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STATE OF OKLAHOMA
2nd Session of the 59th Legislature (2024)
COMMITTEE SUBSTITUTE
FOR
HOUSE BILL NO. 2950 By: McCall
COMMITTEE SUBSTITUTE
An Act relating to revenue and taxation; amending 68
O.S. 2021, Section 2355, as last amended by Section
1, Chapter 27, 1st Extraordinary Session, O.S.L. 2023
(68 O.S. Supp. 2023, Section 2355), which relates to
individual income tax rates; reducing tax rates;
defining terms; imposing tax on renewable power
production; establishing amou nt of tax per megawatt-
hour; making tax applicable after certain date;
establishing timeline f or remittance of tax and
filing of reports; requiring th e prescription of
certain forms; providing fine and penalty for filing
and remittance failures; requiring certain annual
reporting; providing for apportionment of monies;
providing for codification; and providing effective
dates.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 68 O.S. 2021, Section 2355, as
last amended by Section 1, Chapter 27, 1st Extraordinary Session,
O.S.L. 2023 (68 O.S. Supp. 2023, Section 2355), is amended to read
as follows:
Section 2355. A. Individuals. For all taxable years beginning
after December 31, 1998, and before January 1, 2006, a tax is hereby
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imposed upon the Oklahoma taxable in come of every resident or
nonresident individual, which tax shall be computed at the option of
the taxpayer under one of the two following methods:
1. METHOD 1.
a. Single individuals and married individuals filing
separately not deducting federal income t ax:
(1) 1/2% tax on first $1,000.00 or part there of,
(2) 1% tax on next $1,500.00 or part thereof,
(3) 2% tax on next $1,250.00 or part thereof,
(4) 3% tax on next $1,150.00 or part thereof,
(5) 4% tax on next $1,300.00 or part thereof,
(6) 5% tax on next $1,500.00 or part thereof,
(7) 6% tax on next $2,300.00 or part thereof, and
(8) (a) for taxable years beginning after December
31, 1998, and before January 1, 2002, 6 .75%
tax on the remainder,
(b) for taxable years beginning on or after
January 1, 2002, and before January 1, 2004,
7% tax on the remainde r, and
(c) for taxable years beginning on or after
January 1, 2004, 6.65% tax on the remainder.
b. Married individuals filing jointly and surviving
spouse to the extent and in the manner that a
surviving spouse is permitted to file a joint return
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under the provisions of the Internal Revenue Code and
heads of households as defined in the Internal Revenue
Code not deducting federal income tax:
(1) 1/2% tax on first $2,000.00 or part thereof,
(2) 1% tax on next $3,000.00 or part thereof,
(3) 2% tax on next $2,500.00 or part thereof,
(4) 3% tax on next $2,300.00 or part thereof,
(5) 4% tax on next $2,400.00 or part thereof,
(6) 5% tax on next $2,800.00 or part thereof,
(7) 6% tax on next $6,000.00 or part thereof, and
(8) (a) for taxable years beginning after De cember
31, 1998, and before January 1, 2002, 6.75%
tax on the remainder,
(b) for taxable years beginning on or after
January 1, 2002, and before January 1, 2004,
7% tax on the remainder, and
(c) for taxable years beginning on or after
January 1, 2004, 6.65 % tax on the remainder.
2. METHOD 2.
a. Single individuals and married individuals filing
separately deducting federa l income tax:
(1) 1/2% tax on first $1,000.00 or part thereof,
(2) 1% tax on next $1,500. 00 or part thereof,
(3) 2% tax on next $1,250.00 or part thereof,
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(4) 3% tax on next $1,150.00 or part thereo f,
(5) 4% tax on next $1,200.00 or part thereof,
(6) 5% tax on next $1,400.00 or part thereof,
(7) 6% tax on next $1,500.00 or part thereof,
(8) 7% tax on next $1,500.00 or part thereof,
(9) 8% tax on next $2,000.00 or part thereof,
(10) 9% tax on next $3,500.00 or part thereof, and
(11) 10% tax on the remainder.
b. Married individuals filing jointly and surviving
spouse to the extent and in the mann er that a
surviving spouse is permitted to file a joint return
under the provisions of the Internal Revenue C ode and
heads of households as defined in the Internal Rev enue
Code deducting federal income tax:
(1) 1/2% tax on the first $2,000.00 or part there of,
(2) 1% tax on the next $3,000.00 or part thereof,
(3) 2% tax on the next $2,500.00 or part thereof,
(4) 3% tax on the next $1,400.00 or part thereof,
(5) 4% tax on the next $1,500.00 or part thereof,
(6) 5% tax on the next $1,600.00 or part thereof,
(7) 6% tax on the next $1,250.00 or part thereof,
(8) 7% tax on the next $1,750.00 or part thereof,
(9) 8% tax on the next $3,000.00 or part thereof,
(10) 9% tax on the next $6,000.00 or part thereof, and
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(11) 10% tax on the remainder.
B. Individuals. For all taxable years beginning on or after
January 1, 2008, and ending any tax year which begins afte r December
31, 2015, for which the determination required pursuant to Sections
4 and 5 of this act is made by the State Board of Equalization, a
tax is hereby imposed upon the Oklahoma taxable income of every
resident or nonresident individual, which tax s hall be computed as
follows:
1. Single individuals and married indiv iduals filing
separately:
(a) 1/2% tax on first $1,000.00 or part thereof,
(b) 1% tax on next $1,500.00 or part thereof,
(c) 2% tax on next $1,250.00 or part thereof,
(d) 3% tax on next $1,150.00 or part thereof,
(e) 4% tax on next $2,300.00 or part thereo f,
(f) 5% tax on next $1,500.00 or part thereof,
(g) 5.50% tax on the remainder for the 2 008 tax year and
any subsequent tax year unless the rate prescribed by
subparagraph (h) of this paragraph is in effect, and
(h) 5.25% tax on the remainder for the 2009 and subsequent
tax years. The decrease in the top marginal
individual income tax rate o therwise authorized by
this subparagraph shall be contingent upon the
determination required to be made by the State Board
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of Equalization pursuant to Section 2355.1A of this
title.
2. Married individuals filing jointly and surviving spouse to
the extent and in the manner that a surviving spouse is permitted to
file a joint return under the provisions of the Internal Revenue
Code and heads of households as defined in t he Internal Revenue
Code:
(a) 1/2% tax on first $2,000.00 or part thereof,
(b) 1% tax on next $3,000.00 or part thereof,
(c) 2% tax on next $2,500.00 or part thereof,
(d) 3% tax on next $2,300.00 or part thereof,
(e) 4% tax on next $2,400.00 or part thereo f,
(f) 5% tax on next $2,800.00 or part thereof,
(g) 5.50% tax on the remainder for the 2 008 tax year and
any subsequent tax year unless the rate prescribed by
subparagraph (h) of this paragraph is in effect, and
(h) 5.25% tax on the remainder for the 2009 and subsequent
tax years. The decrease in the top marginal
individual income tax rate o therwise authorized by
this subparagraph shall be contingent upon the
determination required to be made by th e State Board
of Equalization pursuant to Section 2355.1A of this
title.
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C. Individuals. For all taxable years beginning on or after
January 1, 2024, a tax is hereby imposed upon the Oklaho ma taxable
income of every resident or nonresident individual, which tax shall
be computed as follows:
1. Single individuals and married individuals filing
separately:
(a) 0.25% 0.00% tax on first $1,000.00 or part thereof,
(b) 0.75% 0.50% tax on next $1,500.00 or part thereof,
(c) 1.75% 1.50% tax on next $1,250.00 or part thereof,
(d) 2.75% 2.50% tax on next $1,150.00 or part thereof,
(e) 3.75% 3.50% tax on next $2,300.00 or part thereof,
(f) 4.75% 4.50% tax on the remainder.
2. Married individuals filing jointly and surviving spouse to
the extent and in the manner that a surviving spouse is permit ted to
file a joint return under the provisions of the Internal Revenue
Code and heads of households as defined in the Internal Revenue
Code:
(a) 0.25% 0.00% tax on first $2,000.00 or part thereof,
(b) 0.75% 0.50% tax on next $3,000.00 or part thereof,
(c) 1.75% 1.50% tax on next $2,500.00 or part thereof,
(d) 2.75% 2.50% tax on next $2,300.00 or part thereof,
(e) 3.75% 3.50% tax on next $4,600.00 or part thereof,
(f) 4.75% 4.50% tax on the remainder.
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No deduction for federal income taxes paid shall be allowed to
any taxpayer to arrive at taxable income.
D. Nonresident aliens. In lieu of the rates set forth in
subsection A above this section, there shall be imposed on
nonresident aliens, as defined in the Internal Revenue Code, a tax
of eight percent (8%) instead of thirty percent (30%) as used in the
Internal Revenue Code, with respect to the Ok lahoma taxable income
of such nonresident aliens as determined under the provision of the
Oklahoma Income Tax Act.
Every payer of amounts covered by this subsection shall deduct
and withhold from such am ounts paid each payee an amount equal to
eight percent (8%) thereof. Every payer required to deduct and
withhold taxes under this subsection shall for each quarterly period
on or before the last day of the month following the close of each
such quarterly period, pay over the amount so withheld as taxes to
the Tax Commission, and shall file a return with each such payment.
Such return shall be in such form as the Tax Commission shall
prescribe. Every payer required under this subsection to deduct and
withhold a tax from a payee shall, as to the total amounts paid to
each payee during the calendar year, furnish to such payee, on or
before January 31, of the succeeding year, a written statement
showing the name of the payer, the name of the payee and the pay ee's
Social Security account number, if any, the tota l amount paid
subject to taxation, and the total amount deducted and withheld as
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tax and such other information as the Tax Commission may require.
Any payer who fails to withhold or pay to the Tax Commi ssion any
sums herein required to be withheld or paid shall be personally and
individually liable therefor to the State of Oklahoma.
E. Corporations. For all taxable years beginning after
December 31, 2021, a tax is hereby imposed upon the Oklahoma taxab le
income of every corporation doing business within this state or
deriving income from sources within this state in an amount equal to
four percent (4%) thereof.
There shall be no additional Oklahoma income tax imposed on
accumulated taxable income or on undistributed personal holding
company income as those terms are defined in the Internal Rev enue
Code.
F. Certain foreign corporatio ns. In lieu of the tax imposed in
the first paragraph of subsection D of this section, for all taxable
years beginning after December 31, 2021, there shall be imposed on
foreign corporations, as defined in the Inte rnal Revenue Code, a tax
of four percent (4%) instead of thirty percent (30%) as used in the
Internal Revenue Code, where such income is received from sources
within Oklahoma, in accordance with the provisions of the Internal
Revenue Code and the Oklahoma Income Tax Act.
Every payer of amounts covered by this subsection shall deduct
and withhold from such amounts paid each payee an amount equal to
four percent (4%) thereof. Every payer required to deduct and
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withhold taxes under this subsection shall for e ach quarterly period
on or before the last d ay of the month following the close of each
such quarterly period, pay over the amount so withheld as taxes to
the Tax Commission, and shall file a return with each such payment.
Such return shall be in such for m as the Tax Commission shall
prescribe. Every payer required under this subsection to deduct and
withhold a tax from a payee shall, as to the total amounts paid t o
each payee during the calendar year, furnish to suc h payee, on or
before January 31, of th e succeeding year, a written statement
showing the name of the payer, the name of the payee and the payee's
Social Security account number, if any, the total amount s paid
subject to taxation, the total amount deducted and withheld as tax
and such other information as the Tax Commission may require . Any
payer who fails to withhold or pay to the Tax Commission any sums
herein required to be withheld or paid shall be p ersonally and
individually liable therefor to the Sta te of Oklahoma.
G. Fiduciaries. A tax is hereby imposed upon the Oklahoma
taxable income of every trust and estate at the same rates as are
provided in subsection B or, C or D of this section for single
individuals. Fiduciaries are not allowed a deduction for any
federal income tax paid.
H. Tax rate tables. For all taxable years beginni ng after
December 31, 1991, in lieu of the tax imposed by subsection A, B or,
C or D of this section, as applicable there is hereby imposed for
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each taxable year on the taxable income of every individual, whose
taxable income for such taxable year does not excee d the ceiling
amount, a tax determined under tables, applicable to such taxable
year which shall be prescribed by t he Tax Commission and which shall
be in such form as it determines appropriate. In the table so
prescribed, the amounts of the tax shall be computed on the basis of
the rates prescribed by subsection A, B or, C or D of this section.
For purposes of this subsection, the term "ceiling amount" means,
with respect to any taxpay er, the amount determined by the T ax
Commission for the tax rate category in which such taxpayer falls.
SECTION 2. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 6701 of Title 68, unless there
is created a duplication in numbering, reads as follows:
As used in this act:
1. "Megawatt-hour" means the energy equivalent of one million
(1,000,000) watts consumed within a period of one (1) hour;
2. "Renewable power" means the production of electricity from a
source that is not depleted when used, including but not limited to
wind power, solar power, geothermal energy, biomass , and
hydroelectric power; and
3. "Renewable power business" means any for-profit business
enterprise engaged in the wholesale production of electricity by
means of renewable power.
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SECTION 3. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 6702 of Title 68, unless there
is created a duplication in numbering, reads as follows:
A. Effective January 1, 2025, there shall be imposed a levy of
One Dollar ($1.00) per megawatt-hour upon electricity produced by a
renewable power business within the state.
B. The tax shall be due and owing not later than the fifteenth
day of the month immediately following the month during which the
electricity was produced.
C. The Oklahoma Tax Commission shall prescribe a form for use
in reporting the tax imposed pursuant to the provi sions of this act.
D. The renewable power business shall timely file the report
and make remittance of the tax as required by this section. Failure
to timely file the report shall result in a fine of One Hundred
Dollars ($100.00) per day for each day the return remains unfiled
not to exceed a maximum of sixty (60) days.
E. Failure to remit the tax to the Tax Commission as required
pursuant to the provisions of this section shall result in a penalty
equal to ten percent (10%) of the principal amount of th e monthly
tax amount due and owing. The penalty shall become part of the
principal amount of the tax due and owing.
SECTION 4. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 6703 of Title 68, unless there
is created a duplication in numbering, reads as follows:
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A. Any renewable power business subject to the tax imposed
pursuant to the provisions of this act shall be required to file an
annual report with the Oklahoma Tax Commission which summarizes the
total amount of electric power produced from any and all renewable
power facilities owned by the renewable power business within the
state for the period of January 1 through December 31 of the year
prior to the year in which the report is filed as req uired by this
section. The summary shall include the amount of electric power
produced each month by each renewable power facility device owned by
the renewable power business in the state.
B. The Oklahoma Tax Commission shall prescribe a form for the
report required by this section. The report shall be filed with the
Oklahoma Tax Commission not later than February 15 each year
covering the electric power produced by renewable power facilities
owned by a renewable power business located in the state for the
preceding calendar year.
SECTION 5. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 6704 of Title 68, unless there
is created a duplication in numbering, reads as follows:
The monies derived from taxes, fines, and penalties imposed
pursuant to the provisions of this act shall be apportioned to the
General Revenue Fund.
SECTION 6. Section 1 of this act shall become effective January
1, 2024.
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SECTION 7. Sections 2 through 5 of this act shall become
effective November 1, 2024.
59-2-10407 LRB 02/22/24