WEST virginia legislature

2021 regular session

Introduced

Senate Bill 515

By Senators Nelson, Caputo, Phillips, Martin, and Lindsay

[Introduced March 2, 2021; referred
to the Committee on Finance]

A BILL to amend and reenact §11-21-8 of the Code of West Virginia, 1931, as amended, relating to providing new graduates of an in-state or out-of-state higher educational institution, community or technical college, or trade school, up to a $50,000 tax modification to the income tax of the graduate for up to four taxable years; providing rule-making authority to the Tax Commissioner; and removing expired language.

Be it enacted by the Legislature of West Virginia:

article 21. personal income tax.

§11-21-8. Credits against tax.

(a) Business and occupation tax credit. -- A credit shall be allowed against the tax imposed by section three of this article equal to the amount of the liability of the taxpayer for the taxable year for any tax imposed under §11-13-1 et seq. of this code: Provided, That the amount of such business and occupation tax credit shall not exceed the portion of the tax imposed by this article which is attributable to the West Virginia taxable income derived by the taxpayer for the taxable year from the business or occupation with respect to which said tax under article 13 was imposed. In case the West Virginia taxable income of a taxpayer includes income from a partnership, estate, trust, or a corporation electing to be taxed under subchapter S of the Internal Revenue Code of 1954, as amended, a part of any tax liability of the partnership, estate, trust, or corporation under said article 13 shall be allowed to the taxpayer, in computing the credit provided for by this section, in an amount proportionate to the income of such partnership, estate, trust, or corporation, which is included in the taxpayer’s West Virginia taxable income.

For purposes of this section, the tax imposed under §11-13-1 et seq. of this code shall be the amount of the liability of the taxpayer for such tax under said article 13 computed without reduction for the tax credit for industrial expansion or revitalization allowed for such year.

(b) Severance tax credit.--On and after July 1, 1987, a credit shall be allowed against the tax imposed by section three of this article equal to the amount of the liability of the taxpayer for the taxable year for any tax imposed under article thirteen-a, chapter eleven of this code: Provided, That the amount of such severance tax credit shall not exceed the portion of the tax imposed by this article which is attributable to the West Virginia taxable income derived by the taxpayer for the taxable year from the activities with respect to which said tax under article thirteen-a was imposed. In case the West Virginia taxable income of a taxpayer includes income from a partnership, estate, trust or a corporation electing to be taxed under subchapter S of the Internal Revenue Code of 1954, as amended, a part of any tax liability of the partnership, estate, trust or corporation under said article thirteen-a shall be allowed to the taxpayer, in computing the credit provided for by this section, in an amount proportionate to the income of such partnership, estate, trust or corporation, which is included in the taxpayer's West Virginia taxable income.

(c) Expiration of credit.--The credit authorized in subsection (b) of this section shall expire and not be authorized or allowed for any taxable year beginning on or after October 1, 1990

(b) New graduate tax credit. – Any person graduating from an in-state or out-of-state four-year educational institution, community or technical college, or trade school shall be entitled to a modification from personal income tax of up to $50,000 of earned income in any given tax year. The exemption shall be in effect for the person’s initial year of graduation and through the earlier of (1) the subsequent three consecutive taxable years or (2) is no longer a resident of this state. The Tax Commissioner may require any information necessary to validate that a person graduated and may propose for the promulgation of any rules necessary to effectuate the provisions of this section pursuant to §29A-3-1 et seq. of this code.

NOTE: The purpose of this bill is to provide new graduates of an in-state or out-of-state higher education institution, community or technical college, or trade school, up to a $50,000 tax modification to the income tax of the graduate for up to four taxable years; provide rule-making authority to the Tax Commissioner; and remove expired language from this section.

Strike-throughs indicate language that would be stricken from a heading or the present law, and underscoring indicates new language that would be added.