FISCAL NOTE
Date Requested: January 17, 2024
Time Requested: 03:35 PM |
| Agency: |
Tax & Revenue Department, WV State |
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| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 1926 |
Introduced |
HB4208 |
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|---|
| CBD Subject: |
|
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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 a personal income tax credit of $3,000 to parents or legal guardians who provide a year of home or private, primary or secondary education for their children. The credit is limited to $3,000 per taxpayer and not based on the number of children schooled. The bill authorizes rule-making.
Based on our interpretation, the proposed bill would provide a Personal Income Tax credit of up to $3,000 per taxpayer for homeschooled children or children enrolled in private school beginning with Tax Year 2024. We are unable to accurately estimate the revenue impact of this bill on the General Revenue Fund, but the loss would be significant. There are 38,000 children who are either homeschooled in West Virginia or attend private schools. However, we do not know how many families either homeschool or enroll their children in private school. Under the assumption that the 38,000 students represent roughly 15,000 families, the revenue loss could be roughly $45.0 million.
Administrative costs incurred by the State Tax Department are estimated to be $61,500 for FY2025 and $45,000 in subsequent fiscal years.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2024
Increase/Decrease
(use"-") |
2025
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
61,500 |
45,000 |
| Personal Services |
0 |
45,000 |
45,000 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
1,500 |
0 |
| Other |
0 |
15,000 |
0 |
| 2. Estimated Total Revenues |
0 |
-45,000,000 |
-45,000,000 |
Explanation of above estimates (including long-range effect):
Based on our interpretation, the proposed bill would provide a Personal Income Tax credit of up to $3,000 per taxpayer for homeschooled children or children enrolled in private school beginning with Tax Year 2024. We are unable to accurately estimate the revenue impact of this bill on the General Revenue Fund, but the loss would be significant. There are 38,000 children who are either homeschooled in West Virginia or attend private schools. However, we do not know how many families either homeschool or enroll their children in private school. Under the assumption that the 38,000 students represent roughly 15,000 families, the revenue loss could be roughly $45.0 million.
Administrative costs incurred by the State Tax Department are estimated to be $61,500 for FY2025 and $45,000 in subsequent fiscal years.
Memorandum
The stated purpose of this bill is to provide a personal income tax credit of $3,000 to parents or legal guardians who provide a year of home or private, primary or secondary education for their children. The credit is limited to $3,000 per taxpayer and not based on the number of children schooled. The bill authorizes rule-making.
The credit limitation is “per taxpayer”. There is no indication whether a married couple (two taxpayers) could receive a total credit of $6,000. In addition, the bill does not address the age of children or if the credit is refundable.
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov