HB1366
To Create An Income Tax Credit For Qualified Storm Shelters.
Last Action (May 5, 2025): Died in House Committee at Sine Die adjournment.
Sponsors
AI-Generated Summary
House Bill 1366 creates a state income tax credit for Arkansas taxpayers who install a qualified storm shelter at their primary residence. To be qualified, the shelter must meet specific criteria, including the ability to withstand an EF5 tornado and compliance with FEMA standards. The tax credit is equal to 50% of the total construction, acquisition, and installation costs, capped at $3,000 per taxpayer. The bill establishes an annual statewide aggregate cap of $2,000,000 for these credits, which are issued on a first-come, first-served basis by the Division of Emergency Management. Taxpayers must submit an informational report to the division to receive a certificate before claiming the credit. If the annual cap is reached, taxpayers may resubmit their information in the following tax year. The program applies to tax years beginning on or after January 1, 2025.
Potential Impact Analysis
Who Might Benefit?
The primary beneficiaries are Arkansas homeowners who intend to install or have recently installed a storm shelter that meets the specified safety and design standards. These individuals benefit from a direct reduction in their state income tax liability. Additionally, the bill may benefit residential construction companies, shelter manufacturers, and contractors by potentially increasing the consumer demand for storm shelter installation services.
Who Might Suffer?
The primary group negatively impacted consists of the state treasury and taxpayers in general, as the $2 million annual tax credit represents a reduction in potential state revenue. Furthermore, those who do not own their homes—such as renters or individuals living in multi-family dwellings—cannot benefit from this credit as it is restricted to single-family primary residences. Taxpayers who miss the first-come, first-served cutoff for the $2 million annual limit are also effectively excluded from receiving the benefit for that specific tax year.
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