Chapter 998 Oregon Laws 1999

Session Law

AN ACT

SB 2

Relating to child care financial assistance; creating new provisions; and amending ORS 315.262.

Be It Enacted by the People of the State of Oregon:

SECTION 1. ORS 315.262 is amended to read:

315.262. (1) As used in this section:

(a) "Child care" means care provided to a qualifying child of the taxpayer for the purpose of allowing the taxpayer to be gainfully employed, to seek employment or to attend school on a full-time or part-time basis, except that the term does not include care provided by:

(A) The child's parent or guardian, unless the care is provided by the parent in a licensed or registered child care facility; or

(B) A child of the taxpayer who has not yet attained 19 years of age at the close of the tax year.

(b) "Child care expenses" means the costs associated with providing child care to a qualifying child of a qualified taxpayer.

(c) "Earned income" has the meaning given that term in section 32 of the Internal Revenue Code.

(d) "Qualified taxpayer" means a taxpayer:

(A) With at least $6,000 of earned income for the tax year;

(B) With federal adjusted gross income for the tax year that does not exceed [200] 250 percent of the federal poverty level; and

(C) Who does not have more than the maximum amount of disqualified income under section 32(i) of the Internal Revenue Code that is allowed to a taxpayer entitled to the earned income tax credit for federal tax purposes.

(e) "Qualifying child" means a child of the taxpayer who is under 13 years of age, or who is a disabled child, as that term is defined in ORS 316.099.

(2) A qualified taxpayer shall be allowed a credit against the taxes otherwise due under ORS chapter 316 equal to the applicable percentage of the qualified taxpayer's child care expenses (rounded to the nearest $50).

(3) The applicable percentage to be used in calculating the amount of the credit provided in this section shall be determined in accordance with the following table:

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Applicable Federal Adjusted

Percentage Gross Income as Percent

of Federal Poverty Level

40 [150] 200 or less

36 Greater than [150] 200 and less than

or equal to [160] 210

32 Greater than [160] 210 and less than

or equal to [170] 220

24 Greater than [170] 220 and less than

or equal to [180] 230

16 Greater than [180] 230 and less than

or equal to [190] 240

8 Greater than [190] 240 and less than

or equal to [200] 250

0 Greater than [200] 250 percent

of federal poverty level

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(4) The credit shall be claimed on such form and containing such information as may be prescribed by the Department of Revenue.

(5) In the case of a credit allowed under this section:

(a) A nonresident shall be allowed the credit under this section in the proportion provided in ORS 316.117.

(b) If a change in the status of a taxpayer from resident to nonresident or from nonresident to resident occurs, the credit allowed by this section shall be determined in a manner consistent with ORS 316.117.

(c) If a change in the taxable year of a taxpayer occurs as described in ORS 314.085, or if the Department of Revenue terminates the taxpayer's taxable year under ORS 314.440, the credit allowed under this section shall be prorated or computed in a manner consistent with ORS 314.085.

(d) In the case of a qualified taxpayer who is married, a credit shall be allowed under this section only if:

(A) The taxpayer files a joint return;

(B) The taxpayer files a separate return and is legally separated or subject to a separate maintenance agreement; or

(C) The taxpayer files a separate return and the taxpayer and the taxpayer's spouse reside in separate households on the last day of the tax year with the intent of remaining in separate households in the future.

(6) The credit allowed under this section shall not exceed the tax liability of the taxpayer and may not be carried forward to a succeeding tax year.

(7)(a) For tax years beginning on or after January 1, 1999, the minimum amount of earned income a taxpayer must earn in order to be a qualified taxpayer shall be adjusted by multiplying $6,000 by the ratio of the U.S. City Average Consumer Price Index for the average of the monthly indexes for the second quarter of the calendar year over the average of the monthly indexes of the second quarter of the calendar year 1998.

(b) As used in this subsection, "U.S. City Average Consumer Price Index" means the U.S. City Average Consumer Price Index for All Urban Consumers (All Items) as published by the Bureau of Labor Statistics of the United States Department of Labor.

(c) If any adjustment determined under paragraph (a) of this subsection is not a multiple of $50, the adjustment shall be rounded to the nearest multiple of $50.

SECTION 2. The amendments to ORS 315.262 by section 1 of this 1999 Act apply to tax years beginning on or after January 1, 2001.

Approved by the Governor August 20, 1999

Filed in the office of Secretary of State August 23, 1999

Effective date October 23, 1999

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