House Bill No. 6928, also known as File No. 684, is a legislative proposal to amend the Connecticut General Statutes, specifically section 12-701, which deals with the calculation of Connecticut adjusted gross income for state income tax purposes. The bill introduces changes to the tax code to exclude up to $10,000 of federally taxable student loan forgiveness from state income tax. It also includes various adjustments to federal adjusted gross income, such as the subtraction of certain types of exempt income, and addresses the treatment of Social Security benefits based on income levels and marital statuses. The bill includes insertions marked with "HB6928 File No. 684" and a deletion of the word "and" at the end of clause (xxvii), adding a new clause (xxviii) for the student loan forgiveness exclusion. The bill is effective from January 1, 2024, and applies to taxable years commencing on or after that date.

The financial implications of the bill include a one-time cost of up to $75,000 in fiscal year 2024 for updates to the CTax tax administration system and myconneCT online portal, as well as for the development of forms, to be incurred by the Department of Revenue Services. There is no expected impact on municipal finances or revenue through fiscal year 2026 due to the American Rescue Plan Act of 2021, which exempts student loan forgiveness from federal taxation until the end of 2025. The long-term revenue loss for the General Fund starting in fiscal year 2027 will depend on federal policy regarding the taxation of student loan forgiveness. The bill has received a Joint Favorable report, indicating committee approval, with a vote of 51 to 0 on April 18, 2023.

Statutes affected:
Raised Bill: 12-701
FIN Joint Favorable: 12-701
File No. 684: 12-701