This bill proposes amendments to the personal income tax laws in West Virginia, specifically targeting the effective date and structure of tax rates. It modifies the effective date for future personal income tax reductions from August 15, 2025, to August 15, 2026, and establishes a new section, 11-21-4j, which outlines reduced graduated income tax rates for individuals, married couples filing jointly, heads of households, and estates and trusts starting from January 1, 2026. The bill also introduces a new tax rate structure, with specific percentages based on income brackets, and eliminates the previous tax rate of six and one-half percent for certain nonresident composite and withholding obligations, replacing it with a reduced rate of 4.34%.

Additionally, the bill provides for contingent future reductions in personal income tax rates based on the performance of general revenue fund collections relative to inflation-adjusted base year revenues. The Secretary of Revenue will determine if reductions are warranted each year, and the Tax Commissioner will be responsible for notifying taxpayers of any changes. The bill aims to create a more favorable tax environment for residents while ensuring that tax rates remain sustainable and responsive to economic conditions.

Statutes affected:
Introduced Version: 11-21-4hof, 11-21-4j