HOUSE BILL No. 2078
By Committee on Taxation
AN ACT relating to income taxation; providing for a credit therefrom for
certain teaching aids purchased for assisting in the education of indi-
viduals; amending K.S.A. 1996 Supp. 79-32,117 and repealing the ex-
Be it enacted by the Legislature of the State of Kansas:
New Section 1. For all taxable years commencing after December
31, 1996, there shall be allowed as a credit against the tax liability imposed
under the Kansas income tax act of an individual who is certificated to
instruct and educate students of grades kindergarten through 12 in an
accredited school, whether public or otherwise, an amount, not to exceed
$300, equal to the purchase costs of equipment, materials or other teach-
ing aids for use in the classroom to assist in the education of the students
of such individual.
Sec. 2. K.S.A. 1996 Supp. 79-32,117 is hereby amended to read as
follows: 79-32,117. (a) The Kansas adjusted gross income of an individual
means such individual's federal adjusted gross income for the taxable year,
with the modifications specified in this section.
(b) There shall be added to federal adjusted gross income:
(i) Interest income less any related expenses directly incurred in the
purchase of state or political subdivision obligations, to the extent that
the same is not included in federal adjusted gross income, on obligations
of any state or political subdivision thereof, but to the extent that interest
income on obligations of this state or a political subdivision thereof issued
prior to January 1, 1988, is specifically exempt from income tax under the
laws of this state authorizing the issuance of such obligations, it shall be
excluded from computation of Kansas adjusted gross income whether or
not included in federal adjusted gross income. Interest income on obli-
gations of this state or a political subdivision thereof issued after Decem-
ber 31, 1987, shall be excluded from computation of Kansas adjusted
gross income whether or not included in federal adjusted gross income.
(ii) Taxes on or measured by income or fees or payments in lieu of
income taxes imposed by this state or any other taxing jurisdiction to the
extent deductible in determining federal adjusted gross income and not
credited against federal income tax. This paragraph shall not apply to taxes
imposed under the provisions of K.S.A. 79-1107 or 79-1108, and amend-
ments thereto, for privilege tax year 1995, and all such years thereafter.
(iii) The federal net operating loss deduction.
(iv) Federal income tax refunds received by the taxpayer if the de-
duction of the taxes being refunded resulted in a tax benefit for Kansas
income tax purposes during a prior taxable year. Such refunds shall be
included in income in the year actually received regardless of the method
of accounting used by the taxpayer. For purposes hereof, a tax benefit
shall be deemed to have resulted if the amount of the tax had been de-
ducted in determining income subject to a Kansas income tax for a prior
year regardless of the rate of taxation applied in such prior year to the
Kansas taxable income, but only that portion of the refund shall be in-
cluded as bears the same proportion to the total refund received as the
federal taxes deducted in the year to which such refund is attributable
bears to the total federal income taxes paid for such year. For purposes
of the foregoing sentence, federal taxes shall be considered to have been
deducted only to the extent such deduction does not reduce Kansas tax-
able income below zero.
(v) The amount of any depreciation deduction or business expense
deduction claimed on the taxpayer's federal income tax return for any
capital expenditure in making any building or facility accessible to the
handicapped, for which expenditure the taxpayer claimed the credit al-
lowed by K.S.A. 79-32,177, and amendments thereto.
(vi) Any amount of designated employee contributions picked up by
an employer pursuant to K.S.A. 12-5005, 20-2603, 74-4919 and 74-4965,
and amendments to such sections.
(vii) The amount of any charitable contribution made to the extent
the same is claimed as the basis for the credit allowed pursuant to K.S.A.
1996 Supp. 79-32,196, and amendments thereto.
(viii) The amount of any contribution made to an elementary or sec-
ondary school to the extent the same is claimed as the basis for the credit
allowed pursuant to section 1.
(c) There shall be subtracted from federal adjusted gross income:
(i) Interest or dividend income on obligations or securities of any
authority, commission or instrumentality of the United States and its pos-
sessions less any related expenses directly incurred in the purchase of
such obligations or securities, to the extent included in federal adjusted
gross income but exempt from state income taxes under the laws of the
(ii) Any amounts received which are included in federal adjusted
gross income but which are specifically exempt from Kansas income tax-
ation under the laws of the state of Kansas.
(iii) The portion of any gain or loss from the sale or other disposition
of property having a higher adjusted basis for Kansas income tax purposes
than for federal income tax purposes on the date such property was sold
or disposed of in a transaction in which gain or loss was recognized for
purposes of federal income tax that does not exceed such difference in
basis, but if a gain is considered a long-term capital gain for federal in-
come tax purposes, the modification shall be limited to that portion of
such gain which is included in federal adjusted gross income.
(iv) The amount necessary to prevent the taxation under this act of
any annuity or other amount of income or gain which was properly in-
cluded in income or gain and was taxed under the laws of this state for a
taxable year prior to the effective date of this act, as amended, to the
taxpayer, or to a decedent by reason of whose death the taxpayer acquired
the right to receive the income or gain, or to a trust or estate from which
the taxpayer received the income or gain.
(v) The amount of any refund or credit for overpayment of taxes on
or measured by income or fees or payments in lieu of income taxes im-
posed by this state, or any taxing jurisdiction, to the extent included in
gross income for federal income tax purposes.
(vi) Accumulation distributions received by a taxpayer as a beneficiary
of a trust to the extent that the same are included in federal adjusted
(vii) Amounts received as annuities under the federal civil service
retirement system from the civil service retirement and disability fund
and other amounts received as retirement benefits in whatever form
which were earned for being employed by the federal government or for
service in the armed forces of the United States.
(viii) Amounts received by retired railroad employees as a supple-
mental annuity under the provisions of 45 U.S.C. 228b (a) and 228c (a)(1)
(ix) Amounts received by retired employees of a city and by retired
employees of any board of such city as retirement allowances pursuant to
K.S.A. 13-14,106, and amendments thereto, or pursuant to any charter
ordinance exempting a city from the provisions of K.S.A. 13-14,106, and
(x) For taxable years beginning after December 31, 1976, the amount
of the federal tentative jobs tax credit disallowance under the provisions
of 26 U.S.C. 280 C. For taxable years ending after December 31, 1978,
the amount of the targeted jobs tax credit and work incentive credit dis-
allowances under 26 U.S.C. 280 C.
(xi) For taxable years beginning after December 31, 1986, dividend
income on stock issued by Kansas Venture Capital, Inc.
(xii) For taxable years beginning after December 31, 1989, amounts
received by retired employees of a board of public utilities as pension and
retirement benefits pursuant to K.S.A. 13-1246, 13-1246a and 13-1249
and amendments thereto.
(xiii) For taxable years beginning after December 31, 1993, the
amount of income earned on contributions deposited to an individual
development account under K.S.A. 1996 Supp. 79-32,117h, and amend-
(d) There shall be added to or subtracted from federal adjusted gross
income the taxpayer's share, as beneficiary of an estate or trust, of the
Kansas fiduciary adjustment determined under K.S.A. 79-32,135, and
(e) The amount of modifications required to be made under this sec-
tion by a partner which relates to items of income, gain, loss, deduction
or credit of a partnership shall be determined under K.S.A. 79-32,131,
and amendments thereto, to the extent that such items affect federal
adjusted gross income of the partner.
Sec. 3. K.S.A. 1996 Supp. 79-32,117 is hereby repealed.
Sec. 4. This act shall take effect and be in force from and after its
publication in the statute book.