FISCAL NOTE
Date Requested: January 23, 2024
Time Requested: 02:11 PM |
| Agency: |
Tax & Revenue Department, WV State |
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| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 3083 |
Introduced |
HB4880 |
|
|---|
| CBD Subject: |
Governor -- Bills Requested By |
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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 that the personal income tax decreasing modification for 100% of social security income shall no longer be subject to the restriction that such decreasing modification be allowable only when the federal adjusted gross income of a married couple filing a joint return does not exceed $100,000, or $50,000 in the case of a single individual or a married individual filing a separate return. The provision is retrospective to apply to taxable years beginning on and after January 1, 2024.
According to our interpretation, passage of this bill would exempt all federally taxable Social Security benefits from personal income tax by adding a provision to §11-21-12(c)(8)(D) that renders the income limitations no longer applicable for taxable years beginning on or after January 1, 2024. Under current law, a decreasing modification for Social Security benefits is allowed when the federal adjusted gross income of a married couple filing a joint return does not exceed $100,000, or $50,000 in the case of a single individual or a married individual filing a single return.
Based on our interpretation and updated statistical data and Personal Income Tax rates currently in effect, passage of this bill would reduce General Revenue Fund collections by a $37.0 million in FY2025, by $37.7 million in FY2026, and by increasing amounts in subsequent fiscal years.
Additional administrative costs incurred by the State Tax Department would be $15,000 in FY2024, $46,500 in 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 |
15,000 |
46,500 |
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 |
15,000 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
-37,000,000 |
-37,700,000 |
Explanation of above estimates (including long-range effect):
According to our interpretation, passage of this bill would exempt all federally taxable Social Security benefits from personal income tax by adding a provision to §11-21-12(c)(8)(D) that renders the income limitations no longer applicable for taxable years beginning on or after January 1, 2024. Under current law, a decreasing modification for Social Security benefits is allowed when the federal adjusted gross income of a married couple filing a joint return does not exceed $100,000, or $50,000 in the case of a single individual or a married individual filing a single return.
Based on our interpretation and updated statistical data and Personal Income Tax rates currently in effect, passage of this bill would reduce General Revenue Fund collections by a $37.0 million in FY2025, by $37.7 million in FY2026, and by increasing amounts in subsequent fiscal years.
Additional administrative costs incurred by the State Tax Department would be $15,000 in FY2024, $46,500 in FY2025, and $45,000 in subsequent fiscal years.
Memorandum
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov