Continuing personal income tax adjustment to gross income of certain retirees receiving pensions from defined pension plans
If passed, HB2212 would modify state tax law by enabling specific retirees to subtract a certain amount from their federal adjusted gross income. This adjustment would be equal to the difference between what retirees were entitled to receive and what they actually receive under reduced guarantees. The proposed adjustment intends to prevent significant revenue loss to the state, with a clause allowing the Tax Commissioner to cap the total tax reduction should it exceed a $2 million threshold in any given year.
House Bill 2212 is legislation introduced in West Virginia aimed at amending the existing Code regarding personal income tax for retirees. Specifically, it focuses on providing a continuing adjustment to the gross income of retirees receiving pensions from defined benefit plans that have terminated. The bill addresses situations in which retirees receive reduced benefits compared to what would have been available had the pension plans remained intact. This is a reinstatement of a previous adjustment and serves to alleviate tax burdens on certain retirees who have faced financial shortfalls due to terminated pension plans.
The sentiment surrounding HB2212 seems to be generally supportive among those impacted, especially retirees who stand to benefit from the reinstatement of the tax adjustment. Advocates highlight the importance of providing relief to retirees who have found themselves in difficult financial situations due to the loss of full pension benefits. However, concerns about the fiscal implications for the state budget are voiced, especially regarding the limits on revenue that could result from implementing the tax adjustments.
Notable contention points surrounding HB2212 primarily involve the long-term financial impacts on state revenue. While proponents argue that it is necessary to safeguard retiree incomes after pension terminations, critics may fear that allowing such tax adjustments could lead to budgetary constraints or impact funding for public services. This tension between supporting retirees and ensuring the state's fiscal health presents a key discussion point among legislators.