Senate Bill 454 proposes an income tax subtraction for certain qualified overtime compensation, aligning with the definition provided in the Internal Revenue Code. This bill allows claimants to subtract qualified overtime compensation received during the taxable year, with a limit of $12,500 for individual filers and $25,000 for those filing jointly. The subtraction phases out as modified federal adjusted gross income increases, specifically from $150,000 to $275,000 for individual filers and from $300,000 to $550,000 for joint filers. To qualify for this subtraction, claimants must include their social security number on their tax return and, if married, must file jointly.

Additionally, the bill amends current law regarding the definition of income for the homestead credit by including the newly created subtraction for qualified overtime compensation. This change will take effect for claims filed for taxable years beginning after December 31, 2024. The bill aims to provide tax relief to individuals receiving overtime pay, thereby encouraging workforce participation and supporting families with higher earnings from overtime work.

Statutes affected:
Bill Text: 71.52(6), 71.52