical assistance and business planning services
provided to existing or prospective small businesses or entrepreneurs;
(2) "contributions" means and includes the donation of cash or
property other than used clothing in an amount or value of $250 or more.
Contributions shall be valued as follows:
(A) Stocks and bonds contributed shall be valued at the stock market
price on the date of transfer;
(B) personal property items contributed shall be valued at the lesser
of the item's fair market value or cost to the donor and may be inclusive of
costs incurred in making the contribution. Such value shall not include
sales tax;
(C) contributions of real estate are allowable for credit only when title
of such real estate is in fee simple absolute and is clear of any
encumbrances; and
(D) the amount of credit allowable shall be based upon the lesser of
two current independent appraisals conducted by state licensed appraisers;
(3) "department" means the department of commerce;
(4) "entrepreneur" means an individual creating a new business,
service or product;
(5) "region" means multi-county areas as defined by the secretary of
commerce;
(6) "regional business development fund" means an authorized and
audited fund that is created by taxpayer contributions, interest income and
investment income and is managed by the regional foundation board of
directors for the purposes of economic and leadership development in the
region;
(7) "regional foundation" means any organization in Kansas that
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demonstrates capacity to provide economic development services to
regions as defined by this act, and: (A) Has obtained a ruling from the
internal revenue service of the United States department of treasury that
such organization is exempt from income taxation under the provisions of
section 501(c)(3) or 501(c)(6) of the federal internal revenue code;
(B) has been designated as a certified development company by the
United States small business administration;
(C) has been designated as an economic development district by the
United States department of commerce's economic development
administration;
(D) has been organized as a regional planning commission under
K.S.A. 12-744 et seq., and amendments thereto, or its predecessor, K.S.A.
12-716 et seq., and amendments thereto; or
(E) is incorporated in the state of Kansas as a nonstock, nonprofit
corporation;
(8) "regional leadership development" means training and education
that enable a region to develop community leadership that strengthens the
economic and social environment in that region;
(9) "rural community" means any city having a population of fewer
than 50,000 or except as otherwise provided, any unincorporated area.
Unincorporated areas within any county having a population of more than
100,000 are not eligible;
(10) "secretary" means the secretary of the department of commerce;
(11) "small business" means an independently owned and operated
business having fewer than 100 full-time equivalent employees;
(12) "taxpayer" means: (A) Any business entity authorized to do
business in the state of Kansas which is subject to the state income tax
imposed by the provisions of the Kansas income tax act;
(B) any individual subject to the state income tax imposed by the
provisions of the Kansas income tax act;
(C) any national banking association, state bank, trust company or
savings and loan association paying an annual tax on its net income
pursuant to article 11 of chapter 79 of the Kansas Statutes Annotated; or
(D) any insurance company paying the premium tax and privilege
fees imposed pursuant to K.S.A. 40-252, and amendments thereto; and
(13) "technology improvements" means a project that results in the
ability of the region to enhance service in areas, including broadband
access, web site creation, wireless internet services, computer
programming, computer servers, computer networks, computer databases,
electronic training modules, electronic media and any other technological
areas deemed eligible by the secretary.
(b) For taxable years commencing after December 31, 2004, and
ending before January 1, 2026, any taxpayer contributing to a regional
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foundation designated by the secretary of commerce, shall be allowed a
credit, as provided in this act, against the tax imposed by the Kansas
income tax act, the tax on net income of national banking associations,
state banks, trust companies or savings and loan associations imposed
under article 11 of chapter 79 of the Kansas Statutes Annotated, or the
premium tax or privilege fees imposed pursuant to K.S.A. 40-252, and
amendments thereto, if the proposal of the regional foundation is approved
pursuant to this act.
(c) (1) On December 31, 2007, June 30, 2008, and each June 30
thereafter, each regional foundation shall transfer 5% of funds raised in the
previous fiscal year from the marketing of the rural business tax credits to
be credited to the enterprise facilitation fund created in K.S.A. 74-50,155,
and amendments thereto.
(2) The secretary of commerce may adopt rules and regulations for
the disbursement of regional foundation funds to the enterprise facilitation
fund.
(d) (1) The secretary of commerce is hereby authorized to adopt rules
and regulations for establishing criteria for evaluating proposals to
designate regional foundations as defined by this act with the assistance of
the secretary of revenue.
(2) The proposal shall set forth the program to be conducted, why the
program is needed, the estimated amount to be invested in the program,
composition of the board that shall be making investment decisions,
policies stating the organization shall offer services to all counties in that
region and the plans for implementing the program.
(3) The secretary of commerce shall select regional foundations
pursuant to rules and regulations adopted pursuant to subsection (d)(1) to
use the sale of credits to establish regional business development funds.
(4) The total amount of credits allowed under this act shall not exceed
$2,500,000 for fiscal year 2005; $2,500,000 for fiscal year 2006;
$2,000,000 per year for fiscal years 2007 through, and including, 2010,
and fiscal year 2012, and $1,800,000 for fiscal year 2011. Each region as
defined by this act shall receive an equal share of this allocation.
(5) Any credits not sold by such regional foundations shall be
reclaimed by the secretary from such region and redistributed to other
regions that sold all credits previously issued.
(6) The secretary shall annually review and approve or disapprove the
proposal of each designated regional foundation for continued eligibility
for tax credits. The department of commerce retains that right to reclaim
credits in such cases the regional foundation closes or there is
demonstrated violation of the organization's policies. Changes to the
investment policies of each regional foundation are subject to approval of
the secretary.
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(e) Each regional foundation shall administer a regional business
development fund. The sums generated by contributions to each regional
business development fund are intended to be distributed to qualified
entrepreneurs for the purposes of economic and leadership development in
the region. Such sums shall be allocated by each regional foundation as
follows:
(1) Not less than 60% of such funds may be allocated for job creation
or retention;
(2) not more than 10% of such funds shall be allocated for
administrative costs in overseeing particular projects; and
(3) the remaining funds may be allocated towards other eligible
activities as provided in subsection (f) in a manner that fits the region's
priorities and needs.
(f) Funds in the regional business development funds may be utilized
by the regional foundation for one or more of the following eligible
activities:
(1) Business start-ups;
(2) business expansion;
(3) business retention;
(4) business support services;
(5) regional leadership development;
(6) technology improvements; and
(7) administrative services.
(g) All interest generated on idle funds administered by the regional
foundation shall be used by the foundation's board in accordance with
subsections (e) and (f).
(h) Any regional foundation may increase or decrease the allocation
percentages set forth in subsection (e) only upon approval of such
adjustments by the secretary.
(i) (1) The amount of credit allowed pursuant to this act, shall not
exceed 75% of the total amount contributed during the taxable year by the
taxpayer to a regional foundation approved pursuant to this act.
(2) If the amount of the credit allowed by this act, exceeds the
taxpayer's income tax liability imposed under the Kansas income tax act,
such excess amount shall be refunded to the taxpayer.
(j) The provisions of this act shall be applicable to all taxable years
beginning after December 31, 2004, and ending before January 1, 2026.
Sec. 6. K.S.A. 2025 Supp. 74-8133 is hereby amended to read as
follows: 74-8133. (a) A credit against the tax imposed by article 32 of
chapter 79 of the Kansas Statutes Annotated, and amendments thereto, on
the Kansas taxable income of an angel investor and against the tax
imposed by K.S.A. 40-252, and amendments thereto, shall be allowed for
a cash investment in the qualified securities of a qualified Kansas business.
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For tax year 2021 and all tax years thereafter, the credit shall be in a total
amount of up to 50% of such investors' cash investment in any qualified
Kansas business, subject to the limitations set forth in subsection (b). This
Such tax credit may be used in its entirety in the taxable year in which the
cash investment is made except that no tax credit shall be allowed in a year
prior to January 1, 2005. If the amount by which that portion of the credit
allowed by this section exceeds the investors' liability in any one taxable
year, beginning in the year 2005, the remaining portion of the credit may
be carried forward until the total amount of the credit is used. If the
investor is a permitted entity investor, the credit provided by this section
shall be claimed by the owners of the permitted entity investor in
proportion to their ownership share of the permitted entity investor.
(b) For tax year 2021 and all tax years thereafter, the secretary of
revenue shall not allow tax credits of more than $100,000 for a single
Kansas business or a total of $350,000 in tax credits for a single year per
investor who is a natural person or owner of a permitted entity investor.
No tax credits authorized by this act shall be allowed for any cash
investments in qualified securities for any year after the year 2026 2031.
The total amount of tax credits that may be allowed under this section shall
not exceed:
(1) $4,000,000 during the tax year 2007;
(2) $6,000,000 for tax years 2008 through 2010 and 2012 through
2022, except that for tax year 2011, the total amount of tax credits that
may be allowed under this section shall not exceed $5,000,000;
(3) $6,500,000 for tax year 2023;
(4) $7,000,000 for tax year 2024;
(5) $7,500,000 for tax year 2025; and
(6) $8,000,000 for tax year 2026 and for each succeeding tax year
through tax year 2031.
The balance of unissued tax credits may be carried over for issuance in
future years until tax year 2026 2031.
(c) A cash investment in a qualified security shall be deemed to have
been made on the date of acquisition of the qualified security, as such date
is determined in accordance with the provisions of the internal revenue
code.
(d) Any investor without a current tax liability at the time of the
investment in a qualified Kansas business, who does not reasonably
believe that it such investor will owe any such tax for the current taxable
year and who makes a cash investment in a qualified security of a qualified
Kansas business shall be deemed to acquire an interest in the nature of a
transferable credit limited, for tax year 2021 and all tax years thereafter, to
an amount of up to 50% of this such cash investment. This The interest
may be transferred to any natural person whether or not such person is
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then an investor and be claimed by the transferee as a credit against the
transferee's Kansas income tax liability beginning in the year provided in
subsection (a). No person shall be entitled to a refund for the interest
created under this section. Only the full credit for any one investment may
be transferred and this such interest may only be transferred one time. A
credit acquired by transfer shall be subject to the limitations prescribed in
this section. Documentation of any credit acquired by transfer shall be
provided by the investor in the manner required by the director of taxation.
(e) The reasonable costs of the administration of this act, the review
of applications for certification as qualified Kansas businesses and the
issuance of tax credits authorized by this act shall be reimbursed through
fees paid by the qualified Kansas businesses and the investors or the
transferees of investors, according to a reasonable fee schedule adopted by
the secretary by rules and regulations in accordance with the rules and
regulations filing act.
Sec. 7. 6. K.S.A. 79-229 is hereby amended to read as follows: 79-
229. (a) The following described property, to the extent herein specified,
shall be exempt from all property taxes levied under the laws of the state
of Kansas: Any new biomass-to-energy plant property or any expanded
biomass-to-energy plant property.
(b) The provisions of subsection (a) shall apply from and after
purchase or commencement of construction or installation of such property
and for the 10 taxable years immediately following the taxable year in
which construction or installation of such property is completed.
(c) The provisions of this section shall apply to all taxable years
commencing after December 31, 2005, and ending before January 1,
2026.
(d) As used in this section:
(1) "Biomass-to-energy plant" has the meaning provided by K.S.A.
79-32,233, and amendments thereto.
(2) "Expanded biomass-to-energy plant property" means any real or
tangible personal property purchased, constructed or installed for
incorporation in and use as part of an expansion of an existing biomass-to-
energy plant, construction of which expansion begins after December 31,
2005.
(3) "Expansion of an existing biomass-to-energy plant" means
expansion of the capacity of an existing biomass-to-energy plant by at
least 10% of such capacity.
(4) "New biomass-to-energy plant property" means any real or
tangible personal property purchased, constructed or installed for
incorporation in and use as part of a biomass-to-energy plant, construction
of which begins after December 31, 2005.
Sec. 8. 7. K.S.A. 2025 Supp. 79-32,160a is hereby amended to read
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as follows: 79-32,160a. (a) For taxable years commencing after December
31, 1999, and before January 1, 2012, any taxpayer who shall invest in a
qualified business facility, as defined in K.S.A. 79-32,154(b), and
amendments thereto, and effective for tax years commencing after
December 31, 2010, and before January 1, 2012, located in an area other
than a metropolitan county as defined in either K.S.A. 74-50,114 or 74-
50,211, and amendments thereto, and also meets the definition of a
business in K.S.A. 74-50,114(b), and amendments thereto, shall be
allowed a credit for such investment, in an amount determined under
subsection (b) or (c), as the case requires, against the tax imposed by the
Kansas income tax act or where the qualified business facility is the
principal place from which the trade or business of the taxpayer is directed
or managed and the facility has facilitated the creation of at least 20 new
full-time positions, against the premium tax or privilege fees imposed
pursuant to K.S.A. 40-252, and amendments thereto, or as measured by the
net income of financial institutions imposed pursuant to article 11 of
chapter 79 of the Kansas Statutes Annotated, and amendments thereto, for
the taxable year during which commencement of commercial operations,
as defined in K.S.A. 79-32,154(f), and amendments thereto, occurs at such
qualified business facility. In the case of a taxpayer who meets the
definition of a manufacturing business in K.S.A. 74-50,114(d), and
amendments thereto, no credit shall be allowed under this section unless
the number of qualified business facility employees, as determined under
K.S.A. 79-32,154(d), and amendments thereto, engaged or maintained in
employment at the qualified business facility as a direct result of the
investment by the taxpayer for the taxable year for which the credit is
claimed equals or exceeds two. In the case of a taxpayer who meets the
definition of a nonmanufacturing business in K.S.A. 74-50,114(f), and
amendments thereto, no credit shall be allowed under this section unless
the number of qualified business facility employees, as determined under
K.S.A. 79-32,154(d), and amendments thereto, engaged or maintained in
employment at the qualified business facility as a direct result of the
investment by the taxpayer for the taxable year for which the credit is
claimed equals or exceeds five. Where an employee performs services for
the taxpayer outside the qualified business facility, the employee shall be
considered engaged or maintained in employment at the qualified business
facility if: (1) The employee's service performed outside the qualified
business facility is incidental to the employee's service inside the qualified
business facility; or (2) the base of operations or, the place from which the
service is directed or controlled, is at the qualified business facility.
(b) The credit allowed by subsection (a) for any taxpayer who invests
in a qualified business facility that is located in a designated
nonmetropolitan region established under K.S.A. 74-50,116, and
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amendments thereto, on or after the effective date of this act, shall be a
portion of the income tax imposed by the Kansas income tax act on the
taxpayer's Kansas taxable income, the premium tax or privilege fees
imposed pursuant to K.S.A. 40-252, and amendments thereto, or the
privilege tax as measured by the net income of financial institutions
imposed pursuant to article 11 of chapter 79 of the Kansas Statutes
Annotated, and amendments thereto, for the taxable year for which such
credit is allowed, but in the case where the qualified business facility
investment was made prior to January 1, 1996, not in excess of 50% of
such tax. Such portion shall be an amount equal to the sum of the
following:
(1) $2,500 for each qualified business facility employee determined
under K.S.A. 79-32,154, and amendments thereto; plus
(2) $1,000 for each $100,000, or major fraction thereof, which shall
be deemed to be 51% or more, in qualified business facility investment, as
determined under K.S.A. 79-32,154, and amendments thereto.
(c) The credit allowed by subsection (a) for any taxpayer who invests
in a qualified business facility that is not located in a nonmetropolitan
region established under K.S.A. 74-50,116, and amendments thereto, and
effective for tax years commencing after December 31, 2010, and before
January 1, 2012, located in an area other than a metropolitan county as
defined in either K.S.A. 74-50,114 or 74-50,211, and amendments thereto,
and that also meets the definition of business in K.S.A. 74-50,114(b), and
amendments thereto, on or after the effective date of this act, shall be a
portion of the income tax imposed by the Kansas income tax act on the
taxpayer's Kansas taxable income, the premium tax or privilege fees
imposed pursuant to K.S.A. 40-252, and amendments thereto, or the
privilege tax as measured by the net income of financial institutions
imposed pursuant to article 11 of chapter 79 of the Kansas Statutes
Annotated, and amendments thereto, for the taxable year for which such
credit is allowed, but in the case where the qualified business facility
investment was made prior to January 1, 1996, not in excess of 50% of
such tax. Such portion shall be an amount equal to the sum of the
following:
(1) $1,500 for each qualified business facility employee as
determined under K.S.A. 79-32,154, and amendments thereto; and
(2) $1,000 for each $100,000, or major fraction thereof, which shall
be deemed to be 51% or more, in qualified business facility investment as
determined under K.S.A. 79-32,154, and amendments thereto.
(d) The credit allowed by subsection (a) for each qualified business
facility employee and for qualified business facility investment shall be a
one-time credit. If the amount of the credit allowed under subsection (a)
exceeds the tax imposed by the Kansas income tax act on the taxpayer's
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Kansas taxable income, the premium tax and privilege fees imposed
pursuant to K.S.A. 40-252, and amendments thereto, or the privilege tax as
measured by the net income of financial institutions imposed pursuant to
article 11 of chapter 79 of the Kansas Statutes Annotated, and amendments
thereto, for the taxable year, or in the case where the qualified business
facility investment was made prior to January 1, 1996, 50% of such tax
imposed upon the amount which exceeds such tax liability or such portion
thereof may be carried over for credit in the same manner in the
succeeding taxable years until the total amount of such credit is used.
Except that, before the credit is allowed, a taxpayer, who meets the
definition of a manufacturing business in K.S.A. 74-50,114(d), and
amendments thereto, shall recertify annually that the net increase of a
minimum of two qualified business facility employees has continued to be
maintained and a taxpayer, who meets the definition of a
nonmanufacturing business in K.S.A. 74-50,114(f), and amendments
thereto, shall recertify annually that the net increase of a minimum of five
qualified business employees has continued to be maintained.
(e) Notwithstanding the foregoing provisions of this section, and
except as otherwise provided in this subsection, any taxpayer qualified and
certified under the provisions of K.S.A. 74-50,131, and amendments
thereto, that prior to making a commitment to invest in a qualified Kansas
business, has filed a certificate of intent to invest in a qualified business
facility in a form satisfactory to the secretary of commerce, shall be
entitled to a credit in an amount equal to 10% of that portion of the
qualified business facility investment that exceeds $50,000 in lieu of the
credit provided in subsection (b)(2) or (c)(2) without regard to the number
of qualified business facility employees engaged or maintained in
employment at the qualified business facility. For tax years beginning on
or after January 1, 2012, for a qualified business facility investment in
Douglas, Johnson, Sedgwick, Shawnee or Wyandotte county, such credit
shall be in an amount equal to 10% of that portion of the qualified business
facility investment that exceeds $1,000,000. Any taxpayer who has filed a
certificate of intent to invest in a qualified business facility pursuant to this
subsection in Douglas, Johnson, Sedgwick, Shawnee or Wyandotte county
prior to December 31, 2011, and commences investments in a qualified
business facility prior to December 31, 2013, may claim credits under
K.S.A. 74-50,131, 74-50,132 and 79-32,160a(e), and amendments thereto,
in an amount equal to 10% of that portion of the qualified business facility
investment that exceeds $50,000. Timing modifications may be authorized
at the discretion of the secretary of commerce and the secretary of revenue
during the transition period. The credit allowed by this subsection shall be
a one-time credit. If the amount thereof exceeds the tax imposed by the
Kansas income tax act on the taxpayer's Kansas taxable income or the
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premium tax or privilege fees imposed pursuant to K.S.A. 40-252, and
amendments thereto, or the privilege tax as measured by net income of
financial institutions imposed pursuant to article 11 of chapter 79 of the
Kansas Statutes Annotated, and amendments thereto, for the taxable year,
the amount thereof that exceeds such tax liability may be carried forward
for credit in the succeeding taxable year or years until the total amount of
the tax credit is used, except that no such tax credit shall be carried
forward for deduction after the 16 th taxable year succeeding the taxable
year in which such credit initially was claimed, and no carryforward shall
be allowed for deduction in any succeeding taxable year unless the
taxpayer certifies under oath that the taxpayer continues to meet the
requirements of K.S.A. 74-50,131, and amendments thereto, and this act.
In no event shall any credit allowed under this section that expired during
any taxable year prior to the taxable year commencing January 1, 2011, be
revived under the provisions of this act.
(f) For projects placed into service on and after January 1, 2021, a
any taxpayer, including all pass-through entities, awarded a tax credit may
transfer up to 50% of the unused portion of the tax credit allowed under
subsection (e), as provided in this subsection. The taxpayer may make a
transfer to one or more transferees, but the total of all transfers shall not
exceed 50% of the taxpayer's tax credit. The taxpayer shall may make the
transfer or transfers within a single tax year at any time during the
carryforward period allowed by this subsection. The taxpayer shall ensure
that any tax credit transferred has not been used, including any use by any
partner, owner or shareholder of a pass-through entity . The credit may be
transferred to any individual or entity and shall be claimed in the year the
credit was transferred against the transferee's tax liability for the income
tax under the Kansas income tax act or the premium tax or privilege fees
imposed pursuant to K.S.A. 40-252, and amendments thereto, or the
privilege tax as measured by the net income of financial institutions
imposed pursuant to article 11 of chapter 79 of the Kansas Statutes
Annotated, and amendments thereto. The amount of the credit that exceeds
the transferee's tax liability for such year may be carried forward for credit
in the succeeding taxable year or years until the total amount of the tax
credit is used, except that no such credit shall be carried forward for
deduction after the 16 th taxable year succeeding the taxable year in which
such credit was initially claimed. The taxpayer or transferee shall provide
such documentation of the tax credit transfer to the secretary of revenue as
may be required by the secretary.
(g) Notwithstanding the provisions of subsection (f), for projects
placed into service on and after January 1, 2026, by an S corporation that
is wholly owned by an employee stock ownership plan, as defined in the
internal revenue code of 1986, as amended, U.S.C. § 4975(e)(7), and the
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trust thereunder, such S corporation and the trust thereunder may make
one or more transfers that may total up to 100% of the unused portion of
the tax credit allowed pursuant to subsection (e). Such transfer or
transfers may be made to one or more transferees in one or more tax years
and at any time during the carryforward period allowed by subsection (f).
The taxpayer shall ensure that any transferred tax credit or portion of the
tax credit has not been used. The tax credit or portion thereof may be
transferred to any individual or entity and shall be claimed in the year that
the credit was transferred against the transferee's tax liability for the
income tax under the Kansas income tax act or the premium tax or
privilege fees imposed pursuant to K.S.A. 40-252, and amendments
thereto, or the privilege tax as measured by the net income of financial
institutions imposed pursuant to article 11 of chapter 79 of the Kansas
Statutes Annotated, and amendments thereto. The amount of the credit that
exceeds the transferee's tax liability for such year may be carried forward
for credit in the succeeding taxable year or years until the total amount of
the tax credit is used, except that no such credit shall be carried forward
for transfer or deduction after the 16th taxable year succeeding the taxable
year in which such credit was initially claimed. The taxpayer or transferee
shall provide such documentation of the tax credit transfer to the secretary
of revenue as may be required by the secretary.
(h) In the event the tax credit earned by the taxpayer and transferred
to a transferee is later disallowed in whole or in part by the secretary of
revenue, the taxpayer that originally earned the tax credit shall be liable for
repayment to the state in the amount disallowed.
(h)(i) For tax years commencing after December 31, 2005, any
taxpayer claiming credits pursuant to this section, as a condition for
claiming and qualifying for such credits, shall provide information
pursuant to K.S.A. 79-32,243, and amendments thereto, as part of the tax
return in which such credits are claimed. Such credits shall not be denied
solely on the basis of the contents of the information provided by the
taxpayer pursuant to K.S.A. 79-32,243, and amendments thereto.
(i)(j) This section and K.S.A. 79-32,160b, and amendments thereto,
shall be a part of and supplemental to the job expansion and investment
credit act of 1976, and amendments thereto.
Sec. 9. K.S.A. 2025 Supp. 79-32,176a is hereby amended to read as
follows: 79-32,176a. (a) Any resident individual taxpayer who makes
expenditures for the purpose of making all or any portion of an existing
facility accessible to individuals with a disability, which facility is used as,
or in connection with, such taxpayer's principal dwelling or the principal
dwelling of a lineal ascendant or descendant, including construction of a
small barrier-free living unit attached to such principal dwelling, shall be
entitled to claim a tax credit in an amount equal to the applicable
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percentage of such expenditures or $15,000, whichever is less, against the
income tax liability imposed against such taxpayer pursuant to article 32 of
chapter 79 of the Kansas Statutes Annotated, and amendments thereto.
Nothing in this subsection shall be deemed to prevent any such taxpayer
from claiming such credit: (1) For each principal dwelling in which the
taxpayer or lineal ascendant or descendant may reside, or facility used in
connection therewith; or (2) more than once, but not more often than once
every four-year period of time. The applicable percentage of such
expenditures eligible for credit shall be as set forth in the following
schedules:
Married individuals filing joint returns.
% of
Taxpayers expenditures
Federal Adjusted eligible for
Gross Income credit
$0 to $60,000 ................................................................................... 100%
Over $60,000 but not over $70,000 .................................................. 90%
Over $70,000 but not over $80,000 .................................................. 80%
Over $80,000 but not over $90,000 .................................................. 70%
Over $90,000 but not over $100,000 ................................................ 60%
Over $100,000 but not over $110,000 .............................................. 50%
Over $110,000 but not over $120,000 .............................................. 40%
Over $120,000 but not over $130,000 .............................................. 30%
Over $130,000 but not over $140,000 .............................................. 20%
Over $140,000 but not over $150,000 .............................................. 10%
Over $150,000 ................................................................................... 0%
All other individuals.
% of
Taxpayers expenditures
Federal Adjusted eligible for
Gross Income credit
$0 to $40,000 ................................................................................... 100%
Over $40,000 but not over $50,000 .................................................. 90%
Over $50,000 but not over $60,000 .................................................. 80%
Over $60,000 but not over $70,000 .................................................. 70%
Over $70,000 but not over $80,000 .................................................. 60%
Over $80,000 but not over $90,000 .................................................. 50%
Over $90,000 but not over $100,000 ................................................ 40%
Over $100,000 but not over $110,000 .............................................. 30%
Over $110,000 but not over $120,000 .............................................. 20%
Over $120,000 but not over $130,000 .............................................. 10%
Over $130,000 ................................................................................... 0%
Such tax credit shall be deducted from the taxpayer's income tax
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liability for the taxable year in which the expenditures are made by the
taxpayer. If the amount of such tax credit exceeds the taxpayer's income
tax liability for such taxable year, the amount thereof which exceeds such
tax liability may be carried over for deduction from the taxpayer's income
tax liability in the next succeeding taxable year or years until the total
amount of the tax credit has been deducted from tax liability, except that
no such tax credit shall be carried over for deduction after the fourth
taxable year succeeding the taxable year in which the expenditures are
made.
(b) Notwithstanding the provisions of subsection (a), if the amount of
the taxpayer's tax liability is less than $3,750 in the first year in which the
credit is claimed under this section, an amount equal to the amount by
which 1/4 of the credit allowable under this section exceeds such tax
liability shall be refunded to the taxpayer and the amount by which such
credit exceeds such tax liability less the amount of such refund may be
carried over for the next three succeeding taxable years. If the amount of
the taxpayer's tax liability is less than $3,750 in the second year in which
the credit is claimed under this section, an amount equal to the amount by
which 1/3 of the amount of the credit carried over from the first taxable
year exceeds such tax liability shall be refunded to the taxpayer and the
amount by which the amount of the credit carried over from the first
taxable year exceeds such tax liability less the amount of such refund may
be carried over for the next two succeeding taxable years. If the amount of
the taxpayer's tax liability is less than $3,750 in the third year in which the
credit is claimed under this section, an amount equal to the amount by
which ½ of the amount carried over from the second taxable year exceeds
such tax liability shall be refunded to the taxpayer and the amount by
which the amount of the credit carried over from the second taxable year
exceeds such tax liability less the amount of such refund may be carried
over to the next succeeding taxable year. If the amount of the credit carried
over from the third taxable year exceeds the taxpayer's income tax liability
for such year, the amount thereof which exceeds such tax liability shall be
refunded to the taxpayer.
(c) In the case of all tax years commencing after December 31, 2021,
the maximum tax credit amount, as prescribed in subsection (a), and the
tax liability threshold amount in the first, second and third years, as
prescribed in subsection (b), shall be increased by an amount equal to such
maximum tax credit amount and tax liability threshold amount multiplied
by the cost-of-living adjustment determined under section 1(f)(3) of the
federal internal revenue code for the calendar year in which the taxable
year commences.
(d) The provisions of this section are applicable to tax year 2021 , and
all tax years thereafter ending before January 1, 2026. No new tax credit
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pursuant to this section shall be awarded for any tax year after tax year
2025.
Sec. 10. 8. K.S.A. 79-32,177 is hereby amended to read as follows:
79-32,177. Any taxpayer who makes expenditures for the purpose of
making all or any portion of an existing facility accessible to individuals
with a disability, or who makes expenditures for the purpose of making all
or any portion of a facility or of equipment usable for the employment of
individuals with a disability, which facility or equipment is on real
property located in this state and used in a trade or business or held for the
production of income, shall be entitled to claim an income tax credit in an
amount equal to 50% of such expenditures or, the amount of $10,000,
whichever is less, against the income tax liability imposed against such
taxpayer pursuant to article 32 of chapter 79 of the Kansas Statutes
Annotated, and amendments thereto. Such tax credit shall be deducted
from the taxpayer's income tax liability for the taxable year in which the
expenditures are made by the taxpayer. If the amount of such tax credit
exceeds the taxpayer's income tax liability for such taxable year, the
amount thereof which exceeds such tax liability may be carried over for
deduction from the taxpayer's income tax liability in the next succeeding
taxable year or years until the total amount of the tax credit has been
deducted from tax liability, except that no such tax credit shall be carried
over for deduction after the fourth taxable year succeeding the taxable year
in which the expenditures are made. No new tax credit pursuant to this
section shall be awarded for any tax year after tax year 2025.
Sec. 11. 9. K.S.A. 79-32,179 is hereby amended to read as follows:
79-32,179. The provisions of this act shall apply to all taxable years
commencing after December 31, 1977, except that the provisions of K.S.A.
79-32,175 through 79-32,178 79-32,177 , and amendments thereto, shall
not apply to taxable years commencing after December 31, 2025.
Sec. 12. 10. K.S.A. 79-32,180 is hereby amended to read as follows:
79-32,180. The provisions of this act K.S.A. 79-32,175 through 79-32,178
79-32,177, and amendments thereto, shall be applicable to all taxable
years commencing after December 31, 1980, and ending before January 1,
2026.
Sec. 13. 11. K.S.A. 79-32,201 is hereby amended to read as follows:
79-32,201. (a) Any taxpayer who makes expenditures for a qualified
alternative-fueled motor vehicle or alternative-fuel fueling station shall be
allowed a credit against the income tax imposed by article 32 of chapter 79
of the Kansas Statutes Annotated, as follows:
(1) For any qualified alternative-fueled motor vehicle placed in
service on or after January 1, 1996, and before January 1, 2005, an amount
equal to 50% of the incremental cost or conversion cost for each qualified
alternative-fueled motor vehicle but not to exceed $3,000 for each such
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motor vehicle with a gross vehicle weight of less than 10,000 lbs.; $5,000
for a heavy duty motor vehicle with a gross vehicle weight of greater than
10,000 lbs. but less than 26,000 lbs.; and $50,000 for motor vehicles
having a gross vehicle weight of greater than 26,000 lbs.;
(2) for any qualified alternative-fueled motor vehicle placed in
service on or after January 1, 2005, an amount equal to 40% of the
incremental cost or conversion cost for each qualified alternative-fueled
motor vehicle, but not to exceed $2,400 for each such motor vehicle with a
gross vehicle weight of less than 10,000 lbs.; $4,000 for a heavy duty
motor vehicle with a gross vehicle weight of greater than 10,000 lbs. but
less than 26,000 lbs.; and $40,000 for motor vehicles having a gross
vehicle weight of greater than 26,000 lbs.;
(3) for any qualified alternative-fuel fueling station placed in service
on or after January 1, 1996, and before January 1, 2005, an amount equal
to 50% of the total amount expended for each qualified alternative-fuel
fueling station but not to exceed $200,000 for each fueling station;
(4) for any qualified alternative-fuel fueling station placed in service
on or after January 1, 2005, and before January 1, 2009, an amount equal
to 40% of the total amount expended for each qualified alternative-fuel
fueling station, but not to exceed $160,000 for each fueling station; and
(5) for any qualified alternative-fuel fueling station placed in service
on or after January 1, 2009, an amount equal to 40% of the total amount
expended for each qualified alternative-fuel fueling station, but not to
exceed $100,000 for each fueling station.
(b) If no credit has been claimed pursuant to subsection (a), a credit in
an amount not exceeding the lesser of 5% of the cost of the vehicle or
$750 shall be allowed to a taxpayer who purchases a motor vehicle
equipped by the vehicle manufacturer with an alternative fuel system and
who is unable or elects not to determine the exact basis attributable to such
property. The credit under this subsection shall be allowed only to the first
individual to take title to such motor vehicle, other than for resale. The
credit under this subsection for motor vehicles which are capable of
operating on a blend of 85% ethanol and 15% gasoline shall be allowed for
taxable years commencing after December 31, 1999, only if the individual
claiming the credit furnishes evidence of the purchase, during the period of
time beginning with the date of purchase of such vehicle and ending on
December 31 of the next succeeding calendar year, of 500 gallons of such
ethanol and gasoline blend as may be required or is satisfactory to the
secretary of revenue.
(c) The tax credit under subsection (a)(1) through (a)(4) or (b) shall
be deducted from the taxpayer's income tax liability for the taxable year in
which the expenditures are made by the taxpayer. If the amount of the tax
credit exceeds the taxpayer's income tax liability for the taxable year, the
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amount which exceeds the tax liability may be carried over for deduction
from the taxpayer's income tax liability in the next succeeding taxable year
or years until the total amount of the tax credit has been deducted from tax
liability, except that no such tax credit shall be carried over for deduction
after the third taxable year succeeding the taxable year in which the
expenditures are made.
(d) The tax credit under subsection (a)(5) shall be deducted from the
taxpayer's income tax liability for the taxable year in which the
expenditures are made by the taxpayer. If the amount of the tax credit
exceeds the taxpayer's income tax liability for the taxable year, the amount
which exceeds the tax liability may be carried over for deduction from the
taxpayer's income tax liability in the next succeeding taxable year or years
until the total amount of the tax credit has been deducted from tax liability,
except that no such tax credit shall be carried over for deduction after the
fourth taxable year in which the expenditures are made.
(e) As used in this section:
(1) "Alternative fuel" means a combustible liquid derived from grain
starch, oil seed, animal fat or other biomass; or produced from biogas
source, including any nonfossilized, decaying, organic matter.
(2) "Qualified alternative-fueled motor vehicle" means a motor
vehicle that operates on an alternative fuel, meets or exceeds the clean fuel
vehicle standards in the federal clean air act amendments of 1990, Title II
and meets one of the following categories:
(A) Bi-fuel motor vehicle: A motor vehicle with two separate fuel
systems designed to run on either an alternative fuel or conventional fuel,
using only one fuel at a time;
(B) dedicated motor vehicle: A motor vehicle with an engine designed
to operate on a single alternative fuel only; or
(C) flexible fuel motor vehicle: A motor vehicle that may operate on a
blend of an alternative fuel with a conventional fuel, such as E-85 (85%
ethanol and 15% gasoline) or M-85 (85% methanol and 15% gasoline), as
long as such motor vehicle is capable of operating on at least an 85%
alternative fuel blend.
(3) "Qualified alternative-fuel fueling station" means the property
which is directly related to the delivery of alternative fuel into the fuel tank
of a motor vehicle propelled by such fuel, including the compression
equipment, storage vessels and dispensers for such fuel at the point where
such fuel is delivered but only if such property is primarily used to deliver
such fuel for use in a qualified alternative-fueled motor vehicle.
(4) "Incremental cost" means the cost that results from subtracting the
manufacturer's list price of the motor vehicle operating on conventional
gasoline or diesel fuel from the manufacturer's list price of the same model
motor vehicle designed to operate on an alternative fuel.
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(5) "Conversion cost" means the cost that results from modifying a
motor vehicle which is propelled by gasoline or diesel to be propelled by
an alternative fuel.
(6) "Taxpayer" means any person who owns and operates a qualified
alternative-fueled vehicle licensed in the state of Kansas or who makes an
expenditure for a qualified alternative-fuel fueling station.
(7) "Person" means every natural person, association, partnership,
limited liability company, limited partnership or corporation.
(f) Except as otherwise more specifically provided, the provisions of
this section shall apply to all taxable years commencing after December
31, 1995, and ending before January 1, 2026.
(g) For tax year 2013 and all tax years thereafter through tax year
2025, the income tax credit provided by this section shall only be available
to taxpayers subject to the income tax on corporations imposed pursuant to
subsection (c) of K.S.A. 79-32,110, and amendments thereto, and shall be
applied only against such taxpayer's corporate income tax liability. No new
tax credit provided by this section shall be awarded to any taxpayer for
any tax year after tax year 2025.
Sec. 14. 12. K.S.A. 79-32,204 is hereby amended to read as follows:
79-32,204. (a) As used in this section:
(1) Terms have the meanings provided by K.S.A. 65-1,178, and
amendments thereto;
(2) "qualified swine facility" means a swine facility that: (A) Is
owned and operated by a sole proprietorship or partnership or by a family
farm corporation, authorized farm corporation, limited liability agricultural
company, family farm limited liability agricultural company, limited
agricultural partnership, family trust, authorized trust or testamentary trust,
as defined by K.S.A. 17-5903, and amendments thereto; and (B) is
utilizing its swine waste management system on January 1, 1998; and
(3) "required improvements to a qualified swine facility" means
capital improvements that the secretary of health and environment certifies
to the director of taxation: (A) Are required for a qualified swine facility to
comply with the standards and requirements established pursuant to
K.S.A. 65-1,178 through 65-1,198, and amendments thereto, or pursuant
to the amendments made by this act to K.S.A. 65-171d, and amendments
thereto; and (B) are not required because of expansion for which a permit
has not been issued or applied for before the effective date of this act.
(b) There shall be allowed as a credit against the tax liability of a
taxpayer imposed under the Kansas income tax act an amount equal to not
more than 50% of the costs incurred by the taxpayer for required
improvements to a qualified swine facility. The tax credit allowed by this
subsection shall be deducted from the taxpayer's income tax liability for
the taxable year in which the expenditures are made by the taxpayer. If the
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amount of such tax credit exceeds the taxpayer's income tax liability for
such taxable year, the taxpayer may carry over the amount thereof that
exceeds such tax liability for deduction from the taxpayer's income tax
liability in the next succeeding taxable year or years until the total amount
of the tax credit has been deducted from tax liability, except that no such
tax credit shall be carried over for deduction after the fourth taxable year
succeeding the year in which the costs are incurred.
(c) The provisions of this section shall be applicable to all taxable
years commencing after December 31, 1997, and ending before January 1,
2026.
(d) For tax year 2013 and all tax years thereafter before tax year
2026, the income tax credit provided by this section shall only be available
to taxpayers subject to the income tax on corporations imposed pursuant to
subsection (c) of K.S.A. 79-32,110, and amendments thereto, and shall be
applied only against such taxpayer's corporate income tax liability. No new
tax credit pursuant to this section shall be awarded to any taxpayer for
any tax year after tax year 2025.
Sec. 15. 13. K.S.A. 79-32,207 is hereby amended to read as follows:
79-32,207. (a) As used in this section, "abandoned oil or gas well" means
an abandoned well, as defined by K.S.A. 55-191, and amendments thereto:
(1) The drilling of which was commenced before January 1, 1970;
and
(2) which is located on land owned by the taxpayer claiming the tax
credit allowed by this section.
(b) For any taxable year commencing after December 31, 2000, and
ending before January 1, 2026, a credit shall be allowed against the tax
imposed by the Kansas income tax act on the Kansas taxable income of a
taxpayer for expenditures made for the purpose of plugging any
abandoned oil or gas well in accordance with rules and regulations of the
state corporation commission applicable thereto, in an amount equal to
50% of such expenditures made in the taxable year.
(c) If the amount of the tax credit allowed by this section exceeds the
taxpayer's income tax liability for such taxable year, the amount thereof
which exceeds such tax liability may be carried over for deduction from
the taxpayer's income tax liability in the next succeeding taxable year or
years until the total amount of the tax credit has been deducted from tax
liability.
(d) The total amount of credits allowed taxpayers pursuant to this
section, including the amount of credits carried over under subsection (c),
shall not exceed $250,000 for any one fiscal year.
(e) The secretary of revenue shall adopt such rules and regulations as
necessary to carry out the purposes of this section.
(f) For tax year 2013 and all tax years thereafter through tax year
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2025, the income tax credit provided by this section shall only be available
to taxpayers subject to the income tax on corporations imposed pursuant to
subsection (c) of K.S.A. 79-32,110, and amendments thereto, and shall be
applied only against such taxpayer's corporate income tax liability. No new
tax credit pursuant to this section shall be awarded to any taxpayer for
any tax year after tax year 2025.
Sec. 16. K.S.A. 79-32,222 is hereby amended to read as follows: 79-
32,222. (a) As used in this section:
(1) "Refinery" has the meaning provided by K.S.A. 79-32,217, and
amendments thereto.
(2) "Qualified expenditures" means expenditures which the secretary
of health and environment certifies to the director of taxation are required
for an existing refinery to comply with environmental standards or
requirements established pursuant to federal statute or regulation, or state
statute or rules and regulation, adopted after December 31, 2006.
(b) There shall be allowed as a credit against the tax liability of a
taxpayer imposed under the Kansas income tax act an amount equal to the
taxpayer's qualified expenditures. The tax credit allowed by this subsection
shall be deducted from the taxpayer's income tax liability for the taxable
year in which the expenditures are made by the taxpayer. If the amount of
such tax credit exceeds the taxpayer's income tax liability for such taxable
year, the taxpayer may carry over the amount thereof that exceeds such tax
liability for deduction from the taxpayer's income tax liability in the next
succeeding taxable year or years until the total amount of the tax credit has
been deducted from tax liability, except that no such tax credit shall be
carried over for deduction after the fourth taxable year succeeding the year
in which the costs are incurred.
(c) (1) To qualify the expenditures of the tax credit allowed by this
section, a taxpayer shall apply to the secretary of health and environment
for a certification that the costs were incurred to comply with
environmental standards or requirements as specified in subsection (a).
The secretary shall prescribe the form of the application, which shall
include, but not be limited to, the following information: (A) A detailed
description of the refinery project that is the subject of the expenditure; (B)
a citation to the applicable federal or state statutes, regulations or rules and
regulations which require the environmental compliance; (C) a detailed
accounting of the costs incurred for the environmental compliance; and
(D) a certification by a responsible official that, based on information and
belief formed after reasonable inquiry, the statements and information in
the application are true, accurate and complete.
(2) If the secretary of health and environment determines that the
expenditures were incurred to comply with environmental standards or
requirements as specified in subsection (a), the secretary shall issue a
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certificate of compliance to the director of taxation.
(3) The secretary of health and environment may adopt rules and
regulations to administer the provisions of this subsection, including rules
and regulations to fix, charge and collect an application fee to cover all or
any part of the department of health and environment's cost of certifying
the taxpayer's qualified expenditures under this subsection.
(d) The provisions of this section shall be applicable to all taxable
years commencing after December 31, 2006, and ending before January 1,
2026.
(e) For tax year 2013 and all tax years thereafter through tax year
2025, the income tax credit provided by this section shall only be available
to taxpayers subject to the income tax on corporations imposed pursuant to
subsection (c) of K.S.A. 79-32,110, and amendments thereto, and shall be
applied only against such taxpayer's corporate income tax liability. No new
tax credit pursuant to this section shall be awarded to any taxpayer for
any tax year after tax year 2025.
Sec. 17. 14. K.S.A. 79-32,256 is hereby amended to read as follows:
79-32,256. (a) A taxpayer shall be entitled to a deduction from Kansas
adjusted gross income with respect to the amortization of the amortizable
costs of carbon dioxide capture, sequestration or utilization machinery and
equipment based upon a period of 10 years. Such amortization deduction
shall be an amount equal to 55% of the amortizable costs of such
machinery and equipment for the first taxable year in which such
machinery and equipment are in operation and 5% of the amortizable costs
of such machinery and equipment for each of the next nine taxable years.
(b) The election of the taxpayer to claim the deduction allowed by
subsection (a) shall be made by filing a statement of such election with the
secretary of revenue in the manner and form and within the time
prescribed by rules and regulations adopted by the secretary.
(c) The provisions of this section shall apply to all taxable years
commencing after December 31, 2007, and ending before January 1,
2026.
(d) The secretary of revenue shall adopt such rules and regulations as
deemed necessary to carry out the provisions of this section.
(e) As used in this section, "carbon dioxide capture, sequestration or
utilization machinery and equipment" means any machinery and
equipment which is located in this state and is: (1) Used to capture carbon
dioxide from industrial and other anthropogenic sources, or to convert
such carbon dioxide into one or more products; (2) used to inject carbon
dioxide into a carbon dioxide injection well, as defined in K.S.A. 55-1637,
and amendments thereto; or (3) used to recover carbon dioxide from
sequestration.
Sec. 18. 15. K.S.A. 40-2246, 65-7107, 74-50,131, 74-50,154, 79-229,
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79-32,177, 79-32,179, 79-32,180, 79-32,201, 79-32,204, 79-32,207, 79-
32,218, 79-32,222, 79-32,233, 79-32,234, 79-32,235, 79-32,236, 79-
32,237, 79-32,245, 79-32,246, 79-32,247, 79-32,248, 79-32,249, 79-
32,251, 79-32,252, 79-32,253, 79-32,254, 79-32,255 and 79-32,256 and
K.S.A. 2025 Supp. 32-1438 , 74-8133, and 79-32,160a , 79-32,176a, 79-
32,275 and 79-32,295 are hereby repealed.
Sec. 19. 16. This act shall take effect and be in force from and after
its publication in the statute book.
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