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HB 6318

AN ACT ELIMINATING THE QUALIFYING INCOME THRESHOLDS FOR THE PERSONAL INCOME TAX DEDUCTIONS FOR SOCIAL SECURITY BENEFITS, PENSION OR ANNUITY INCOME AND CERTAIN INDIVIDUAL RETIREMENT ACCOUNT DISTRIBUTIONS.

2025 Regular Session Introduced by Cathy Osten and 1 co-sponsor

HB 6318 removes income caps on Connecticut tax deductions for Social Security, pensions, and IRA distributions, benefiting higher-income retirees but reducing state tax revenue.

REF. TO JOINT COMM. ON Finance, Revenue and Bonding
#annuities #incometaxdeductions(state) #individualretirementaccounts(iras) #pensions #socialsecurity
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WeVote Research Nonpartisan
Bill Summary · HB 6318

Legislative bill overview

HB 6318 would remove income limits that currently restrict Connecticut residents from claiming personal income tax deductions for Social Security benefits, pension/annuity income, and certain Individual Retirement Account (IRA) distributions. Currently, these deductions phase out or disappear for higher-income taxpayers; this bill would make them available to all income levels.

Why is this important

This change would primarily benefit middle-to-upper income retirees by allowing them to deduct retirement income that is currently taxable above certain thresholds. Connecticut has one of the highest tax burdens on retirees in the nation, so this represents a meaningful tax reduction for seniors, though it also reduces state revenue and potentially widens the tax burden on non-retirees or working-age residents.

Potential points of contention

  • Revenue impact: Eliminating income thresholds will significantly reduce state tax revenue during a period when Connecticut faces budget pressures, requiring either spending cuts or other revenue sources
  • Equity concerns: The benefit flows primarily to higher-income retirees who can afford substantial pensions and IRAs, potentially increasing tax burdens on younger and lower-income workers
  • Precedent: This may encourage similar threshold eliminations for other tax deductions, compounding revenue loss and making future budget forecasting more difficult

Compiled from official sources — confirm details with the bill’s official record.

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