1     
TAXPAYER TAX CREDIT MODIFICATIONS

2     
2021 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Wayne A. Harper

5     
House Sponsor: Jefferson Moss

6     

7     LONG TITLE
8     General Description:
9          This bill modifies provisions relating to the taxpayer tax credit.
10     Highlighted Provisions:
11          This bill:
12          ▸     increases the value of the Utah personal exemption for purposes of the taxpayer tax
13     credit; and
14          ▸     makes technical and conforming changes.
15     Money Appropriated in this Bill:
16          None
17     Other Special Clauses:
18          This bill provides retrospective operation.
19     Utah Code Sections Affected:
20     AMENDS:
21          59-10-1018, as last amended by Laws of Utah 2018, Second Special Session, Chapter 3
22     

23     Be it enacted by the Legislature of the state of Utah:
24          Section 1. Section 59-10-1018 is amended to read:
25          59-10-1018. Definitions -- Nonrefundable taxpayer tax credits.
26          (1) As used in this section:
27          (a) "Head of household filing status" means a head of household, as defined in Section

28     2(b), Internal Revenue Code, who files a single federal individual income tax return for the
29     taxable year.
30          (b) "Joint filing status" means:
31          (i) spouses who file a single return jointly under this chapter for a taxable year; or
32          (ii) a surviving spouse, as defined in Section 2(a), Internal Revenue Code, who files a
33     single federal individual income tax return for the taxable year.
34          (c) "Qualifying dependent" means an individual with respect to whom the claimant is
35     allowed to claim a tax credit under Section 24, Internal Revenue Code, on the claimant's
36     federal individual income tax return for the taxable year.
37          (d) "Single filing status" means:
38          (i) a single individual who files a single federal individual income tax return for the
39     taxable year; or
40          (ii) a married individual who:
41          (A) does not file a single federal individual income tax return jointly with that married
42     individual's spouse for the taxable year; and
43          (B) files a single federal individual income tax return for the taxable year.
44          (e) "State or local income tax" means the lesser of:
45          (i) the amount of state or local income tax that the claimant:
46          (A) pays for the taxable year; and
47          (B) reports on the claimant's federal individual income tax return for the taxable year,
48     regardless of whether the claimant is allowed an itemized deduction on the claimant's federal
49     individual income tax return for the taxable year for the full amount of state or local income tax
50     paid; and
51          (ii) $10,000.
52          (f) (i) "Utah itemized deduction" means the amount the claimant deducts as allowed as
53     an itemized deduction on the claimant's federal individual income tax return for that taxable
54     year minus any amount of state or local income tax for the taxable year.
55          (ii) "Utah itemized deduction" does not include any amount of qualified business
56     income that the claimant subtracts as allowed by Section 199A, Internal Revenue Code, on the
57     claimant's federal income tax return for that taxable year.
58          (g) "Utah personal exemption" means, subject to Subsection (6), [$565] $3,113

59     multiplied by the number of the claimant's qualifying dependents.
60          (2) Except as provided in Section 59-10-1002.2, and subject to Subsections (3) through
61     (5), a claimant may claim a nonrefundable tax credit against taxes otherwise due under this part
62     equal to the sum of:
63          (a) (i) for a claimant that deducts the standard deduction on the claimant's federal
64     individual income tax return for the taxable year, 6% of the amount the claimant deducts as
65     allowed as the standard deduction on the claimant's federal individual income tax return for
66     that taxable year; or
67          (ii) for a claimant that itemizes deductions on the claimant's federal individual income
68     tax return for the taxable year, 6% of the amount of the claimant's Utah itemized deduction;
69     and
70          (b) 6% of the claimant's Utah personal exemption.
71          (3) A claimant may not carry forward or carry back a tax credit under this section.
72          (4) The tax credit allowed by Subsection (2) shall be reduced by [$.013] $.015 for each
73     dollar by which a claimant's state taxable income exceeds:
74          (a) for a claimant who has a single filing status, [$12,000] $14,879;
75          (b) for a claimant who has a head of household filing status, [$18,000] $22,318; or
76          (c) for a claimant who has a joint filing status, [$24,000] $29,758.
77          (5) (a) For a taxable year beginning on or after January 1, [2009] 2022, the commission
78     shall increase or decrease annually the following dollar amounts by a percentage equal to the
79     percentage difference between the consumer price index for the preceding calendar year and
80     the consumer price index for calendar year [2007] 2020:
81          (i) the dollar amount listed in Subsection (4)(a); and
82          (ii) the dollar amount listed in Subsection (4)(b).
83          (b) After the commission increases or decreases the dollar amounts listed in Subsection
84     (5)(a), the commission shall round those dollar amounts listed in Subsection (5)(a) to the
85     nearest whole dollar.
86          (c) After the commission rounds the dollar amounts as required by Subsection (5)(b),
87     the commission shall increase or decrease the dollar amount listed in Subsection (4)(c) so that
88     the dollar amount listed in Subsection (4)(c) is equal to the product of:
89          (i) the dollar amount listed in Subsection (4)(a); and

90          (ii) two.
91          (d) For purposes of Subsection (5)(a), the commission shall calculate the consumer
92     price index as provided in Sections 1(f)(4) and 1(f)(5), Internal Revenue Code.
93          (6) (a) For a taxable year beginning on or after January 1, [2019] 2022, the commission
94     shall increase annually the Utah personal exemption amount listed in Subsection (1)(g) by a
95     percentage equal to the percentage by which the consumer price index for the preceding
96     calendar year exceeds the consumer price index for calendar year [2017] 2020.
97          (b) After the commission increases the Utah personal exemption amount as described
98     in Subsection (6)(a), the commission shall round the Utah personal exemption amount to the
99     nearest whole dollar.
100          (c) For purposes of Subsection (6)(a), the commission shall calculate the consumer
101     price index as provided in Sections 1(f)(4) and 1(f)(5), Internal Revenue Code.
102          Section 2. Retrospective operation.
103          This bill has retrospective operation for a taxable year beginning on or after January 1,
104     2021.