This bill proposes comprehensive changes to income taxation and property tax regulations in Kansas. Key provisions include the introduction of an additional personal exemption for head of household tax filers and an increased personal exemption for certain disabled veterans. The bill modifies the definition of household income and shifts the apportionment of business income to a single sales factor for most businesses, while establishing a receipts factor for financial institutions. It aims to reduce corporate income tax rates based on the growth of corporate income tax receipts, with new rates to be calculated and published by October 1, 2028. Additionally, the bill provides property tax exemptions for specific personal property, such as off-road vehicles and marine equipment, effective for taxable years commencing after December 31, 2025, and streamlines the process for property tax exemption requests.

Furthermore, the bill introduces a deferred tax impact deduction for unitary groups of businesses, allowing them to offset increases in net deferred tax liabilities or decreases in net deferred tax assets, with specific filing requirements and a defined period for claiming the deduction. It also amends the apportionment of business income for railroads and interstate motor carriers, removing the term "for-hire" and establishing that all business income will be apportioned solely by the sales factor starting January 1, 2027. The legislation includes provisions for a multistate tax compact, uniform regulations for tax administration, and adjustments to the homestead property tax refund act. Notably, it establishes that all watercraft will be exempt from property or ad valorem taxes starting January 1, 2026, while repealing several existing statutes related to watercraft taxation to streamline the legal framework.

Statutes affected:
As introduced: 79-32
As Amended by House Committee: 79-32
As Amended by Senate Committee: 79-32, 79-4508a
Enrolled: 79-213, 79-1129, 79-3279, 79-3287, 79-32, 79-4301, 79-4508a, 79-5501