This bill amends Section 2355 of the Oklahoma income tax law, introducing new tax brackets for individuals, including specific rates for single filers, married individuals filing jointly, and heads of households. It outlines a gradual reduction in tax rates for tax years 2024 through 2029, ultimately leading to the elimination of income tax for individuals starting in 2030. Additionally, the bill specifies that no deductions for federal income taxes paid will be allowed when calculating taxable income. For corporations, it maintains a 4% tax rate for those doing business in Oklahoma and replaces previous higher rates for foreign corporations with a 4% tax on income sourced from within the state.

Furthermore, the bill imposes a tax on the taxable income of trusts and estates at the same rates applicable to single individuals, while prohibiting fiduciaries from deducting any federal income tax paid. It introduces a new tax rate table for individuals with taxable income below a specified ceiling amount, which will be determined by the Tax Commission, replacing the previous tax structure. The changes are set to take effect on November 1, 2025, aiming to streamline the tax rates for trusts and estates and provide a clearer framework for individual taxpayers based on their income levels.

Statutes affected:
Introduced: 68-2355