1     
INCOME TAX MODIFICATIONS

2     
2024 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Brian S. King

5     
Senate Sponsor: ____________

6     

7     LONG TITLE
8     General Description:
9          This bill amends income tax provisions.
10     Highlighted Provisions:
11          This bill:
12          ▸     creates individual income tax brackets with higher rates for higher incomes; and
13          ▸     makes conforming changes.
14     Money Appropriated in this Bill:
15          None
16     Other Special Clauses:
17          This bill provides a special effective date.
18     Utah Code Sections Affected:
19     AMENDS:
20          59-10-104, as last amended by Laws of Utah 2023, Chapter 459
21          59-10-116, as last amended by Laws of Utah 2022, Chapter 252
22          59-10-201, as last amended by Laws of Utah 2010, Chapter 6
23          59-10-205, as last amended by Laws of Utah 2008, Chapter 389
24     

25     Be it enacted by the Legislature of the state of Utah:
26          Section 1. Section 59-10-104 is amended to read:
27          59-10-104. Tax basis -- Tax rate -- Exemption.
28          (1) A tax is imposed on the state taxable income of a resident individual as provided in
29     this section.
30          (2) For purposes of Subsection (1), for a taxable year, the tax is an amount equal to [the
31     product of]:
32          [(a) the resident individual's state taxable income for that taxable year; and]
33          [(b)] (a) [4.65%.] 4.65% multiplied by the state taxable income for a resident
34     individual with $250,000 or less in state taxable income;
35          (b) $11,625 plus 5.65% multiplied by the state taxable income greater than $250,000
36     for a resident individual with more than $250,000 but no more than $1,000,000 in state taxable
37     income; or
38          (c) $54,000 plus 6.65% multiplied by the state taxable income greater than $1,000,000
39     for a resident individual with more than $1,000,000 in state taxable income.
40          (3) This section does not apply to a resident individual exempt from taxation under
41     Section 59-10-104.1.
42          Section 2. Section 59-10-116 is amended to read:
43          59-10-116. Tax on nonresident individual -- Calculation -- Exemption.
44          (1) Except as provided in Subsection (2), a tax is imposed on a nonresident individual
45     in an amount equal to [the product of the]:
46          [(a) nonresident individual's state taxable income; and]
47          [(b) percentage listed in Subsection 59-10-104(2).]
48          (a) 4.65% multiplied by the state taxable income for a nonresident individual with
49     $250,000 or less in state taxable income;
50          (b) $11,625 plus 5.65% multiplied by the state taxable income greater than $250,000
51     for a nonresident individual with more than $250,000 but no more than $1,000,000 in state
52     taxable income; or
53          (c) $54,000 plus 6.65% multiplied by the state taxable income greater than $1,000,000
54     for a nonresident individual with more than $1,000,000 in state taxable income.
55          (2) This section does not apply to a nonresident individual:
56          (a) exempt from taxation under Section 59-10-104.1; or
57          (b) whose only state source income is wages that are excluded in accordance with
58     Section 59-10-117.5.
59          Section 3. Section 59-10-201 is amended to read:
60          59-10-201. Taxation of resident trusts and estates.
61          (1) (a) Except as provided in Subsection (2), a tax [determined in accordance with the
62     rate prescribed by Subsection 59-10-104(2)(b)] is imposed for each taxable year on the state
63     taxable income of [each] a resident estate or trust.
64          (b) The tax is in an amount equal to:
65          (i) 4.65% multiplied by the state taxable income for a resident trust or estate with
66     $250,000 or less in state taxable income;
67          (ii) $11,625 plus 5.65% multiplied by the state taxable income greater than $250,000
68     for a resident trust or estate with more than $250,000 but no more than $1,000,000 in state
69     taxable income; or
70          (iii) $54,000 plus 6.65% multiplied by the state taxable income greater than $1,000,000
71     for a resident trust or estate with more than $1,000,000 in state taxable income.
72          (2) The following are not subject to a tax imposed by this part:
73          (a) a resident estate or trust that is not required to file a federal income tax return for
74     estates and trusts for the taxable year; or
75          (b) a resident trust taxed as a corporation.
76          (3) A resident estate or trust shall be allowed the credit provided in Section
77     59-10-1003, relating to an income tax imposed by another state, except that the limitation shall
78     be computed by reference to the taxable income of the estate or trust.
79          (4) The property of the Utah Educational Savings Plan established in Title 53B,
80     Chapter 8a, Utah Educational Savings Plan, and its income from operations and investments
81     are exempt from all taxation by the state under this chapter.
82          Section 4. Section 59-10-205 is amended to read:
83          59-10-205. Tax on nonresident estate or trust.
84          (1) Except as provided in Subsection (2), a tax is imposed on a nonresident estate or
85     trust in an amount equal to [the product of]:
86          [(a) the nonresident estate's or trust's state taxable income as determined under Section
87     59-10-204; and]
88          [(b) the percentage listed in Subsection 59-10-104(2).]
89          (a) 4.65% multiplied by the state taxable income for a nonresident trust or estate with
90     $250,000 or less in state taxable income;
91          (b) $11,625 plus 5.65% multiplied by the state taxable income greater than $250,000
92     for a nonresident trust or estate with more than $250,000 but no more than $1,000,000 in state
93     taxable income; or
94          (c) $54,000 plus 6.65% multiplied by the state taxable income greater than $1,000,000
95     for a nonresident trust or estate with more than $1,000,000 in state taxable income.
96          (2) The following are not subject to a tax imposed by this part:
97          (a) a nonresident estate or trust that is not required to file a federal income tax return
98     for estates and trusts for the taxable year; or
99          (b) a nonresident trust taxed as a corporation.
100          Section 5. Effective date.
101          This bill takes effect for a taxable year beginning on or after January 1, 2025.