1     
INCOME TAX AMENDMENTS

2     
2017 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Jim Dabakis

5     
House Sponsor: ____________

6     

7     LONG TITLE
8     General Description:
9          This bill amends provisions related to individual income taxes.
10     Highlighted Provisions:
11          This bill:
12          ▸     increases the individual income tax rate for taxpayers with state taxable income
13     above certain thresholds; and
14          ▸     makes technical changes.
15     Money Appropriated in this Bill:
16          None
17     Other Special Clauses:
18          This bill provides a special effective date.
19     Utah Code Sections Affected:
20     AMENDS:
21          59-10-104, as last amended by Laws of Utah 2008, Chapter 389
22          59-10-116, as last amended by Laws of Utah 2008, Chapters 382 and 389
23          59-10-201, as last amended by Laws of Utah 2010, Chapter 6
24          59-10-205, as last amended by Laws of Utah 2008, Chapter 389
25     

26     Be it enacted by the Legislature of the state of Utah:
27          Section 1. Section 59-10-104 is amended to read:
28          59-10-104. Tax basis -- Tax rate -- Exemption.
29          [(1) For taxable years beginning on or after January 1, 2008,]
30          (1) (a) Except as provided in Subsection (2), a tax is imposed on the state taxable
31     income of a resident individual as provided in [this section] Subsection (1)(b).
32          (b) (i) A resident individual whose filing status is single or married filing separately
33     shall pay a tax for the taxable year equal to:
34          (A) 5% of state taxable income, if the resident individual has state taxable income for
35     that taxable year of less than or equal to $250,000; and
36          (B) 7% of state taxable income, if the resident individual has state taxable income for
37     that taxable year of more than $250,000.
38          (ii) A resident individual whose filing status is married filing jointly, head of
39     household, or qualifying widow or widower shall pay a tax for the taxable year equal to:
40          (A) 5% of state taxable income, if the resident individual has state taxable income for
41     that taxable year of less than or equal to $500,000; and
42          (B) 7% of state taxable income, if the resident individual has state taxable income for
43     that taxable year of more than $500,000.
44          [(2) For purposes of Subsection (1), for a taxable year, the tax is an amount equal to the
45     product of:]
46          [(a) the resident individual's state taxable income for that taxable year; and]
47          [(b) 5%.]
48          [(3)] (2) This section does not apply to a resident individual exempt from taxation
49     under Section 59-10-104.1.
50          Section 2. Section 59-10-116 is amended to read:
51          59-10-116. Tax on nonresident individual -- Tax rate -- Exemption.
52          (1) (a) Except as provided in Subsection (2), a tax is imposed on the state taxable
53     income of a nonresident individual [in an amount equal to the product of the:] as provided in
54     Subsection (1)(b).
55          [(a) nonresident individual's state taxable income; and]
56          [(b) percentage listed in Subsection 59-10-104(2).]
57          (b) (i) A nonresident individual whose filing status is single or married filing separately
58     shall pay a tax for the taxable year equal to:
59          (A) 5% of state taxable income, if the nonresident individual has state taxable income
60     for that taxable year of less than or equal to $250,000; and
61          (B) 7% of state taxable income, if the nonresident individual has state taxable income
62     for that taxable year of more than $250,000.
63          (ii) A nonresident individual whose filing status is married filing jointly, head of
64     household, or qualifying widow or widower shall pay a tax for the taxable year equal to:
65          (A) 5% of state taxable income, if the nonresident individual has state taxable income
66     for that taxable year of less than or equal to $500,000; and
67          (B) 7% of state taxable income, if the nonresident individual has state taxable income
68     for that taxable year of more than $500,000.
69          (2) This section does not apply to a nonresident individual exempt from taxation under
70     Section 59-10-104.1.
71          Section 3. Section 59-10-201 is amended to read:
72          59-10-201. Taxation of resident trusts and estates.
73          (1) (a) Except as provided in Subsection (2), a tax [determined in accordance with the
74     rate prescribed by Subsection 59-10-104(2)(b)] is imposed [for each taxable year] on the state
75     taxable income of [each] a resident estate or trust as provided in Subsection (1)(b).
76          (b) A resident estate or trust shall pay a tax for the taxable year equal to:
77          (i) 5% of state taxable income, if the resident estate or trust has state taxable income
78     for that taxable year of less than or equal to $250,000; or
79          (ii) 7% of state taxable income, if the resident estate or trust has state taxable income
80     for that taxable year of more than $250,000.
81          (2) The following are not subject to a tax imposed by this part:
82          (a) a resident estate or trust that is not required to file a federal income tax return for
83     estates and trusts for the taxable year; or
84          (b) a resident trust taxed as a corporation.
85          (3) A resident estate or trust shall be allowed the credit [provided] described in Section
86     59-10-1003, relating to an income tax imposed by another state, except that the limitation shall
87     be computed by reference to the taxable income of the estate or trust.
88          (4) The property of the Utah Educational Savings Plan established in Title 53B,
89     Chapter 8a, Utah Educational Savings Plan, and its income from operations and investments
90     are exempt from all taxation by the state under this chapter.
91          Section 4. Section 59-10-205 is amended to read:
92          59-10-205. Tax on nonresident estate or trust.
93          (1) (a) Except as provided in Subsection (2), a tax is imposed on the state taxable
94     income of a nonresident estate or trust [in an amount equal to the product of:] as provided in
95     Subsection (1)(b).
96          [(a) the nonresident estate's or trust's state taxable income as determined under Section
97     59-10-204; and]
98          [(b) the percentage listed in Subsection 59-10-104(2).]
99          (b) A nonresident estate or trust shall pay a tax for the taxable year equal to:
100          (i) 5% of state taxable income, if the nonresident estate or trust has state taxable
101     income for that taxable year of less than or equal to $250,000; or
102          (ii) 7% of state taxable income, if the nonresident estate or trust has state taxable
103     income for that taxable year of more than $250,000.
104          (2) The following are not subject to a tax imposed by this part:
105          (a) a nonresident estate or trust that is not required to file a federal income tax return
106     for estates and trusts for the taxable year; or
107          (b) a nonresident trust taxed as a corporation.
108          Section 5. Effective date.
109          This bill takes effect for a taxable year beginning on or after January 1, 2018.




Legislative Review Note
Office of Legislative Research and General Counsel