Date Requested: February 05, 2015
Time Requested: 12:47 PM
Agency: State Tax & Revenue Department
CBD Number: Version: Bill Number: Resolution Number:
2031 Introduced HB2622
CBD Subject: Tax


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 limit the personal income tax deduction for Smart 529 plan contributions to those payments made when the designated beneficiary is eighteen years of age or younger.
    
    We cannot determine the revenue gain associated with this bill due to lack of data on the number of taxpayers who would be affected.
    
    There would be $5,000 of additional costs in FY2016 assuming that the only change would be in the instructions to those who claim such modifications. If there is a desire for greater scrutiny of returns claiming this type of modification, additional administrative costs would be much more significant.
    



Fiscal Note Detail


Effect of Proposal Fiscal Year
2015
Increase/Decrease
(use"-")
2016
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 5,000 0
Personal Services 0 0 0
Current Expenses 0 0 0
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 5,000 0
2. Estimated Total Revenues 0 0 0


Explanation of above estimates (including long-range effect):


    We cannot determine the revenue gain associated with this bill. In tax year 2013, a total of 7,059 taxpayers claimed a State deduction totaling $36.6 million related to this line on the tax return. The total net costs to the State Treasury were slightly more than $2 million. We have no data available to indicate the portion of the total $36.6 million deduction that was attributable to contributions to Smart 529 plans to benefit children over age 18.
    
    There would be $5,000 of additional costs in FY2016 assuming that the only change would be in the instructions to those who claim such modifications. If there is a desire for greater scrutiny of returns claiming this type of modification, additional administrative costs would be much more significant.
    
    



Memorandum


    



    Person submitting Fiscal Note: Mark Muchow
    Email Address: kerri.r.petry@wv.gov