Bill > SB0244

This bill modifies Utah's income tax structure by introducing a two-tiered tax rate system for state income taxes. Starting in 2026, the bill establishes an income tax rate of 4.55% for income below a certain threshold and 5.55% for income equal to or above that threshold. The threshold for the first taxable year (2026) is set at $1,000,000, with subsequent years' thresholds adjusted annually based on inflation. The bill updates various sections of the state tax code to reflect this new income tax rate, replacing the previous flat 4.55% rate. Additionally, the bill introduces a new refundable earned income tax credit for qualifying claimants, which allows individuals to claim 20% of their federal earned income tax credit, subject to certain conditions. The bill also repeals the existing non-refundable earned income tax credit and makes several technical amendments to align with the new tax structure. These changes aim to provide a more progressive tax system and offer additional support to low-income workers through the new refundable tax credit.

Budget and Finance

https://le.utah.gov/~2025/bills/static/SB0244.html