2017 -- H 5778

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LC001619

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2017

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A N   A C T

RELATING TO TAXATION -- RHODE ISLAND LIVABLE HOME TAX CREDIT ACT

     

     Introduced By: Representatives McNamara, Casimiro, Carson, Vella-Wilkinson, and
Solomon

     Date Introduced: March 01, 2017

     Referred To: House Finance

     It is enacted by the General Assembly as follows:

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     SECTION 1. Title 44 of the General Laws entitled "TAXATION" is hereby amended by

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adding thereto the following chapter:

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CHAPTER 70

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RHODE ISLAND LIVABLE HOME TAX CREDIT ACT

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     44-70-1. Short title.

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     This chapter shall be known and may be cited as the "Rhode Island Livable Home Tax

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Credit Act."

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     44-70-2. Definitions.

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     As used in this chapter:

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     (1) "Accessibility features" means and includes the following:

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     (i) Accessible route to a zero-step entrance on firm surface that is no steeper than a 1:12

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slope from a driveway or public sidewalk;

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     (ii) Zero-step entrance;

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     (iii) Doors with at least thirty-two inches (32") of clear width;

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     (iv) Hallways and passages with at least thirty-six inches (36") of clear width;

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     (v) Accessible light switches, electrical outlets and environmental controls;

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     (vi) Accessible bathroom;

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     (vii) Accessible and useable kitchen facilities; and

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     (viii) Retrofitting of an existing unit shall also include permanently installed lifts or

 

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elevators. These features are to meet the specifications of an existing standard.

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     (2) "Existing standards" means and includes adaptability features prescribed by the

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Rhode Island state building code, the specifications of the American National Standards Institute,

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the Uniform Federal Accessibility Standards (24 C.F.R. Part 40), or fair housing guidelines.

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     (3) "New residence" means a unit purchased for use as a residence that has not been

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previously sold for occupancy as a residence. This includes newly constructed units and

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residential units created through the adaptive reuse of buildings previously used for nonresidential

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uses.

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     (4) "Sensory modifications" means alarms, appliances and controls designed to assist

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sensory disabled persons that are structurally integrated into the residential unit. Built-in

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appliances would meet this definition. Accommodations or features that can be removed and

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reinstalled in another residential unit and so reused at another location are not considered to be

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sensory modifications for the purposes of this tax credit program. Appliances or alarms that can

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be reinstalled in another residence would not meet this definition.

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     (5) "Universal visitability" means:

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     (i) At least one zero-step entrance approached by an accessible route on a firm surface no

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steeper than a 1:12 slope proceeding from a driveway or public sidewalk;

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     (ii) An accessible bathroom, which can be a half bath/powder room, on the same floor as

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the zero-step entrance; and

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     (iii) Doors with at least thirty-two inches (32") of clear width and hallways/passage ways

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of at least thirty-six inches (36") of clear width to the accessible bathroom and eating area.

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     44-70-3. Tax credits.

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     (a) For taxable years beginning on and after January 1, 2018, any taxpayer who purchases

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a new residence as defined in §44-70-2 or retrofits or hires someone to retrofit an existing

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residence, provided that such new residence or the retrofitting of such existing residence meets

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the qualification criteria as established in §44-70-4 and meets the eligibility requirements

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established by guidelines developed by the governor’s commission on disabilities, shall be

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allowed a credit against the tax imposed pursuant to the provisions of chapter 30 of title 44

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("personal income tax") of fifty percent (50%) of the total amount spent upon meeting the

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qualification criteria for the new residence or retrofitting of such existing residence, not to exceed

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five thousand dollars ($5,000). The credit shall be allowed for the taxable year in which the

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residence has been purchased or construction, retrofitting, or renovation of the residence or

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residential structure or unit has been completed.

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     (b) The credit required by this section shall require application by the taxpayer as

 

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provided in §44-70-5.

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     44-70-4. Qualifications for tax credit.

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     (a) New residence. In order for the purchase or construction of a new residence to qualify

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for tax credit the new residence must include the three (3) features of universal visitability as

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defined in §44-70-2 or include at least three (3) accessibility features as defined in §44-70-2 and

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meet the requirements of an existing standard as defined in §44-70-2.

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     (b) Retrofitting of an existing unit. In order to qualify for the tax credit retrofitting of an

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existing residential unit must include at least one accessibility feature as defined in §44-70-2 and

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meet the requirements of an existing standard as defined in §44-70-2 or provide sensory

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modifications as defined in §44-70-2.

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     44-70-5. Applications.

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     Eligible taxpayers shall apply for the credit by making application to the governor’s

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commission on disabilities, which shall issue a certification for an approved application to the

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taxpayer. The taxpayer shall attach the certification to the applicable income tax return. The total

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amount of tax credits granted under this section for any fiscal year shall not exceed two hundred

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fifty thousand dollars ($250,000). In the event applications for the tax credit exceed the amount

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allocated by the governor’s commission on disabilities for the fiscal year, the governor’s

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commission on disabilities shall issue the tax credits on a pro rata basis, based upon the amount of

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the tax credit approved for each taxpayer and the amount of tax credits allocated by the

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governor’s commission on disabilities.

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     44-70-6. Eligibility.

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     (a) Credit shall be allowed under this chapter for the retrofitting, or renovation of

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residential rental property provided that the owner agreed to maintained access for ten (10) years.

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Excluded from the tax credits are entities that are:

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     (1) Eligible for the federal disabled access credit established under section 44 of the

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Internal Revenue Code (26 U.S.C. §44) and §44-54-1, disabled access credit for small businesses;

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     (2) Limited liability companies or foreign limited liability companies, as defined in §7-

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16-2;

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     (3) S Corporations established under Subchapter S of Chapter 1 of the Internal Revenue

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Code (26 U.S.C. §§1361 et seq.);

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     (4) Cooperative housing corporations, as defined in §7-6.1-4; or

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     (5) Corporations or foreign corporations, as defined in §7-1.2-106.

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     (b) Accessibility or visitablity modifications that are funded through local, state or federal

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programs are not eligible for tax credits.

 

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     (c) No credit shall be allowed under this chapter for the purchase or construction of

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residential rental property.

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     (d) In no case shall the governor’s commission on disabilities issue any tax credit relating

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to transactions or dealings between affiliated entities. In no case shall the governor’s commission

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on disabilities issue any tax credit more than once to the same or different persons relating to the

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same retrofitting, renovation, or construction project.

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     (e) In no case shall the amount of credit taken by a taxpayer pursuant to this chapter

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exceed the taxpayer's income tax liability for the taxable year. If the amount of credit allowed for

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the taxable year in which the residence has been purchased or construction, retrofitting, or

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renovation of the residence or residential structure or unit has been completed exceeds the

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taxpayer's income tax liability imposed for such taxable year, then the amount that exceeds the

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tax liability may be carried over for credit against the income taxes of such taxpayer in the next

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seven (7) taxable years or until the total amount of the tax credit issued has been taken, whichever

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is sooner.

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     44-70-7. Reporting

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     By August 15 of each year, the division of taxation shall report:

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     (1) The number of tax credits issued to qualifying individuals;

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     (2) The number of applicants who did not qualify;

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     (3) The total dollar amount of tax credits issued; and

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     (4) The average amount of the tax credits issued.

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     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO TAXATION -- RHODE ISLAND LIVABLE HOME TAX CREDIT ACT

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     This act would establish the "Rhode Island Livable Home Tax Credit Act", and would

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provide for its administration. The act would provide a tax credit against the state’s personal

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income tax for taxpayers who purchase new residences or retrofit residences which meet or are

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modified to meet standards that make the residences more accessible for elderly and disabled

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persons.

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     This act would take effect upon passage.

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