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An Act
ENROLLED HOUSE
BILL NO. 2645 By: Hilbert, Pogemiller, and
Eaves of the House
and
Paxton and Hall of the
Senate
An Act relating to revenue and taxation; establishing
an income tax credit for income from compensation
related to certain practice of medicine or
osteopathic medicine; defining terms; providing
credit amount; prohibiting credit from reducing
taxpayer's tax liability to less than zero;
specifying time period during which credit is
allowed; establishing annual cap on the total amount
of credits authorized; requiring Oklahoma Tax
Commission to calculate and publish certain
percentage; providing the formula for percentage
adjustment; providing for codification; and providing
an effective date.
SUBJECT: Revenue and taxation
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 2357.410 of Title 68, unless
there is created a duplication in numbering, reads as follows:
A. Except as provided in subsection F of this section, for tax
year 2026 and subsequent tax years, there shall be allowed a credit
against the tax imposed pursuant to Section 2355 of Title 68 of the
Oklahoma Statutes on taxable income from compensation directly
related to the practice of medicine or osteopathic medicine by a
qualifying doctor in a rural area of this state.
B. For purposes of this section:
ENR. H. B. NO. 2645 Page 2
1. “Qualifying doctor” means a medical doctor or osteopathic
physician:
a. who is licensed in this state by the State Board of
Medical Licensure and Supervision or the State Board
of Osteopathic Examiners either on or after the
effective date of this act or at any time within the
period two (2) years prior to the effective date of
this act, but not earlier than January 1, 2024,
b. who has graduated from a college of medicine or
osteopathic medicine located in this state or has
completed his or her residency in this state, and
c. whose primary residence is located within the same
county as the rural area where the compensation
qualifying for credit under this paragraph was earned.
For purposes of this subparagraph, the qualifying
doctor must maintain the primary residence within the
county for the entire taxable year for which the
credit otherwise authorized by this section is
claimed; and
2. “Rural area” means any municipality or unincorporated
location in this state which:
a. has a population not exceeding twenty-five thousand
(25,000) as determined by the most recent Federal
Decennial Census, and
b. is at least twenty-five (25) miles from the boundary
of the nearest municipality in this state with a
population exceeding twenty-five thousand (25,000) as
determined by the most recent Federal Decennial
Census.
C. The amount of the credit provided by this section claimed by
a taxpayer in any tax year shall not exceed Twenty Thousand Dollars
($20,000.00).
D. The credit authorized by this section shall not be used to
reduce the tax liability of the taxpayer to less than zero (0).
E. Except as provided in subsection F of this section, a
qualifying doctor who first claims the credit provided by this
ENR. H. B. NO. 2645 Page 3
section shall be allowed the credit for up to four (4) subsequent
taxable years so long as he or she qualifies pursuant to the
provisions of this section.
F. For tax year 2028 and subsequent tax years, the total amount
of credits authorized by this section shall not exceed One Million
Dollars ($1,000,000.00). The Oklahoma Tax Commission shall annually
calculate and publish a percentage by which the credits authorized
by this section shall be reduced so the total amount of credits used
to offset tax does not exceed the annual limit. The formula to be
used for the percentage adjustment shall be One Million Dollars
($1,000,000.00) divided by the amount of credit claimed in the
second preceding tax year. In the event the total tax credits
authorized by this section exceed the annual limit in any tax year,
the Tax Commission shall permit any excess but shall factor such
excess into the percentage adjustment formula for subsequent tax
years.
SECTION 2. This act shall become effective January 1, 2026.
ENR. H. B. NO. 2645 Page 4
Passed the House of Representatives the 28th day of May, 2025.
Presiding Officer of the House
of Representatives
Passed the Senate the 29th day of May, 2025.
Presiding Officer of the Senate
OFFICE OF THE GOVERNOR
Received by the Office of the Governor this ____________________
day of ___________________, 20_______, at _______ o'clock _______ M.
By: _________________________________
Approved by the Governor of the State of Oklahoma this _________
day of ___________________, 20_______, at _______ o'clock _______ M.
_________________________________
Governor of the State of Oklahoma
OFFICE OF THE SECRETARY OF STATE
Received by the Office of the Secretary of State this __________
day of ___________________, 20_______, at _______ o'clock _______ M.
By: _________________________________