| 12 | 13 | | A BILL TO BE ENTITLED 1 |
|---|
| 13 | 14 | | AN ACT TO PROVIDE INCOME TAX RELIEF TO SMALL BUSINESSES. 2 |
|---|
| 14 | 15 | | The General Assembly of North Carolina enacts: 3 |
|---|
| 15 | 16 | | SECTION 1. G.S. 105-153.5(b) reads as rewritten: 4 |
|---|
| 16 | 17 | | "(b) Other Deductions. – In calculating North Carolina taxable income, a taxpayer may 5 |
|---|
| 17 | 18 | | deduct from the taxpayer's adjusted gross income any of the following items that are included in 6 |
|---|
| 18 | 19 | | the taxpayer's adjusted gross income: 7 |
|---|
| 19 | 20 | | … 8 |
|---|
| 20 | 21 | | (17) An amount not to exceed seventy-five thousand dollars ($75,000) of net 9 |
|---|
| 21 | 22 | | business income the taxpayer receives during the taxable year if the taxpayer 10 |
|---|
| 22 | 23 | | is a small business. In the case of a married couple filing a joint return where 11 |
|---|
| 23 | 24 | | both spouses receive or incur net business income, the maximum dollar 12 |
|---|
| 24 | 25 | | amounts apply separately to each spouse's net business income, not to exceed 13 |
|---|
| 25 | 26 | | a total of one hundred fifty thousand dollars ($150,000). For purposes of this 14 |
|---|
| 26 | 27 | | subdivision, the term "business income" does not include income that is 15 |
|---|
| 27 | 28 | | considered passive income under the Code, and the term "small business" 16 |
|---|
| 28 | 29 | | means an independently owned and operated business (i) whose employees, 17 |
|---|
| 29 | 30 | | combined with the employees of all related persons, for the relevant tax year 18 |
|---|
| 30 | 31 | | did not exceed 50 and (ii) with annual revenues of less than five million dollars 19 |
|---|
| 31 | 32 | | ($5,000,000)." 20 |
|---|
| 32 | 33 | | SECTION 2. This act is effective for taxable years beginning on or after January 1, 21 |
|---|
| 33 | 34 | | 2026. 22 |
|---|