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An Act
ENROLLED HOUSE
BILL NO. 3704 By: Crosswhite Hader, Caldwell
(Chad), Hill, and Maynard
of the House
and
Daniels and Howard of the
Senate
An Act relating to revenue and taxation; electing the
State of Oklahoma to participate in the federal
income tax credit for individual contributions to
scholarship granting organizations; directing the
Governor to execute required certification and
agreements as required by the United States
Department of the Treasury; requiring the Oklahoma
Tax Commission to identify certain scholarship
granting organizations and provide list to the
Secretary of the Treasury; requiring the Oklahoma Tax
Commission to promulgate necessary rules, forms, and
procedures; prohibiting the promulgation of rules
that exceed certain requirements; providing for
election to participate in the federal income tax
credit to remain in effect for certain period;
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 2357.901 of Title 68, unless
there is created a duplication in numbering, reads as follows:
A. The State of Oklahoma hereby elects to participate, to the
fullest extent permitted by federal law, in the federal income tax
ENR. H. B. NO. 3704 Page 2
credit for individual contributions to scholarship granting
organizations, as established in Section 25F of the Internal Revenue
Code of 1986, as added by Section 70411 of Pub. L. No. 119-21, or
any successor provision.
B. The Governor of this state is directed and authorized to:
1. Execute and submit any election, certification, agreement,
or other instrument required by the United States Department of the
Treasury or the Internal Revenue Service for a state to be treated
as a "covered state" for purposes of the federal credit for
contributions to scholarship granting organizations;
2. Designate, consistent with federal law, the Oklahoma Tax
Commission as the state agency responsible for:
a. identifying and registering scholarship granting
organizations within this state that meet the
requirements of Section 25F of the Internal Revenue
Code of 1986 and related federal guidance,
b. maintaining and providing to the Secretary of the
Treasury a list of scholarship granting organizations
identified in subparagraph a of this paragraph that
are located in this state, and
c. performing any reporting, recordkeeping, or compliance
functions specifically required of covered states
under Pub. L. No. 119-21 and applicable federal
regulations; and
3. Take any other action and execute any other document that is
required to implement and maintain the state's election to
participate in the federal tax credit for contributions to
scholarship granting organizations.
C. The Oklahoma Tax Commission shall:
1. Coordinate, to the extent necessary, the administration of
this section with the existing income tax credit provided in Section
2357.206 of Title 68 of the Oklahoma Statutes for contributions to
scholarship granting organizations and related entities that also
comply with Section 25F of the Internal Revenue Code, as added by
Pub. L. No. 119-21;
ENR. H. B. NO. 3704 Page 3
2. Promulgate such rules, forms, and procedures, subject to
subsection D of this section as are necessary to:
a. register scholarship granting organizations on a list
and in a format indicated by the Department of the
Treasury for purposes of this section,
b. collect and transmit information only as required by
the Secretary of the Treasury or the Internal Revenue
Service concerning qualified contributions, qualified
organizations, and scholarship awards, and
c. inform taxpayers and scholarship granting
organizations of the interaction between the federal
credit under Section 25F of the Internal Revenue Code
of 1986 and any state-level income tax credit allowed
under Section 2357.206 of Title 68 of the Oklahoma
Statutes, including any reduction in the federal
credit on account of a state credit for the same
contribution.
D. No state department, division, or any other agency,
including the Oklahoma Tax Commission and Governor, shall promulgate
any rules or regulations that exceed requirements of the applicable
federal law or rules and regulations in implementing this act.
E. The election made pursuant to subsection A of this section
shall remain in effect for all tax years for which federal law
permits state participation in the credit program, unless repealed
by an act of the Legislature or unless federal law is amended to
terminate participating-state status.
SECTION 2. This act shall become effective November 1, 2026.
ENR. H. B. NO. 3704 Page 4
Passed the House of Representatives the 23rd day of March, 2026.
Presiding Officer of the House
of Representatives
Passed the Senate the 15th day of April, 2026.
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: _________________________________