FISCAL NOTE
Date Requested: January 21, 2026
Time Requested: 04:36 PM |
| Agency: |
Tax & Revenue Department, WV State |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 2030 |
Introduced |
HB4665 |
|
|---|
| CBD Subject: |
Taxation |
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|
FUND(S):
General Revenue Fund
Sources of Revenue:
General Fund
Legislation creates:
Decreases Existing Revenue, Increases Existing Expenses
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The stated purpose of this bill is to expand the state's modifications for tax reducing federal adjusted gross income to retired out-of-state police, first responders, and other retirees who show the work they performed was in the capacity of Law Enforcement Officer, and/or a First Responder.
The bill, as written, expands the list of taxpayers who qualify for a full decreasing modification for retirement income to include retired out-of-state police, first responders and other retirees whose duties while working were in the capacity of law enforcement or first responders. We are unable to determine the revenue loss from this proposal due to lack of data on the number of retirees who would qualify under this expanded definition, but the revenue loss could be significant. The new definition includes a long list of classifications that are not covered under the current decreasing modification.
In addition, the wording of the bill language effectively makes the changes retroactive to the 1980 tax year, which will probably result in many amended returns from taxpayers who will benefit from the change.
Additional administrative would be $109,800 in FY2026 and $90,000 in subsequent fiscal years.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2026
Increase/Decrease
(use"-") |
2027
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
0 |
0 |
| Personal Services |
0 |
0 |
0 |
| 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, expands the list of taxpayers who qualify for a full decreasing modification for retirement income to include retired out-of-state police, first responders and other retirees whose duties while working were in the capacity of law enforcement or first responders. We are unable to determine the revenue loss from this proposal due to lack of data on the number of retirees who would qualify under this expanded definition, but the revenue loss could be significant. The new definition includes a long list of classifications that are not covered under the current decreasing modification. Under the provisions of the bill, the following would qualify for the full decreasing modification:
•Law enforcement officers, including, but not limited to “Municipal Police Officers, State Police, Deputy Sheriffs, Correctional Officers, Animal Control Officers, Bailiffs, Bike Patrol Officers, Border Patrol Agents, Constables, Crime Scene Investigators, Crisis Negotiators, Customs Officers, Defensive Tactics Instructors, Drug Recognition Experts, Evidence Technicians, Explosive Ordnance Disposal Technicians (EOD), FBI Special Agents, Field Training Officers, Forensics Analysts, Gang Investigators, Homicide Detectives, Investigators, Jailers, K-9 Officers, Marine Patrol Officer, Motor Officers, Narcotics Officers, Narcotics Officers, Police Officers, Probation & Parole Officers, Quartermasters, Rangers, Records Specialists, Reserve Officers, School Resource Officers, Special Agents, Sky Marshals, SWAT Operators, Sworn Officers, Traffic Homicide Investigators, Troopers, Undercover Officers, Victim-Witness Advocates, and Youth Programs Coordinators”,
•First responders, including, but not limited to Firefighters, Paramedics, Police, and Emergency Medical Technicians (EMT’s),
•Nuclear materials couriers,
•Air traffic controllers, and
•Other retirees showing the work they performed was in the capacity of Law Enforcement Officer, and/or a First Responder.
In addition, the wording of the bill language effectively makes the changes retroactive to the 1980 tax year, which will probably result in many amended returns from taxpayers who will benefit from the change.
Additional administrative would be $109,800 in FY2026 and $90,000 in subsequent fiscal years.
Memorandum
The stated purpose of this bill is to expand the state's modifications for tax reducing federal adjusted gross income to retired out-of-state police, first responders, and other retirees who show the work they performed was in the capacity of Law Enforcement Officer, and/or a First Responder
The bill amends W. Va. Code §11-21-12 by providing a decreasing modification against personal income tax for retirement income received by:
• Law enforcement officers, including, but not limited to “Municipal Police Officers, State Police, Deputy Sheriffs, Correctional Officers, Animal Control Officers, Bailiffs, Bike Patrol Officers, Border Patrol Agents, Constables, Crime Scene Investigators, Crisis Negotiators, Customs Officers, Defensive Tactics Instructors, Drug Recognition Experts, Evidence Technicians, Explosive Ordnance Disposal Technicians (EOD), FBI Special Agents, Field Training Officers, Forensics Analysts, Gang Investigators, Homicide Detectives, Investigators, Jailers, K-9 Officers, Marine Patrol Officer, Motor Officers, Narcotics Officers, Narcotics Officers, Police Officers, Probation & Parole Officers, Quartermasters, Rangers, Records Specialists, Reserve Officers, School Resource Officers, Special Agents, Sky Marshals, SWAT Operators, Sworn Officers, Traffic Homicide Investigators, Troopers, Undercover Officers, Victim-Witness Advocates, and Youth Programs Coordinators”,
• First responders, including, but not limited to Firefighters, Paramedics, Police, and Emergency Medical Technicians (EMT’s),
• Nuclear materials couriers,
• Air traffic controllers, and
• Other retirees showing the work they performed was in the capacity of Law Enforcement Officer, and/or a First Responder.
The above definitions are overly broad, especially because of the language “including but not limited to.” The bill does not establish any hard factors or criteria in determining whether someone qualifies and creates significant administrative issues regarding how to identify taxpayers that qualify for the credit.
The substituted language retains the subdivision’s opening applicability language – “Retirement income received in the form of pensions and annuities after December 31, 1979 . . .” – effectively making the changes retroactive to the 1980 tax year, which will probably result in many amended returns from taxpayers who will benefit from the change
Person submitting Fiscal Note: Mark Muchow
Email Address: RADfiscal@wv.gov