FISCAL NOTE
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 provide a two-tiered personal income tax credit to parents or legal guardians who provide home or private education for their children. The tax credit will be effective upon the completion of a school year and available at a rate per child of $1,000 for home schooling and $2,000 for private schooling.
Passage of this bill would result in a General Revenue Fund decline of approximately $33.6 million per year, beginning in FY2015. Due to the lack of an internal effective date, this bill would not become effective until the 2014 tax year.
Additional administrative costs to the State Tax Department would be approximately $36,000 in FY2014 for the creation and development of a separate schedule, as well as the programming, testing, and implementation costs associated with the reporting requirements of the bill.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2013
Increase/Decrease
(use"-") |
2014
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
36,160 |
0 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
0 |
31,160 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
5,000 |
0 |
| 2. Estimated Total Revenues |
0 |
0 |
-33,600,000 |
Explanation of above estimates (including long-range effect):
The stated purpose of this bill is to provide a two-tiered personal income tax credit to parents or legal guardians who provide home or private education for their children. The tax credit will be effective upon the completion of a school year and available at a rate per child of $1,000 for home schooling and $2,000 for private schooling.
Passage of this bill would result in a General Revenue Fund decline of approximately $33.6 million per year, beginning in FY2015. Due to the lack of an internal effective date, this bill would not become effective until the 2014 tax year.
Additional administrative costs to the State Tax Department would be approximately $36,000 in FY2014 for the creation and development of a separate schedule, as well as the programming, testing, and implementation costs associated with the reporting requirements of the bill.
Memorandum
There is no requirement that the parent or guardian is required to provide all of the expenses for the home or private schooling; all that is required is that the schooling be provided. In the case of divorced parents, each may assist in providing the required schooling and then each may be able to take the credit. The bill also uses the terms “home schooling” and “private schooling” without providing definitions. Furthermore, the bill has no provision stating the schooling take place in West Virginia. Separated or divorced parents could receive the credit for schooling in other states while they reside in West Virginia. Finally, the bill has no provision for refundability, carry forward, or carry back.
Person submitting Fiscal Note: Mark B. Muchow
Email Address: Roger.D.Cox@wv.gov