FISCAL NOTE
Date Requested: February 10, 2017 Time Requested: 09:04 AM |
Agency: |
Tax & Revenue Department, WV State |
CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
1309 |
Introduced |
HB1309 |
|
CBD Subject: |
Taxation |
---|
|
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 reduce state income taxes for state and federal retirees by increasing the exemption on retirement income in calculating the federal gross income for state personal income tax purposes.
The bill, as written, increases the decreasing modification for benefits received from federal retirement but does not increase the modification for benefits received from PERS or the Teachers Retirement System. The bill would increase the modification for federal retirees from $2,000 to $20,000 beginning with Tax Year 2018. Passage of this bill would reduce General Revenue Fund collections by roughly $4.1 million in FY2019. The anticipated retirements of members of the baby-boom generation will result in additional escalation of costs over time.
Additional administrative costs would be $29,000 in FY2019 and $15,000 a year for fiscal years thereafter.
Fiscal Note Detail
Effect of Proposal |
Fiscal Year |
2017 Increase/Decrease (use"-") |
2018 Increase/Decrease (use"-") |
Fiscal Year (Upon Full Implementation) |
1. Estmated Total Cost |
0 |
0 |
15,000 |
Personal Services |
0 |
0 |
15,000 |
Current Expenses |
0 |
0 |
0 |
Repairs and Alterations |
0 |
0 |
0 |
Assets |
0 |
0 |
0 |
Other |
0 |
0 |
0 |
2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
The bill, as written, increases the decreasing modification for benefits received from federal retirement but does not increase the modification for benefits received from PERS or the Teachers Retirement System. The bill would increase the modification for federal retirees from $2,000 to $20,000 beginning with Tax Year 2018. Passage of this bill would reduce General Revenue Fund collections by roughly $4.1 million in FY2019. The anticipated retirements of members of the baby-boom generation will result in additional escalation of costs over time.
Additional administrative costs would be $29,000 in FY2019 and $15,000 a year for fiscal years thereafter.
Memorandum
The stated purpose of this bill is to reduce state income taxes for state and federal retirees by increasing the exemption on retirement income in calculating the federal gross income for state personal income tax purposes.
The bill does not increase the modification amount for State retirees as suggested in the title of the bill. Also, additional litigation by less favored groups could result in an increase in administrative costs to the State Tax Department.
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov