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Oklahoma Senate Bill SB292

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Oklahoma 2025 Regular Session

Oklahoma Senate Bill SB292 Compare Versions

Only one version of the bill is available at this time.

Version 1 (Old)

Version 2 (New)

Old	New		Differences
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4	4		Req. No. 433 Page 1 1
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53	53		STATE OF OKLAHOMA
54	54
55	55		1st Session of the 60th Legislature (2025)
56	56
57	57		SENATE BILL 292 By: Pugh
58	58
59	59
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63	63		AS INTRODUCED
64	64
65	65		An Act relating to tax; amending 68 O.S. 2021,
66	66		Section 2355, as last amended by Section 1, Chapter
67	67		27, 1st Extraordinary Session, O.S.L. 20 23 (68 O.S.
68	68		Supp. 2024, Section 2355), which relates to income
69	69		tax; modifying certain income tax rate for certain
70	70		tax years; modifying certain withholding requirement
71	71		for certain tax years; amending 68 O.S. 2021, Section
72	72		2370, which relates to the banking privilege tax;
73	73		modifying tax rate for certain tax years; updating
74	74		statutory references; updating statutory language;
75	75		and providing an effective date .
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81	81		BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
82	82		SECTION 1. AMENDATORY 68 O.S. 2021, Section 2355, as
83	83		last amended by Section 1, Chapter 27, 1st Extraordinary Session,
84	84		O.S.L. 2023 (68 O.S. Supp. 2024, Section 2355), is amended to read
85	85		as follows:
86	86		Section 2355. A. Individuals. For all taxable years beginning
87	87		after December 31, 1998, and before January 1, 2006, a tax is hereby
88	88		imposed upon the Oklahoma taxable income of every resident or
89	89		nonresident individual, which tax shall be computed at the option of
90	90		the taxpayer under one of the two following methods:
91	91
92	92
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142	142		1. METHOD 1.
143	143		a. Single individuals and married individuals filing
144	144		separately not deducting federal income tax:
145	145		(1) 1/2% tax on first $1,000.00 or part thereof,
146	146		(2) 1% tax on next $1,500.00 or part thereof,
147	147		(3) 2% tax on next $1,250.00 or part thereof,
148	148		(4) 3% tax on next $1,150.00 or part thereof,
149	149		(5) 4% tax on next $1,300.00 or part thereof ,
150	150		(6) 5% tax on next $1,500.00 or part thereof,
151	151		(7) 6% tax on next $2,300.00 or part thereof, and
152	152		(8) (a) for taxable years beginning after December
153	153		31, 1998, and before January 1, 2002, 6.75%
154	154		tax on the remainder,
155	155		(b) for taxable years beginning on or after
156	156		January 1, 2002, and before January 1, 2004,
157	157		7% tax on the remainder, and
158	158		(c) for taxable years beginning on or after
159	159		January 1, 2004, 6.65% tax on the remainder.
160	160		b. Married individuals filing jointly and surviving
161	161		spouse to the extent and in the manner that a
162	162		surviving spouse is permitted to file a joint return
163	163		under the provisions of the Internal Revenue Code of
164	164		1986, as amended, and heads of households as defined
165	165
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216	216		in the Internal Revenue Code of 1986, as amended, not
217	217		deducting federal income tax:
218	218		(1) 1/2% tax on first $2,000.00 or part thereof,
219	219		(2) 1% tax on next $3,000.00 or part thereof,
220	220		(3) 2% tax on next $2,500.00 or part thereof,
221	221		(4) 3% tax on next $2,300.00 or part there of,
222	222		(5) 4% tax on next $2,400.00 or part thereof,
223	223		(6) 5% tax on next $2,800.00 or part thereof,
224	224		(7) 6% tax on next $6,000.00 or part thereof, and
225	225		(8) (a) for taxable years beginning after December
226	226		31, 1998, and before January 1, 2002, 6.75%
227	227		tax on the remainder,
228	228		(b) for taxable years beginning on or after
229	229		January 1, 2002, and before January 1, 2004,
230	230		7% tax on the remainder, and
231	231		(c) for taxable years beginning on or after
232	232		January 1, 2004, 6.65% tax on the remainder.
233	233		2. METHOD 2.
234	234		a. Single individuals and ma rried individuals filing
235	235		separately deducting federal income tax:
236	236		(1) 1/2% tax on first $1,000.00 or part thereof,
237	237		(2) 1% tax on next $1,500.00 or part thereof,
238	238		(3) 2% tax on next $1,250.00 or part thereof,
239	239		(4) 3% tax on next $1,150.00 or part thereof,
240	240
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291	291		(5) 4% tax on next $1,200.00 or part thereof,
292	292		(6) 5% tax on next $1,400.00 or part thereof,
293	293		(7) 6% tax on next $1,500.00 or part thereof,
294	294		(8) 7% tax on next $1,500.00 or part thereof,
295	295		(9) 8% tax on next $2,000.00 or part thereof,
296	296		(10) 9% tax on next $3,500.00 or part thereof, and
297	297		(11) 10% tax on the remainder.
298	298		b. Married individuals fi ling jointly and surviving
299	299		spouse to the extent and in the manner that a
300	300		surviving spouse is permitted to file a joint return
301	301		under the provisions of the Internal Revenue Code of
302	302		1986, as amended, and heads of households as defined
303	303		in the Internal Revenue Code of 1986, as amended,
304	304		deducting federal income tax:
305	305		(1) 1/2% tax on the first $2,000.00 or part thereof,
306	306		(2) 1% tax on the next $3,000.00 or part thereof,
307	307		(3) 2% tax on the next $2,500.00 or part thereof,
308	308		(4) 3% tax on the next $1,400.00 or part thereo f,
309	309		(5) 4% tax on the next $1,500.00 or part thereof,
310	310		(6) 5% tax on the next $1,600.00 or part thereof,
311	311		(7) 6% tax on the next $1,250.00 or part thereof,
312	312		(8) 7% tax on the next $1 ,750.00 or part thereof,
313	313		(9) 8% tax on the next $3,000.00 or part thereof,
314	314		(10) 9% tax on the next $6,000.00 or part thereof, and
315	315
316	316
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366	366		(11) 10% tax on the remainder.
367	367		B. Individuals. For all taxable years beginning on or after
368	368		January 1, 2008, and ending any t ax year which begins after December
369	369		31, 2015, for which the determination requ ired pursuant to Sections
370	370		4 2355.1F and 5 2355.1G of this act title is made by the State Board
371	371		of Equalization, a tax is hereby imposed upon the Oklahoma taxable
372	372		income of every resident or nonresident individual, which tax shall
373	373		be computed as follows:
374	374		1. Single individuals and married individuals filing
375	375		separately:
376	376		(a) 1/2% tax on first $1,000.00 or part thereof,
377	377		(b) 1% tax on next $1,500.00 or part thereof,
378	378		(c) 2% tax on next $1,250.00 or part thereof,
379	379		(d) 3% tax on next $1,150.00 or part thereof,
380	380		(e) 4% tax on next $2,300.00 or part thereof,
381	381		(f) 5% tax on next $1,500.00 or part thereof,
382	382		(g) 5.50% tax on the remainder for the 2008 tax year and
383	383		any subsequent tax year unless the rate prescribed by
384	384		subparagraph (h) of this paragraph is in effect, and
385	385		(h) 5.25% tax on the remainder for the 2009 and subsequent
386	386		tax years. The decrease in the top marginal
387	387		individual income tax rate otherwise authorized by
388	388		this subparagraph shall be c ontingent upon the
389	389		determination required to be made by the State Board
390	390
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441	441		of Equalization pursuant to Section 2355.1A of this
442	442		title.
443	443		2. Married individuals filing jointly and surviving spouse to
444	444		the extent and in the manner that a surviving spouse is permit ted to
445	445		file a joint return under the provisions of the Internal Revenue
446	446		Code of 1986, as amended, and heads of households as defined in the
447	447		Internal Revenue Code of 1986, as amended:
448	448		(a) 1/2% tax on first $2,000.00 or part thereof,
449	449		(b) 1% tax on next $3,00 0.00 or part thereof,
450	450		(c) 2% tax on next $2,500.00 or part thereof,
451	451		(d) 3% tax on next $2,300.00 or part thereof,
452	452		(e) 4% tax on next $2,400.00 or part thereof,
453	453		(f) 5% tax on next $2,800.00 or part thereof,
454	454		(g) 5.50% tax on the remainder for the 2008 tax ye ar and
455	455		any subsequent tax year unless the rate prescribed by
456	456		subparagraph (h) of this paragraph is in effect, and
457	457		(h) 5.25% tax on the remainder for the 2009 and subsequent
458	458		tax years. The decrease in the top marginal
459	459		individual income tax rate otherwise a uthorized by
460	460		this subparagraph shall be contingent upon the
461	461		determination required to be made by the State Board
462	462		of Equalization pursuant to Section 2355.1A of this
463	463		title.
464	464
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515	515		C. Individuals. For all taxable years beginning on or after
516	516		January 1, 2024, a tax is hereby imposed upon the Oklahoma taxable
517	517		income of every resident or nonresident individual, which tax shall
518	518		be computed as follows:
519	519		1. Single individuals and married individuals filing
520	520		separately:
521	521		(a) 0.25% tax on first $1,000.00 or part thereof,
522	522		(b) 0.75% tax on next $1,500.00 or part thereof,
523	523		(c) 1.75% tax on next $1,250.00 or part thereof,
524	524		(d) 2.75% tax on next $1,150.00 or part thereof,
525	525		(e) 3.75% tax on next $2,300.00 or part thereof, and
526	526		(f) 4.75% tax on the remainder.
527	527		2. Married individuals fil ing jointly and surviving spouse to
528	528		the extent and in the manner that a surviving spouse is permitted to
529	529		file a joint return under the provisions of the Internal Revenue
530	530		Code of 1986, as amended, and heads of households as defined in the
531	531		Internal Revenue Code of 1986, as amended:
532	532		(a) 0.25% tax on first $2,000.00 or part thereof,
533	533		(b) 0.75% tax on next $3,000.00 or part thereof,
534	534		(c) 1.75% tax on next $2,500.00 or part thereof,
535	535		(d) 2.75% tax on next $2,300.00 or part thereof,
536	536		(e) 3.75% tax on next $4,600.00 or part thereof, and
537	537		(f) 4.75% tax on the remainder.
538	538
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540	540		Req. No. 433 Page 8 1
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589	589		No deduction for federal income taxes paid shall be allowed to
590	590		any taxpayer to arrive at taxable income.
591	591		D. Nonresident aliens. In lieu of the rates set forth in
592	592		subsection A above, there shall be impose d on nonresident aliens, as
593	593		defined in the Internal Revenue Code of 1986, as amended, a tax of
594	594		eight percent (8%) instead of thirty percent (30%) as used in the
595	595		Internal Revenue Code of 1986, as amended, with respect to the
596	596		Oklahoma taxable income of such nonresident aliens as determined
597	597		under the provision of the Oklahoma Income Tax Act.
598	598		Every payer of amounts covered by this subsection shall deduct
599	599		and withhold from such amounts paid each payee an amount equal to
600	600		eight percent (8%) thereof. Every payer r equired to deduct and
601	601		withhold taxes under this subsection shall for each quar terly period
602	602		on or before the last day of the month following the close of each
603	603		such quarterly period, pay over the amount so withheld as taxes to
604	604		the Oklahoma Tax Commission, and shall file a return with each such
605	605		payment. Such return shall be in such form as the Tax Commission
606	606		shall prescribe. Every payer required under this subsection to
607	607		deduct and withhold a tax from a payee shall, as to the total
608	608		amounts paid to each payee during the calendar year, furnish to such
609	609		payee, on or before January 31 , of the succeeding year, a written
610	610		statement showing the name of the payer, the name of the payee and
611	611		the payee’s Social Security account number, if any, the total amount
612	612		paid subject to taxation, and the total amount deducted and withheld
613	613
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664	664		as tax and such other information as the Tax Commission may require.
665	665		Any payer who fails to withhold or pay to the Tax Commission any
666	666		sums herein required to be withheld or paid shall be personally and
667	667		individually liable therefor to the State of Oklahoma .
668	668		E. Corporations. For all taxable years beginning after
669	669		December 31, 2021, a A tax is hereby imposed upon the Oklahoma
670	670		taxable income of every corporation doing business within this state
671	671		or deriving income from sources within this state in an amount equal
672	672		to four percent (4%) thereof for tax years 2022 through 2025 and
673	673		zero percent (0%) thereof for tax year 2026 and subsequent tax
674	674		years.
675	675		There shall be no additional Oklahoma income tax imposed on
676	676		accumulated taxable income or on undistributed personal holding
677	677		company income as those terms are defined in the Internal Revenue
678	678		Code of 1986, as amended.
679	679		F. Certain foreign corporations. In lieu of the tax imposed in
680	680		the first paragraph of subsection D of this section, for all taxable
681	681		years beginning after December 31, 2021, there shall be imposed on
682	682		foreign corporations, as defined in the Internal Revenue Code of
683	683		1986, as amended, a tax of four percent (4%) for tax years 2022
684	684		through 2025 and zero perc ent (0%) for tax year 2026 and subsequent
685	685		tax years instead of thirty percent (30%) as used in the Internal
686	686		Revenue Code of 1986, as amended, where such income is received from
687	687		sources within Oklahoma, in accordance with the provisions of the
688	688
689	689
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739	739		Internal Revenue Code of 1986, as amended, and the Oklahoma Income
740	740		Tax Act.
741	741		Every payer of amounts covered by this subsection shall deduct
742	742		and withhold from such amounts paid each payee an amount equal to
743	743		four percent (4%) thereof the percentage rate of the tax imposed by
744	744		this subsection of the amount thereof . Every payer required to
745	745		deduct and withhold taxes under this subsection shall for each
746	746		quarterly period on or before the last day of the month following
747	747		the close of each such quarterly period, pay over the amoun t so
748	748		withheld as taxes to the Tax Commission, and shall file a return
749	749		with each such payment. Such return shall be in such form as the
750	750		Tax Commission shall prescribe. Every payer required under this
751	751		subsection to deduct and withhold a tax from a payee sh all, as to
752	752		the total amounts paid to each payee during the calendar year,
753	753		furnish to such payee, on or before January 31 , of the succeeding
754	754		year, a written statement showing the name of the payer, the name of
755	755		the payee and the payee ’s Social Security accou nt number, if any,
756	756		the total amounts paid subject to taxation, the total amount
757	757		deducted and withheld as tax , and such other information as the Tax
758	758		Commission may require. Any payer who fails to withhold or pay to
759	759		the Tax Commission any sums herein requir ed to be withheld or paid
760	760		shall be personally and individually liable therefor to the State of
761	761		Oklahoma.
762	762
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813	813		G. Fiduciaries. A tax is hereby imposed upon the Oklahoma
814	814		taxable income of every trust and estate at the same rates as are
815	815		provided in subsection B or C of this section for single
816	816		individuals. Fiduciaries are not allowed a deduction for any
817	817		federal income tax paid.
818	818		H. Tax rate tables. For all taxable years beginning after
819	819		December 31, 1991, in lieu of the tax imposed by subsection A, B or
820	820		C of this section, as applicable there is hereby imposed for each
821	821		taxable year on the t axable income of every individual, whose
822	822		taxable income for such taxable year does not exceed the ceiling
823	823		amount, a tax determined under tables, applicable to such taxable
824	824		year which shall be prescribed by the Tax Commission and which shall
825	825		be in such form as it determines appropriate. In the table so
826	826		prescribed, the amounts of the tax shall be computed on the basis of
827	827		the rates prescribed by subsection A, B or C of this section. For
828	828		purposes of this subsection, the term “ceiling amount” means, with
829	829		respect to any taxpayer, the amount determined by the Tax Commission
830	830		for the tax rate category in which such taxpayer falls.
831	831		SECTION 2. AMENDATORY 68 O.S. 20 21, Section 2370, is
832	832		amended to read as follows:
833	833		Section 2370. A. For taxable years beginning after December
834	834		31, 2021, for the privilege of doing business within this state,
835	835		every state banking association, national banking association and
836	836		credit union organized under the laws of this state, located or
837	837
838	838
839	839		Req. No. 433 Page 12 1
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888	888		doing business within the li mits of the State of Oklahoma this state
889	889		shall annually pay to this state a privilege tax at the rate of four
890	890		percent (4%) for tax years 2022 through 2025 and zero percent (0%)
891	891		for tax year 2026 and subsequent tax years of the amount of the
892	892		taxable income as provided in this section.
893	893		B. 1. The privilege tax levied by this section shall be in
894	894		addition to the Business Activity Tax levied in Section 1218 of this
895	895		title and the franchise tax levied in Article 12 of this title and
896	896		in lieu of the tax levied by S ection 2355 of this title and in lieu
897	897		of all taxes levied by the State of Oklahoma this state, or any
898	898		subdivision thereof, upon the shares of stock or personal property
899	899		of any banking association or credit union subject to taxation under
900	900		this section.
901	901		2. Nothing in this section shall be construed to exempt the
902	902		real property of any banking associations or credit unions from
903	903		taxation to the same extent, according to its value, as o ther real
904	904		property is taxed. Nothing herein shall be construed to exempt an
905	905		association from payment of any fee or tax authorized or levied
906	906		pursuant to the banking laws.
907	907		3. Personal property which is subject to a lease agreement
908	908		between a bank or credit union, as lessor, and a nonbanking business
909	909		entity or individual, as lessee, is not exempt from personal
910	910		property ad valorem taxation. Provided further, that it shall be
911	911		the duty of the lessee of such personal property to return sworn
912	912
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963	963		lists or schedules o f their taxable property within each county to
964	964		the county assessor of such cou nty as provided in Sections 2433 and
965	965		2434 of this title.
966	966		C. Any tax levied under this section shall accrue on the last
967	967		day of the taxable year and be payable as provided in Sect ion 2375
968	968		of this title. The accrual of such tax for the first taxable year
969	969		to which this act the Oklahoma Income Tax Act applies, shall apply
970	970		notwithstanding the prior accrual of a tax in the same taxable year
971	971		based upon the net income of the next precedi ng taxable year;
972	972		provided, however, any additional deduction enuring to the be nefit
973	973		of the taxpayer shall be deducted in accordance with the optional
974	974		transitional deduction procedures in Section 2354 of this title.
975	975		D. The basis of the tax shall be United States taxable income
976	976		as defined in paragraph 10 of Section 2353 of this title and any
977	977		adjustments thereto under the provisions of Section 2358 of this
978	978		title with the following adjustments:
979	979		1. There shall be deducted all interest income on obligations
980	980		of the United States government and agencies thereof not otherwise
981	981		exempted and all interest income on obligations of the State of
982	982		Oklahoma this state or political subdivisions thereof, including
983	983		public trust authorities, not otherwise exempted under the laws of
984	984		this state; and
985	985		2. Expense deductions claimed in arriving at taxable income
986	986		under paragraph 10 of Section 2353 of this title shall be reduced by
987	987
988	988
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1038	1038		an amount equal to fifty percent (50%) of excluded interest income
1039	1039		on obligations of the United States gov ernment or agencies thereof
1040	1040		and obligations of the State of Oklahoma this state or political
1041	1041		subdivisions thereof.
1042	1042		E. 1. Except as otherwise provided in paragraph 2 of this
1043	1043		subsection, before January 1, 2017, there shall be allowed a credit
1044	1044		against the tax levied in subsection A of this section in an amount
1045	1045		equal to the amount of taxable income received by a participating
1046	1046		financial institution as defined in Section 90.2 of Title 62 of the
1047	1047		Oklahoma Statutes pursuant to a loan made under the Rural Economic
1048	1048		Development Loan Act. Such credit shall be limited each year to
1049	1049		five percent (5%) of the amount of annual payroll certified by the
1050	1050		Oklahoma Rural Economic Development Loan Program Review Board
1051	1051		pursuant to the provisions of paragraph 3 of subsection B of S ection
1052	1052		90.4 of Title 62 of the Oklahoma Statutes with respect to the loan
1053	1053		made by the participating financial institution and may be claimed
1054	1054		for any number of years necessary until the amount of total credits
1055	1055		claimed is equal to the total amount of taxable income received by
1056	1056		the participating financial institution pursuant to the lo an. Any
1057	1057		credit allowed but not used in a taxable year may be carried forward
1058	1058		for a period not to exceed five (5) taxable years. In no event
1059	1059		shall a credit allowed pursuant to t he provisions of this subsection
1060	1060		be transferable or refundable.
1061	1061
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1063	1063		Req. No. 433 Page 15 1
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1112	1112		2. No credit otherwise authorized by the provisions of this
1113	1113		subsection may be claimed for any event, transaction, investment,
1114	1114		expenditure or other act occurring on or after July 1, 2010, for
1115	1115		which the credit would otherwise be allowable. The provisions of
1116	1116		this paragraph shall cease to be operative on July 1, 2012.
1117	1117		Beginning July 1, 2012, the credit authorized by this subsection may
1118	1118		be claimed for any event, transaction, investment, expenditu re or
1119	1119		other act occurring on or after July 1, 2012, according to the
1120	1120		provisions of this subsection.
1121	1121		SECTION 3. This act shall become effective November 1, 2025.
1122	1122
1123	1123		60-1-433 QD 12/30/2024 11:22:22 PM