FISCAL NOTE
Date Requested: February 10, 2021
Time Requested: 05:00 PM |
| Agency: |
Tax & Revenue Department, WV State |
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| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 1462 |
Introduced |
SB62 |
|
|---|
| CBD Subject: |
|
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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 change the qualifier for low income to 300 percent or less of the federal poverty guideline for a senior citizens’ homestead tax credit.
As written, this bill would extend the Senior Citizens’ Tax Credit for Property Tax paid on the first $20,000 of taxable assessed value of a homestead to taxpayers whose Federal Adjusted Gross Income is less than or equal to three hundred percent of the federal poverty guidelines based upon family size. Currently, the eligibility criterion is a Federal Adjusted Gross Income of less than or equal to one hundred fifty percent of the federal poverty guidelines. The change would be effective for tax years beginning after December 31, 2021. According to our interpretation, passage of this bill would result in an initial annual reduction in the General Revenue Fund of roughly $8.0 beginning in FY2023. The number of senior citizens in West Virginia is expected to increase; therefore, the cost of the program in future years would also increase.
Additional administrative costs to the State Tax Department attributable to passage of the bill would be $220,000 in FY2023 and in subsequent fiscal 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 |
150,000 |
| Personal Services |
0 |
0 |
150,000 |
| 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 |
-8,000,000 |
Explanation of above estimates (including long-range effect):
As written, this bill would extend the Senior Citizens’ Tax Credit for Property Tax paid on the first $20,000 of taxable assessed value of a homestead to taxpayers whose Federal Adjusted Gross Income is less than or equal to three hundred percent of the federal poverty guidelines based upon family size. Currently, the eligibility criterion is a Federal Adjusted Gross Income of less than or equal to one hundred fifty percent of the federal poverty guidelines. According to our interpretation, passage of this bill would result in an initial annual reduction in the General Revenue Fund of roughly $8.0 beginning in FY 2023. The number of senior citizens in West Virginia is expected to increase; therefore, the cost of the program in future years would also increase.
Additional administrative costs to the State Tax Department attributable to passage of the bill would be $220,000 in FY2023 and $150,000 in subsequent fiscal years. The Senior Citizen tax credit program is one of the most resource intensive programs due to significant taxpayer errors. Additional staff would be necessary for return processing, return review, and distributions.
Memorandum
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov