FISCAL NOTE
Date Requested: February 12, 2021 Time Requested: 02:19 PM |
Agency: |
Tax & Revenue Department, WV State |
CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
1361 |
Introduced |
HB2341 |
|
CBD Subject: |
Taxation |
---|
|
FUND(S):
General Revenue Fund
Sources of Revenue:
General Fund
Legislation creates:
Decreases Existing Revenue, Increases Existing Expenses
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The stated purpose of this bill is to provide taxpayers repaying their own student loans a modification reducing federal adjusted gross income in the amount of the interest paid, for personal income tax purposes.
The proposed decreasing modification for student loan interest is allowed only to the extent the amount is not taken as a deduction when arriving at the taxpayer’s federal adjusted gross income for taxable years beginning after December 31, 2020. The annual cost of the current above-the-line student loan deduction is roughly $2.8 million. We are unable to accurately determine the additional revenue loss from the proposed bill. However, the additional revenue loss will be significantly lower than the amount lost through the above-the-line deduction due to a smaller number of taxpayers qualifying for the modification relative to the number qualifying for the current deduction.
Additional administrative costs would be $30,000 in FY2022 and $20,000 in subsequent fiscal years.
Fiscal Note Detail
Effect of Proposal |
Fiscal Year |
2021 Increase/Decrease (use"-") |
2022 Increase/Decrease (use"-") |
Fiscal Year (Upon Full Implementation) |
1. Estmated Total Cost |
0 |
30,000 |
20,000 |
Personal Services |
0 |
20,000 |
20,000 |
Current Expenses |
0 |
0 |
0 |
Repairs and Alterations |
0 |
0 |
0 |
Assets |
0 |
0 |
0 |
Other |
0 |
10,000 |
0 |
2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
The proposed decreasing modification for student loan interest is allowed only to the extent the amount is not taken as a deduction when arriving at the taxpayer’s federal adjusted gross income for taxable years beginning after December 31, 2020. The annual cost of the current above-the-line student loan deduction is roughly $2.8 million. We are unable to accurately determine the additional revenue loss from the proposed bill. However, the additional revenue loss will be significantly lower than the amount lost through the above-the-line deduction due to a smaller number of taxpayers qualifying for the modification relative to the number qualifying for the current deduction.
Additional administrative costs would be $30,000 in FY2022 and $20,000 in subsequent fiscal years.
Memorandum
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov