HB 2645: Revenue and taxation; practice of medicine; tax credit; time period; effective date. - Oklahoma

Floor (House) → Floor (Senate) · 6 edits

MODERATE

The bill was amended to transition from a House version to a Senate version, changing the effective date from December 31, 2025 to January 1, 2026. The Senate version also increased the individual credit limit from $25,000 to $20,000 and adjusted the total annual credit cap from $1,000,000 to $1,000,000 with a new calculation method. The definition of a 'qualifying doctor' was expanded to include those licensed within two years prior to the effective date, provided they meet residency and education requirements.

Scope change

The bill's scope was modified to apply to tax years beginning after December 31, 2025, with the effective date set to January 1, 2026. The credit is now available for tax year 2026 and subsequent years.

TIMELINE

The effective date was changed from January 1, 2026 to January 1, 2026, with the credit applying to taxable years beginning after December 31, 2025.

FISCAL

The individual credit limit was reduced from $25,000 to $20,000 per taxpayer per year.

The total annual credit cap remains at $1,000,000, but the calculation method for adjusting credits was updated to include a formula based on the second preceding tax year.

ELIGIBILITY

The definition of a 'qualifying doctor' was expanded to include doctors licensed within two years prior to the effective date, provided they meet residency and education requirements.

DEFINITION

The definition of a 'qualifying doctor' now includes doctors who graduated from a college of medicine or osteopathic medicine located in the state or completed residency in the state.

The definition of a 'rural area' was updated to use the most recent Federal Decennial Census for population determination.

Senate Committee Substitute for House Bill → Floor (House) · 3 edits

MINOR

The bill was revised from a committee substitute version to the House floor version, primarily updating the header to reflect it as the floor version and adjusting the credit limit from $20,000 to $25,000 per year. The committee report was also added to indicate the committee's recommendation to pass the bill as amended and coauthored.

Scope change

The scope of the bill remains focused on providing a tax credit for qualifying doctors practicing in rural areas, with a slight increase in the maximum credit amount available to taxpayers.

FISCAL

The maximum tax credit amount for qualifying doctors increased from $20,000 to $25,000 per taxable year.

TECHNICAL

A committee report was added to the end of the bill, recommending that the House pass the bill as amended and coauthored.

The document header was updated to reflect the House floor version instead of the committee substitute version.

House Committee Substitute → Senate Committee Substitute for House Bill · 4 edits

MODERATE

The Senate Committee Substitute modified the medical tax credit bill to increase the individual credit limit from $25,000 to $20,000, reduce the total annual credit cap from $1 million to $1 million (unchanged), and adjust the credit duration from 4 subsequent years to 4 subsequent years (unchanged). The definition of 'qualifying doctor' was refined to require residency in the same county as the rural area where compensation was earned, and the effective date remains January 1, 2026.

Scope change

The bill's scope remains focused on providing tax credits to qualifying doctors practicing in rural areas, but eligibility criteria were tightened regarding residency requirements.

FISCAL

The individual tax credit amount was reduced from $25,000 to $20,000 per year for tax year 2026 and subsequent years.

ELIGIBILITY

The definition of 'qualifying doctor' now requires the doctor's primary residence to be in the same county as the rural area where the taxable compensation was earned, rather than just within the same state.

DEFINITION

The definition of 'rural area' was updated to specify population thresholds based on the most recent Federal Decennial Census, with clear boundaries for municipalities and unincorporated locations.

TECHNICAL

The bill title was updated from 'House Committee Substitute' to 'Senate Committee Substitute for House Bill' with updated page numbering and reference numbers.

Proposed Policy Committee Substitute 1 → House Committee Substitute · 4 edits

MODERATE

The bill was completely rewritten from a Proposed Policy Committee Substitute to a House Committee Substitute, updating the bill number tracking and committee designation while maintaining the core policy of providing income tax credits to doctors practicing in rural Oklahoma. The substantive policy language remains largely the same, with no changes to credit amounts, eligibility criteria, or effective dates.

TECHNICAL

Bill title changed from 'PROPOSED POLICY COMMITTEE SUBSTITUTE' to 'COMMITTEE SUBSTITUTE' reflecting the bill's progression through the legislative process.

Tracking number updated from Req. No. 12415 to Req. No. 13162, indicating the bill has been renumbered by the House Committee.

Date stamp changed from 2/10/2025 to 3/05/25, showing the bill was processed by the House Committee on a later date.

Committee name changed from 'Proposed Policy Committee' to 'House Committee' as the bill moved to the House floor for consideration.

Enrolled (final version) → Proposed Policy Committee Substitute 1 · 5 edits

MODERATE

The bill was completely rewritten by the Policy Committee to expand eligibility for doctors working in rural areas, increase the credit amount from $20,000 to $25,000, and add provisions allowing tribal health facility employees to qualify. The committee also removed the automatic percentage reduction formula and replaced it with a simpler cap that suspends the credit entirely once cumulative claims exceed $1 million annually.

Scope change

Expanded eligibility to include doctors whose primary residence is within the jurisdiction of a federally recognized tribe and directly employed by a tribally owned health facility or federal Indian Health Service facility.

ELIGIBILITY

Added a new eligibility category for doctors whose primary residence is in a federally recognized tribe jurisdiction and who work at tribally owned health facilities or federal Indian Health Service facilities.

FISCAL

Increased the maximum credit amount from $20,000 to $25,000 per taxpayer per year.

Changed the annual cap mechanism from a percentage reduction formula to a hard cap that completely suspends the credit once cumulative claims exceed $1 million in a single year.

REQUIREMENT

Removed the requirement for the Oklahoma Tax Commission to calculate and publish a percentage adjustment formula, replacing it with a requirement to only publish an estimate of total credits claimed.

TECHNICAL

Changed the effective date language from 'tax year 2026 and subsequent tax years' to 'taxable years beginning after December 31, 2025' for consistency.

Engrossed → Enrolled (final version) · 5 edits · May 29, 2025

MODERATE

The bill was finalized as an Enrolled version with additional sponsors added and the title expanded to clarify its purpose. The most significant substantive change is the reduction of the annual credit cap from $25,000 to $20,000 per taxpayer, and the addition of a new $1 million annual total credit limit with a pro-rata reduction mechanism if the limit is exceeded. The effective date remains January 1, 2026, and the definition of a rural area was slightly modified to apply to 'this state' instead of 'Oklahoma' for consistency.

Scope change

The bill's scope remains focused on providing an income tax credit to doctors practicing in rural areas, but the total amount of credits available has been reduced and now includes a hard annual cap.

FISCAL

The maximum credit amount per taxpayer was reduced from $25,000 to $20,000.

A new annual total credit cap of $1,000,000 was added for tax years 2028 and later, with a formula to reduce individual credits proportionally if the cap is exceeded.

DEFINITION

The definition of 'rural area' was updated to use 'this state' instead of 'Oklahoma' for consistency in legal language.

TECHNICAL

Additional sponsors (Pogemiller, Eaves, Hall) were added to the bill header, and the title was expanded to include more descriptive language about the bill's provisions.

TIMELINE

The effective date was changed from 'taxable years beginning after December 31, 2025' to 'tax year 2026 and subsequent tax years' for clarity.

Amended And Engrossed → Engrossed · 3 edits · May 29, 2025

MINOR

The bill was amended to add a new sponsor from the Senate, update the bill's subject matter description, increase the maximum credit amount from $20,000 to $25,000, and add a provision that suspends the credit for one year if the total claimed credits exceed $1 million in any given year.

Scope change

The bill now includes a Senate sponsor and modifies the credit limit and suspension mechanism.

ELIGIBILITY

Increased the maximum tax credit amount from $20,000 to $25,000 per year for qualifying doctors in rural areas.

REQUIREMENT

Added a new provision requiring the Oklahoma Tax Commission to suspend the credit for one taxable year if the cumulative total of credits claimed in a single year exceeds $1 million.

TECHNICAL

Added a Senate sponsor (Paxton) to the bill and updated the subject matter description to include 'limitations' and 'estimate'.

Introduced → Amended And Engrossed · 4 edits · May 29, 2025

MODERATE

The bill was amended to change its effective date from November 1, 2025 to January 1, 2026, and to specify that it will be codified as Section 2357.410 of Title 68 of the Oklahoma Statutes. The substantive policy content regarding the tax credit for rural medical practitioners remains largely unchanged, though the effective date shift means the credit applies to tax years beginning after December 31, 2025 rather than 2026.

Scope change

The bill's scope remains focused on creating a tax credit for doctors practicing in rural areas of Oklahoma, but the effective date was moved forward by approximately two months.

TIMELINE

The effective date of the bill was changed from November 1, 2025 to January 1, 2026, which delays when the tax credit becomes available to taxpayers.

TECHNICAL

The bill title was changed from 'Oklahoma Revenue and Taxation Act of 2025' to a more descriptive title covering revenue, taxation, medicine, credit limitations, and effective date.

The codification section was updated to specify that the new law should be codified as Section 2357.410 of Title 68 of the Oklahoma Statutes, unless there is a numbering duplication.

A new Section 3 was added to the House bill version to mirror the content of the Senate amendment's Section 1, ensuring consistency between the two versions.

Revenue and taxation; practice of medicine; tax credit; time period; effective date.

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