AB 709

This bill creates an individual income tax subtract modification, or deduction,

for up to $200,000 of income earned in this state by a psychiatrist, in the taxable year

to which the claim relates, from the practice of psychiatry. The deduction may not

be claimed for more than ten years, and must be claimed during the ten-year period

that begins once the claimant first claims the credit. The deduction must be claimed

initially within the first two years that a psychiatrist begins to practice in this state,

or within the first two years that a psychiatrist returns to this state after practicing

in another state for at least one year. If an individual begins to claim the deduction

and is then ineligible to claim the deduction in any year that he or she is a full-year

resident of this state, the individual may again claim the deduction in a future year

if eligible to do so. If an individual begins to claim the deduction but is unable to claim

it for ten consecutive years because he or she leaves the state, the individual must

add to his or her tax that is due for the year in which he or she leaves the state the

sum of all gross tax due, based on a recalculation of taxable income that assumes the

individual did not claim the deduction, for the years in which he or she claimed the

deduction. In addition, an individual who is eligible for and claims the deduction

may not claim the homestead tax credit.

Because this bill relates to an exemption from state or local taxes, it may be

referred to the Joint Survey Committee on Tax Exemptions for a report to be printed

as an appendix to the bill.