Senate panel amends Social Security income tax exemption
CHARLESTON - With the bill’s strongest supporters - AARP members - watching, the West Virginia Senate Finance Committee on Monday passed an amended version of a bill to exempt Social Security income from the state’s income tax.
As amended, House Bill 2001 will phase out the tax on Social Security income in steps of 35 percent on Jan. 1, 2020, 65 percent in 2021 and 100 percent in 2022.
The amended version also caps the exemption at $100,000 total income for a married couple and $50,000 for a single filer.
There had been criticism of the bill, requested by Gov. Jim Justice in his State of the State address, that it was only benefiting wealthy West Virginians because 78 percent of the 468,120 Social Security beneficiaries in the state are already exempt from Social Security taxation because their total income is below $25,000 (for a single filer). The cap seems to try and address that.
The Finance Committee amendment also added provisions from Senate Bill 474, which exempts retirement income from the uniform services from federal adjusted gross income for the taxable year following Dec. 31, 2018. This needed to be added, committee counsel said, to clear up some conflicts within code.
The fiscal note for the bill in its original form without the income cap said the exemption would cost the state $50 million.
The bill was passed unanimously without any discussion.
The bill now goes to the Senate floor for a vote. If passed, the House will need to decide whether to accept the changes.
Follow reporter Taylor Stuck on Twitter and Facebook @TaylorStuckHD.