H. B. 2610
(By Delegates Walters and Armstead)
[Introduced
February 23, 2005
; referred to the
Committee on Finance.]
A BILL to amend and reenact §11-21-10 of the Code of West Virginia,
1931, as amended, relating to personal income tax and
increasing the low income exclusion.
Be it enacted by the Legislature of West Virginia:
That §11-21-10 of the Code of West Virginia, 1931, as amended,
be amended and reenacted to read as follows:
ARTICLE 21. PERSONAL INCOME TAX.
§11-21-10. Low income exclusion.
(a) Earned income exclusion. -- In the case of an eligible
taxpayer, there shall be is allowed as a deduction from federal
adjusted gross income the amount of his or her earned income
included therein, not to exceed ten eighteen thousand dollars,
except that when a husband and wife file separate returns under
this article this exclusion shall may not exceed five nine thousand
dollars per separate return: Provided, That for the taxable year beginning the first day of January, one thousand nine hundred
ninety-six two thousand five, the exclusion provided for in this
section shall apply applies only to earned income received after
the thirtieth day of June, one thousand nine hundred ninety-six two
thousand five, and the amount excluded shall may not exceed fifty
percent of the annual low income exclusion amounts set forth in
this subsection.
(b) "Eligible taxpayer" defined. -- The term "eligible
taxpayer" means:
(1) Any unmarried individual and any husband and wife filing
a joint return under this article who has or have federal adjusted
gross income of ten eighteen thousand dollars or less for the
taxable year; or
(2) Any husband or wife filing a separate return under this
article who has federal adjusted gross income of five nine thousand
dollars or less.
(c) "Earned income" defined. --
(1) The term "earned income" means:
(A) Wages, salaries, tips, and other employee compensation;
plus
(B) The amount of the taxpayer's net earnings from
self-employment for the taxable year (within the meaning of Section
1402 (a) of the Internal Revenue Code), but such the net earnings
shall be determined with regard to the deduction allowed to the taxpayer under Section 164 of the Internal Revenue Code.
(2) For purposes of this section:
(A) The earned income of an individual shall be computed
without regard to any community property laws;
(B) No amount received as pension or annuity shall may be
taken into account; and
(C) No amount received for services provided by an individual
while the individual is an inmate at a penal institution shall may
be taken into account.
(d) Taxable year must be full taxable year. -- Except in the
case of a taxable year closed by reason of the death of the
taxpayer, no credit shall may be allowed under this section in the
case of a taxable year covering a period of less than twelve
months.
NOTE: The purpose of this bill is to increase the low income
exclusion for personal income tax.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
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