Session of 2025
HOUSE BILL No. 2066
By Committee on Federal and State Affairs
Requested by Garrett Hanson on behalf of the Office of the Attorney General
1-23
1AN ACT concerning employment; prohibiting the employment of
2unauthorized aliens by business entities and public employers;
3requiring use and registration of the e-verify program; prohibiting the
4deduction of certain wages and remuneration to unauthorized aliens;
5amending K.S.A. 2024 Supp. 79-32,117 and repealing the existing
6section.
7
8Be it enacted by the Legislature of the State of Kansas:
9New Section 1. For the purposes of sections 1 through 4, and
10amendments thereto:
11(a) "Alien" means the same as provided in 8 U.S.C. § 1101.
12(b) "Employee" means any person directed, allowed or permitted to
13perform labor or service of any kind by an employer, with the exception of
14casual domestic labor hired to work in or around an individual's personal
15place of residence. The employees of an independent contractor working
16for a business entity shall not be deemed as the employees of the business
17entity for the purposes of this section.
18(c) "Business entity" means any person or group of persons
19performing or engaging in any activity, enterprise, profession or
20occupation for gain, benefit, advantage or livelihood, whether for-profit or
21not-for-profit. "Business entity" includes, but is not limited to:
22(1) Self-employed individuals, business entities filing articles of
23incorporation, partnerships, limited partnerships, limited liability
24companies, foreign corporations, foreign limited partnerships, foreign
25limited liability companies authorized to transact business in this state,
26business trusts and any business entity that registers with the secretary of
27state; and
28(2) any business entity that possesses a business license or
29registration to do business issued by the state, is exempt by law from
30obtaining such a business license or operating unlawfully without such a
31business license.
32(d) "Business license" means a license, permit, certificate, approval,
33registration, charter or similar form of authorization to perform a service
34or conduct any activity, enterprise, profession or occupation issued to a
35business entity by this state or any subdivision of this state. "Business
1license" does not include registration with the secretary of state to transact
2business as a corporation, limited liability company, partnership or other
3business entity in this state.
4(e) "New employee" means a person who becomes an employee of an
5employer on or after July 1, 2025.
6(f) "Person" means a natural person.
7(g) "Public employer" means any department, agency, political
8subdivision or instrumentality of the state.
9(h) "Unauthorized alien" means an alien who does not have the legal
10right or authorization under federal law to work in the United States as
11described in 8 U.S.C. § 1324a(h)(3).
12(i) "E-verify" means the electronic verification of federal employment
13authorization program, or its successor program, used to compare
14information from form I-9 to governmental records to confirm that an
15employee is authorized to work in the United States pursuant to 8 U.S.C. §
161324a and that is operated by the United States department of homeland
17security and the social security administration.
18New Sec. 2. (a) It is unlawful for an employer to knowingly hire or to
19recruit or refer for a fee an unauthorized alien for employment in this state.
20It shall be a violation of this section for an employer to:
21(1) Use a contract, subcontract or other independent contractor
22agreement to obtain the labor of an unauthorized alien in this state; or
23(2) knowingly contract with an unauthorized alien or with a person
24who employs or contracts with an unauthorized alien to perform the labor.
25(b) The provisions of this section may be enforced in the courts of
26this state by a civil action brought by any county or district attorney or the
27attorney general.
28(c) (1) The attorney general shall develop a complaint form for a
29person to allege a violation of subsection (a). The complainant shall not be
30required to list the complainant's social security number on the complaint
31form or to have the complaint form notarized. On receipt of a complaint on
32such complaint form that an employer has allegedly knowingly employed
33an unauthorized alien, the county or district attorney or attorney general
34shall investigate whether the business entity has violated the provisions of
35subsection (a). If a complaint is received but is not submitted on a
36complaint form developed by the attorney general, the county or district
37attorney or attorney general may investigate whether the employer has
38violated the provisions of subsection (a). The county or district attorney or
39attorney general shall not investigate complaints that are based solely on
40race, color or national origin. This subsection shall not be construed to
41prohibit the filing of anonymous complaints that are not submitted on a
42complaint form developed by the attorney general.
43(2) A complaint that is submitted to the attorney general or the county
1or district attorney shall be provided by the attorney general or, when
2submitted to a different county or the district attorney, by such county or
3district attorney to the county or district attorney of the county in which
4the alleged unauthorized alien is, or was previously, employed by the
5business entity. The county sheriff or any other local law enforcement
6agency may assist in investigating a complaint. When investigating a
7complaint, the county or district attorney or attorney general shall verify
8the employment authorization of the alleged unauthorized alien with the
9federal government pursuant to 8 U.S.C. § 1373(c).
10(3) A person who knowingly files a false and frivolous complaint
11under this subsection is guilty of a class C nonperson misdemeanor.
12(d) If the county or district attorney or attorney general elects to bring
13an action to enforce this section, the county or district attorney or attorney
14general shall notify the United States immigration and customs
15enforcement.
16(e) (1) If a business entity violates the provisions of this section, the
17court shall order the business entity to terminate the employment of all
18unauthorized aliens and file a signed affidavit with the relevant county or
19district attorney within three business days. The affidavit shall state that
20the business entity has terminated the employment of all unauthorized
21aliens in this state and will not intentionally or knowingly employ an
22unauthorized alien in this state. If the business entity fails to file a signed
23affidavit with the county or district attorney within three business days, the
24court shall order the suspension of all business licenses that are held by the
25business entity until the business entity files such signed affidavit with the
26county or district attorney.
27(2) (A) For a first violation of this section, the court shall order the
28suspension of all business licenses issued by the state or any subdivision of
29the state that are held by the business entity for at least one day but not
30more than 30 days.
31(B) For a second violation of this section, the court shall order the
32suspension of all licenses that are held by the business entity for at least 30
33days but not more than one year.
34(C) For a third violation of this section, the court shall order the
35permanent suspension of all business licenses that are held by the business
36entity and the revocation of the business entity's registration as a
37corporation, limited liability company or limited partnership in this state, if
38applicable.
39(f) (1) In enforcing the provisions of this section, no state, county or
40local official in this state shall attempt to independently determine whether
41an individual is an unauthorized alien or an alien not lawfully present in
42the United States. Such determination shall only be made by verifying the
43alien's employment authorization status with the federal government
1pursuant to 8 U.S.C. § 1373(c).
2(2) When making a determination of whether an employee is an
3unauthorized alien, a court shall only consider the federal government's
4determination pursuant to 8 U.S.C. § 1373(c). The court shall take judicial
5notice of any verification of the employment authorization status
6previously provided by the federal government. The court may, and at the
7request of a party shall, request the federal government to provide a new
8verification of the employment authorization status of the employee
9pursuant to 8 U.S.C. § 1373(c). The most recent determination of the
10employment authorization status of an employee by the federal
11government shall create a rebuttable presumption as to the employee's
12employment authorization status.
13(g) A business entity that has complied in good faith with:
14(1) This section through enrollment in e-verify and that has used e-
15verify to confirm the employment authorization of any employee in
16question shall have a rebuttable presumption that the business entity did
17not knowingly employ an unauthorized alien; and
18(2) the requirements of 8 U.S.C. § 1324a(b) shall have an affirmative
19defense that the business entity did not knowingly employ an unauthorized
20alien.
21(h) Any penalty imposed pursuant to this section may be imposed
22separate from, commensurate with or in addition to any other applicable
23civil or criminal penalty, including, but not limited to, any criminal penalty
24pursuant to K.S.A. 21-6509, and amendments thereto.
25New Sec. 3. (a) (1) On and after July 1, 2025, every business entity
26doing business within this state that employs one or more employees shall
27register with and utilize e-verify to verify the employment authorization of
28all new employees. The business entity shall retain all documentation
29received in connection with its participation in e-verify that verifies the
30employment authorization of any employee verified through e-verify for at
31least three years after the end of an employee's employment with such
32business entity. Upon request by any county or district attorney or the
33attorney general, the business entity shall provide this documentation to
34such county or district attorney or the attorney general.
35(2) The provisions of this subsection may be enforced in the courts of
36this state by a civil action brought by any county or district attorney or the
37attorney general. Upon a finding of a violation of this subsection by a
38business entity, the court shall order the suspension of all licenses issued
39by the state or any subdivision of the state that are held by the business
40entity for at least 10 days but not more than one year.
41(b) On and after July 1, 2025, every public employer in this state shall
42register with and utilize e-verify to verify the employment authorization of
43all new employees.
1(c) On and after July 1, 2025, no public employer shall enter into a
2contract for the performance of services within this state unless the
3contractor registers and participates in e-verify to verify the employment
4authorization of all new employees. This subsection shall not apply to any
5contracts entered into prior to July 1, 2025.
6New Sec. 4. (a) All business entities shall annually submit a signed
7affidavit to the secretary of revenue that states:
8(1) Whether the business entity:
9(A) Utilized a business expense or business loss deduction in
10determining federal adjusted gross income;
11(B) employed any employees or independent contractors for the tax
12year in question and the number of such employees or contractors;
13(C) is enrolled in and is actively participating in e-verify;
14(D) has used e-verify to confirm the employment authorization of
15every employee hired on or after July 1, 2025; and
16(E) has confirmed that any independent contractor paid by the
17business entity is an independent contractor who is registered with and
18utilizing e-verify to verify the employment authorization of all new
19employees; and
20(2) the business entity's identification number signifying the
21employer's enrollment in e-verify.
22(b) The secretary of revenue may audit any business entity that:
23(1) Fails to timely submit an affidavit required by this subsection; or
24(2) the secretary has probable cause to believe is out of compliance
25with this section.
26(c) If the secretary of revenue determines that a business entity has
27knowingly made material misrepresentations of fact regarding information
28contained in the affidavit, the business entity shall be required to add back
29business deductions taken, to the extent such deductions constitute wages
30or remuneration paid to employees whose employment authorization was
31not verified using e-verify, in determining the business entity's adjusted
32gross income used to calculate the business entity's state tax liability.
33Sec. 5. K.S.A. 2024 Supp. 79-32,117 is hereby amended to read as
34follows: 79-32,117. (a) The Kansas adjusted gross income of an individual
35means such individual's federal adjusted gross income for the taxable year,
36with the modifications specified in this section.
37(b) There shall be added to federal adjusted gross income:
38(i) Interest income less any related expenses directly incurred in the
39purchase of state or political subdivision obligations, to the extent that the
40same is not included in federal adjusted gross income, on obligations of
41any state or political subdivision thereof, but to the extent that interest
42income on obligations of this state or a political subdivision thereof issued
43prior to January 1, 1988, is specifically exempt from income tax under the
1laws of this state authorizing the issuance of such obligations, it shall be
2excluded from computation of Kansas adjusted gross income whether or
3not included in federal adjusted gross income. Interest income on
4obligations of this state or a political subdivision thereof issued after
5December 31, 1987, shall be excluded from computation of Kansas
6adjusted gross income whether or not included in federal adjusted gross
7income.
8(ii) Taxes on or measured by income or fees or payments in lieu of
9income taxes imposed by this state or any other taxing jurisdiction to the
10extent deductible in determining federal adjusted gross income and not
11credited against federal income tax. This paragraph shall not apply to taxes
12imposed under the provisions of K.S.A. 79-1107 or 79-1108, and
13amendments thereto, for privilege tax year 1995, and all such years
14thereafter.
15(iii) The federal net operating loss deduction, except that the federal
16net operating loss deduction shall not be added to an individual's federal
17adjusted gross income for tax years beginning after December 31, 2016.
18(iv) Federal income tax refunds received by the taxpayer if the
19deduction of the taxes being refunded resulted in a tax benefit for Kansas
20income tax purposes during a prior taxable year. Such refunds shall be
21included in income in the year actually received regardless of the method
22of accounting used by the taxpayer. For purposes hereof, a tax benefit shall
23be deemed to have resulted if the amount of the tax had been deducted in
24determining income subject to a Kansas income tax for a prior year
25regardless of the rate of taxation applied in such prior year to the Kansas
26taxable income, but only that portion of the refund shall be included as
27bears the same proportion to the total refund received as the federal taxes
28deducted in the year to which such refund is attributable bears to the total
29federal income taxes paid for such year. For purposes of the foregoing
30sentence, federal taxes shall be considered to have been deducted only to
31the extent such deduction does not reduce Kansas taxable income below
32zero.
33(v) The amount of any depreciation deduction or business expense
34deduction claimed on the taxpayer's federal income tax return for any
35capital expenditure in making any building or facility accessible to the
36handicapped, for which expenditure the taxpayer claimed the credit
37allowed by K.S.A. 79-32,177, and amendments thereto.
38(vi) Any amount of designated employee contributions picked up by
39an employer pursuant to K.S.A. 12-5005, 20-2603, 74-4919 and 74-4965,
40and amendments thereto.
41(vii) The amount of any charitable contribution made to the extent the
42same is claimed as the basis for the credit allowed pursuant to K.S.A. 79-
4332,196, and amendments thereto.
1(viii) The amount of any costs incurred for improvements to a swine
2facility, claimed for deduction in determining federal adjusted gross
3income, to the extent the same is claimed as the basis for any credit
4allowed pursuant to K.S.A. 79-32,204, and amendments thereto.
5(ix) The amount of any ad valorem taxes and assessments paid and
6the amount of any costs incurred for habitat management or construction
7and maintenance of improvements on real property, claimed for deduction
8in determining federal adjusted gross income, to the extent the same is
9claimed as the basis for any credit allowed pursuant to K.S.A. 79-32,203,
10and amendments thereto.
11(x) Amounts received as nonqualified withdrawals, as defined by
12K.S.A. 75-643, and amendments thereto, if, at the time of contribution to a
13family postsecondary education savings account, such amounts were
14subtracted from the federal adjusted gross income pursuant to subsection
15(c)(xv) or if such amounts are not already included in the federal adjusted
16gross income.
17(xi) The amount of any contribution made to the same extent the
18same is claimed as the basis for the credit allowed pursuant to K.S.A. 74-
1950,154, and amendments thereto.
20(xii) For taxable years commencing after December 31, 2004,
21amounts received as withdrawals not in accordance with the provisions of
22K.S.A. 74-50,204, and amendments thereto, if, at the time of contribution
23to an individual development account, such amounts were subtracted from
24the federal adjusted gross income pursuant to subsection (c)(xiii), or if
25such amounts are not already included in the federal adjusted gross
26income.
27(xiii) The amount of any expenditures claimed for deduction in
28determining federal adjusted gross income, to the extent the same is
29claimed as the basis for any credit allowed pursuant to K.S.A. 79-32,217
30through 79-32,220 or 79-32,222, and amendments thereto.
31(xiv) The amount of any amortization deduction claimed in
32determining federal adjusted gross income to the extent the same is
33claimed for deduction pursuant to K.S.A. 79-32,221, and amendments
34thereto.
35(xv) The amount of any expenditures claimed for deduction in
36determining federal adjusted gross income, to the extent the same is
37claimed as the basis for any credit allowed pursuant to K.S.A. 79-32,223
38through 79-32,226, 79-32,228 through 79-32,231, 79-32,233 through 79-
3932,236, 79-32,238 through 79-32,241, 79-32,245 through 79-32,248 or 79-
4032,251 through 79-32,254, and amendments thereto.
41(xvi) The amount of any amortization deduction claimed in
42determining federal adjusted gross income to the extent the same is
43claimed for deduction pursuant to K.S.A. 79-32,227, 79-32,232, 79-
132,237, 79-32,249, 79-32,250 or 79-32,255, and amendments thereto.
2(xvii) The amount of any amortization deduction claimed in
3determining federal adjusted gross income to the extent the same is
4claimed for deduction pursuant to K.S.A. 79-32,256, and amendments
5thereto.
6(xviii) For taxable years commencing after December 31, 2006, the
7amount of any ad valorem or property taxes and assessments paid to a state
8other than Kansas or local government located in a state other than Kansas
9by a taxpayer who resides in a state other than Kansas, when the law of
10such state does not allow a resident of Kansas who earns income in such
11other state to claim a deduction for ad valorem or property taxes or
12assessments paid to a political subdivision of the state of Kansas in
13determining taxable income for income tax purposes in such other state, to
14the extent that such taxes and assessments are claimed as an itemized
15deduction for federal income tax purposes.
16(xix) For taxable years beginning after December 31, 2012, and
17ending before January 1, 2017, the amount of any: (1) Loss from business
18as determined under the federal internal revenue code and reported from
19schedule C and on line 12 of the taxpayer's form 1040 federal individual
20income tax return; (2) loss from rental real estate, royalties, partnerships, S
21corporations, except those with wholly owned subsidiaries subject to the
22Kansas privilege tax, estates, trusts, residual interest in real estate
23mortgage investment conduits and net farm rental as determined under the
24federal internal revenue code and reported from schedule E and on line 17
25of the taxpayer's form 1040 federal individual income tax return; and (3)
26farm loss as determined under the federal internal revenue code and
27reported from schedule F and on line 18 of the taxpayer's form 1040
28federal income tax return; all to the extent deducted or subtracted in
29determining the taxpayer's federal adjusted gross income. For purposes of
30this subsection, references to the federal form 1040 and federal schedule
31C, schedule E, and schedule F, shall be to such form and schedules as they
32existed for tax year 2011, and as revised thereafter by the internal revenue
33service.
34(xx) For taxable years beginning after December 31, 2012, and
35ending before January 1, 2017, the amount of any deduction for self-
36employment taxes under section 164(f) of the federal internal revenue
37code as in effect on January 1, 2012, and amendments thereto, in
38determining the federal adjusted gross income of an individual taxpayer, to
39the extent the deduction is attributable to income reported on schedule C,
40E or F and on line 12, 17 or 18 of the taxpayer's form 1040 federal income
41tax return.
42(xxi) For taxable years beginning after December 31, 2012, and
43ending before January 1, 2017, the amount of any deduction for pension,
1profit sharing, and annuity plans of self-employed individuals under
2section 62(a)(6) of the federal internal revenue code as in effect on January
31, 2012, and amendments thereto, in determining the federal adjusted gross
4income of an individual taxpayer.
5(xxii) For taxable years beginning after December 31, 2012, and
6ending before January 1, 2017, the amount of any deduction for health
7insurance under section 162(l) of the federal internal revenue code as in
8effect on January 1, 2012, and amendments thereto, in determining the
9federal adjusted gross income of an individual taxpayer.
10(xxiii) For taxable years beginning after December 31, 2012, and
11ending before January 1, 2017, the amount of any deduction for domestic
12production activities under section 199 of the federal internal revenue code
13as in effect on January 1, 2012, and amendments thereto, in determining
14the federal adjusted gross income of an individual taxpayer.
15(xxiv) For taxable years commencing after December 31, 2013, that
16portion of the amount of any expenditure deduction claimed in
17determining federal adjusted gross income for expenses paid for medical
18care of the taxpayer or the taxpayer's spouse or dependents when such
19expenses were paid or incurred for an abortion, or for a health benefit plan,
20as defined in K.S.A. 65-6731, and amendments thereto, for the purchase of
21an optional rider for coverage of abortion in accordance with K.S.A. 40-
222,190, and amendments thereto, to the extent that such taxes and
23assessments are claimed as an itemized deduction for federal income tax
24purposes.
25(xxv) For taxable years commencing after December 31, 2013, that
26portion of the amount of any expenditure deduction claimed in
27determining federal adjusted gross income for expenses paid by a taxpayer
28for health care when such expenses were paid or incurred for abortion
29coverage, a health benefit plan, as defined in K.S.A. 65-6731, and
30amendments thereto, when such expenses were paid or incurred for
31abortion coverage or amounts contributed to health savings accounts for
32such taxpayer's employees for the purchase of an optional rider for
33coverage of abortion in accordance with K.S.A. 40-2,190, and
34amendments thereto, to the extent that such taxes and assessments are
35claimed as a deduction for federal income tax purposes.
36(xxvi) For all taxable years beginning after December 31, 2016, the
37amount of any charitable contribution made to the extent the same is
38claimed as the basis for the credit allowed pursuant to K.S.A. 72-4357, and
39amendments thereto, and is also claimed as an itemized deduction for
40federal income tax purposes.
41(xxvii) For all taxable years commencing after December 31, 2020,
42the amount of any interest expense paid or accrued in a previous taxable
43year but allowed as a deduction pursuant to section 163 of the federal
1internal revenue code in the current taxable year by reason of the
2carryforward of disallowed business interest pursuant to section 163(j) of
3the federal internal revenue code. For purposes of this paragraph, an
4interest expense is considered paid or accrued only in the first taxable year
5the deduction would have been allowable pursuant to section 163 of the
6federal internal revenue code if the limitation pursuant to section 163(j) of
7the federal internal revenue code did not exist.
8(xxviii) For all taxable years beginning after December 31, 2021, the
9amount of any contributions to, or earnings from, a first-time home buyer
10savings account if distributions from the account were not used to pay for
11expenses or transactions authorized pursuant to K.S.A. 2024 Supp. 58-
124904, and amendments thereto, or were not held for the minimum length
13of time required pursuant to K.S.A. 2024 Supp. 58-4904, and amendments
14thereto. Contributions to, or earnings from, such account shall also include
15any amount resulting from the account holder not designating a surviving
16payable on death beneficiary pursuant to K.S.A. 2024 Supp. 58-4904(e),
17and amendments thereto.
18(xxix) For all taxable years beginning after December 31, 2024, the
19amount of any contributions to, or earnings from, an adoption savings
20account if distributions from the account were not used to pay for expenses
21or transactions authorized pursuant to K.S.A. 2024 Supp. 38-2504, and
22amendments thereto, or were not held for the minimum length of time
23required pursuant to K.S.A. 2024 Supp. 38-2504, and amendments thereto.
24Contributions to, or earnings from, such account shall also include any
25amount resulting from the account holder not designating a surviving
26payable on death beneficiary pursuant to K.S.A. 2024 Supp. 38-2504(e),
27and amendments thereto.
28(xxx) (1) For all taxable years beginning after December 31, 2024:
29(A) Wages or remuneration for the performance of labor paid to an
30individual claimed as a deduction for federal income tax purposes by a
31taxpayer if the individual is an unauthorized alien. The provisions of this
32subsection shall apply regardless of whether an internal revenue service
33form 1099 is issued in conjunction with the wages or renumeration; and
34(B) any deductible business expense claimed as a deduction for
35federal income tax purposes of wages or remuneration for the
36performance of labor paid to an independent contractor who is not
37registered with and utilizing the e-verify system to verify the federal
38employment authorization of all new employees.
39(2) For purposes of this subsection, "e-verify," "new employee" and
40"unauthorized alien" mean the same as defined in section 1, and
41amendments thereto.
42(c) There shall be subtracted from federal adjusted gross income:
43(i) Interest or dividend income on obligations or securities of any
1authority, commission or instrumentality of the United States and its
2possessions less any related expenses directly incurred in the purchase of
3such obligations or securities, to the extent included in federal adjusted
4gross income but exempt from state income taxes under the laws of the
5United States.
6(ii) Any amounts received which are included in federal adjusted
7gross income but which are specifically exempt from Kansas income
8taxation under the laws of the state of Kansas.
9(iii) The portion of any gain or loss from the sale or other disposition
10of property having a higher adjusted basis for Kansas income tax purposes
11than for federal income tax purposes on the date such property was sold or
12disposed of in a transaction in which gain or loss was recognized for
13purposes of federal income tax that does not exceed such difference in
14basis, but if a gain is considered a long-term capital gain for federal
15income tax purposes, the modification shall be limited to that portion of
16such gain which is included in federal adjusted gross income.
17(iv) The amount necessary to prevent the taxation under this act of
18any annuity or other amount of income or gain which was properly
19included in income or gain and was taxed under the laws of this state for a
20taxable year prior to the effective date of this act, as amended, to the
21taxpayer, or to a decedent by reason of whose death the taxpayer acquired
22the right to receive the income or gain, or to a trust or estate from which
23the taxpayer received the income or gain.
24(v) The amount of any refund or credit for overpayment of taxes on
25or measured by income or fees or payments in lieu of income taxes
26imposed by this state, or any taxing jurisdiction, to the extent included in
27gross income for federal income tax purposes.
28(vi) Accumulation distributions received by a taxpayer as a
29beneficiary of a trust to the extent that the same are included in federal
30adjusted gross income.
31(vii) Amounts received as annuities under the federal civil service
32retirement system from the civil service retirement and disability fund and
33other amounts received as retirement benefits in whatever form which
34were earned for being employed by the federal government or for service
35in the armed forces of the United States.
36(viii) Amounts received by retired railroad employees as a
37supplemental annuity under the provisions of 45 U.S.C. §§ 228b(a) and
38228c(a)(1) et seq.
39(ix) Amounts received by retired employees of a city and by retired
40employees of any board of such city as retirement allowances pursuant to
41K.S.A. 13-14,106, and amendments thereto, or pursuant to any charter
42ordinance exempting a city from the provisions of K.S.A. 13-14,106, and
43amendments thereto.
1(x) (1) For taxable years beginning after December 31, 2021, the
2amount of any federal credit disallowance under the provisions of 26
3U.S.C. § 280C(a).
4(2) For taxable years beginning after December 31, 2019, and ending
5before January 1, 2022, 50% of the amount of the federal employee
6retention credit disallowance under rules similar to the rules of 26 U.S.C. §
7280C(a). The taxpayer shall be required to prove that such taxpayer
8previously filed Kansas income tax returns and paid Kansas income tax on
9the disallowed amount. Notwithstanding any other provision of law to the
10contrary, any claim for refund or amended return relating to this
11subparagraph shall be allowed to be filed on or before April 15, 2025, and
12no claim for refund or amended return shall be allowed or filed after April
1315, 2025.
14(xi) For taxable years beginning after December 31, 1986, dividend
15income on stock issued by Kansas venture capital, inc.
16(xii) For taxable years beginning after December 31, 1989, amounts
17received by retired employees of a board of public utilities as pension and
18retirement benefits pursuant to K.S.A. 13-1246, 13-1246a and 13-1249,
19and amendments thereto.
20(xiii) For taxable years beginning after December 31, 2004, amounts
21contributed to and the amount of income earned on contributions deposited
22to an individual development account under K.S.A. 74-50,201 et seq., and
23amendments thereto.
24(xiv) For all taxable years commencing after December 31, 1996, that
25portion of any income of a bank organized under the laws of this state or
26any other state, a national banking association organized under the laws of
27the United States, an association organized under the savings and loan
28code of this state or any other state, or a federal savings association
29organized under the laws of the United States, for which an election as an
30S corporation under subchapter S of the federal internal revenue code is in
31effect, which accrues to the taxpayer who is a stockholder of such
32corporation and which is not distributed to the stockholders as dividends of
33the corporation. For taxable years beginning after December 31, 2012, and
34ending before January 1, 2017, the amount of modification under this
35subsection shall exclude the portion of income or loss reported on schedule
36E and included on line 17 of the taxpayer's form 1040 federal individual
37income tax return.
38(xv) The cumulative amounts not exceeding $3,000, or $6,000 for a
39married couple filing a joint return, for each designated beneficiary that
40are contributed to: (1) A family postsecondary education savings account
41established under the Kansas postsecondary education savings program or
42a qualified tuition program established and maintained by another state or
43agency or instrumentality thereof pursuant to section 529 of the internal
1revenue code of 1986, as amended, for the purpose of paying the qualified
2higher education expenses of a designated beneficiary; or (2) an achieving
3a better life experience (ABLE) account established under the Kansas
4ABLE savings program or a qualified ABLE program established and
5maintained by another state or agency or instrumentality thereof pursuant
6to section 529A of the internal revenue code of 1986, as amended, for the
7purpose of saving private funds to support an individual with a disability.
8The terms and phrases used in this paragraph shall have the meaning
9respectively ascribed thereto by the provisions of K.S.A. 75-643 and 75-
10652, and amendments thereto, and the provisions of such sections are
11hereby incorporated by reference for all purposes thereof. For all taxable
12years beginning after December 31, 2022, contributions made to a
13qualified tuition program account or a qualified ABLE program account
14pursuant to this paragraph on and after January 1 but prior to the date
15required for filing a return pursuant to K.S.A. 79-3221, and amendments
16thereto, of the successive taxable year may be elected by the taxpayer to
17apply to the prior taxable year if such election is made at the time of filing
18the return. No contribution shall be used as a modification pursuant to this
19paragraph in more than one taxable year.
20(xvi) For all taxable years beginning after December 31, 2004,
21amounts received by taxpayers who are or were members of the armed
22forces of the United States, including service in the Kansas army and air
23national guard, as a recruitment, sign up or retention bonus received by
24such taxpayer as an incentive to join, enlist or remain in the armed services
25of the United States, including service in the Kansas army and air national
26guard, and amounts received for repayment of educational or student loans
27incurred by or obligated to such taxpayer and received by such taxpayer as
28a result of such taxpayer's service in the armed forces of the United States,
29including service in the Kansas army and air national guard.
30(xvii) For all taxable years beginning after December 31, 2004,
31amounts received by taxpayers who are eligible members of the Kansas
32army and air national guard as a reimbursement pursuant to K.S.A. 48-
33281, and amendments thereto, and amounts received for death benefits
34pursuant to K.S.A. 48-282, and amendments thereto, to the extent that
35such death benefits are included in federal adjusted gross income of the
36taxpayer.
37(xviii) (A) For all taxable years beginning after December 31, 2007,
38and ending before January 1, 2024, amounts received as benefits under the
39federal social security act which are included in federal adjusted gross
40income of a taxpayer with federal adjusted gross income of $75,000 or
41less, whether such taxpayer's filing status is single, head of household,
42married filing separate or married filing jointly.
43(B) For all taxable years beginning after December 31, 2023, amounts
1received as benefits under the federal social security act that are included
2in federal adjusted gross income of a taxpayer.
3(xix) Amounts received by retired employees of Washburn university
4as retirement and pension benefits under the university's retirement plan.
5(xx) For taxable years beginning after December 31, 2012, and
6ending before January 1, 2017, the amount of any: (1) Net profit from
7business as determined under the federal internal revenue code and
8reported from schedule C and on line 12 of the taxpayer's form 1040
9federal individual income tax return; (2) net income, not including
10guaranteed payments as defined in section 707(c) of the federal internal
11revenue code and as reported to the taxpayer from federal schedule K-1,
12(form 1065-B), in box 9, code F or as reported to the taxpayer from federal
13schedule K-1, (form 1065) in box 4, from rental real estate, royalties,
14partnerships, S corporations, estates, trusts, residual interest in real estate
15mortgage investment conduits and net farm rental as determined under the
16federal internal revenue code and reported from schedule E and on line 17
17of the taxpayer's form 1040 federal individual income tax return; and (3)
18net farm profit as determined under the federal internal revenue code and
19reported from schedule F and on line 18 of the taxpayer's form 1040
20federal income tax return; all to the extent included in the taxpayer's
21federal adjusted gross income. For purposes of this subsection, references
22to the federal form 1040 and federal schedule C, schedule E, and schedule
23F, shall be to such form and schedules as they existed for tax year 2011
24and as revised thereafter by the internal revenue service.
25(xxi) For all taxable years beginning after December 31, 2013,
26amounts equal to the unreimbursed travel, lodging and medical
27expenditures directly incurred by a taxpayer while living, or a dependent
28of the taxpayer while living, for the donation of one or more human organs
29of the taxpayer, or a dependent of the taxpayer, to another person for
30human organ transplantation. The expenses may be claimed as a
31subtraction modification provided for in this section to the extent the
32expenses are not already subtracted from the taxpayer's federal adjusted
33gross income. In no circumstances shall the subtraction modification
34provided for in this section for any individual, or a dependent, exceed
35$5,000. As used in this section, "human organ" means all or part of a liver,
36pancreas, kidney, intestine, lung or bone marrow. The provisions of this
37paragraph shall take effect on the day the secretary of revenue certifies to
38the director of the budget that the cost for the department of revenue of
39modifications to the automated tax system for the purpose of
40implementing this paragraph will not exceed $20,000.
41(xxii) For taxable years beginning after December 31, 2012, and
42ending before January 1, 2017, the amount of net gain from the sale of: (1)
43Cattle and horses, regardless of age, held by the taxpayer for draft,
1breeding, dairy or sporting purposes, and held by such taxpayer for 24
2months or more from the date of acquisition; and (2) other livestock,
3regardless of age, held by the taxpayer for draft, breeding, dairy or
4sporting purposes, and held by such taxpayer for 12 months or more from
5the date of acquisition. The subtraction from federal adjusted gross income
6shall be limited to the amount of the additions recognized under the
7provisions of subsection (b)(xix) attributable to the business in which the
8livestock sold had been used. As used in this paragraph, the term
9"livestock" shall not include poultry.
10(xxiii) For all taxable years beginning after December 31, 2012,
11amounts received under either the Overland Park, Kansas police
12department retirement plan or the Overland Park, Kansas fire department
13retirement plan, both as established by the city of Overland Park, pursuant
14to the city's home rule authority.
15(xxiv) For taxable years beginning after December 31, 2013, and
16ending before January 1, 2017, the net gain from the sale from Christmas
17trees grown in Kansas and held by the taxpayer for six years or more.
18(xxv) For all taxable years commencing after December 31, 2020,
19100% of global intangible low-taxed income under section 951A of the
20federal internal revenue code of 1986, before any deductions allowed
21under section 250(a)(1)(B) of such code.
22(xxvi) (1) For all taxable years commencing after December 31,
232020, the amount of any interest expense paid or accrued in the current
24taxable year and disallowed as a deduction pursuant to section 163(j) of
25the federal internal revenue code.
26(2) For purposes of this paragraph, an interest expense is considered
27paid or accrued only in the first taxable year the deduction would have
28been allowable pursuant to section 163 of the federal internal revenue code
29if the limitation pursuant to section 163(j) of the federal internal revenue
30code did not exist.
31(3) For tax year 2021, an amount equal to the sum of any interest
32expenses paid or accrued in tax years 2018, 2019 and 2020 less the sum of
33amounts allowed as a deduction pursuant to section 163 of the federal
34internal revenue code in tax years 2018, 2019 and 2020.
35(xxvii) For taxable years commencing after December 31, 2020, the
36amount disallowed as a deduction pursuant to section 274 of the federal
37internal revenue code of 1986 for meal expenditures shall be allowed to
38the extent such expense was deductible for determining federal income tax
39and was allowed and in effect on December 31, 2017.
40(xxviii) For all taxable years beginning after December 31, 2021: (1)
41The amount contributed to a first-time home buyer savings account
42pursuant to K.S.A. 2024 Supp. 58-4903, and amendments thereto, in an
43amount not to exceed $3,000 for an individual or $6,000 for a married
1couple filing a joint return; or (2) amounts received as income earned from
2assets in a first-time home buyer savings account. For all taxable years
3beginning after December 31, 2022, contributions made to a first-time
4home buyer savings account pursuant to subparagraph (1) on and after
5January 1 but prior to the date required for filing a return pursuant to
6K.S.A. 79-3221, and amendments thereto, of the successive taxable year
7may be elected by the taxpayer to apply to the prior taxable year if such
8election is made at the time of filing the return. No contribution shall be
9used as a modification pursuant to subparagraph (1) in more than one
10taxable year.
11(xxix) For taxable years beginning after December 31, 2017, for an
12individual taxpayer who carried back federal net operating losses arising in
13a taxable year beginning after December 31, 2017, and before January 1,
142021, pursuant to section 172(b)(1) of the federal internal revenue code as
15amended by the coronavirus aid, relief, and economic security act
16(CARES act), the amount of such federal net operating loss carryback for
17each applicable year. If the amount of such federal net operating loss
18carryback exceeds the taxpayer's Kansas adjusted gross income for such
19taxable year, the amount thereof that exceeds such Kansas adjusted gross
20income may be carried forward as a subtraction modification in the
21following taxable year or years until the total amount of such federal net
22operating loss carryback has been deducted, except that no such unused
23amount shall be carried forward for deduction as a subtraction
24modification after the 20th taxable year following the taxable year of the
25net operating loss. Notwithstanding any other provision of law to the
26contrary, an extension of time shall be allowed for a claim for refund or
27amended return for tax years 2018, 2019 or 2020 limited to the application
28of the provisions of this paragraph and such claim for refund or amended
29return must be filed on or before April 15, 2025.
30(xxx) For all taxable years beginning after December 31, 2024: (1)
31The amount contributed to an adoption savings account pursuant to K.S.A.
322024 Supp. 38-2503, and amendments thereto, in an amount not to exceed
33$6,000 for an individual or $12,000 for a married couple filing a joint
34return; or (2) amounts received as income earned from assets in an
35adoption savings account.
36(d) There shall be added to or subtracted from federal adjusted gross
37income the taxpayer's share, as beneficiary of an estate or trust, of the
38Kansas fiduciary adjustment determined under K.S.A. 79-32,135, and
39amendments thereto.
40(e) The amount of modifications required to be made under this
41section by a partner which relates to items of income, gain, loss, deduction
42or credit of a partnership shall be determined under K.S.A. 79-32,131, and
43amendments thereto, to the extent that such items affect federal adjusted
1gross income of the partner.
2Sec. 6. K.S.A. 2024 Supp. 79-32,117 is hereby repealed.
3Sec. 7. This act shall take effect and be in force from and after its
4publication in the statute book.