FISCAL NOTE

Date Requested: January 21, 2016
Time Requested: 02:00 PM
Agency: Tax Department, State
CBD Number: Version: Bill Number: Resolution Number:
1759 Introduced SB354
CBD Subject: Tax


FUND(S):

General Revenue Fund

Sources of Revenue:

General Fund

Legislation creates:

Neither Program nor Fund



Fiscal Note Summary


Effect this measure will have on costs and revenues of state government.


    The stated purpose of this bill is to update the meaning of “federal taxable income” and certain other terms in the West Virginia Corporation Net Income Tax Act by bringing them into conformity with their meaning for Internal Revenue Code’s definitions; changing the due dates for filing a West Virginia Corporation Net Income Tax Return; and specifying effective dates.
    
    As written, this bill will update West Virginia’s Corporation Net Income Tax Law with the laws of the United States, in effect prior to January 1, 2016, that relate to the determination of income for federal income tax purposes. That is, State law will conform to federal statutes for changes made before January 1, 2016. Federal tax law provisions enacted in 2015 that have an impact on State revenue were included in the Governor’s official revenue estimates for FY2017. This proposed update incorporates recent tax changes associated with the Protecting Americans from Tax Hikes Act of 2015 (PATH). The revenue impact due to changes in due dates for the Corporation Net Income Tax Return has also been incorporated in the Governor’s official estimates for FY2017.
    
    Administrative costs to the Tax Department will be $6,550 in FY 2017.
    



Fiscal Note Detail


Effect of Proposal Fiscal Year
2016
Increase/Decrease
(use"-")
2017
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 6,550 0
Personal Services 0 0 0
Current Expenses 0 0 0
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 6,550 0
2. Estimated Total Revenues 0 0 0


Explanation of above estimates (including long-range effect):


    As written, this bill will update West Virginia’s Corporation Net Income Tax Law with the laws of the United States, in effect prior to January 1, 2016, that relate to the determination of income for federal income tax purposes. That is, State law will conform to federal statutes for changes made before January 1, 2016. Federal tax law provisions enacted in 2015 that have an impact on State revenue were included in the Governor’s official revenue estimates for FY2017. This proposed update incorporates recent tax changes associated with the Protecting Americans from Tax Hikes Act of 2015 (PATH). The major changes include the permanent extension of Section 179 expensing provisions for qualified small businesses and the extension of the first-year 50 percent bonus depreciation for capital investments, The revenue impact due to changes in due dates for the Corporation Net Income Tax Return has also been incorporated in the Governor’s official estimates for FY2017.
    
    Administrative costs to the Tax Department will be $6,550 in FY 2017.
    



Memorandum


    



    Person submitting Fiscal Note: Mark Muchow
    Email Address: kerri.r.petry@wv.gov