Raised Bill No. 7007 proposes significant amendments to the tax code, particularly focusing on providing income tax deductions for individuals who care for elderly persons, children, or disabled individuals. The bill amends Section 12-701 of the general statutes by repealing subparagraph (B) of subdivision (20) of subsection (a) and replacing it with new provisions that allow for various deductions from gross income, including income exempt from state taxation due to federal law, exempt dividends, and certain tax refunds. Additionally, it introduces specific criteria for deducting Social Security benefits based on adjusted gross income thresholds, as well as deductions for contributions to state tuition programs and military retirement pay. The overall aim is to offer financial relief to caregivers by allowing them to deduct certain expenses and income from their taxable income.

Furthermore, the bill outlines a phased approach to deductions for individual retirement account (IRA) distributions, allowing for a 50% subtraction starting in 2024, increasing to 100% by 2026. It also introduces new deductions for organ donation-related expenses, financial assistance from the Crumbling Foundations Assistance Fund, and student loan reimbursements, while deleting conflicting existing provisions to streamline tax calculations. Notably, the bill allows taxpayers licensed under specific marijuana-related chapters to claim ordinary expenses disallowed under federal law. The act is set to take effect upon passage, with amendments applicable to taxable years commencing on or after January 1, 2025.

Statutes affected:
Raised Bill: 12-701
AGE Joint Favorable Change of Reference: 12-701