This bill amends the Code of West Virginia to address the personal income tax by introducing a credit for income tax paid to foreign countries, in addition to existing provisions for taxes paid to other states. Specifically, it allows residents to claim a credit against their West Virginia income tax for income taxes paid to foreign countries, provided they can demonstrate that double taxation will occur on their foreign income included in their federal adjusted gross income. The bill also modifies the limitations on the credit, stating that it may not exceed a certain percentage of the taxpayer's West Virginia income subject to taxation by the foreign jurisdiction.

Additionally, the bill includes a sunset provision, which stipulates that the credit for income tax paid to foreign countries will be effective until July 1, 2070. This aims to alleviate the burden of double taxation on foreign income at the state level while ensuring that the credit is only available under specific conditions. The changes also clarify the definitions and limitations surrounding the credit, ensuring that it does not reduce the tax liability below what would be owed if the foreign income were excluded from the taxpayer's West Virginia income.

Statutes affected:
Introduced Version: 11-21-20