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Senate bill creates incentive for hiring disabled

Disabled EmployeeBy Bob Eschliman
Editor

 

The Senate Ways and Means Committee, chaired by state Sen. Joe Bolkcom (D-Iowa City), has introduced a bill that would amend the deduction from the individual income tax, corporate income tax, and franchise tax of wages paid relating to the employment of an individual with a disability.

Senate Study Bill 1268 modifies the criteria for claiming the deduction. Under current law, a small business with 20 or fewer full-time equivalent employees and not more than $3 million in annual gross revenue may claim a deduction equal to 65 percent of the wages paid to an individual with a disability that was hired during the year. The bill removes the small business restriction to provide that any business may claim the deduction.

Also under current law, the Iowa Department of Revenue is required to develop and distribute information concerning a similar deduction for wages paid to an individual who is a felon, on parole, on probation, or in a work release program. The bill provides that the department is also required to develop and distribute information concerning the deduction for wages paid to an individual with a disability.

SSB 1268 takes effect upon enactment and applies to individuals hired on or after that date. The bill applies retroactively to tax years beginning on or after Jan. 1 of the year of enactment.