Bill > SB435

Introduced Session

INDIVIDUAL INCOME TAX RATE This bill decreases the individual income tax rate in the third tax bracket from 5.3 percent to 4.40 percent beginning with the 2023 tax year. Under current law, there are four income tax brackets for single individuals, certain fiduciaries, heads of households, and married persons, and the brackets are indexed for inflation. The rate of taxation under current law for the lowest bracket for single individuals, certain fiduciaries, heads of households, and married persons is 3.50 percent of taxable income. The rate for the second bracket is 4.40 percent. The rate for the third bracket is 5.3 percent. And the rate for the highest bracket is 7.65 percent. Before bracket indexing, the four brackets for individuals, certain fiduciaries, and heads of households, to which the above rates apply, are as follows: 1) taxable income from $0 to $7,500; 2) taxable income exceeding $7,500 but not exceeding $15,000; 3) taxable income exceeding $15,000 but not exceeding $225,000; and 4) taxable income exceeding $225,000. LRB-4303/1 JK:cdc&emw 2023 - 2024 Legislature SENATE BILL 435 RETIREMENT INCOME SUBTRACTION This bill increases and expands the individual state income tax subtraction for payments or distributions received from qualified retirement plans under the Internal Revenue Code or from certain individual retirement accounts. Under the bill, beginning in tax year 2023, up to $100,000 of payments or distributions received from qualified retirement plans or certain individual retirement accounts may be subtracted annually from an individual's taxable income, if the individual is at least 67 years of age. If the individual and individual's spouse are both at least 67 years of age, the sum of the amount that the couple may subtract annually from their combined taxable income may not exceed $150,000. Under current law, up to $5,000 of payments or distributions received by certain individuals from qualified retirement plans or from certain individual retirement accounts may be subtracted. To be eligible, the individual must be at least 65 years old and have federal adjusted gross income under $15,000, or under $30,000 if married. Because this bill relates to an exemption from state or local taxes, it may be referred to the Joint Survey Committee on Tax Exemptions for a report to be printed as an appendix to the bill. For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

AI Summary

Committee Categories

Julian Bradley (R)*,  Rachael Cabral-Guevara (R)*,  John Jagler (R)*,  Dan Knodl (R)*,  Van Wanggaard (R)*,  Scott Allen (R),  David Armstrong (R),  Tyler August (R),  Elijah Behnke (R),  Amy Binsfeld (R),  Mark Born (R),  Robert Brooks (R),  Calvin Callahan (R),  Alex Dallman (R),  Barbara Dittrich (R),  Robert Donovan (R),  Cindi Duchow (R),  James Edming (R),  Joy Goeben (R),  Chanz Green (R),  Rick Gundrum (R),  Nate Gustafson (R),  Karen Hurd (R),  Scott Johnson (R),  Terry Katsma (R),  Joel Kitchens (R),  Scott Krug (R),  Anthony Kurtz (R),  John Macco (R),  Gae Magnafici (R),  Dave Maxey (R),  Paul Melotik (R),  Tom Michalski (R),  Clint Moses (R),  Jeff Mursau (R),  Amanda Nedweski (R),  Todd Novak (R),  Jerry O'Connor (R),  Loren Oldenburg (R),  William Penterman (R),  Kevin Petersen (R),  Warren Petryk (R),  Jon Plumer (R),  Treig Pronschinske (R),  Nik Rettinger (R),  Jessie Rodriguez (R),  Donna Rozar (R),  Angie Sapik (R),  Peter Schmidt (R),  Michael Schraa (R),  Pat Snyder (R),  Shae Sortwell (R),  David Steffen (R),  Rob Summerfield (R),  Rob Swearingen (R),  Paul Tittl (R),  Travis Tranel (R),  Ron Tusler (R),  Nancy VanderMeer (R),  Robin Vos (R),  Robert Wittke (R),  Shannon Zimmerman (R), 

Failed to pass pursuant to Senate Joint Resolution 1 (on 04/15/2024)

Official Document