The bill proposes significant amendments to the Oklahoma Income Tax Act, particularly in the apportionment of taxable income for corporations and individuals. It replaces references to "Federal" with "United States" and establishes that for tax years beginning after December 31, 2026, net income or loss will be apportioned solely based on the sales factor, moving away from the previous three-factor method that included property and payroll. For tax year 2025 and earlier, the three-factor method will still apply. The bill also empowers the Tax Commission to adjust the attribution of net income to "this state" instead of "Oklahoma," ensuring a more accurate reflection of net income. Additionally, it introduces a tax exemption for owners of new or expanded agricultural commodity processing facilities, allowing them to exclude 15% of their investment from taxable income, with a cap on total tax liability reduction.

Further provisions in the bill address various tax relief measures, including net operating loss carrybacks for farmers, deductions for qualified wages, and exemptions for employers using OSHA consultation services. It also clarifies the treatment of retirement benefits, agricultural income, and contributions to savings plans, while updating definitions related to real estate investment trusts (REITs). The bill aims to streamline tax calculations, provide clearer guidelines for individuals and corporations, and ensure compliance with federal regulations, ultimately enhancing the tax framework in Oklahoma.

Statutes affected:
Introduced: 68-2358