COMMITTEE ON WAYS AND MEANS
HOUSE OF REPRESENTATIVES AMENDMENTS TO S.B. 1151
(Reference to Senate engrossed bill)
Page 1, between lines 1 and 2, insert:
"Section 1. Section 42-2001, Arizona Revised Statutes, is amended to read:
42-2001. Definitions
In this article, unless the context otherwise requires:
1. "Affidavits" includes forms received to report nontaxable estates.
2. "Confidential information":
(a) Includes the following information whether it concerns individual taxpayers or is aggregate information for specifically identified taxpayers:
(i) Returns and reports filed with the department for income tax, withholding tax, transaction privilege tax, luxury tax, use tax, rental occupancy tax, property tax, estate tax and severance tax.
(ii) Affidavits, reports or other information filed relating to taxable and nontaxable estates.
(iii) Applications for transaction privilege licenses, luxury tax licenses, use tax licenses and withholding licenses.
(iv) Information discovered concerning taxes and receipts by the department, whether or not by compulsory process.
(v) Return information obtained from the United States internal revenue service and United States bureau of alcohol, tobacco and firearms.
(vi) Information supplied at the special request of the department by a taxpayer which the taxpayer requests to be held in confidence.
(vii) Guidelines, standards or procedures that are established by the department for, or other information relating to, selecting returns or taxpayers for examination or settling or compromising any tax liability.
(viii) A taxpayer's identity, the nature, source or amount of the taxpayer's income, payments, receipts, deductions, exemptions, credits, assets, liabilities, net worth, tax liability, tax withheld, deficiencies, overassessments or tax payments, whether the taxpayer's return was, is being or will be examined or subject to investigation, collection or processing or any other data received by, recorded by, prepared by, furnished to or collected by the department with respect to a return or with respect to the termination, or possible existence, of liability of any person for any tax, penalty or interest imposed pursuant to this title or title 43.
(ix) Information supplied by an employee to an employer regarding the employee's election to have the employee's withholding tax reduced for the purposes of contributions to qualified school tuition organizations or public schools pursuant to section 43-401, subsection H.
(b) Does not include information which is otherwise a public record.
3. "Report" includes a notice of insurance payments, a request for a release of a bank account and an inventory of a safe deposit box.
4. "Return" includes any form prescribed by the department and any supporting schedules, attachments and lists.
5. "Tax administration" includes assessment, collection, investigation, litigation, statistical gathering functions, enforcement, policy making functions or management of those functions of the tax revenue laws of this state.
6. "Taxpayer", with respect to a joint return, means either party."
Renumber to conform
Page 1, line 4, after "employee" insert "; violation; classification"
Page 2, line 36, after "employee's" insert "written"
Line 37, strike "shall" insert "may"
Line 39, after the period insert "The employee's request must include the name and address of the qualified school tuition organization or public school. Within thirty days after the employee's request,"
Line 42, after the period insert "Within fifteen days after the close of each pay period, the employer shall pay the entire amount of the reduction in withholding tax for that pay period to the designated qualified school tuition organization or public school. These payments are considered to be on the employee's behalf, and not the employer's, for the purposes of qualifying for the income tax credits under sections 43-1089 and 43‑1089.01. The employee is responsible and accountable for the accuracy and the amount of reduction in withholding tax and the payments to a qualifying designated school tuition organization or public school. The employer is responsible and accountable to the school tuition organization or public school, the employee and the department for actually making the required payments. An employer that fraudulently appropriates, or that conceals with a fraudulent intent to appropriate, to any other use or purpose any part of reduced withholding taxes under this subsection is guilty of a class 4 felony. within thirty days after the end of each calendar year, or within fifteen days after the termination of employment, the employer shall furnish to each electing employee and to the department a statement of the amount withheld and paid on behalf of the employee DURING that year.
Sec. 3. Section 43-1089, Arizona Revised Statutes, is amended to read:
43-1089. Credit for contributions to school tuition organization; definitions
A. A credit is allowed against the taxes imposed by this title for the amount of voluntary cash contributions made by the taxpayer or on the taxpayer's behalf pursuant to section 43-401, subsection H during the taxable year to a school tuition organization, but not exceeding:
1. Five hundred dollars in any taxable year for a single individual or a head of household.
2. Eight hundred twenty-five dollars in taxable year 2005 for a married couple filing a joint return.
3. One thousand dollars in taxable year 2006 and any subsequent taxable year for a married couple filing a joint return.
B. A husband and wife who file separate returns for a taxable year in which they could have filed a joint return may each claim only one‑half of the tax credit that would have been allowed for a joint return.
C. If the allowable tax credit exceeds the taxes otherwise due under this title on the claimant's income, or if there are no taxes due under this title, the taxpayer may carry the amount of the claim not used to offset the taxes under this title forward for not more than five consecutive taxable years' income tax liability.
D. The credit allowed by this section is in lieu of any deduction pursuant to section 170 of the internal revenue code and taken for state tax purposes.
E. The tax credit is not allowed if the taxpayer designates the taxpayer's contribution to the school tuition organization for the direct benefit of any dependent of the taxpayer.
F. A school tuition organization that receives a voluntary cash contribution pursuant to subsection A shall report to the department, in a form prescribed by the department, by February 28 of each year the following information:
1. The name, address and contact name of the school tuition organization.
2. The total number of contributions received during the previous calendar year.
3. The total dollar amount of contributions received during the previous calendar year.
4. The total number of children awarded educational scholarships or tuition grants during the previous calendar year.
5. The total dollar amount of educational scholarships and tuition grants awarded during the previous calendar year.
6. For each school to which educational scholarships or tuition grants were awarded:
(a) The name and address of the school.
(b) The number of educational scholarships and tuition grants awarded during the previous calendar year.
(c) The total dollar amount of educational scholarships and tuition grants awarded during the previous calendar year.
G. For the purposes of this section:
1. "Handicapped student" means a student who has any of the following conditions:
(a) Hearing impairment.
(b) Visual impairment.
(c) Preschool moderate delay.
(d) Preschool severe delay.
(e) Preschool speech or language delay.
2. "Qualified school" means a nongovernmental primary school or secondary school or a preschool for handicapped students that is located in this state, that does not discriminate on the basis of race, color, handicap, familial status or national origin and that satisfies the requirements prescribed by law for private schools in this state on January 1, 1997.
3. "School tuition organization" means a charitable organization in this state that is exempt from federal taxation under section 501(c)(3) of the internal revenue code and that allocates at least ninety per cent of its annual revenue for educational scholarships or tuition grants to children to allow them to attend any qualified school of their parents' choice. In addition, to qualify as a school tuition organization the charitable organization shall provide educational scholarships or tuition grants to students without limiting availability to only students of one school.
Sec. 4. Section 43-1089.01, Arizona Revised Statutes, is amended to read:
43-1089.01. Tax credit; public school fees and contributions; definitions
A. A credit is allowed against the taxes imposed by this title for the amount of any fees or cash contributions made by a taxpayer or on the taxpayer's behalf pursuant to section 43-401, subsection H during the taxable year to a public school located in this state for the support of extracurricular activities or character education programs of the public school, but not exceeding:
1. Two hundred dollars for a single individual or a head of household.
2. Three hundred dollars in taxable year 2005 for a married couple filing a joint return.
3. Four hundred dollars in taxable year 2006 and any subsequent taxable year for a married couple filing a joint return.
B. A husband and wife who file separate returns for a taxable year in which they could have filed a joint return may each claim only one‑half of the tax credit that would have been allowed for a joint return.
C. The credit allowed by this section is in lieu of any deduction pursuant to section 170 of the internal revenue code and taken for state tax purposes.
D. If the allowable tax credit exceeds the taxes otherwise due under this title on the claimant’s income, or if there are no taxes due under this title, the taxpayer may carry the amount of the claim not used to offset the taxes under this title forward for not more than five consecutive taxable years' income tax liability.
E. The site council of the public school that receives contributions that are not designated for a specific purpose shall determine how the contributions are used at the school site. If a charter school does not have a site council, the principal, director or chief administrator of the charter school shall determine how the contributions that are not designated for a specific purpose are used at the school site.
F. A public school that receives fees or a cash contribution pursuant to subsection A of this section shall report to the department, in a form prescribed by the department, by February 28 of each year the following information:
1. The total number of fee and cash contribution payments received during the previous calendar year.
2. The total dollar amount of fees and contributions received during the previous calendar year.
3. The total dollar amount of fees and contributions spent by the school during the previous calendar year.
G. For the purposes of this section:
1. "Character education programs" means a program described in section 15‑719.
2. "Extracurricular activities" means school sponsored activities that require enrolled students to pay a fee in order to participate including fees for:
(a) Band uniforms.
(b) Equipment or uniforms for varsity athletic activities.
(c) Scientific laboratory materials.
(d) In‑state or out‑of‑state trips that are solely for competitive events. Extracurricular activities do not include any senior trips or events that are recreational, amusement or tourist activities."
Renumber to conform