This bill amends the Code of West Virginia to reinstate a personal income tax adjustment for certain retirees who receive pensions from defined benefit plans that have terminated and are now being paid a reduced maximum benefit guarantee. Specifically, it allows these retirees to subtract from their federal adjusted gross income the difference between the maximum annual pension benefit they would have received had the plan not terminated and the actual benefit received from the guarantor. The bill also includes a provision that if the tax adjustment reduces state revenues by $2 million or more in any year, the Tax Commissioner must adjust the percentage of the reduction to limit the cost to $2 million for the following year.

The bill updates the effective dates of this tax adjustment, stating that it will apply to taxable years beginning on January 1, 2025, and will terminate after December 31, 2026. This replaces the previous language that set the adjustment to be effective for tax years beginning on January 1, 2020, and terminating after January 1, 2028. The modification is available regardless of the type of return form filed.

Statutes affected:
Introduced Version: 11-21-12d