The Substitute Senate Bill No. 1246 proposes significant amendments to Connecticut's tax laws, particularly focusing on operating loss carry-overs, capital loss deductions, and the taxation of hospitals. Key provisions include the repeal of subdivision (4) of subsection (a) of section 12-217, which is replaced with new regulations allowing businesses to carry over operating losses for up to thirty years for losses incurred from January 1, 2025, onward, and twenty years for losses from January 1, 2000, to January 1, 2025. The bill also introduces a provision for combined groups to relinquish fifty percent of unused operating losses incurred before January 1, 2015. Additionally, the bill modifies the tax structure for hospitals, establishing a tax on net revenues from inpatient and outpatient services, with specific rates and adjustments based on audited net revenue.

Furthermore, the bill introduces various tax credits and exemptions aimed at supporting families and businesses, including a Child Tax Credit of $150 per child, a refundable business tax credit for farmers, and a credit for employers contributing to employees' Connecticut Higher Education Trust (CHET) accounts. It also imposes a temporary capital gains surcharge on high-income taxpayers and establishes a new Supplemental Budget Reserve Fund to address projected deficits. The effective dates for many provisions are set for July 1, 2025, or January 1, 2026, with specific provisions taking effect earlier. Overall, the bill aims to enhance fiscal stability while providing financial relief and incentives across various sectors in the state.

Statutes affected:
Governor's Bill: 12-217ee, 3-20, 12-704c, 12-263q, 3-114c, 3-114m, 3-115b, 20-12j, 20-86c, 20-86g, 20-93, 20-94, 20-94a, 20-96, 20-97, 20-126i, 20-126k, 20-71, 20-74d, 20-74h, 20-195c, 20-195o, 20-195t, 20-333, 20-334a, 20-334e, 20-335
FIN Joint Favorable Substitute: 12-217ee, 12-263q, 3-114c, 3-114m, 20-12j, 20-86c, 20-86g, 20-93, 20-94, 20-94a, 20-96, 20-97, 20-126i, 20-126k, 20-71, 20-74d, 20-74h, 20-195c, 20-195o, 20-195t, 20-333, 20-334a, 20-334e, 20-335, 12-412, 12-543
File No. 893: 12-217ee, 12-263q, 3-114c, 3-114m, 20-12j, 20-86c, 20-86g, 20-93, 20-94, 20-94a, 20-96, 20-97, 20-126i, 20-126k, 20-71, 20-74d, 20-74h, 20-195c, 20-195o, 20-195t, 20-333, 20-334a, 20-334e, 20-335, 12-412, 12-543