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S. B. No. 145 As Introduced
As Introduced
128th General Assembly | Regular Session | 2009-2010 |
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A BILLTo amend sections 5733.98 and 5747.98 and to enact
sections 5733.421 and 5747.391 of the Revised Code
to create a tax credit for wages paid by employers
to employees who have been convicted of felonies.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 5733.98 and 5747.98 be amended and
sections 5733.421 and 5747.391 of the Revised Code be enacted to
read as follows:
Sec. 5733.421. (A) As used in this section:
(1) "Qualified reforming felon" means an individual who:
(a) Has been convicted of a felony under any statute of the
United States or any state;
(b) Was hired by a taxpayer within one year after the
conviction
or, if sentenced to a term of incarceration, was hired
within one
year after being released from incarceration; and
(c) Is a member of a family that, in the six months
immediately preceding the date of hiring, had an income that, on
an annual basis, would be seventy per cent or less of the most
recent lower living standard calculated by the federal bureau of
labor statistics.
(2) "Family" means an individual, an individual's spouse, and
children.
(3) "Wages" has the same meaning as in section 3306 of the
Internal Revenue Code.
(B)(1) Beginning in tax year 2009, a nonrefundable credit is
allowed against the tax imposed by section 5733.06 of the Revised
Code for the wages paid by a taxpayer to a qualified reforming
felon who works at least one hundred twenty hours for the taxpayer
during the taxpayer's taxable year. The amount of the credit shall
be calculated as follows:
(a) For each qualified reforming felon who works at least
four hundred hours during the taxable year, the credit equals
forty per cent of the wages paid to the qualified reforming felon,
but shall not exceed two thousand four hundred dollars per
qualified reforming felon.
(b) For each qualified reforming felon who works less than
four hundred hours but at least one hundred twenty hours during
the taxable year, the credit equals twenty-five per cent of the
wages paid to the qualified reforming felon, but shall not exceed
one thousand five hundred dollars per qualified reforming felon.
The credit shall be claimed in the order required under
section 5733.98 of the Revised Code. The credit, to the extent it
exceeds the taxpayer's tax liability for the tax year after
allowance for any other credits that precede the credit under that
section in that order, may be carried forward for the next five
succeeding tax years, but the amount of any excess credit allowed
in any such year shall be deducted from the balance carried
forward to the succeeding year.
(2) A taxpayer who received federally funded payments for
on-the-job training of a qualified reforming felon may not claim
the credit allowed under this section for any portion of the wages
paid to that qualified reforming felon.
(3) A taxpayer may not claim the credit allowed under this
section for any portion of the wages paid to a qualified reforming
felon for services that were the same as, or substantially similar
to, services that, but for a strike or lockout, would have been
performed by another employee.
(4) If a qualified reforming felon's employment is terminated
during the taxable year and the qualified reforming felon was
employed by the taxpayer for less than twelve months, the taxpayer
may not claim the full amount of the credit allowed under this
section unless the qualified reforming felon voluntarily
terminated employment; was unable to continue employment due to a
disability or death; or was terminated for cause. If a qualified
reforming felon's employment is terminated for any other reason,
the amount of the credit to which the taxpayer is entitled under
this section is reduced by a percentage equal to the percentage of
the taxable year that the qualified reforming felon was not
employed by the taxpayer.
(C) All files, statements, returns, reports, papers, or
documents of any kind relating to qualified reforming felons or
their families are not public records under section 149.43 of the
Revised Code.
Sec. 5733.98. (A) To provide a uniform procedure for
calculating the amount of tax imposed by section 5733.06 of the
Revised Code
that is due under this chapter, a taxpayer
shall
claim any credits to which it is entitled in the following order,
except as otherwise provided in section 5733.058 of the Revised
Code:
(1) For tax year 2005, the credit for taxes paid by a
qualifying pass-through
entity allowed
under section 5733.0611 of
the Revised Code;
(2) The credit allowed for financial institutions under
section 5733.45 of the Revised Code;
(3) The credit for qualifying affiliated groups under
section
5733.068 of the Revised Code;
(4) The subsidiary corporation credit under section
5733.067
of the Revised Code;
(5) The savings and loan assessment credit under section
5733.063 of the Revised Code;
(6) The credit for recycling and litter prevention
donations
under section
5733.064 of the Revised Code;
(7) The credit for employers that enter into
agreements with
child day-care centers under section 5733.36 of the
Revised Code;
(8) The credit for employers that reimburse employee child
care expenses under section 5733.38 of the Revised
Code;
(9) The credit for maintaining railroad active grade
crossing
warning
devices under section 5733.43 of the Revised
Code;
(10) The credit for purchases of lights and reflectors under
section
5733.44 of the Revised Code;
(11) The job retention credit under division (B) of section
5733.0610 of the Revised Code;
(12) The credit for
tax years
2008 and 2009 for selling
alternative fuel under section 5733.48
of the
Revised Code;
(13) The second credit for purchases of new
manufacturing
machinery and equipment under
section 5733.33 of the
Revised Code;
(14) The job training credit under section 5733.42 of
the
Revised
Code;
(15) The credit for qualified research expenses under
section
5733.351 of
the Revised Code;
(16) The enterprise zone credit under section 5709.66 of
the
Revised Code;
(17) The credit for the eligible costs associated with a
voluntary action under section 5733.34
of the Revised Code;
(18) The credit for employers that establish on-site
child
day-care centers under section 5733.37 of the Revised
Code;
(19)
The ethanol plant investment credit under section
5733.46 of the Revised Code;
(20) The credit for employers that employ qualified reforming
felons under section 5733.421 of the Revised Code;
(21) The credit for purchases of qualifying grape
production
property under section 5733.32 of the Revised Code;
(21)(22) The export sales credit under section 5733.069 of
the
Revised Code;
(22)(23) The credit for research and development and
technology
transfer investors under section 5733.35 of the Revised
Code;
(23)(24) The enterprise zone credits under section 5709.65
of
the
Revised Code;
(24)(25) The credit for using Ohio coal under section
5733.39
of
the
Revised Code;
(25)(26) The credit for small telephone companies under
section
5733.57 of the Revised Code;
(26)(27) The credit for eligible nonrecurring 9-1-1 charges
under
section 5733.55 of the Revised Code;
(27)(28) For tax year 2005, the credit for providing programs
to
aid the communicatively impaired under division (A) of section
5733.56 of the Revised Code;
(28)(29) The research and development credit under section
5733.352 of the Revised Code;
(29)(30) For tax years 2006 and subsequent tax years, the
credit
for taxes paid by a qualifying pass-through entity allowed
under
section 5733.0611 of the Revised Code;
(30)(31) The refundable credit for rehabilitating a historic
building under section 5733.47 of the Revised Code;
(31)(32) The refundable jobs creation credit under
division
(A)
of section
5733.0610 of the Revised Code;
(32)(33) The refundable credit for tax withheld under
division
(B)(2) of section 5747.062 of the Revised Code;
(33)(34) The refundable credit under section 5733.49 of the
Revised Code for losses on loans made to the Ohio venture capital
program under sections 150.01 to 150.10 of the Revised Code;
(34)(35) For tax years 2006, 2007, and 2008, the refundable
credit allowable under division (B) of section 5733.56 of the
Revised Code.
(B) For any credit except the
credits enumerated
in divisions
(A)(30)(31) to (34)(35) of this section, the amount of the
credit
for a
tax year shall not
exceed
the tax due after allowing
for
any other
credit that
precedes it
in the order required under
this section.
Any excess
amount of a
particular credit may be
carried forward if
authorized
under the
section creating that
credit.
Sec. 5747.391. (A) As used in this section:
(1) "Pass-through entity" has the same meaning as in section
5733.04 of the Revised Code and includes a sole proprietorship.
(2) "Qualified reforming felon" means an individual who:
(a) Has been convicted of a felony under any statute of the
United States or any state;
(b) Was hired by a pass-through entity within one year after
the
conviction or, if sentenced to a term of incarceration, was
hired
within one year after being released from incarceration;
and
(c) Is a member of a family that, in the six months
immediately preceding the date of hiring, had an income that, on
an annual basis, would be seventy per cent or less of the most
recent lower living standard calculated by the federal bureau of
labor statistics.
(3) "Family" means an individual, an individual's spouse, and
children.
(4) "Wages" has the same meaning as in section 3306 of the
Internal Revenue Code.
(B)(1) For taxable years beginning in 2009 or thereafter, a
nonrefundable credit is allowed against the tax imposed by section
5747.02 of the Revised Code for the wages paid by a pass-through
entity to a qualified reforming felon who works at least one
hundred twenty hours for the pass-through entity during the
entity's taxable year ending in or with the taxpayer's taxable
year. The amount of the credit shall be calculated as follows:
(a) For each qualified reforming felon who works at least
four hundred hours during the entity's taxable year, the credit
equals forty per cent of the wages paid to the qualified reforming
felon, but shall not exceed two thousand four hundred dollars per
qualified reforming felon.
(b) For each qualified reforming felon who works less than
four hundred hours but at least one hundred twenty hours during
the entity's taxable year, the credit equals twenty-five per cent
of the wages paid to the qualified reforming felon, but shall not
exceed one thousand five hundred dollars per qualified reforming
felon.
The amount of a taxpayer's credit is the taxpayer's
proportionate share of the credit distributed by the pass-through
entity. The credit shall be claimed in the order required under
section 5747.98 of the Revised Code. The credit, to the extent it
exceeds the taxpayer's tax liability for the taxable year after
allowance for any other credits that precede the credit under that
section in that order, may be carried forward for the next five
succeeding taxable years, but the amount of any excess credit
allowed in any such year shall be deducted from the balance
carried forward to the succeeding year.
(2) A taxpayer may not claim the credit allowed under this
section for any portion of the wages paid to a qualified reforming
felon for whom the pass-through entity received federally funded
payments for on-the-job training.
(3) A taxpayer may not claim the credit allowed under this
section for any portion of the wages paid to a qualified reforming
felon for services that were the same as, or substantially similar
to, services that, but for a strike or lockout, would have been
performed by another employee.
(4) If a qualified reforming felon's employment is terminated
during the pass-through entity's taxable year ending in or with
the taxpayer's taxable year and the qualified reforming felon was
employed by the pass-through entity for less than twelve months, a
taxpayer may not claim the full amount of the credit allowed under
this section unless the qualified reforming felon voluntarily
terminated employment; was unable to continue employment due to a
disability or death; or was terminated for cause. If a qualified
reforming felon's employment is terminated for any other reason,
the amount of the credit to which the taxpayer is entitled under
this section is reduced by a percentage equal to the percentage of
the taxable year that the qualified reforming felon was not
employed by the pass-through entity.
(C) All files, statements, returns, reports, papers, or
documents of any kind relating to qualified reforming felons or
their families are not public records under section 149.43 of the
Revised Code.
Sec. 5747.98. (A) To provide a uniform procedure for
calculating the amount of tax due under section 5747.02 of the
Revised Code, a taxpayer shall claim any credits to which the
taxpayer is
entitled in the following order:
(1) The retirement income credit under division (B) of
section 5747.055 of the Revised Code;
(2) The senior citizen credit under division (C) of
section
5747.05 of the Revised Code;
(3) The lump sum distribution credit under division (D) of
section 5747.05 of the Revised Code;
(4) The dependent care credit under section 5747.054 of
the
Revised Code;
(5) The lump sum retirement income credit under division
(C)
of section 5747.055 of the Revised Code;
(6) The lump sum retirement income credit under division
(D)
of section 5747.055 of the Revised Code;
(7) The lump sum retirement income credit under division
(E)
of section 5747.055 of the Revised Code;
(8) The low-income credit under section 5747.056 of the
Revised Code;
(9) The credit for displaced workers who pay for job
training
under section 5747.27 of the Revised Code;
(10) The campaign contribution credit under section
5747.29
of
the Revised Code;
(11) The twenty-dollar personal exemption credit under
section 5747.022 of the Revised Code;
(12) The joint filing credit under division (G) of
section
5747.05 of the Revised Code;
(13) The nonresident credit under division (A) of
section
5747.05 of the Revised Code;
(14) The credit for a resident's out-of-state income
under
division (B) of section 5747.05 of the Revised Code;
(15) The credit for employers that enter
into agreements
with
child day-care centers under section 5747.34 of the
Revised
Code;
(16) The credit for employers that reimburse employee
child
care expenses under section 5747.36 of the Revised Code;
(17) The credit for adoption of a minor child under section
5747.37 of the Revised Code;
(18) The credit for purchases of lights and reflectors under
section
5747.38 of the Revised Code;
(19)
The job retention credit under division (B) of section
5747.058 of the Revised Code;
(20) The credit for
selling alternative fuel under section
5747.77 of the
Revised
Code;
(21) The second credit for purchases of new
manufacturing
machinery and
equipment and the credit for using
Ohio coal under
section 5747.31 of the
Revised Code;
(22) The job training credit under section 5747.39 of
the
Revised Code;
(23) The enterprise zone credit under section 5709.66 of
the
Revised Code;
(24) The credit for the eligible costs associated with a
voluntary action
under section 5747.32 of the Revised Code;
(25) The credit
for employers that establish on-site
child
day-care centers under section
5747.35 of the Revised Code;
(26)
The ethanol plant investment credit under section
5747.75 of the Revised Code;
(27) The credit for employers that employ qualified reforming
felons under section 5747.391 of the Revised Code;
(28) The credit for purchases of qualifying grape
production
property under section 5747.28 of the Revised Code;
(28)(29) The export sales credit under section 5747.057 of
the
Revised Code;
(29)(30) The credit for research and development and
technology
transfer investors under section 5747.33 of the Revised
Code;
(30)(31)
The enterprise zone credits under
section 5709.65
of
the
Revised Code;
(31)(32) The research and development credit under section
5747.331 of the Revised Code;
(32)(33) The credit for rehabilitating a historic building
under
section 5747.76 of the Revised Code;
(33)(34) The refundable credit for rehabilitating a historic
building under section 5747.76 of the Revised Code;
(34)(35) The refundable jobs creation credit
under
division
(A)
of section
5747.058 of the Revised Code;
(35)(36) The refundable credit for taxes paid by a
qualifying
entity granted under section 5747.059 of the Revised
Code;
(36)(37) The refundable credits for taxes paid by a
qualifying
pass-through
entity granted under division (J) of
section 5747.08
of the Revised Code;
(37)(38) The refundable credit for tax withheld under
division
(B)(1) of section 5747.062 of the Revised Code;
(38)(39) The refundable credit under section 5747.80 of the
Revised Code for losses on loans made to the Ohio venture
capital
program under sections 150.01 to 150.10 of the Revised
Code.
(B) For any credit, except the credits enumerated
in
divisions (A)(33)(34) to (38)(39) of
this
section
and
the
credit
granted
under division
(I) of
section
5747.08 of
the
Revised
Code, the
amount of the credit
for
a
taxable year
shall
not
exceed the tax
due after allowing for any
other credit
that
precedes it in the
order required under this
section. Any
excess
amount of a
particular credit may be carried
forward if
authorized
under the
section creating that credit.
Nothing in
this
chapter
shall be
construed to allow a taxpayer to
claim,
directly
or
indirectly, a
credit more than once for a
taxable
year.
Section 2. That existing sections 5733.98 and 5747.98 of the
Revised Code are hereby repealed.
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