|SB 0097||Creates the Individual Development Account Program|
|LR Number:||S0436.01I||Fiscal Note:||0436-01|
|Committee:||Public Health and Welfare|
|Last Action:||05/14/99 - S Inf Calendar S Bills for Perfection||Journal page:|
|Effective Date:||August 28, 1999|
SB 97 - This act establishes the "Individual Development Account Program" (IDA) under the Department of Social Services. The IDA program will provide eligible families and individuals with an opportunity to establish special savings accounts. Community-based organizations may submit proposals to administer these accounts on a not for profit basis. The proposals must contain a requirement that the individual account holder match the contributions made to the account.
Families or individuals with a household income of less than or equal to 200 percent of the federal poverty level may open an IDA. The funds may be used for postsecondary education, job training, home ownership, home improvement, or small business capitalization. Financial institutions will be permitted to establish IDAs upon approval by the Department of Economic Development. The total deposits to an IDA in any calendar year shall not exceed $2500.00 and the total balance in an IDA shall not exceed $50,000.00.
If money is withdrawn from an IDA for any unauthorized purpose, a fifteen percent penalty will be charged and the account will be closed. Any moneys the account holder deposited in the account will be returned to the account holder, but all contributions from other sources will be forfeited. IDA funds will be disregarded when determining eligibility to receive public assistance.
Moneys deposited in and interest earned by IDAs are tax
exempt, except for withholding taxes. Tax credits will be given
to contributors, up to $50,000.00. This act is substantially
similar to SB 699 (1998) and HB 349, portions of the Truly Agreed
to SCS/HCS/HBs 316, 660 & 203 and HS/HCS/SCS/SBs 387, 206 & 131
SCA 1 - REDUCES AMOUNT OF INDIVIDUAL DEVELOPMENT ACCOUNT FUNDS ALLOWED TO GO TOWARD ADMINISTRATIVE COSTS FROM "FIFTEEN" TO "TEN". SCA 2 - REPLACES LANGUAGE REQUIRING PARTICIPANTS TO ATTEND SEMINARS TO LANGUAGE STATING PARTICIPANTS ARE ENCOURAGE TO ATTEND.