This bill proposes the addition of a new section, 11-21-12o, to the Code of West Virginia, which authorizes a personal income tax deduction for qualified tipped wages. Specifically, it allows resident individual taxpayers to deduct the total amount of qualified tips received during the taxable year that were reported to their employer from their federal adjusted gross income. The bill defines "qualified tips" as any tips or gratuities received in cash, credit or debit card charges, or checks in the ordinary course of employment. This deduction is only applicable if the tips are not already deductible when calculating federal adjusted gross income.

The modification is set to take effect for taxable years beginning on or after January 1, 2026, and is available regardless of the type of return form filed by the taxpayer. This legislative change aims to provide financial relief to individuals who rely on tips as part of their income, thereby enhancing the overall tax structure for those in the service industry.

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