FISCAL NOTE

Date Requested: February 10, 2021
Time Requested: 04:39 PM
Agency: Tax & Revenue Department, WV State
CBD Number: Version: Bill Number: Resolution Number:
1058 Introduced HB2196
CBD Subject:


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 a $500 per child tax credit for families who have foster children in their care. The proposed bill would allow the taxpayer to take a refundable tax credit of $500 per foster child in their care. The estimated revenue loss with this Personal Income Tax credit would be estimated at $2.9 million for FY2023 and all subsequent years. Additional administrative costs to the State Tax Department would be $56,000 for FY2023 and $45,000 for subsequent years.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2021
Increase/Decrease
(use"-")
2022
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 0 45,000
Personal Services 0 0 45,000
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 -2,900,000


Explanation of above estimates (including long-range effect):


The proposed bill would allow the taxpayer to take a refundable tax credit of $500 per foster child in their care. The estimated revenue loss with this Personal Income Tax credit would be estimated at $2.9 million for FY2023 and all subsequent years. Additional administrative costs to the State Tax Department would be $56,000 for FY2023 and $45,000 for subsequent years.



Memorandum


The stated purpose of this bill is to provide a $500 per child tax credit for families who have foster children in their care. A credit is imposed against personal income tax for a foster family with a foster child in its care. The credit is $500 for each year the child is in the foster family’s care and must be used the year the child was in foster care with that family. If the child is only in the family’s care a portion of the year, the credit is pro-rated. It is possible that one taxpayer may have multiple foster children in their home, or that one child might be in more than one home during the year. It would prevent exploitation of the credit if “foster care”; “foster child” and “family” were defined. It does not limit this credit to non-relative provided foster care. The bill is not clear regarding whether the credit applies if the child is in a facility placement, or if the placement facility is a corporation.



    Person submitting Fiscal Note: Mark Muchow
    Email Address: kerri.r.petry@wv.gov