This bill amends the Income Tax Act of 1967, focusing on homestead property tax credits and income tax rates. Key updates include a revised definition of "gross rent," which now specifies it as the total rent paid in an arms-length transaction. The bill clarifies that unoccupied real property leased by the owner is not considered a homestead unless adjacent to the owner's home. Additionally, it modifies the calculation of property tax credits for claimants, particularly seniors, by adjusting the percentage of total household resources considered for tax credits. The percentage of property taxes that can be credited against state income tax liability is reduced from 3.5% to 3.2% for certain tax years, with further adjustments for subsequent years.

Moreover, the bill introduces new income tax brackets and corresponding rates for single and joint returns, adjusting thresholds for various income levels. It specifies a tax rate of 1.0% for income over $3,000 but not exceeding $4,000 for single filers, with similar adjustments for higher brackets. The bill also outlines new tax credits for servicepersons, veterans, widows, widowers, blind claimants, and senior citizens, increasing the percentage of rent that can be credited for eligible claimants. These amendments will take effect for tax years beginning on or after January 1, 2025, contingent upon the enactment of Senate Bill No. 345.

Statutes affected:
Senate Introduced Bill: 206.508