The Substitute Senate Bill No. 1246 proposes extensive amendments to Connecticut's tax laws, particularly focusing on operating loss carry-overs, capital loss deductions, and various tax credits. The bill repeals and replaces subdivision (4) of subsection (a) of section 12-217, establishing a new framework for businesses to carry over operating losses based on the year incurred, with different time frames for losses before 2000, from 2000 to 2024, and from 2025 onward. It also modifies the limitations on loss deductions for combined groups and introduces a recalculation process for those who made specific elections regarding their operating losses. Additionally, the bill repeals subsection (k) of section 12-218e, capping the tax for combined groups at $2.5 million for income years before January 1, 2025, thereby clarifying tax obligations while limiting liability.

Moreover, the bill introduces various tax credits, including a Child Tax Credit of $150 per child for eligible taxpayers, 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, mandating a transfer of $700 million by June 30, 2025. The bill aims to streamline tax calculations, enhance financial planning for businesses, and provide targeted support to families and specific sectors, while eliminating certain occupational licensing fees to reduce barriers for healthcare professionals. Overall, sSB1246 reflects a comprehensive approach to adjusting the state's tax framework and revenue management.

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