WEST virginia
legislature
2017 regular session
By
[
to the Committee on Finance.
A BILL to repeal
§11-21-22a of the Code of West Virginia, 1931, as amended; and to amend and
reenact §11-21-22 and §11-21-22b of said code, all relating to personal income
tax; creating the West Virginia Earned Income Tax Credit; and authorizing a
refundable tax credit based upon the federal earned income tax credit.
Be it enacted by the
Legislature of West Virginia:
That §11-21-22a of the Code of West Virginia, 1931, as
amended be repealed; and that §11-21-22
and §11-21-22b of said code
be amended and reenacted, all to read as follows:
ARTICLE
21. PERSONAL INCOME TAX.
PART I. GENERAL.
§11-21-22. Working family tax credit Refundable
West Virginia Earned Income Tax Credit.
In order to eliminate West Virginia personal income tax
on families with low incomes below the federal poverty guidelines
and to reduce the West Virginia personal income tax on working families
with moderate incomes that are immediately above the federal poverty
guidelines, there is hereby created a nonrefundable refundable
tax credit, to be known as the low-income family tax credit West Virginia
Earned Income Tax Credit, against the West Virginia personal income tax. The low-income family tax credit is based upon
family size and the federal poverty guidelines. The low-income tax credit
reduces the tax imposed by the provisions of this article on families with
modified federal adjusted gross income below or near the federal poverty
guidelines: Provided, That for
tax years beginning on and after January 1, 2009, any person who is required to
pay the federal alternative minimum income tax in the current tax year is
disqualified from receiving any tax credit provided under this section The West Virginia Earned Income Tax Credit
is based upon the federal earned income tax credit.
§11-21-22b. Eligibility; amount of credit.
(a) (1) For each taxable year beginning after December
31, 2016, a West Virginia resident who is eligible for the federal earned
income tax credit under Section 32 of the Internal Revenue Code is eligible for
a credit under this article equal to fifty percent of the amount of the federal
earned income tax credit that the individual:
(A) Is eligible to receive in the taxable year; and
(B) Claimed for the taxable year under Section 32 of
the Internal Revenue Code.
(2) If the West Virginia resident is not eligible for
the federal earned income tax credit under Section 32 of the Internal Revenue
Code solely because the resident does not have a qualifying child the resident
is eligible for a credit under this section equal to fifty percent of the
amount of the federal earned income tax credit that the individual would have
been eligible for if he or she had one
qualifying child.
(b) If other credits allowed are used by the taxpayer
for the taxable year, the West Virginia Earned Income Tax Credit shall be
applied last.
(c) If the amount of the credit allowed exceeds the
taxpayer's West Virginia personal income tax liability, the commissioner shall
treat the excess as an overpayment and shall pay the taxpayer the amount of the
excess, without interest.
(d) The commissioner shall make an effort every year to
inform taxpayers who may be eligible to receive the credit provided under this
section.
NOTE: The purpose of this bill is
to provide low and moderate income workers with a refundable state tax credit
based on the federal earned income tax credit. Current law provides for a
nonrefundable tax credit based on federal poverty guidelines.
Strike-throughs indicate language
that would be stricken from a heading or the present law and underscoring
indicates new language that would be added.
§11-21-22b has been completely
rewritten; therefore, it has been completely underscored.