Tax Credit for Qualified Renters

For the 2024 income tax year through the 2026 income tax year, the bill creates a nonrefundable income tax credit (credit), which cannot be carried forward, for a taxpayer who:

• Rents the taxpayer's primary residence in the state; and
• Has a federal adjusted gross income (AGI) that is less than or equal to $75,000 if filing a single return, or less than or equal to $150,000 $125,000 if filing a joint return (qualifying taxpayer).

The amount of the credit is:

• $2,000 for 2 qualifying taxpayers filing a joint return with a federal AGI that is $50,000 $75,000 or less. For every $500 of AGI above $50,000, the amount of the credit is reduced by $10 $20.
• $1,000 for a qualifying taxpayer filing a single return with a federal AGI that is $25,000 or less. For every $500 of AGI above $25,000, the amount of the credit is reduced by $10 $20 .

Notwithstanding the income-based reductions in the allowable credit amount, a qualifying taxpayer who also qualifies for a rent or heat assistance grant during calendar year 2024, 2025, or 2026, as applicable, is eligible to receive the full credit amount. In addition, the bill specifies that, to the extent permitted by federal law, the credit is not income or resources for the purpose of determining eligibility for the payment of public assistance benefits and medical assistance benefits authorized under state law or for a payment made under any other publicly funded programs or for eligibility determinations made under any affordable housing program provided by local, state, federal, or quasi-governmental entities.

The bill specifies that a qualifying taxpayer who is eligible to claim any other income tax credit that is allowed to a taxpayer who rents the taxpayer's primary residence and has a federal AGI that is less than or equal to $75,000 if filing a single return, or less than or equal to $150,000 $125,000 if filing a joint return, may claim the income tax credit allowed in the bill or the other income tax credit allowed for income-qualified renters, but not both. The bill makes appropriations to the department of revenue and the department of personnel for the implementation of the bill.

(Note: Italicized words indicate new material added to the original summary; dashes through words indicate deletions from the original summary.)

(Note: This summary applies to the reengrossed version of this bill as introduced in the second house.)