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HB 2024

Updating the meaning certain terms used in West Virginia Personal Income Tax Act

2025 Regular Session Introduced by Roger Hanshaw and 1 co-sponsor

HB 2024 aligns West Virginia's Personal Income Tax Act with federal tax laws, simplifying compliance for taxpayers and clarifying benefits for low-income seniors.

Chapter 226, Acts, Regular Session, 2025
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Bill Summary · HB 2024

Summary of House Bill 2024 (HB 2024)

Overview

House Bill 2024 (HB 2024) is a legislative measure enacted by the West Virginia Legislature during the 2025 Regular Session. The bill primarily aims to update the definitions of certain terms used in the West Virginia Personal Income Tax Act, specifically concerning federal adjusted gross income and related tax provisions.

Purpose and Intent

The main purpose of HB 2024 is to ensure that the definitions and terms used in the West Virginia Personal Income Tax Act align with the most current federal tax laws. This alignment is crucial for maintaining consistency in tax calculations and ensuring that West Virginia's tax code reflects any changes made at the federal level.

Key Provisions

The bill includes several significant updates and clarifications:

  1. Definition Alignment:

    • Terms used in the West Virginia Personal Income Tax Act will have the same meanings as those in the federal tax laws, specifically referencing the Internal Revenue Code of 1986 and its amendments.
    • Changes to federal tax laws made between December 31, 2023, and January 1, 2025, will be incorporated into state tax calculations.

  2. Medical Savings Accounts:

    • The bill clarifies that contributions to medical savings accounts are not considered wages for withholding purposes.
    • It defines "surtax" as a 20% additional tax on taxable withdrawals from these accounts.

  3. Effective Dates:

    • The amendments are retroactive to the extent allowed under federal law, preserving the law as it was for taxable years prior to January 1, 2025.

  4. Low-Income Senior Citizen Credit:

    • The bill specifies that the term "laws of the United States" includes definitions related to low-income status as defined in state law, which affects property tax credits for low-income senior citizens.

  5. Exemption Definitions:

    • Clarifies how exemptions are treated for individuals who would have been eligible for personal exemptions had federal tax laws not changed.

Impact

  • Taxpayers: The updates will directly affect individuals and businesses in West Virginia who file personal income taxes, ensuring they are compliant with both state and federal tax laws.
  • Tax Administration: The West Virginia Tax Commissioner will need to implement these changes in tax administration and compliance processes.
  • Low-Income Seniors: The bill aims to provide clarity and support for low-income seniors regarding property tax credits.

Legislative Timeline

  • Introduced: January 29, 2025
  • Passed House: February 13, 2025
  • Passed Senate: February 17, 2025
  • Approved by Governor: February 24, 2025
  • Effective Date: July 1, 2025

Conclusion

HB 2024 represents a significant update to the West Virginia Personal Income Tax Act, ensuring that state tax laws remain in sync with federal regulations. This alignment is intended to simplify tax compliance for residents and enhance the clarity of tax-related provisions.

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

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