Date Requested:January 13, 2011
Time Requested:02:14 PM
Agency: State Tax Department
CBD Number: Version: Bill Number: Resolution Number:
2011R1263 Introduced HB2426
CBD Subject: TAX CREDIT FOR MILITARY PENSIONS
FUND(S)
General Revenue Fund
Sources of Revenue
General Fund
Legislation creates:
Neither Program nor Fund

Fiscal Note Summary

Effect this measure will have on costs and revenues of state government.

    The stated purpose of this bill is to allow individuals to utilize any portion of their federal civil service retirement pension based on credit for military service to reduce their federal adjusted gross income for West Virginia personal income tax purposes, as well as not prohibiting a claimant from obtaining this modification if the claimant can provide to the State Tax Commissioner a screen print or short form letter from the United States Office of Personnel Management, or its successor, with information pertaining to applicable particular credit for their military service towards their federal civil service retirement pension.
    
    The State Tax Department does not have access to information necessary to distinguish between normal federal civil service pensions and federal civil service pensions that include converted military pensions or federal police pensions. Thus, we are unable to estimate the potential revenue impact that would result from passage of this bill.
    
    Passage of this bill may require the State Tax Department to alter normal tax return processing in order to determine whether a federal civil service pension was solely attributable to federal civil service or if the pension included converted military or federal police retirement benefits. The additional administrative costs could be significant.

Fiscal Note Detail
Over-all effect
Effect of Proposal Fiscal Year
2011
Increase/Decrease
(use"-")
2012
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 0 0
Personal Services 0 0 0
Current Expenses 0 0 0
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues 0 0 0
3. Explanation of above estimates (including long-range effect):
    The State Tax Department does not have access to information necessary to distinguish between normal federal civil service pensions and federal civil service pensions that include converted military pensions or federal police pensions. Thus, we are unable to estimate the potential revenue impact that would result from passage of this bill.
    
    Passage of this bill may require the State Tax Department to alter normal tax return processing in order to determine whether a federal civil service pension was solely attributable to federal civil service or if the pension included converted military or federal police retirement benefits. The additional administrative costs could be significant.
    


Memorandum
Person submitting Fiscal Note:
Mark Muchow
Email Address:
kerri.r.petry@wv.gov
    The stated purpose of this bill is to allow individuals to utilize any portion of their federal civil service retirement pension based on credit for military service to reduce their federal adjusted gross income for West Virginia personal income tax purposes, as well as not prohibiting a claimant from obtaining this modification if the claimant can provide to the State Tax Commissioner a screen print or short form letter from the United States Office of Personnel Management, or its successor, with information pertaining to applicable particular credit for their military service towards their federal civil service retirement pension.
    
    There is no method given for accounting for that portion of the retirement that is “income from any portion of a federal civil service retirement pension based on credit for military service of the individual.”