tax credit; increased taxes;
prisoners
HB 2616 states that a person who is sentenced to the custody of the Department of Corrections (DOC) or a county jail is not eligible to claim the state income tax credit in mitigation of increased Transaction Privilege Tax (TPT) and use taxes.
HB 2616 was amended in the Appropriations Committee to add both Prop 105 and Prop 108 clauses. In addition, the amendment clarifies that a person would not qualify for the credit if in custody for at least six months out of a year, adds federal prisoners and specifies that this would be effective for taxable years beginning December 31, 2002. The Appropriations Committee amendment was adopted in Committee of the Whole, and further amended to change the time a person must be in custody from six months to 60 days.
In the 2000 state general election, the voters approved a state income tax credit in mitigation of increased TPT and use tax. The credit is allowed for tax years beginning from and after December 31, 2000. Those eligible for this credit are taxpayers who are not claimed as dependents by other taxpayers and whose federal adjusted gross income is:
§ $25,000 or less for a married couple or a single person who is a head of a household.
§ $12,500 or less for a single person or a married person filing separately.
This tax credit is considered to be in mitigation of increased of increased tax rates. The amount of the credit can not exceed $25 for each person who is a resident of this state and each dependent. Total tax credit per taxpayer’s household cannot exceed $100. If the amount of credit claimed exceeds the income taxes otherwise due, the excess credit is to be refunded to the taxpayer.
· States that a person who is sentenced to the custody of the DOC or a county jail is not eligible to claim a credit.
HB 2616 was amended
in the Appropriations Committee as follows:
· Clarifies that a person in custody for six months out of a taxable year will not qualify for the tax credit.
· Adds federal prisoners.
· Makes this bill effective for taxable years beginning December 31, 2002.
· Adds a Proposition 105 clause.
· Adds a Proposition 108 clause.
The Appropriations Committee amendment was adopted in Committee of the Whole and further amended as follows:
· Changes the time a person must be in the custody of DOC, county jail or federal prison from six months to 60 days.
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45th Legislature
Second Regular Session 2 April 10, 2002
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