FISCAL NOTE
Date Requested: January 14, 2019
Time Requested: 11:27 AM |
| Agency: |
Tax & Revenue Department, WV State |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 1997 |
Introduced |
HB2226 |
|
|---|
| CBD Subject: |
Taxation |
|---|
|
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 provide taxpayers repaying their own student loans a modification reducing federal adjusted gross in the amount of the interest paid for personal income tax purposes.
The proposed decreasing modification for student loan interest is allowed only to the extent the amount is not taken as a deduction when arriving at the taxpayer’s federal adjusted gross income for taxable years beginning after December 31, 2018. The revenue loss associated with this bill would be roughly $2.6 million beginning in FY2020. The modification would be effective beginning with Tax Year 2019.
Additional administrative costs would be $30,000 in FY2020 and $20,000 in subsequent fiscal years.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2019
Increase/Decrease
(use"-") |
2020
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
30,000 |
20,000 |
| Personal Services |
0 |
20,000 |
20,000 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
10,000 |
0 |
| 2. Estimated Total Revenues |
0 |
-2,600,000 |
-2,600,000 |
Explanation of above estimates (including long-range effect):
The proposed decreasing modification for student loan interest is allowed only to the extent the amount is not taken as a deduction when arriving at the taxpayer’s federal adjusted gross income for taxable years beginning after December 31, 2018. Currently, student loan interest up to $2,500 per taxpayer can be taken as both a federal modification and above the line State deduction by taxpayers whose income is less than $80,000 ($160,000 for joint taxpayers). The provisions of this bill would expand the State deduction for those with interest cost in excess of $2,500 and for those with incomes in excess of the current ceilings set for this deduction. The revenue loss associated with this bill would be roughly $2.6 million beginning in FY2020. The modification would be effective beginning with Tax Year 2019.
Additional administrative costs would be $30,000 in FY2020 and $20,000 in subsequent fiscal years.
Memorandum
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov