Utah 2025 Regular Session

Utah Senate Bill SB0270 Compare Versions

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

Old	New	Differences
1	1	02-12 16:15 S.B. 270
2	2	1
3	3	Income Tax Amendments
4	4	2025 GENERAL SESSION
5	5	STATE OF UTAH
6	6	Chief Sponsor: Heidi Balderree
7	7	House Sponsor:
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9	9
10	10	3
11	11	LONG TITLE
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13	13	General Description:
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15	15	This bill enacts an income tax credit for self-employment income.
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17	17	Highlighted Provisions:
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19	19	This bill:
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21	21	▸ defines terms;
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23	23	▸ enacts a nonrefundable income tax credit for individuals under a certain age who earn
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25	25	self-employment income in Utah; and
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27	27	▸ provides for apportionment of the tax credit for nonresidents and part-time residents.
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29	29	Money Appropriated in this Bill:
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31	31	None
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33	33	Other Special Clauses:
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35	35	This bill provides retrospective operation.
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37	37	Utah Code Sections Affected:
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39	39	AMENDS:
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41	41	59-10-1002.2 (Effective 05/07/25), as last amended by Laws of Utah 2023, Chapters
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43	43	460, 462
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45	45	ENACTS:
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47	47	59-10-1048 (Effective 05/07/25) (Applies beginning 01/01/25), Utah Code Annotated
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49	49	1953
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51	51
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53	53	Be it enacted by the Legislature of the state of Utah:
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55	55	Section 1. Section 59-10-1002.2 is amended to read:
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57	57	59-10-1002.2 (Effective 05/07/25). Apportionment of tax credits.
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59	59	(1) A nonresident individual or a part-year resident individual that claims a tax credit in
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61	61	accordance with Section 59-10-1017, 59-10-1018, 59-10-1019, 59-10-1022, 59-10-1023,
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63	63	59-10-1024, 59-10-1028, 59-10-1042, 59-10-1043, 59-10-1044, 59-10-1046,[ or]
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65	65	59-10-1047, or 59-10-1048 may only claim an apportioned amount of the tax credit
66	66	S.B. 270 S.B. 270 02-12 16:15
67	67	31
68	68	equal to:
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70	70	(a) for a nonresident individual, the product of:
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72	72	(i) the state income tax percentage for the nonresident individual; and
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74	74	(ii) the amount of the tax credit that the nonresident individual would have been
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76	76	allowed to claim but for the apportionment requirements of this section; or
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78	78	(b) for a part-year resident individual, the product of:
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80	80	(i) the state income tax percentage for the part-year resident individual; and
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82	82	(ii) the amount of the tax credit that the part-year resident individual would have been
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84	84	allowed to claim but for the apportionment requirements of this section.
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86	86	(2) A nonresident estate or trust that claims a tax credit in accordance with Section
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88	88	59-10-1017, 59-10-1020, 59-10-1022, 59-10-1024, or 59-10-1028 may only claim an
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90	90	apportioned amount of the tax credit equal to the product of:
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92	92	(a) the state income tax percentage for the nonresident estate or trust; and
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94	94	(b) the amount of the tax credit that the nonresident estate or trust would have been
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96	96	allowed to claim but for the apportionment requirements of this section.
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98	98	Section 2. Section 59-10-1048 is enacted to read:
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100	100	59-10-1048 (Effective 05/07/25) (Applies beginning 01/01/25). Nonrefundable tax
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102	102	credit for self-employment earners under a certain age.
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104	104	(1) As used in this section:
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106	106	(a) "Adjusted taxable value limit" means:
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108	108	(i) for the taxable year beginning on January 1, 2025, $3,000; or
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110	110	(ii) for a taxable year beginning on or after January 1, 2026, an amount equal to the
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112	112	sum of:
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114	114	(A) the amount of the adjusted taxable value limit for the previous taxable year;
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116	116	and
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118	118	(B) an amount calculated by multiplying the amount of the adjusted taxable value
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120	120	limit for the previous taxable year and the actual percentage change in the
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122	122	consumer price index during the previous calendar year, rounded to the nearest
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124	124	whole dollar.
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126	126	(b) "Qualifying claimant" means an individual who:
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128	128	(i) earns self-employment income in Utah during a taxable year; and
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130	130	(ii) is 19 years old or younger on the last day of the taxable year in which the
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132	132	individual claims a tax credit under this section.
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134	134	(c) "Self-employment" means employment in which an individual operates a trade or
135	135	- 2 - 02-12 16:15 S.B. 270
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137	137	business, either as an owner, sole proprietor, or partner, rather than working for an
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139	139	employer.
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141	141	(d) "Self-employment income" means income that:
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143	143	(i) is derived from self-employment during a taxable year; and
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145	145	(ii) is subject to self-employment tax for federal income tax purposes.
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147	147	(2) Subject to Section 59-10-1002.2, a qualifying claimant may claim a nonrefundable
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149	149	income tax credit in an amount equal to the lesser of:
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151	151	(a) the product of:
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153	153	(i) the total amount of self-employment income derived from Utah sources that the
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155	155	qualifying claimant earns during the taxable year; and
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157	157	(ii) the percentage listed in Subsection 59-10-104(2); and
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159	159	(b) the adjusted taxable value limit.
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161	161	(3) A qualifying claimant may not carry forward or carry back the amount of the tax credit
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163	163	that exceeds the qualifying claimant's tax liability for the taxable year.
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165	165	Section 3. Effective Date.
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167	167	This bill takes effect on May 7, 2025.
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169	169	Section 4. Retrospective operation.
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171	171	This bill has retrospective operation for a taxable year beginning on or after January 1,
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173	173	2025.
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