Bill > HB880

This bill proposes several changes to Georgia's income tax laws, aiming to gradually reduce the state income tax rate and increase certain deductions and exclusions. Starting in 2025, the income tax rate will begin a yearly reduction of 0.10 percent, eventually reaching 3.99 percent, though these reductions can be delayed if revenue estimates are not met or if the Revenue Shortfall Reserve, a fund for unexpected budget shortfalls, is not sufficiently large. The bill also plans to gradually increase the deduction for dependents, from $4,000 to $5,000, and the standard deduction for individuals, from $12,000 to $15,000 for single filers and from $24,000 to $30,000 for married couples filing jointly, with similar provisions for delaying these increases based on revenue conditions. Additionally, for individuals aged 65 and older, the amount of retirement income that can be excluded from state taxable income will increase, with a higher exclusion amount available for those meeting certain criteria, rising from $65,000 to $70,000 starting in 2027. The bill also modifies the management of the Revenue Shortfall Reserve, allowing a larger portion of surplus funds, specifically amounts exceeding 8 percent of the previous fiscal year's net revenue, to be used for tax relief, and increasing the maximum percentage of net revenue that can be held in the reserve from 15 percent to 20 percent. These changes are set to become effective for taxable years beginning on or after January 1, 2027.

Budget and Finance

https://www.legis.ga.gov/legislation/71847