Income tax, state; conformity, increase in standard deduction, refundable income tax credit. (HB2086)

Introduced By

Del. Vivian Watts (D-Annandale) with support from co-patron Del. Kaye Kory (D-Falls Church)

Progress

Introduced
Passed Committee
Passed House
Passed Senate
Signed by Governor
Became Law

Description

Income tax; conformity; increase in standard deduction; refundable income tax credit for low-income taxpayers; emergency. Advances conformity of the Commonwealth's tax code with the federal tax code to December 31, 2018. However, for taxable years 2018 through 2025, the bill deconforms from the provisions of Public Law 115-97, known as the "Tax Cuts and Jobs Act," that would suspend the overall limitation on itemized deductions. The bill increases, for taxable years 2018 through 2025, the amount of the standard deduction to $4,500 for single individuals and $9,000 for married couples. Under current law, the standard deduction is $3,000 for single individuals and $6,000 for married couples. The bill adjusts Virginia's standard deduction for taxable years 2019 through 2025 by the percentage increase in the Chained Consumer Price Index for all Urban Consumers (C-CPI-U) for the previous taxable year. The bill contains an emergency clause. The bill allows low-income individuals and married persons to claim either (i) a nonrefundable income tax credit equal to $300 for each individual, his spouse, and any dependents or (ii) an income tax credit equal to 20 percent of the federal earned income tax credit, a portion of which would be refundable. Fifty percent of the value of the credit would be refundable in taxable year 2018, and the refundable portion would increase by five percent each year, becoming fully refundable starting in taxable year 2028. Under current law, low-income individuals and married persons may elect either of these amounts; however, both options for claiming the credit are nonrefundable. Amends § 58.1-301, § 58.1-339.8, § 63.2-527, of the Code of Virginia. Read the Bill »

Status

01/07/2019: Awaiting a Vote in the Rules Committee

History

DateAction
01/07/2019Committee
01/07/2019Presented and ordered printed with emergency clause 19103890D
01/07/2019Referred to Committee on Rules

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