FISCAL NOTE

Date Requested: January 14, 2026
Time Requested: 08:16 PM

2172	Introduced	SB248
Agency:	Tax & Revenue Department, WV State
CBD Number:	Version:	Bill Number:	Resolution Number:
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 for a nonrefundable $25,000 tax credit against state personal income taxes and encourage West Virginians to return to West Virginia to pursue employment opportunities. The tax credit offered in this bill would be allowed for individuals who had been employed in West Virginia for at least ten years, then moved out of state for at least ten years, and then returned to the state on or after January 1, 2025. According to the most recently available Census data, West Virginia has experienced a loss of an average of approximately 2,000 residents to other states each year over the past ten years. However, West Virginia’s net migration was positive over the two most recent years of available data. According to the United States Census Bureau, approximately 43,000 people moved to the state in 2022, compared with the estimated 41,000 people who moved out of West Virginia. Only a very small fraction of those moving to the state would qualify for the personal income tax cut. Any portion of the $25,000 personal income tax credit that is unused may be applied to a future tax year to which this credit applies. No carryback to a prior taxable year is allowed for any unused portion of the credit. The tax credit limit is significantly larger than the average tax liability of West Virginia residents. Given the limited available data concerning net migration to West Virginia, we cannot reasonably estimate the amount of revenue loss associated with this bill. Additional administrative costs incurred by the Tax Division would be $16,500 in FY 2026 and $11,000 in subsequent fiscal years.

Fiscal Note Detail

Effect of Proposal	Fiscal Year
Effect of Proposal	2026 Increase/Decrease (use"-")	2027 Increase/Decrease (use"-")	Fiscal Year (Upon Full Implementation)
1. Estmated Total Cost	16,500	11,000	11,000
Personal Services	0	11,000	11,000
Current Expenses	0	0	0
Repairs and Alterations	0	0	0
Assets	0	0	0
Other	16,500	0	0
2. Estimated Total Revenues	0	0	0

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

The tax credit offered in this bill would be allowed for individuals who had been employed in West Virginia for at least ten years, then moved out of state for at least ten years, and then returned to the state on or after January 1, 2025. According to the most recently available Census data, West Virginia has experienced a loss of an average of approximately 2,000 residents to other states each year over the past ten years. However, West Virginia’s net migration was positive over the two most recent years of available data. According to the United States Census Bureau, approximately 43,000 people moved to the state in 2022, compared with the estimated 41,000 people who moved out of West Virginia. Only a very small fraction of those moving to the state would qualify for the personal income tax cut. Any portion of the $25,000 personal income tax credit that is unused may be applied to a future tax year to which this credit applies. No carryback to a prior taxable year is allowed for any unused portion of the credit. The tax credit limit is significantly larger than the average tax liability of West Virginia residents. Given the limited available data concerning net migration to West Virginia, we cannot reasonably estimate the amount of revenue loss associated with this bill. Additional administrative costs incurred by the Tax Division would be $16,500 in FY 2026 and $11,000 in subsequent fiscal years.

Memorandum

The stated purpose of this bill is to provide for a nonrefundable $25,000 tax credit against state personal income taxes and encourage West Virginians to return to West Virginia to pursue employment opportunities. There is no requirement that the individual work again in West Virginia upon returning on or after January 1, 2025, just that they reside in the state. Thus, the part of the bill’s stated purpose to provide “an incentive to return home and work in the state” may not be met. The amount of the credit is set at $25,000. The bill provides that the credit may not exceed $25,000, but there is no provision in the bill for a credit less than that amount. Whatever amount of the credit that is not used in any tax year may be carried forward to future tax years, but may not be carried back to any tax year. The credit “may be claimed after December 31, 2026,” which should probably be interpreted to mean that it can first be claimed after that date, i.e., with the 2026 tax return that is due to be filed in 2027. The bill provides that the credit “shall expire and not be authorized or applied for any taxable year after December 31, 2030.” This language could be more clear. It is not clear whether a credit that is earned prior to December 31, 2030 would still be available to be applied after December 31, 2030 (i.e., claimed on a tax form submitted in 2031 for the 2030 tax year), either initially or as a carry forward. The bill provides that, starting on or before July 1, 2025, the Tax Commissioner shall provide an annual report to the Joint Committee on Government and Finance setting forth details concerning utilization of the credit, including the number of taxpayers claiming the credit, the number of taxpayers deemed eligible or ineligible for the credit by the Tax Commissioner, benefits realized as a result of the credit, and the annual amount of the credit. The meaning of “benefits realized as a result of the credit” is unclear. Given that the credit cannot be claimed until after December 31, 2026, a requirement to submit a report on or before July 1, 2025, seems superfluous.

Person submitting Fiscal Note: Mark Muchow
Email Address: RADfiscal@wv.gov